Category: Business Essay

Environmental sustainability is the ability to sustain the aspects that are valued in the physical environment or the act of utilizing them without depletion. In fact, there are four main perspectives on environment sustainability. From an ecologist viewpoint, it is possible to achieve sustainability when humans do not interfere in nature at all. Ecologists argue that plants and animals are internally related and interference in their habitat will trigger undesired consequences. The second viewpoint originates from a conservationist angle. Conservationists subscribe to the notion that humans can exploit the environmental resources but in a manner that is not wasteful. Conservationists do not oppose mankind’s exploitation of the environment but rather the negative effects. The third perspective on sustainability is from First Nations and Metis Ways which holds the notion that the earth gave human resources as gifts, and people should only use what they need. Another viewpoint on environmental sustainability is the utilitarian perspective. Utilitarianism assesses the intent of one’s actions; thus, it involves judging actions as right or wrong. Contemporary utilitarianism takes into consideration such environmental risks as ozone depletion, global warming, deforestation, and pollution, among others.

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Most people want to sustain the capabilities of the natural environment to maintain favorable living conditions and aspects of the environment that give renewable resources. Apart from the above desirable aspects of sustainability, the functioning of society regardless of depletion of non-renewable resources and the quality of life, among others, are the intended targets of sustainability. ‘Eco-labeling’ refers to a voluntary method of environmental performance accreditation and labeling practiced globally. Therefore, an eco-label is a sticker that recognizes generally proven environmental inclination of a product within the respective category. Unlike green stickers and associated claim statements, eco-labels are awarded by impartial third-parties in relation to certain products that are independently verified to satisfy transparent environmental leadership criteria. Moreover, eco-labels are based on lifecycle considerations. The paper will explore eco-labeling as an environmental policy tool and as a potential trade barrier. The paper will also focus on some well-known eco-labeling programs such as Blue Angel programmer in Germany, Forest Stewardship Council, and Marine Stewardship Council, among others.

Eco-Labels

Eco-labels and green stickers refer to labeling systems for food and consumer products. While the law mandates stickers, eco-labels are voluntary. For instance, major appliances and automobiles in North America use Energy Star eco-label. In this aspect, an eco-label is a form of sustainability metrification directed at consumers so as they find it easy to take into account environmental concerns when shopping. Other labels quantify pollution or energy consumption via index scores. Moreover, they are labels that simply reinforce compliance with a set of practices for sustainability. Apparently, eco-labeling systems were started by NGOs with the European Union, subsequently legislating conduct of eco-labeling. In fact, the European Union has developed its eco-labels for food and consumer products categories.

Confidence in the label is entirely consumer’s decision as rogue manufacturers may embrace ‘green washes’. In this context, ‘green wash’ is a false claim by a manufacturer that the product is purported to meet the environment-friendly aspects. In various researches, there is still no concrete primary data that can help examine the performance of eco-labels. In that respect, most conclusions on eco-labels rely heavily on grey literature. In 1977, the German government embedded eco-labeling into mainstream environmental policy by establishing the Blue Angel programmer. Consequently, eco-labels have become most visible market-based tools for realizing environmental objectives. However, the opponents claim that there is a downside of eco-labeling since it sometimes acts as an unjustified non-tariff barrier to trade. Hereby, a lack of checks and balances is a major problem of eco-labeling. There is no harmonious way to incorporate the new eco-labels in the existing ones. In addition to the above factor, the cost of conformity assessment becomes a trade barrier for developing country producers.

The Environmental Effectiveness of Eco-Labeling

Shade Coffee

The first real example of eco-labeling is the Commission for Environmental Cooperation Shade Coffee. Commission for Environmental Cooperation’s core duties is to promote green marketing. In a bid to realize its objectives, CEC studied the market possibilities of shade-grown coffee as a desirable coffee product that Mexico might export. The visible environmental benefits of shade-grown coffee include maintenance of forest cover that triggers reduced soil erosion and, consequently, watershed conservation. Moreover, while trees use carbon and release oxygen during the day, coffee provides shelter for several species of mammals, reptiles, and flora. Shade-grown coffee, thus, serves as a conservation measure for biological diversity.

It is imperative to acknowledge that the term ‘shade-grown’ is contextual and is open to interpretation as to how much forest cover is maintained. Producers of shade-grown coffee seek harmonized criteria for the accreditation of what defines shade-grown coffee. Producers are, thus, able to charge a premium price for a certified product once they agree on a common standard for shade-grown coffee. On social and economic fronts, shade-grown coffee production is feasible for smallholders who are unable to afford high volume of chemical inputs and hybrid seeds needed for full-sun coffee production. In maintaining the forest cover, the small-scale producers may additionally harvest other forest products such as medical plants, firewood, and fruits to supplement their incomes.

Apparently, the existing market research shows that there is little consumer demand for certified shade-grown coffee. As such, the benefits of accreditation are unknown to the majority of consumers. Thus, importers and roasters can spur demand for certification of shade-grown coffee. Accreditation of shade-grown coffee will, therefore, need a variety of chain custody monitoring. The chain of custody monitoring can be realized by producers bearing the costs of certification. Alternatively, the chain of custody monitoring may be met by the roaster bearing the costs of certification. In the Mexican case, the second approach above is highly applicable as they often lack the requisite capital to pay for an audit of their product. Even though the costs of certifications may be recouped via price premiums, the initial seed capital outlay is beyond the capability of smallest producers. Most roasters are hesitant to pay for a certificate label. In North America, the degree of customer awareness on the meaning of shade-grown eco-label coffee is low. The above low consumer awareness about shade-grown coffee negates the consumers’ desire to pay a premium price for the shade product. Consequently, the roasters have to promote the product themselves which is an extra cost on top of having to pay the certification fee. The above analysis reflects the lackluster participation of most large- and medium-scale roasters on shade-grown coffee certification efforts in North America. However, the recognition factor plays a pivotal role in the success of an eco-label. It can, thus, be concluded that CEC shade-grown eco-label coffee as being inherently successful but practically a failure.

Marine Stewardship Council Nordic Fisheries Eco-Labeling

A voluntary consumer-driven for marine capture fisheries were proposed by the Nordic Technical Working Group. In collaboration with state authorities, the Nordic Technical Working Group established criteria that can be employed by private bodies and non-governmental organizations to eco-label products. The above criteria are seen as most applicable in North-East Atlantic region. The framework requires that fishery must follow the fisheries administration or management plan. In turn, the fisheries management plan must be based on consistent scientific information on the state of fish stocks and commendations for sustainable fish exploitation. Furthermore, the fisheries management framework must have pre-agreed management measures that are implemented immediately as soon as relevant precautionary reference points are met. The last requirement on fish stock demands efficient monitoring and control measures must be implemented.

The Nordic Fisheries eco-labeling sets conditions on the ecosystem for potential players interested in its eco-labeling. First, the group prohibits destructive fishing practices such as the use of poisons or explosives to kill fish. Secondly, the best available technology for selective fishing methods should be embraced to minimize discards of fish, mollusks, and crustaceans. The above eco-labeling monitors discard via a sampling program. Lastly, on ecosystem demands, management framework should control any other emerging issues in the ecosystem t