Are Ethical Labels Facing an Identity Crisis?

Research Proposes an Innovative and Dynamic Approach to Labelling

A thesis on the subject of ethical food labelling has proposed a multi-grade dynamic approach that is defined by society itself.

A PhD student at the world-renowned Wageningen University and Research Centre in the Netherlands has produced a thesis that has provoked widespread discussion in the food labelling industry.

In “The Citizen goes Shopping: A framework for the assessment and optimization of production from the perspective of society,” Tassos Michalopoulos evaluates the purpose of ethical labels and suggests some limitations in the current system of labelling. He also proposes some innovative approaches to overcome these limitations, which could have wide reaching implications on how printed labels are used and perceived in the food industry. You can read the thesis here (pdf).

Ethical Labels

There are a vast array of ethical labels currently in use in the food industry. Typical examples include Freedom Food, the Rainforest Alliance and an ever-growing list of independent organic schemes.

Today, more than a quarter of all the food consumed in the UK has some form of ethical label on it. There can be no doubt that ethical labelling is a positive thing – it highlights positive production methods and provides consumers with relevant data with which to inform their buying decisions.

Shortcomings of the Current System

In his thesis, Mr Michalopoulos suggests that the way in which organisations endorse certain products gives only a snapshot of information about the product itself and does not reflect changes in the market.

He also notes that ethical labelling only provides information about those products that are voluntary participants in a given scheme. It gives no information on the ethical characteristics of products that are outside the scheme. Consequently, consumers only have a limited amount of information to hand, with which to make informed buying decisions according to their individual ethical standards and preferences.

Other shortcomings that are noted include the fact that once a product is certified, there is no motivation for manufacturers towards further development and continuous improvement. Finally, the number of different and overlapping schemes is noted, leading to potential confusion among consumers.

Comparative Evaluation

The thesis proposes mandatory labelling that informs consumers on the relative performance of alternative products in relation to the issues that really matter. Particularly innovative is the suggestion that the consumers themselves should dictate exactly what these issues, or metrics, should be.

It is suggested that this will eliminate the possibility of less ethical products being consumed unknowingly and will provide manufacturers and suppliers with the motivation to improve their products and services.

This system would provide a level playing field in terms of information availability. It would initiate competition amongst suppliers and incentivise businesses to compete on the basis of reputation, transparency and the issues that matter most to their consumers.

Free Market Ethos

This consumer-led approach to ethical labelling exemplifies the free-market ethos of demand dictating supply, and the logic of the arguments it puts forward is compelling.

The thesis has provoked numerous discussions within the industry, to a degree that is almost unheard of for an academic paper, and will, no doubt, lead to further research and consultations.

Whether some or all the recommendations will come into being remains to be seen, but it could ultimately revolutionise the way the industry approaches ethical labelling forever.