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Memorandum submitted by Marks and Spencer
Marks & Spencer is one of the UK's leading retailers of clothing, food and home products. Over 15.8 million customers visit our 500 stores in the UK each week. We welcome the opportunity to provide written evidence to the Environmental Audit Committee's sub-group's examination of environmental labelling.
UK consumers are now more aware and more prepared to act on environmental issues than ever before. Research partly funded by M&S under Accountability's and Consumer International's 'What Assures Consumers?' programme in 2007 shows that 70% of consumers believe individuals have to take more responsibility for climate change. However, this should be set within the context of further research we have done that shows that overall consumers believe that 75% of the responsibility for addressing social and environmental issues lies with the retailer and 25% with them.
It was in response to this growing consumer interest and desire for information that in January 2006 we launched our look behind the label advertising campaign and in January 2007 followed this up by launching Plan A, a 100 point, 5 year commitment to address environmental and social issues.
This heightened consumer interest has the potential to drive a step change in business commitment to work with government and civil society to address major challenges such as climate change, waste and human rights. However, if consumer confidence is to be maintained in this 'green' business revolution and the initial tentative steps towards sustainable consumption are to be translated into sustained, mass change in behaviour then it is imperative that consumers receive accurate and useful information on the social and environmental issues associated with the products they buy. Labelling has an important part to play in providing consumers with this information.
However, labelling is only one of a number of options available to develop consumer confidence and willingness to participate in sustainable consumption. Other solutions exist, ranging from 'choice editing' to the provision of whole brand re-assurance to consumers, which also have an important role to play. We have outlined our thoughts on this range of consumer information options in Appendix 1. We have also provided some thoughts on your more specific questions in Appendix 2.
The EAC's enquiry is important and timely. We hope the observations we have provided help you in your work.
October 2007
Appendix 1 - Our approach to providing consumers with information
We have considerable experience of providing information to our customers on social and environmental issues. This is summarised below.
We know that 73% of our customer's want information about the social and environmental qualities of our products. We are meeting this need using six main approaches, summarised below. We believe all have a role to play in informing and re-assuring our customers.
1. Core traceability information - The 'bedrock' for re-assuring our consumers on social and environmental issues is being able to demonstrate that we know where our products are made. Unless our customers have this basic re-assurance they can have little confidence that we are managing any associated social and environmental issues. This is why we label all our products with their country of origin. We are also increasingly labelling food products with the UK County they were produced and in many cases, the name of the farmer who produced the fresh meat, fruit and vegetables we sell.
2. Brand consumer communication - We sell approximately 35,000 product lines, virtually all of which are under our own Marks & Spencer brand. Our customers have told us that across such a large number of products (where sustainability issues range from fish sourcing to chemical use in manufacturing clothing; labour standards to climate change; packaging to reducing salt in food; cotton sourcing to food miles, animal welfare to Fairtrade) they often want the simple re-assurance that the brand they are shopping with (M&S) is addressing all sustainability issues, across all products on their behalf.
This is why we've used our look behind the label campaign to provide consumer re-assurance that we have taken, for example, hydrogenated vegetable oils out of all of the food in our food halls. Across the 4500+ food lines we sell, our customers do not have to look at the small print they know none of the food products we sell contain HVOs.
Often when people are in a rush, with just a few minutes available to them to do their shopping in a busy life, this is all the information they want.
3. Choice editing: Our customers expect us to remove 'bad' choices from our shelves. For example, our new range of electrical bulbs only features energy efficient varieties, all our eggs are free range and all our tea and coffee is Fairtrade. We do not offer conventional light bulbs, battery eggs or non-fairtrade coffee/tea. Our customers can only buy the 'responsible' option from us. This choice editing works for issues that consumers understand well and where the loss of choice is unlikely to result in them simply going to buy the product from another retailer.
4. Mandatory labels: We use mandatory labels where required to do so by UK and EU legislation such as certification of Organic food, Waste Electrical and Electronic Equipment (WEEE) and energy efficiency labels. Clearly we have a legal obligation to do this, but it also ensures that consumers receive the same consistent information wherever they shop.
5. Voluntary third party labels available to the whole industry: We use a small number of third-party voluntary labels to address issues which are reasonably mature and there is consensus about defining the sustainable option. For example, all our products will carry the WRAP (the Waste & Resource Action Programme's) symbols on packaging to advise consumers on how to recycle used packaging or, where this is not possible, give them a clear and honest message that this packaging must go in the bin. Similarly we also use Fairtrade, Marine Stewardship Council and Forest Stewardship Council labels on relevant products.
Our customers have told us that the involvement of independent third parties (e.g. Fairtrade Foundation, Soil Association) in developing and 'policing' these labels is very important to them.
We are also supporting the Climate Group's &Together campaign by encouraging our customers to wash their clothing at 30 C wherever possible as this has the potential to significantly reduce energy use in heating wash water and consequently reduce CO2 emissions. To do this we are using the traditional wash label supported by an additional 'Think climate wash at 30 C message. The key here is not to develop a new type of label but to supplement a well established 'label' (the wash instruction) with additional information. The &Together campaign enables several companies to work together across a number of different product lines to present a coherent message to consumers about how their everyday choices can collectively begin to address the challenge of climate change.
We have also been working closely with the Carbon Trust. They have helped us develop a detailed carbon footprint for our food business, from field to fork. We believe strongly that within the UK, only the Carbon Trust should be responsible for developing an industry wide approach to carbon labelling. We will not be developing a carbon label of our own. We will continue to support the Carbon Trust in its work.
6. Marks & Spencer Voluntary labels - Where we cannot adopt the approaches outlined above, usually because an issue is relatively new, and we believe our customers want information on our approach we have adopted our own carefully thought through approach. For example, we have launched a range of clothing made from recycled polyester, produced from used plastic bottles. This approach has ensured we have been transparent with our customers in changing a traditional business practice (we have used polyester made from oil for many decades) as well as giving them an engaging and motivational story that brings the concept of sustainable consumption alive for them.
We have also introduced an 'air freight' symbol on food transported by aeroplane in response to requests for transparency about sea and air freighted produce. We are very clear this is not a form of carbon label but was designed to respond to growing consumer concerns about unnecessary usage of airfreight, particularly on fresh produce. This has been successful in educating our customers that very little of our overseas produces is transported by air and that this approach is only used where closer sourcing options are not available.
Appendix 2 - M&S Observations on EAC questions
Issue 1 - Labelling should not be viewed in isolation as a means of informing and re-assuring consumers
As we have outlined above, we believe that labelling is an important way of informing and re-assuring consumers. However, it should not be viewed in isolation and should be complemented by a more holistic approach to information provision.
Issue 2 - There are a number of criteria which can help us judge whether a particular label will work and a small number of labels that currently meet these criteria
We believe the criteria for judging whether a consumer label will work are
Labels that clearly meet these criteria include Fairtrade, Organic, Marine Stewardship Council (MSC) and Forestry Stewardship Council (FSC) labels.
Fairtrade and organic have been particularly successful in helping consumers both identify 'better' choices but also make them more aware of an issue and the difference they can make through their purchasing decisions.
At a time when more and more labels are starting to emerge, we will continue to prioritise this small number of well established labels.
Issue 3 - The Government should set up a stakeholder advisory group to help identify where gaps exist in sustainability labelling and where existing labels can be improved.
The Food Industry Sustainability Strategy (FISS) recommended the formation of a stakeholder group to look at 'ethical' sourcing, including associated labelling issues. We believe that such a group could help identify where labelling is the optimum approach to provide consumers with information on environmental and social issues.
Issue 4 - Consumer labels work well when they focus on a specific issue.
Experience with the EU Eco-label scheme in the 1990's has shown that whilst multi-issue labels may appear attractive as a 'one-size-fits-all' solution in reality the aggregated nature of their message make them less effective with most consumers.
In addition, they require increasingly large datasets to prove a product meets a wide set of sustainability criteria. In a marketplace characterised by rapid product development, the unwieldy collection and auditing of such massive datasets will deter retailers and fast moving consumer goods brands from widening the use of labels.
Government is currently exploring where there maybe nutrition, local sourcing and carbon efficiency overlaps in order to identify combined messages. Whilst we support this work, in reality we believe that red meat may be the only significant point of convergence.
Government and industry must exercise care to avoid unintended consequences. For example, 'food miles' is rarely a good proxy for the overall carbon footprint of a product.
Issue 5 - Signposting is typically easier for consumers to understand rather than the provision of numeric values
More research and understanding is required as to how consumers will navigate choices on the issue of climate change/ carbon. We believe that simple 'in use' signposting on relevant products (such as A-G energy labels) is more likely to be effective than numerical values requiring interpretation.
Consumer 'carbon labels' are likely to be most effective when the consumer use phase dominates a product's overall carbon footprint. Thus electrical goods, where the use phase is often the dominant factor, are more likely to lend themselves to carbon labelling than food, where the make-up of the carbon footprint is highly variable, with the supply chain often being the dominant factor rather than the use phase.
Issue 6 - Government should co-ordinate the labelling activities of its 'agencies'
It is important that Government continues to co-ordinate the activities of its funded delivery organisations such as WRAP, The Carbon Trust and the Energy Savings Trust who are all working to develop new labelling schemes.
Issue 7 - Carbon labelling may prove to be effective but other approaches exist to address the climate change impacts of consumption.
Climate change is such an important issue that we need to continue work to develop a robust, cross industry carbon labelling scheme. However, as the scheme is developed in the years to come we should not avoid the potential to reduce product CO2 footprints now.
We have estimated our total carbon footprint to be at least 6.7 million tonnes of CO2 across the production, transport, sale, use and disposal of our products. Approximately 10% of these emissions arise from our own operations (stores, lorries, offices, warehouses etc). The other 90% comes from the manufacture and use of the products we sell. In practice as a food and clothing retailer this total footprint is dominated by a few activities, for example washing clothing.
We could spend many years developing a carbon labelling scheme, spend many more years and tens of millions of pounds applying it to each of our 35,000 product lines and wait even longer for whole-scale behaviour change in purchasing practices amongst our customer base that results in significant CO2 savings.
In addition, our customers have consistently and rightly told us that responsibility for addressing sustainability issues is 25% their responsibility and 75% ours. They do not expect us to neglect changes we know we can start to make ourselves now in the hope that a robust carbon labelling scheme will emerge in the future that they may construe as us passing responsibility for fighting climate change to them.
Retailers are able to set internal targets to reduce CO2 emissions from their supply chains and operations now. Only when the use phase of a product dominates its overall carbon footprint should we consider asking consumers to make choices. And even here solutions may already exist that avoid the need for the development of complex new labelling methodologies. For example, the consumer wash phase dominates the CO2 footprint of clothing. We can use a well understood and simple 'label' - the wash temperature care label - to encourage behaviour change rather than developing at great cost a complex alternative which we need to explain to consumers.
Issue 8 - Environmental labels should not act as a barrier for developing countries
Consumers expect all the products they buy from us to be safe and of high quality, wherever in the world the product is produced. We believe consumers have the same expectations on sustainability. To consumers, a pesticide residue on food is the same whether the product comes from Kent or Kenya.
We therefore believe that environmental labels should be applied consistently across retail products wherever they are sourced from. What matters in this situation is the acceptance that producers in developing countries may face additional challenges in meeting standards. We work hard with producers in developing countries to help them meet our requirements. We believe Government and other funding sources should give consideration to how they help producers meet the requirements of sustainability labels. The Fairtrade model is a good example of how extension work, funded by Government and retailers, can help poor producers improve production methods to meet the requirements of the standard.
We have also created a Plan A Supplier Exchange to help our 2,000 suppliers and 15,000 growers address social and environmental issues wherever in the world they operate. We have already held several conferences for our suppliers on these issues and are now forming sub-groups to address particular challenges - groups on pesticides and labour standards are already up and running.
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