Make Informed Consumption Choices

-- Towards Sustainable Consumption

Changhua WuPresident, Professional Association for China’s Environment

April 29th, 2005Beijing University

Consumer Sovereignty ….

这是一个多事之春，不断有大企业陷入危机之中 SK II、亨氏、强生、联合利华、肯德基、 APP、朝日啤酒……

这也是一个消费者不断宣泄自己情绪的春天： 因为恐慌而不敢吃肯德基 因为民族情绪而拒绝喝朝日啤酒 因为有社会责任感而拒绝购买 APP 的产品…… 当这种情绪每每体现为向商家说” NO”的时候 企业强烈体会到了民众消费情绪的力量。

I. Understanding Consumption

What is consumption?

Functional role: satisfying needs for food, housing, transport, recreation, leisure, and so on – well-being and welfare

Social and cultural: Consumerism is what defines our age and is the lens through which most people view our times – Gary Cross;

Personal: Consumption has given hundreds of millions of people a new sense of independence and has become a common benchmark to measure personal accomplishment;

Political: President Bush, after “9.11,” advised his fellow Americans that it was their patriotic duty to go to the mall and “buy.”

Consumers = God?

The Curve: The Equation:

I = P A TSupply

Demand

Consumption Choices

Consumption patterns are the result of choices of a wide variety of actors including business, government and individual households.

Adam Smith - Decisions reached individually will be the best decision for an entire society.

Examples of Impact

在加拿大沿海省份，由于过渡捕捞，上世纪九十年代初，鱈鱼捕捞业几乎崩溃，结果，三万渔民不得不靠政府福利为生，仅 NEWFOUNDLAND 一个地方， 700个社区经济中，十分之一遭扼杀。

中国的主要城市中有 100多个城市的居民面临严重缺水，其中部分原因是城市附近河流和地下水源遭过渡开采和污染。

印度森林的商业砍伐严重破坏了传统上村落管理当地森林的制度，结果，几百万村民遭受薪炭木和建筑材料缺乏之苦。

Some worrisome trends

生活在高收入国家的世界 15%的人口占世界总消费的56%，而生活在世界最贫穷的国家的 40%的人口只占总消费的 11%。

随着上世纪 90年代世界经济的不断扩大，多数人今天消费的物质在增多，很多国家的生活水平不断上升，但是，每个非洲家庭的平均消费却比 25年前减少 20%。

预测显示，世界人口到 2025年将增至 80亿，到 2050年为 93亿；人口的增加，加上生活水平的提高，尤其是发展中国家的生活水准上升，将对土地、水、能源和其他自然资源带来巨大压力。

Trends (continued) 农业贸易在增加，但农业的扩张威胁其他生态系统，对森林、湿地、山地和生物多样性的最大威胁来自由于粮食需求的增加而带来的农业土地的扩张，以及过于密集的耕种而带来的耕地减少。

到 2025年，近世界一半的人口将经历缺水；全球范围内，水采集已达总可再生水资源的 10 ~ 20%。

世界森林覆盖面积继续缩小。世界森林覆盖率在上世纪 90年代减少了约 2.4%，每年损失约 90000平方公里。

矿物燃料的消耗和二氧化碳排放继续上升。发达国家的人们消费的矿物燃料相当于发展中国家的 10倍。

II. Factors Influencing Consumption Choices

Access - key to making choices

Access to information

Access to alternatives of goods and services

Access to infrastructure to deliver alternative goods and services

Access to legal remedy when damage occurs

Other Key Elements Influencing Choices

Motivations, attitudes and values

contextual/situational Social influence Personal capabilities Costs and benefits Habits, routines, cues

Models of consumer behavior

Attitude-behavior- context (ABC) theory

Stern and Oskamp 1987

Stern 2000

Behavior is an interactive product of “internal” attitudinal variables and “external” contextual factors

Expectancy-value theory

Fishbein 1973, Ajzen and Fishbein 1980

Behavior is motivated by expectations about consequences and values attached

Elaboration-likelihood model

Petty 1977, Petty and Cacioppo 1981

Long-term success of persuasive message depends on how much mental processing is undertaken

Interpersonal behavior

Triandis 1977 Influence of habitual, social and affective factors, besides expectancy value and normative belief constructs

Models

Motivation-ability-opportunity model

Thogersen 1995

International motivational variables and external contextual variables of ability and opportunity

Norm activation theory

Schwartz 1977, 1992

Pro-social or altruistic behaviors, activated by awareness of consequences of one’s actions and personal responsibily

Symbolic interactionism

Blumer 1969, Mead 1934

People interact with things based on the symbolic meanings

Theory of planned behavior

Ajzen 1991 Incorporate actor’s perceived control over outcomes of behavior

Influence and Inform Choices

Inform Influence Change

Stimulate and facilitate better products and services

Alter current infrastructure and regulatory framework that lock consumers into unsustainable behavior.

III. Sustainable Consumption

Sustainable Consumption

The ultimate goal: improved quality of life for all consumers.

Consumer (current and future generations) needs and demands fulfilled

Resource efficient and lean Minimal negative environmental, social and

economic impacts

UN Guidelines

P.43 - Responsibility for SC shared by all members and organizations of society, with informed consumers, government, business, labor organizations and consumer and environ organizations playing particularly important roles. Informed consumers have an essential role in promoting consumption that is environmentally, economically and socially sustainable, including through the effects of their choices on producers.

P.44 - Governments, in partnership with business and relevant organizations of civil society, should develop and implement strategies that promote SC through a mix of policies that could include…information programs to raise awareness of the impact of consumption patterns….

UN Guidelines

P.49 - Governments should promote awareness of the health-related benefits of sustainable consumption and production patterns…..

P.50 - Governments, in partnership with the private sector and other relevant organizations, should encourage the transformation of unsustainable consumption patterns through…, including information and communication technologies, that can meet consumer needs while reducing pollution and depletion of natural resources.

UN Guidelines

P.53 - Governments, in cooperation with business and other relevant groups, should develop indicators, methodologies and databases for measuring progress towards SC at all levels.This information should be publicly available.

P.55 - Governments and other relevant organizations should promote research on consumer behavior related to environmental damage in order to identify ways to make consumption patterns more sustainable.

Stakeholders and Practitioners

Government Business Civil society organizations Individuals and households Media

Rock the Same Boat…...

Form partnership Inform consumers Raise awareness Understand consumers Educate consumers Market SC products

and services Track progresses

business

NGOs

Individual

media

government

Government to take the lead...

Governments are responsible for providing consumers of household goods and services with necessary tools to make informed and sustainable choices

Ensuring accurate and reliable information in the market and prioritizing public environ information strategies to support households to adopt more SC patterns

Highly developed consumer-focused information programs can assist governments to adopt policies and methods that will promote SC.

NGO’s role

Promote public participation and debate on SC

Pressure government and business towards SC policy and practices

Educate/inform consumers of SC choices Carry out specific SC programs

Policy Options and Strategy

Ensure that incentive structures and institutional rules favor SC behavior

Enable access to SC choices Engage people in initiatives to help

themselves Exemplify the desired changes within

government’s own policies and practices

A new policy model for behavior change ?

enable

incentives

catalyze

engage

-remove barrier -give info -provide facilities – give alternatives – educate/train –provide capacity

-through tax system – expenditure/grants – reward scheme – recognition/social pressure – penalties

-Is the package enough to break a habit? - Govt role to exemplify and drive change/stimulate markets?

-community action – co-production – deliberation fora – personal contacts/sneezers – media campaigns/opinion formers - networks

Tools to Reinforce Change

Regulatory instrument:

1) command and control 2) incentives and disincentives 3) information 4) non-mandatory

Certification, product information and impartial testing

Waste minimization and recycling

Green procurement Awareness, education

and marketing

Consumer Governance – A Policy Cycle

Technical, Social and Political Innovations

IV. Cases and Practices

Setting Priorities - EU

National Level Strategy - UK

Consumer VOICE Challenges Popular Brands - India

Consistent finding: Indian brands give multi-national brands a run for their money.

Indian refrigerator brand ‘Videocon’ outperforms Whirlpool and Samsung. Videocon also the most energy-efficient of all refrigerators tested.

MNC brand ‘Alstom’ finishes last among 14 brands.

Indian toothpaste brands better than 7 MNC brands tested.

Results and impacts: 15 Environmental guidelines for public

purchasers (with several subtopics). According to the state institutions 40% of their

purchasing is "green buys". According to the regions 40% of their

purchasing is "green buys". According to the municipalities 20% of their

purchasing is "green buys".

Green Procurement in Denmark

Results and impacts: 50% of the suppliers answered that

environmental requirements from public purchasers had influenced their product development.

Only 50% of the municipalities have implemented a "green purchasing policy"

Green Procurement in Denmark

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2002 2003 2004

PROPER 2002 - 2004

Black Red Blue Green Gold

PROPER RATING SYSTEM 2002

- PROPER rating system consists of five colors designed to represent the entire spectrum of environmental performance.

- Ratings are based on performance in all aspects of environmental management within and outside a company

- Unlike PROPER 1995, PROPER 2002 methodology includes water, air and hazardous waste and other factors.

GOLD

GREEN

BLUE

RED

BLACK• No pollution control effort,

• Serious environmental damages

• Efforts meet minimum legal standards

• Better than legal standards by 50%, uses clean technology, waste minimization, pollution prevention, and resource conservation

• Pollution level 5% of the legal standards and near zero emissions level

• Efforts don’t meet standards

V. Hurdles to Overcome

Understanding the Nexus

policy

Info practice

government business

individual

Producer

Consumer

Goods

Services

Ecosystem

NGOs

media

Gaps and “Noises”

Policy and practice Information/message

and policy Practice and

message/information

Among policies Among

information/messages Among practices

Inadequate Policy Tools in Asia

Scattered policy, initiatives and practices, lack of synthesized clear definition, policy framework, policy tools, strategy, experience to promote SC;

And yet, each country has been shifting its policy focuses more towards sustainability, though gradually and slowly.

Lack of Uniform Perception on SC

SC not as broadly known as SD/SP; but many sectoral practices and policies have integrated the practices in real life, such as sustainable energy, organic food, sustainable forestry, etc.

SC typically as part of the SD policies and strategies;

The China example - “resource saving society”, circular economy

Gaps between Policy and Reality

M ajor G ap s b e tw een P o licy an d R ea lity

B en efit o f S CP rog ress

R esearch on con su m er b eh avio r

im p ac t on h ea lthim p ac t on en viron m en t

econ om ic cos ts

P rod u c t a lte rn a tivesS ervice a lte rn a tives

A lte rn a tive p o lic y too ls

D e live ry in fras tru c tu reg u aran tee m ech an ism

More Challenging

Asia review seems to point to the fact that there is an increasing info and programs to raise awareness, educate the consumers and market certain products, and yet the supply of SC-oriented products and services seems rather in short supply, let alone the infrastructure that is needed to deliver them.

Urgent Need….

So, it is more urgent than ever for Asian countries to look at each others’ policies and practices as well as those from other parts of the world, to develop its own effective policy tools and promote the transformation towards SC.

VI. “China Factor”

The World’s Largest Consumer Country

The latest survey shows that in 2004, Chinese consumers’ total consumption expenditures reached 700 billion USD, with an expected annual growth up to 18%, faster than the US;

In 2003, Chinese consumers ate 33% of the world’s rice, 22% soybean oil and 12% meat products;

Out of the 1.7 billion people, 27% of humanity, have now entered the consumer society, 240 million are in China.

What if …? The Car Story

What would happen if China adopted the same consumption patterns as the USA? This would mean producing another 850 million cars and more than doubling the world’s output of oil. The additional cars alone would produce more carbon dioxide per year than the whole of the world’s existing transportation system.

The fact is that China went from having virtually no private cars in 1980 to having 5 million in 2000, which is likely to have 24 million cars in 2005, leaving still more than 1 billion prospective car buyers in China.

China’s Future Development Alternatives

HistoricalStates

CurrentState

Green Development

Path

PerilousPath

Human Choices

Critical Uncertainties

Past Present Future

Driving Forces

China’s Futures

The Perilous Path: increasing resource use intensity, with two serious perils -continued social instability and environmental degradation

Green Development Path: decreasing resource use intensity, when the impact on environment is reduced through the development and implementation of integrated economic and environmental policies and the engagement of the broader civil society in pursuing a new development strategy.

Up or Through?

Now(Developing Countries)

Now(Developed Countries)

Public Participation

Market Mechanism

Pollution Control

Resource Consumption

Economic Development

The Question to You…

HOW?

…………

Thank You