The Idea

Though still in its earlier stages of development, the idea I have been cultivating for my final project is eco-labeling for products, which would reveal certain economic and environmental aspect of a product’s design and manufacturing. The general concepts underlying this idea are transparency, accountability, and, hopefully further down the line, sustainability. The idea for a new kind of label one might find on product packaging was inspired by an interest in the relationship between consumer trends and product design within a system (see: Earth), as well as conversations with Professor Altringer. 

The Problem 

In a very broad sense, the problem I’m attempting to address is that of Western consumerism. The current model, which is very much purchase-consume-dispose, if a big factor in environmental and social problems that contribute out the “un-sustainable way our society runs. Firms and corporations have little incentive to affect change on their end (e.g. reducing waste during production, “closing” the loop for product designs, using fair trade labor, etc.). It has become increasingly apparent that our consumerist status quo must be challenged, though it seems unrealistic and unproductive to focus efforts on changing the public’s degree of consumption. The burden will rest on product design and manufacturing processes and, eventually, really considering the life cycles of products. Such a task is daunting, to say the least, but I believe a first step in the right direction is possible through product transparency though eco-labeling. 

Transparency

The main idea behind labeling is transparency, with the ultimate goal being to hold firms accountable to their designing and manufacturing processes. The labels would make information collected through aggregated supply chain data. Some pioneering firms have taken it upon themselves to trace their supply chains, improve various areas of the chain, and then make all of this information available to consumers. Such ambitious companies include Nike, Patagonia, and Puma. Labeling, and more generally transparency, can play a role in shifting the paradigm towards more conscientious production. 

The Consumer

The supply chain and product breakdown information for products is out there–it exists. However, many firms don’t collate this data (especially not for the public) and many firms also haven’t digitized their supply chain, which would benefit the firms (since it is more cost efficient and it would be easier to locate areas of improvement in the actual), and also make labeling more of a possibility. Consumer research shows that knowledge influences all phases in decision making. The average consumer has asymmetric information products unless they have made a special effort to become more familiar with the product. Labeling could address these information problems. In a world of increasing consumer demand for more and better information, and increasing consumer desire to have products meet specific needs and values, transparency is paramount. 

Areas of Exploration / What’s on the Horizon 

Quick or voluntary compliance to increased transparency by firms, especially in the form of labeling, is unrealistic. And if there happened to be policy lobbying for some sort of compulsory labeling (as in the case of nutrition labeling, EPA fuel economy labeling), there would undoubtedly be big push-back, as we have observed in the recent push for GMO-labeling in certain areas of the U.S. Perhaps the most promising area of development in pursuing increased transparency is offering a service to “early adopter” firms that traced and digitized said firms’ supply chains. The service could also advise on ways to improve the supply chain, e.g. increasing resource efficiency, reducing water intensity in the factor. The service could also have a certain set of criteria that established standard for things like environmentally preferred materials, physical waste, chemical/toxic impact, water/CO2 intensity, occupational health/safety/fairness, etc. If these criteria were met, the firm could attain a rating/approval/certification of sorts, that could also be tiered. It is also possible that the rating/certification can be done by a separate. to-be-developed third party organization (something similar to LEED certification). 

The incentive for firms to trace, digitize, and improve their supply chains are numerous. They would be able to identify environmental risks and other opportunities for improvement, to reduce impact, achieve efficiencies, track progress, mitigate risks, build consumer trust, increase accountability to stakeholders, etc. If firms were to make the information available, it could positively affect stakeholder and consumer response/behaviors, which would in turn pressure other firms to follow suit. 

To make this task more manageable, it might perhaps be wise to start off this service in a certain industry. The building industry has LEED and the garment/textile industry has various transparency/accountability operations in play. Further research may reveal what industry would most benefit/have the most positive impact from supply chain examination/increased transparency.