The Emperor's New Eco-Logos?: A Critical Review of the Scientific Certification Systems Environmental Report Card and the Green Seal Certification Mark Programs
By Roger D. Wynne
INTRODUCTION
First, the good news. In the last several years, Americans have expressed a new-found desire to act upon their environmental concerns in the marketplace. Their enthusiasm has spawned a “green consumerism” movement in which shoppers vote with their dollars to reward companies that offer products that pose fewer negative environmental effects than those of their competitors. This movement offers the hope that a green consumer market will generate environmental improvements within businesses that government regulation alone has thus far been unable to provoke. By harnessing pro-environment sentiment to competitive forces, a green consumer market promises to let people lead industry down a greener path.
Now, the bad news. The green consumer market has proven to be dysfunctional. The call of green consumers sparked a virtual green marketing revolution among producers and advertisers. Companies have flooded stores with unprecedented numbers of products touting environmental improvements and superiority. Unfortunately, many of these claims emanate from the lips of producers more intent on greening their images than their products. They make vague, unverifiable claims of “environmental friendliness,” or proclaim more specific environmental attributes -- such as “biodegradable,” “recycled,” or “recyclable” -- that either offer no meaningful environmental benefit or are based deceptively on half-truths. Green consumers are left awash in this tide of claims with little or no capacity to discern truly green products from those merely labeled as such. This information gap derails green consumers' attempts to dictate environmental improvements and instills in them a more cynical view of the effort.
Policy responses to the dysfunctional green consumer market take two broad forms. The first is the truth-in-advertising approach, which attempts to ensure that, at a minimum, marketers' green claims do not mislead consumers. Various state attorneys general, invoking generic consumer protection laws, brought enforcement actions against some of the more egregious green marketers. Several state legislatures and agencies enacted regulatory definitions of specific terms like “recycled” and “degradable,” and curtailed the use of broader, unverifiable claims of environmental benefits. Unfortunately for marketers, these state efforts have left an inconsistent patchwork of regulation across the nation. The Federal Trade Commission (FTC) attempted to impose a measure of consistency by issuing non-binding “guides” for green marketing claims, but some observers rightly question the legal and practical import of the FTC's effort. Meanwhile, the private sector has also begun to police itself, either through industry-wide consensus standards or through claims verification by independent, third-party organizations.
The second policy response can be grouped under the banner of “eco-logos,” and is the focus of this study. Eco-logos, as used here, are labels issued by independent organizations and displayed voluntarily by manufacturers who submit to inspection or in some other way meet the organizations' environmental or advertising standards. The goals of eco-logo programs reach beyond the squelching of deceptive claims. They seek to supplement the information available to consumers, thereby raising consumers' awareness of environmental issues, educating them about the role of green consumerism, and directing their buying power toward the most environmentally benign products. By doing so, eco-logo programs attempt to resuscitate the green consumer market by enabling consumer preferences to compel environmentally beneficial changes within industry.
This Article assesses the ability of two fledgling American eco-logo programs to realize these goals. The first is a product of Scientific Certification Systems, Inc. (SCS), a privately held company. SCS issues an “Environmental Report Card” for products whose manufacturers submit to a full, quantitative inventory of those products' environmental burdens. The Report Card presents the results of this inventory to consumers in the form of a bar chart. The second eco-logo is issued by Green Seal, Inc., a non-profit organization. Called “The Green Seal Certification Mark,” its logo resembles a seal of approval; only those products within certain categories that meet criteria developed by Green Seal may display its Certification Mark.
This Article presents a critical review of these two programs. Both programs attempt to fill an inherently public function, but neither operates with the authority of a government agency. Instead, each relies on its reputation as a private instrument of public policy. Each uses its technical and marketing skills to build and maintain its credibility, yet neither has come under intense scrutiny in public policy literature. This Article attempts to fill that gap and to stimulate a policy-level debate about these programs. It seeks to play a role like that of the boy in the fable of the Emperor's New Clothes. In that tale, the emperor claimed that he was clad most regally in his new clothes, and the townspeople assented to his claim. Not until a boy observed that, indeed, the emperor was wearing no clothes whatsoever, did others concede that observation.
Analogizing this tale to SCS and its Environmental Report Card, this Article maintains that the Report Card program is scantily clad, if not functionally naked. Its methodology for evaluating products' environmental burdens and conveying that evaluation to consumers through a product label is riddled by qualitative judgments that belie SCS's claim to present objective information unfiltered by experts. The few consumers who actually attempt to process the large amount of information found on the Report Card are very likely to misunderstand it. Most importantly, the Report Card will probably not cause a consistent shift in consumer demand. It will therefore fail to harness the power of green consumerism to compel manufacturers to change their ways. SCS could still provide consulting services to individual manufacturers or industries for internal uses, but as a means of correcting the dysfunctional green consumer market, its Report Card is fundamentally flawed.
In the case of Green Seal, this Article argues that its Certification Mark program is certainly clothed, and in many ways quite well, but that interested parties should maintain a careful watch over Green Seal nonetheless. Its Certification Mark could be an effective tool for influencing the purchase decisions of green and latent green consumers, and thus for stimulating some changes from manufacturers eager to expand or protect market share. Still, the sphere of its influence will likely be limited to the green consumer segment. Furthermore, Green Seal will operate much like a dictator, albeit one that aspires to benevolence. It will retain a great deal of discretion to craft product standards as it sees fit, and its power to influence green consumer decisions will be enhanced by consumers' proclivity to misunderstand the Certification Mark's actual meaning. Green Seal has yet to abuse its power, but failure to maintain a vigilant watch over its operations amounts to an act of faith.
Evaluating these programs now is problematic because Green Seal has only recently begun issuing standards for products and because SCS's Report Card, until recently, remained something of a work in progress. Thus, pronouncements about them must be taken as predictions, not established truths. Nevertheless, this Article will draw upon a number of disciplines -- most notably life-cycle assessment methodology, behavioral science, and consumer psychology -- to analyze the programs in their present forms. This analysis must therefore remain structural. It is based on the institutional goals, methodologies, and constraints each organization has adopted, not on how those institutional structures function in practice. Only subsequent research and evaluation will demonstrate whether the analysis presented here is accurate.
This Article's analysis begins in Part II by tracing the programs through the various components of an idealized, successful eco-logo scheme, as depicted in Figure 1. Part III examines the issue of methodology, demonstrating that no purely empirical method exists for identifying the most environmentally benign products and critiquing the divergent approaches of SCS and Green Seal to the task's inherently qualitative nature. Part IV assesses the likely effect that the two programs' logos will have on consumers, paying particular attention to the logos' capacity to “educate” consumers. Part V speculates about the programs' abilities to influence corporate image or market share. Part VI concludes that such influence, if it occurs, should cause at least some manufacturers to reduce the environmental burdens associated with their processes and products.
First, the good news. In the last several years, Americans have expressed a new-found desire to act upon their environmental concerns in the marketplace. Their enthusiasm has spawned a “green consumerism” movement in which shoppers vote with their dollars to reward companies that offer products that pose fewer negative environmental effects than those of their competitors. This movement offers the hope that a green consumer market will generate environmental improvements within businesses that government regulation alone has thus far been unable to provoke. By harnessing pro-environment sentiment to competitive forces, a green consumer market promises to let people lead industry down a greener path.
Now, the bad news. The green consumer market has proven to be dysfunctional. The call of green consumers sparked a virtual green marketing revolution among producers and advertisers. Companies have flooded stores with unprecedented numbers of products touting environmental improvements and superiority. Unfortunately, many of these claims emanate from the lips of producers more intent on greening their images than their products. They make vague, unverifiable claims of “environmental friendliness,” or proclaim more specific environmental attributes -- such as “biodegradable,” “recycled,” or “recyclable” -- that either offer no meaningful environmental benefit or are based deceptively on half-truths. Green consumers are left awash in this tide of claims with little or no capacity to discern truly green products from those merely labeled as such. This information gap derails green consumers' attempts to dictate environmental improvements and instills in them a more cynical view of the effort.
Policy responses to the dysfunctional green consumer market take two broad forms. The first is the truth-in-advertising approach, which attempts to ensure that, at a minimum, marketers' green claims do not mislead consumers. Various state attorneys general, invoking generic consumer protection laws, brought enforcement actions against some of the more egregious green marketers. Several state legislatures and agencies enacted regulatory definitions of specific terms like “recycled” and “degradable,” and curtailed the use of broader, unverifiable claims of environmental benefits. Unfortunately for marketers, these state efforts have left an inconsistent patchwork of regulation across the nation. The Federal Trade Commission (FTC) attempted to impose a measure of consistency by issuing non-binding “guides” for green marketing claims, but some observers rightly question the legal and practical import of the FTC's effort. Meanwhile, the private sector has also begun to police itself, either through industry-wide consensus standards or through claims verification by independent, third-party organizations.
The second policy response can be grouped under the banner of “eco-logos,” and is the focus of this study. Eco-logos, as used here, are labels issued by independent organizations and displayed voluntarily by manufacturers who submit to inspection or in some other way meet the organizations' environmental or advertising standards. The goals of eco-logo programs reach beyond the squelching of deceptive claims. They seek to supplement the information available to consumers, thereby raising consumers' awareness of environmental issues, educating them about the role of green consumerism, and directing their buying power toward the most environmentally benign products. By doing so, eco-logo programs attempt to resuscitate the green consumer market by enabling consumer preferences to compel environmentally beneficial changes within industry.
This Article assesses the ability of two fledgling American eco-logo programs to realize these goals. The first is a product of Scientific Certification Systems, Inc. (SCS), a privately held company. SCS issues an “Environmental Report Card” for products whose manufacturers submit to a full, quantitative inventory of those products' environmental burdens. The Report Card presents the results of this inventory to consumers in the form of a bar chart. The second eco-logo is issued by Green Seal, Inc., a non-profit organization. Called “The Green Seal Certification Mark,” its logo resembles a seal of approval; only those products within certain categories that meet criteria developed by Green Seal may display its Certification Mark.
This Article presents a critical review of these two programs. Both programs attempt to fill an inherently public function, but neither operates with the authority of a government agency. Instead, each relies on its reputation as a private instrument of public policy. Each uses its technical and marketing skills to build and maintain its credibility, yet neither has come under intense scrutiny in public policy literature. This Article attempts to fill that gap and to stimulate a policy-level debate about these programs. It seeks to play a role like that of the boy in the fable of the Emperor's New Clothes. In that tale, the emperor claimed that he was clad most regally in his new clothes, and the townspeople assented to his claim. Not until a boy observed that, indeed, the emperor was wearing no clothes whatsoever, did others concede that observation.
Analogizing this tale to SCS and its Environmental Report Card, this Article maintains that the Report Card program is scantily clad, if not functionally naked. Its methodology for evaluating products' environmental burdens and conveying that evaluation to consumers through a product label is riddled by qualitative judgments that belie SCS's claim to present objective information unfiltered by experts. The few consumers who actually attempt to process the large amount of information found on the Report Card are very likely to misunderstand it. Most importantly, the Report Card will probably not cause a consistent shift in consumer demand. It will therefore fail to harness the power of green consumerism to compel manufacturers to change their ways. SCS could still provide consulting services to individual manufacturers or industries for internal uses, but as a means of correcting the dysfunctional green consumer market, its Report Card is fundamentally flawed.
In the case of Green Seal, this Article argues that its Certification Mark program is certainly clothed, and in many ways quite well, but that interested parties should maintain a careful watch over Green Seal nonetheless. Its Certification Mark could be an effective tool for influencing the purchase decisions of green and latent green consumers, and thus for stimulating some changes from manufacturers eager to expand or protect market share. Still, the sphere of its influence will likely be limited to the green consumer segment. Furthermore, Green Seal will operate much like a dictator, albeit one that aspires to benevolence. It will retain a great deal of discretion to craft product standards as it sees fit, and its power to influence green consumer decisions will be enhanced by consumers' proclivity to misunderstand the Certification Mark's actual meaning. Green Seal has yet to abuse its power, but failure to maintain a vigilant watch over its operations amounts to an act of faith.
Evaluating these programs now is problematic because Green Seal has only recently begun issuing standards for products and because SCS's Report Card, until recently, remained something of a work in progress. Thus, pronouncements about them must be taken as predictions, not established truths. Nevertheless, this Article will draw upon a number of disciplines -- most notably life-cycle assessment methodology, behavioral science, and consumer psychology -- to analyze the programs in their present forms. This analysis must therefore remain structural. It is based on the institutional goals, methodologies, and constraints each organization has adopted, not on how those institutional structures function in practice. Only subsequent research and evaluation will demonstrate whether the analysis presented here is accurate.
This Article's analysis begins in Part II by tracing the programs through the various components of an idealized, successful eco-logo scheme, as depicted in Figure 1. Part III examines the issue of methodology, demonstrating that no purely empirical method exists for identifying the most environmentally benign products and critiquing the divergent approaches of SCS and Green Seal to the task's inherently qualitative nature. Part IV assesses the likely effect that the two programs' logos will have on consumers, paying particular attention to the logos' capacity to “educate” consumers. Part V speculates about the programs' abilities to influence corporate image or market share. Part VI concludes that such influence, if it occurs, should cause at least some manufacturers to reduce the environmental burdens associated with their processes and products.
