challenges to ecolabels

According to the European Commission, an ecolabel is a voluntary environmental performance certificate awarded to products and services. Certified products and services are classified by groups. These product and service groups must meet specific, pre-defined criteria by demonstrating that they reduce the standard overall environmental impact. Accordingly, ecolabels are seals of approval given to products that are deemed to be less impactful to the environment than functionally or competitively similar products.

Due to their voluntary nature, ecolabelling is perceived as one of the least coercive market-based mechanisms still capable of improving conservation outcomes. Despite their unobtrusive nature, ecolabels are not without their challenges, many of which are related to finding a balance between the needs and demands of various stakeholders.

For example, there is the so-called Devil’s Triangle that relates to a certification scheme’s credibility, accessibility, and ability to drive improvement. In other words, consumers and producers alike must have faith in the value of an ecolabel. Likewise, both parties must be able to consume the ecolabel. For producers, this entails being able to achieve certification, e.g. no draconian requirements or outlandish certification fees. The producer also needs to be able to bring their product to the market. Conversely, consumers need to be able to find the product in the market, they must understand the purpose of the ecolabel, and they must be able to afford certified products.

In a similar vein, certification schemes for ecolabels must find a balance between specificity and generality so it is possible for a wide range of products to be certified while also avoiding generalizations that would render a certification useless as it lacks clear and specific indicators. Likewise, ecolabels must achieve a balance between being dynamic and being dependable, i.e. they must adapt to evolving market needs while also establishing a consistent base of trust and reliability. Once a balance between these factors is achieved, consumers must also still be interested in the product.

Overcoming the above-described challenges is possible with intelligent design and objective, rigorous and consistent auditing. Such activities are generally performed by Conformity Assessment Bodies (CABs). However, if rigorous quality standards are not established, many of the common disadvantages to ecolabels can emerge (see Disadvantages of Ecolabels). Conversely, the benefits of ecolabels can be realized if such standards are defined and enforced.

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