Carbon Labeling Provides Information to Consumers in the Fight Against Climate Change

Carbon Labeling Provides By Reed Shapiro

Public disclosures associated with companies and/or their products’ carbon emissions have transformed.

New consumer research from Carbon Trust shows product carbon footprint labeling and emissions reductions associated with products have now reached an Early Majority threshold in terms of adoption. This means between 16% and 50% of consumers consider product-related carbon impacts when deciding how to spend their money between brands making similar products.

Marketing and product design teams should be taking notes.

I’ve written appeals to people as consumers, employees, and managers to consider how these labels and actions to reduce product emissions could be valuable to them if adopted since 2016.

Just a few years ago carbon mapping and offsetting were considered niche solutions, bearing only direct costs to companies, who faced a generally apathetic public. This public, they feared, might not rush to adopt a new norm, or worse, may outright reject a forced ‘progressive’ agenda.

However, these issues are now breaking into the mainstream public discourse, and carbon emissions are now a part of consumer considerations that determine the profit and loss of product lines, entire companies, and even whole industries.

A Carbon Trust study has revealed for the second year in a row that the relevance of carbon labeling and emissions reduction as a product attribute has broken out of the early adopter category into the early majority mainstream consideration when making purchases. That is to say, carbon labeling and offsetting are not going away—it will only continue its path to an everyday decision metric for consumers. According to Carbon Trust, almost a quarter of consumers already are in the most conservative capacity.

The study asks over 10,500 consumers in 8 countries in the EU, UK, and the US found that:

• 42% of consumers surveyed want to know about a product’s environmental impacts before spending money on it
• 67% think a recognizable carbon label or carbon neutral label is a good idea
• 23% generally think about a product’s carbon footprint when choosing between options
• 64% would feel more positive towards companies that have reduced carbon impacts of their products

The big finding here is the third point. It means almost a quarter of consumers today are thinking about the environmental performance of products and companies when deciding between buying their product, or a competitor’s. In the actual question, 50% of respondents said they generally do not think about a product’s carbon footprint when purchasing. But it only takes 16% of consumers in a potential market to adopt a new idea, product, or in this case, commodity before it begins its ascent into full adoption at a societal level.

The “chasm” between the first market innovators and a fully functioning global carbon market with strong foundations—generally between 2.5% and 16% market adoption—has been crossed.

According to the time-tested studies of market, technology, and trend adoption, it is now simply a matter of time until we see 50% of consumers considering carbon impacts of products when choosing between brands. The path from 50% to 85% and then towards 100% will be even shorter. It’s taken from the mid-2000s to get here, I’ll bet you it won’t take until the late 2030s for the latter three-quarters of the world’s populace to make up the rest of the way.

With the advent of carbon labeling and climate action tied to product sales (among many other product attributes like organic/regenerative, fair-trade/social justice impact), the public is rapidly adding arrows to its quiver of influence over the way the world develops. I’ve written about B Lab’s ‘Vote Every Day’ campaign and 1% for the Planet’s ‘Be 1% Better’ platform. Both highlight that while individuals often see the ballot box as the only way they can affect change in the world, the way we spend money every day also determines how the world works.

Companies now exist in almost every industry that simply does better business—who don’t just trade their product for your money, but rather help you create a positive impact in the world or in your life by simply by transacting with them at all.

CCC posted its best quarter-to-date in the midst of the COVID-19 outbreak, and we believe it is because our clients are primarily these sorts of companies mentioned above. Our partners shared our belief that providing carbon labeling and offsetting for products would result in a more loyal consumer base as these ideas became popularized throughout society. This is not to say that our labeling and partnership alone has reduced our clients’ exposure to the volatility COVID-19 has wreaked on economic markets globally, but it was and will continue to be a contributing factor to our partners’ stability now and into the future.Carbon Trust

The ‘wake up call’ ship has sailed. Early adopters like Lyft, Etsy, Delta, Gucci, and Allbirds have emerged as the leaders to stick their flag in the ground, declaring carbon neutrality, or carbon neutrality targets in their respective industries. Some have hit kinks, but none big enough to stop their competitors from following suit. Companies will soon need to include at least product carbon labeling in order to remain best-in-class. Get far enough down the line, you could be looking at a loss of social license to operate for companies unable or unwilling to inform customers about their carbon performance.

This is not to imply that the simple act of labeling products or services with carbon metrics will save a company from damnation, or that firms may face damnation without them, as much as it is to say what still seem like benign metrics today, product attributes like carbon labeling are becoming discernable consumer interests. Take heed and ride the wave as this trend hits the mainstream, or don’t and get caught in the undertow.