Products and services

A company cannot act 'sustainably' unless it has considered the implications of sustainability for the goods and services its sells, whether food, fossil fuels or financial services. This raises issues about sustainability in the supply chain, but also about the need to develop new, more sustainable products and services.

Just a few years ago, the focus of attention was on how many 'ethical consumers' might exist to purchase 'green products'. The pervading paradigm suggested that as long as enough customers chose the greener products and, by implication, left the less green products on the shelves, then there would be a transformation in the goods and services on offer.

The limitations of green consumerism should have been obvious, however. When 'green products' (however defined) are produced for a niche market of 'green consumers', they are nearly always more expensive than those that are merely produced as cheaply as possible. A more fundamental limit is that even the most ardent, the most caring, the most affluent green consumer will never possess enough knowledge (or time) to buy 'green' all the time. While certification, labelling schemes and even 'carbon footprint' labels exist for some products, they account for only a small proportion of the range of goods that the average consumer buys (Bennett, 2005; Bennett and Burley, 2005).

The average supermarket contains tens of thousands of product lines. The climate and energy issues associated with product supply and use are ever more complex and dynamic. How can we possibly expect consumers to keep abreast of all the latest developments and then have the time to work out for themselves what this means for their shopping basket in a world where people are increasingly time poor? How is a 'green consumer' to express their desire for a particular 'green product' if it does not exist yet?

While 'green consumerism' may have a limited role to play, it seems highly unlikely that it will trigger the transformational change in goods and services that is needed to deliver climate and energy security:

The focus needs to be on creating a supportive framework for collective progress, rather than exhorting individuals to go against the grain... It is possible to make sustainable habits and choices easier to take up, by drawing on insights about consumer behaviour and using people's preferences for purchasing shortcuts, and what we call the trend towards 'choice editing'. (National Consumer Council and Sustainable Development Commission, 2006)

The bulk of responsibility lies, therefore, with companies to ensure that all their products and services are transformed so that they contribute to climate and energy security or are removed from the marketplace when this is not possible. In doing so, there are real opportunities to go beyond narrow concerns about the 'offer' of an individual product and, instead, build a deeper and longer relationship with the consumer in which they develop trust that a certain company or brand is working with them, across all their product lines, to address these issues.

As Bart Becht, chief executive officer (CEO) of the global consumer products company Reckitt Benckiser (which includes household brands such as Cillit Bang, Dettol, Finish, Harpic and Vanish) commented recently:

The only way we can have any real impact on climate change is to look not just at the emissions that stem from the manufacturing process, but to examine the total carbon footprint from cradle to grave of what we produce. This means looking at everything, from how we extract the raw materials all the way through to a product's use and disposal. Only by tackling the embedded carbon across our products' entire life cycle can we fully take responsibility and make a meaningful reduction to our global emissions.

The reason we at Reckitt Benckiser have adopted this approach is that we directly control only a very small proportion of the emissions and energy use, when compared to the total carbon footprint of a product. For example, we have calculated that our manufacturing and distribution accounts for less than 5 per cent of the total, with raw materials and packaging producing roughly 30 per cent.

Perhaps surprisingly, then, our research shows that 60 to 70 per cent of the carbon contribution of Reckitt Benckiser products rests with consumers and how they use and dispose of our products. So despite our achievements in reducing our carbon emissions from manufacturing by 30 per cent since 2000, there is much more we can all do. This is not about passing the buck onto our customers; it is about working with them. (Becht, 2008)

In 2007, Reckitt Benckiser launched its Carbon 20 programme in which it committed to reduce its 'total carbon footprint' by 20 per cent by 2020 (on a base of circa 15 million tonnes of CO2 equivalent per annum). If Reckitt

Benckiser achieves its targets, it will have removed the carbon impact equivalent of nearly 1 million medium-sized family cars (Reckitt Benckiser, 2007).

It is worth noting the political significance of Reckitt Benckiser's commitment. In 2008, the European Union finally adopted a target to reduce its greenhouse gas emissions by 20 per cent by 2020, but only after long and protracted negotiations and resistance from many member states. The vast majority of developed countries are yet to adopt similar mid-term commitments. This begs the question: if one of the world's largest consumer products companies thinks such reductions are possible even when their commitments extend into those areas outside their direct control, why are so many of the world's politicians so hesitant to make similar commitments?

In some circumstances, it may be that a particular type of product or service has no place in a carbon-constrained world. In these cases, it will be necessary for a company to withdraw the product from the marketplace. An excellent, if almost comical, example of this so-called 'choice editing' is the decision that some UK retailers made in 2007 to stop selling patio heaters. Patio heaters burn propane gas or use electricity to provide outdoor heating and became popular with domestic consumers at the start of the decade.

The problem is that they are incredibly wasteful of energy. The UK-based Energy Saving Trust has estimated that a propane patio heater with a heat output of 12.5kW will produce around 34.9kg of CO2 before the fuel runs out (after approximately 13 hours). This is equivalent to the energy required to produce approximately 5200 cups of tea (or 400 cups for every hour of operation) (Energy Saving Trust, 2007).

The irony of this statistic is that, in an attempt to save energy, the UK government has paid for television advertising to persuade its citizens to avoid overfilling their kettles. A diligent individual could do this for a whole year and the total energy saving would be wiped out if they then sat under a patio heater for just one hour.

A modelling exercise by the UK government's Market Transformation Programme on the energy use of the 630,000 UK domestic patio heaters calculated that they could produce a total of 140,000 tonnes of carbon dioxide per annum. This is roughly equivalent to the carbon emissions from all the homes in a small city such as Bath (Market Transformation Programme, 2007).

This level of emissions associated with just one product, and very clearly a non-essential product at that, prompted Wyevale Country Gardens, the UK's leading garden centre company, to announce in 2007 that it would stop selling patio heaters. In a statement, Wyevale (2007) said:

Out of all the products we sell, patio heaters are the least defensible. When we were asked how we could sell something which directly heated the atmosphere, there wasn't much we could say.

It did not take long for some of its rivals to follow suit. The individual product line was profitable; but these companies could not defend continuing to stock such a wasteful product given their wider corporate responsibility strategies.

'Choice editing' need not be limited to companies that sell physical products. The pioneering work in the financial sector is now about how banks can mainstream sustainability criteria across all their investments and financial services, not just their socially responsible investment (SRI) funds. Some individuals and companies in the advertising industry are starting to wonder whether they should decline contracts to market the most polluting products in the same way that many advertising companies shunned tobacco money during the 1970s.

As Alan Knight, a member of the UK Sustainable Development Commission, has said: 'Customers do not want to be overwhelmed with choice and are happy that choice is limited to only greener options' (Knight, 2007). Every company should be looking at how it can address climate and energy security through the products and services it offers or, just as importantly, does not offer.

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