Science has delivered a grim message. Reduce emissions of greenhouse gases by 90 per cent in the next 30 years or risk catastrophic climate change. The private sector and governments are taking their own initiatives to reduce the carbon footprint of consumption. This has important implications for developing country exporters.
In 2007, the UK retailer Teseo decided to label all its products with information on carbon dioxide emissions in their production, processing and transport. Further carbon labelling schemes have emerged. Carbon labels now join organic and fair trade as the "must have" labels to attract the "ethical" consumer.
The labels vary in the type of information they provide, ranging from a measurement (10Og of C02) to a comparison between products (15.7 per cent less C02).
However, surveys show that while consumers want climate-related information, they don't necessarily understand it. For example, is 10Og of C02 excessive? Will consumers ignore the information?
Another problem is "moral offsetting" when consumers buying "green" feel they gain permission to license bad behaviour - eating lentils rather than beef and then buying a plane ticket.
The business interest in carbon labelling is clear. According to Matthew Bateson of the World Business Council for Sustainable Development, carbon labelling is "driven by the need to cut costs through energy savings, but also market differentiation, i.e., there are market opportunities among climate-aware consumers, Similarly, carbon management can be integrated into companies' CSR [corporate social responsibility] programmes".
The growing importance of reducing emissions in the supply chain is underlined in a recent report by AT Kearney which shows that 6 per cent of leading companies already deselect suppliers who fail to "manage" carbon and 56 per cent of these companies said they are committed to do so in future.
Paul Dickinson, CEO of the Carbon Disclosure Project, who commissioned the survey, said, "It is clear that some companies now require their suppliers to address carbon management as a core business issue. This is no longer a 'nice to have' for the leaders, it is becoming a 'need to have', and we expect to see this trend growing across the whole business sector."
Governments have also endorsed carbon footprmting, particularly for the agro-food sector. Japan, the Republic of Korea and the United Kingdom have all sponsored new schemes for measuring supply chain emissions! France has even introduced legislation making it mandatory for food products in France to have environmental labelling, including for carbon.
For developing country food exporters, are caibon requirements an opportunity to gain a competitive advantage or simply a non-tariff barrier to trade?
Stephen Mbithi, CEO of the Kenya Fresh Fruits and Vegetable Exporters' Association, says his sector is being proactive in reducing emissions. However, he still sees an "inevitable increase in costs" due to measurement and certification needs. …