April 19, 2012

Is Tesco's carbon footprint getting footsore?

Tesco's carbon footprint (photo: The Grocer)
Upon my farm he did put his lovely foot: In four years, Tesco has labelled less than one per cent of its assortment with carbon footprints (photo: The Grocer)
Tesco is generally recognised as a forerunner when it comes to carbon footprint product labelling.

But the UK's leading grocer by sales seems to have gone a little lame on what former CEO Terry Leahy had intended to be a triumphant marathon.

Over the last four years, Tesco has only managed to research 1,100 lines and to label around 500 on an average assortment of 70,000.

Against this backdrop, Professor Simonetta Carbonaro, CEO of REAL_Ise Strategic Consultants, and Dagmar Bottenbruch, Board Director at FLO-CERT, the certification arm of Fair Trade, dispute the usefulness of CO² labelling.

Both international sustainability experts give the whole idea a thorough bastinado in an interview with our newspaper.

Despite similar criticisms, Tesco disputes that it is withdrawing from the Carbon Trust supported scheme. "We are committed to continuing our footprinting," says Lucy Neville-Rolfe, executive director for corporate & legal affairs.

However, the amount of research time and cost involved seems to have taken Tesco by surprise. Also, previous hopes that other major UK retailers would follow in the market leader's footprint have proved illusory.

It is perhaps telling that no German retail multiples currently run any similar initiatives.

"A fata morgana" 

Professor Simonetta Carbonaro, Realise (photo: Matthias Richter)
Professor Simonetta Carbonaro (photo: Matthias Richter)
Professor Carbonaro, would you agree that CO2 labelling has already exceeded its sell-by date?
CO² labelling is the rain of yesterday. Pragmatically speaking, calculating the carbon footprints of every product is more than difficult, it is a fata morgana.

So no hope for those consumers who expect the retailer to give them some orientation regarding product choices?
The way forward is spelled differently: s-u-s-t-a-i-n-a-b-i-l-i-t-y, that is social, environmental, economic, and culturally responsible. However, make no mistake, this also represents a difficult and complex approach.

Sustainability requires considerable systemic thought and the setting of priorities (e.g. water depletion, labour exploitation). It also requires understanding whole processes and a clear commitment to a continuous process of learning and transparency!

We are actually talking about a dilemma. The dilemma of sustainability is always the same: Whenever one asks what the best route is, every answer starts with 'it depends'. There is no one single standard solution, and there are multiple challenges.

Do you believe that retailers should try to take the lead in environmental causes?
There is a clear and urgent need to mitigate the harmful social and environmental impact of industrial mass manufacturing. Companies, governments and media must educate (yes, educate) people to consume less by telling them what is good (what we could improve) and what is bad (what we haven't fixed yet) in our value and supply chains etc.

Meanwhile, retailers need to educate themselves first. Most of them don't even have clear and transparent facts which allow them to calculate the real total cost of their own label products, let alone the total external cost of all the individual SKUs in their assortment.

Retails must gain full control of the real costs if they want to deliver better quality and sustainability at prices which are affordable for mass consumers. In order to do this, retailers need to shorten their supply chains and fully control their sourcing.

Why have they been so slow to do this?
Retailers are still trying to finance their “lowest-price battles” by raising the margins of their premium "green" products. This approach impedes the process towards sustainability.

"Overused and underexplained" 

Dagmar Bottenbruch, angel investor & consultant (photo: Dagmar Bottenbruch)
Dagmar Bottenbruch (photo: Dagmar Bottenbruch)
Frau Bottenbruch, what do you think about carbon footprint labelling?
I'm not sure that it makes sense to invest millions in order to determine carbon footprints. In fact, true carbon footprinting is practically impossible to do and a bit of a waste of time.

Also, I am convinced that many customers do not know what a carbon footprint is, and it is questionable whether they would pay more for a lower carbon product. The word 'sustainability' is currently overused and underexplained. More effort should go into compensating the latter situation.

What then do consumers care about?
I believe that they care about healthy, reliable food. No one wants to eat a chicken that might have a low carbon footprint because it was raised locally, but which is full of antibiotics.

So what should big corporations like Tesco do instead?
I think it would be far better if big corporations invested in sustainable farming and Fairtrade initiatives. It could well be that this wouldn’t generate much customer interest in the short-term. However, in the long term it would contribute towards fairly produced and healthy food – an absolutely tangible benefit to all involved.

I think that last year's cocoa shortages and the resultant supply and price issues show what happens when too little attention is paid to the sustainability of farming practices.

When every stage of the production process is taken into account, sustainably produced food would probably have a better carbon footprint anyway. Last but not least, it would contribute to the development of local communities and long-term food supply security.

But, Tesco clearly believes that it should take the lead in helping its customers make better environmental decisions when buying products…
Of course, it is positive when retailers know about the environmental impact in the supply chain of the products they offer. But, at the end of the day, the customer who really cares about CO² emissions and environmental issues has to start with him or herself and not leave the job to the retailer.

Everyone knows that a 30-minute hot shower has a higher carbon footprint than a 10-minute warm shower and that the excessive consumption of meat has a higher carbon footprint than eating local seasonal vegetables etc.

Lebensmittel Zeitung with its online sisters (photo: LZ)
Lebensmittel Zeitung with its online sisters
Read in German: 'Titel' by international editor Mike Dawson on page x of
Lebensmittel Zeitung, no. 16, 20.04.2012

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