51.1 Role of Retailer Companies towards Sustainable Consumption and Production: A European Map of Initiatives and Future Prospects

Burcu Tuncer , UNEP/Wuppertal Institute Collaborating Centre on SCP, Wuppertal, Germany
<>Role of Retailer Companies Towards Sustainable Consumption and Production: A European Map of Initiatives and Future Prospects

 

Main Author: Burcu Tuncer, Project Manager, UNEP/Wuppertal Institute Collaborating Centre on SCP

 

Abstract:

Retailers have a “gatekeeper” role within many product chains connecting suppliers with consumers and vice versa. On the one hand, being in direct contact with consumers, they exert significant influence on what products consumers want to buy, and how they use and dispose them. On the other hand, they reach out to suppliers worldwide bearing the opportunity to encourage green and fair production practices.

Retailers can directly influence consumer choice at the sales point, during consumers use of products and at the end of product life (see Figure 1). Working together with their producer and supplier companies, retailers can edit choices, and encourage ecologically correct and socially fair manufacturing processes. To communicate these differentiated product qualities and to well position their green and fair brands, they use a variety of marketing, advertising, and communication tactics at the sales point. In addition to this, to communicate improved experience of product use and after-sales value, they utilize other set of communication strategies from delivering information on packaging of products to forming third-party partnerships or setting up take-back systems. However, retailers' role is not limited to putting life cycle thinking into practice. Beyond this, they can and do play a role as well in encouraging sustainable ways of living as they communicate certain values and induce particular habits.

All in all, retailers' efforts towards sustainable consumption and production can span three major functions looking from a life cycle perspective: upstream efforts in relation to suppliers and producer companies, in-store operations and consumer relations. From life cycle assessment studies, it is known that priority for action for retailers are often located upstream within their supply chains, followed by downstream consumer use phase activities while in-house aspects as their direct impacts are considered to be relatively low importance (See Figure 2). Having said this, most retailers can foresee only their first tear producer companies and in-store operations as they can easily exert control and anticipate immediate value. The degree of influence retailers can exercise in their supply chains depends on the degree of vertical integration and brand ownerships. On the consumer side the motive to provide consumers with information on supply chain issues as well as environmentally friendly use and disposal may not be straightforward. Recently the strategy of choice-editing - removal of “unsustainable” products and services from the marketplace in partnership with other actors in society is often suggested as the core sustainable consumption approach for retailers. However, some retailers are reserved to limit consumer choice as they see themselves as choice providers, so choice editing may not be as easy to put into practice. Indeed these issues are rather taken up by producer or brand-owner companies.

Given this framework, the objective of this paper is threefold: first, the large numbers of retailer initiatives which have emerged in recent years aiming to develop life cycle management practices to achieve sustainable operations and products, have made it difficult to keep an overview about the scope, issue areas and effectiveness of these initiatives. To address this issue the first part of this paper briefly describes and classifies current European initiatives taken by retailers and companies to recognise current actions and areas for performance improvement of management strategies. Secondly, given this map of initiatives, the paper has the objective to reflect on the most recent initiatives such as the upcoming Retailer Forum within the EU SCP Action Plan and the retailers project group under the UNEP/SETAC Life Cycle Initiative.

Concerning the initial section of this paper, inventory of the life cycle management initiatives led solely by retailer companies, or where retailers are involved resulted in about 90 initiatives focusing on different product life cycle stages and different issues (See Figure 3). Initiatives at the shop-level are usually on environmental improvements at the site-level such as energy and water efficiency, packaging and waste reduction, efficient logistics and use of environmentally friendly building material. About half of the initiatives identified are relevant all retailers irrespective of the products they sell (crosscutting initiatives), while the other half are initiatives led by a group of food & drink retailers.

Upstream initiatives usually focus on both environmental and social issues including labour and pollution issues during extraction and production stages. In many cases these are initiatives led by producers where retailers have joined at a later stage. Most of these upstream initiatives are quite ahead in identifying main life cycle issues and developing them into responsible sourcing and/or labelling criteria (e.g. FSC, ETI, Fair Trade). Some of the retailers have integrated these criteria in their supplier code of conduct. They apply sustainable sourcing criteria for the products they buy, including products they sell to customers as well as (indirect) products they use at their stores.

The purchasing decisions of these customers, as well as how they use and dispose of goods at home, have a great impact on the environment and energy usage. Through downstream initiatives, retailers help their customers to make informed decisions about products and their use. Sector-level initiatives identified focus on encouraging sales of energy-efficient lighting and products with reduced carbon footprint, while company self-led initiatives focus on sales of more environmentally-friendly and ethical products.

 

 

 

 


[1] A preliminary study on what these functions might entail from sustainable consumption and production perspective is described in the Guideline Manual for Retailers Towards Sustainable Consumption and Production, "Retailers Calendar – Exploring New Horizons in 12 Steps Towards Long-Term Market Success". This study is available for download at the link: http://www.scp-centre.org/RETAILERS_ROLE_TOWARDS_SCP.1938.0.html

[2] See for example the recent publication of the WBCSD (2009) Sustainable Consumption Facts and Trends from a Business Perspective.