Ecolabelling, public procurement support key to achieving SDG 12

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Businesses will have to navigate the labyrinthine realm of ESG and responsible choices that transcend mere compliance.

Ecolabelling and sustainability: The world took note of India’s call to ditch consumerism and shift to circular economy at the WEF Davos Agenda Summit. This was in line with the country’s climate action initiatives such as energy transition, green bonds, and sustainable urban planning which would provide for equitable economic growth and sustainable use of the planet’s resources. Such initiatives by the government could accelerate the shift towards sustainable consumption and production (SCP), especially at a time when pressure is mounting on the country to achieve the Sustainable Development Goals, particularly responsible consumption and production (SDG 12).

Various schemes initiated by the government such as the Skill India, Digital India, Make in India, Zero Defect & Zero Effect express this keenness to balance economic growth with sustainability and social inclusion. It speaks volumes about the country’s aspiration to move ahead and grow in a much greener, cleaner, sustainable and reliable manner.

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Still, India performs poorly on overall sustainability despite some serious efforts. In fact, the country has slipped three spots from last year’s 117 to rank 120 on the 17 SDGs adopted as part of the 2030 agenda by 192 United Nations member states in 2015. While both the Union and state governments are taking action towards SCP, meeting targets of any SDG should never be seen as the sole responsibility of the government, even private players like businesses and citizens have their own crucial role. For fulfilling such roles, producers and consumers need to be facilitated with suitable tools. They need encouragement for behavioural change towards long-term sustainability.

Need to promote ecolabelling

While India has numerous policies and programmes to boost sustainability, the country has failed to use both ecolabel and sustainable public procurement, which can help promote SCP and tools that rest of the world have utilised well. Recognising the true potential of an ecolabel, the Prime Minister had highlighted the need to revive and promote Ecomark scheme, our national ecolabel established in 1991. Despite the thrust from the highest authority, the scheme has failed to pick up and still lies dormant. This is largely due to the lacklustre attitude of those who are managing it.

For sustainable consumption to happen, the government needs to ensure that the market provides consumers with sustainable choices that are reliable and trustworthy. Consumers need to be sure that the products they choose can be trusted and have a proven environmental benefit. It can help consumers in identifying products and services that are less harmful to the environment.

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There are a number of other public benefits from ecolabelling schemes. These include promotion of economic efficiency, supporting companies in making correct and effective environmental claims thereby helping to avoid greenwash, increase in awareness of general public, reducing the impact of production and many others. But for the success of ecolabels, it needs to be supported with the promotion of complementary tools and instruments like public procurement. Experience of most national ecolabels (Taiwan, China, Korea etc) shows that acceptance of ecolabels enhanced extensively when they were supplemented by additional tools and measures.

Sustainable business needs market incentives

The most effective way to incentivise businesses for responsible and sustainable production is to show them the benefits it brings. In India, efforts to reduce the environmental impact, resource and energy consumption of their products and services have gone unrecognised. The country has failed to offer them enough economic incentives and competitive advantages in the market.

Overall picture of India’s Ecomark scheme would have been entirely different had the scheme been linked with the procurement policy of the government in the early stages. Doing so might have provided an incentive to producers to adopt environmentally sound production methods and offer more environment friendly products and services.

Such a message by the government to businesses could have created ripple effects, not just in public procurement but also in private consumption by companies. In the international arena such green public procurement policy could give a leeway for India’s positioning as an environment-friendly economy and shrugging off its image as a polluter. There could also be enormous advantages in terms of economies of scale as public procurement accounts for roughly 25-30% of the GDP. The Union government must take lead in adopting a green public procurement policy to send a strong message to the business community and to promote Ecomark.

Intertwining facilitates achieving of SDG 12

There is no doubt that ecolabel and green public procurement are seen as perfect tools to facilitate acceleration towards SDG 12. For instance, an international study has proved that in the Republic of Korea, where ecolabels play a central role in the public procurement practices, the public procurement of green products from 2005 to 2010 has helped reduce emissions by almost 3 million tonnes of greenhouse gases. For most countries, the intertwine of their national ecolabels with government procurement paved way for the wide acceptance and expansion of the schemes.

In India, the government agencies are legally bound to purchase the lowest priced products and not sustainable products. Sustainable procurement is largely overlooked due to fund restrictions to pay the premium for environmentally preferable alternatives. Budget allocation and financial mechanisms are still prejudiced against sustainable products because of the common perception that sustainable alternatives are more expensive. This is despite the fact that reduced operating costs of sustainable products make them cost-effective over their lifetime.

(George Cheriyan, Director and Simi TB, Policy Analyst, at CUTS International, a global public policy research and advocacy group.)