Evaluating Products With a Sustainability Scorecard
Another day, another green product.
Just about every day, it seems, a new item pops up on the market claiming it’s been certified as sustainable, according to one set of criteria or another.
Many manufacturers, retailers and third-party certification programs have developed their own methods — and definition — of assessing whether a product is sustainable.
So how can a retailer validate a manufacturer’s claims and choose a supplier from the scores of those saying it meets the retailer’s criteria — when each product has been evaluated using a different method?
There’s no easy answer. No standardized method, approach or common list of questions and criteria determining the attributes of a sustainable product exists. So it’s going to be awhile before the day when the best product can be identified and sourced using a true “apples to apples” comparison.
What’s really needed for the long haul is a standardized approach to a green scorecard or assessment system, so similar products can be compared to one another using the same measures.
Doing so will not only cut down on consumer confusion, but also save time and also money. Companies wouldn’t have to spend hours answering questionnaires each requiring a different set of information about the material composition, sourcing information and manufacturing processes of their products. Instead, they would only need to complete one standardized questionnaire.
This was the conclusion of speakers who presented at “The Future of Product Scorecards for Retailers and Suppliers,” a GreenBiz Group webcast held Tuesday.
“I’d ideally like to see a set of common standards, definitions and processes — any time industry can come together around commonalities, we’re definitely very supportive of that,” Chris Conley, director of sustainability and EHS at Johnson & Johnson told webcast attendees.
Various industries and groups are making efforts to consolidate and harmonize efforts when it comes to product sourcing, said Lise Beutel, a UL Environment senior business consultant who shared the results of her company’s effort to catalog these initiatives. One example is the joint efforts of The Sustainability Consortium and the Retail Industry Leaders Association. The pair is collaborating to develop common sustainability measures as well as a library of common questions to assess sustainability at the enterprise and product level.
But among individual retailers, it’s a different story. “UL Environment findings reveal no standard approach for greener product sourcing,” she said.
Initiatives were similarly jumbled. While some addressed one product in a single category such as sustainable seafood, other initiatives used a checklist of criteria which spanned various product types, Beutel reported. Still others combined supplier data and product claims in a “sophisticated” database with metrics and scoring, she said.
UL Environment also identified a gap between the criteria consumers wanted retailers to focus on and the criteria that retailers actually used to assess whether manufacturers’ products met green sourcing requirements.
Sustainability issues of most concern to consumers are those that are associated with human health, Beutel said. But her company’s research found that only 13 percent of the initiatives focused on chemicals of concern.
“Retailers are underrepresenting this consumer value,” she said.
Similarly, most of the initiatives UL Environment examined focused on traditional sourcing points — materials, production and distribution, Beutel said. But just a third of retailers in the company’s research focused on the impacts related to consumer use or impacts at the end of a product’s life.
“Consumers do have expectations that companies which sell [the products] should be responsible for these products and how they are disposed of,” Beutel said, citing Shelton Group market research showing 74 percent of consumers think a company has some responsibility for a product’s end-of-life disposal.
Beutel provided tips to companies interested in developing green products as well as to retailers interested in selling such products:
- Define what “green” means to the company as a first step
- Develop a greener product framework which will help design and source products — as well as track performance and set goals over time
- Create a private label brand as a sourcing framework with green attributes across different product categories
- Embed sustainability in the process by enrolling engineers in an environmental product design class that covers concepts such as lifecycle thinking
- Look at hotspots to determine how the products your company offers can have the most impact
- Seek out strategic suppliers
Developing a proprietary internal scorecard: Johnson & Johnson
Earthwards is a certification process applied towards in-house products as a way to support sustainable product development, encourage innovation and assess product sustainability within the group of Johnson & Johnson companies. With a scorecard as guidance, the evaluation is conducted across seven areas.
“It’s used to determine where the most significant social and environmental impacts occur along a value chain,” said Johnson & Johnson’s Conley. “Then we work on reducing them.”
Each product is evaluated with the scorecard using a four-step process:
- Step 1: The product’s source, composition and end of life are assessed. For example: Can the product be recycled or are there opportunities for reuse?
- Step 2: Each product goes through a lifecycle screening measuring its environmental impacts as well as measuring its improvements across seven categories.
- Step 3: The extent of improvements are assessed to determine whether the product can be designated as an Earthwards product. Improvements of at least 10 percent or greater across three of the seven categories must be achieved before qualifying.
- Step 4: Internal and external sustainability experts review the scorecard, decide whether it qualifies as an Earthwards product and provide suggestions on how a product can be improved.
Only a small percent of the company’s total number of products has been evaluated through the Earthwards process. “We want to increase that number over time,” Conley said.
In 2009, a few years after the process was launched, it was peer reviewed by a group of sustainability experts in government, academia and NGOs.
“They challenged its rigor and effectiveness,” Conley said.
The company responded to the experts’ suggestions. Two years later — as a way to add more credibility to the results — Johnson & Johnson asked UL Environment to audit Earthwards.
“We do see an advantage [in the Earthwards process],” Conley said. “In some cases it’s the minimum expectation of entering the marketplace.”
Adopting third-party standards: Safeway
Instead of using its own scorecard, Safeway applies third-party standards to its O Organics and Bright Green product lines.
O Organics products are sourced to USDA organic labeling standards, meaning that a product must be composed of at least 95 percent organically produced ingredients, said Christy Consler, Safeway’s vice president of sustainability.
The supermarket chain’s Bright Green household products are vetted by Scientific Certification Systems, a third-party provider using scientific standards to test for naturally derived and biodegradable ingredients, post-consumer recycled content, energy efficiency and ability for reuse or recycling.
Some in-house brands of toilet paper and paper towels sold at Safeway, such as Softly and Ultra Thirsty, are sourced to the Forest Stewardship Council and Rainforest Alliance certifications, Conser said.
Safeway’s seafood purchasing standard — which the company plans to roll out completely among all of its seafood offerings by 2015 — is to source only seafood that has been classified on the Monterey Bay Aquarium’s sustainable seafood list as a “best choice” or “good alternative.”
Consler advised that companies can move forward in their sustainability goals by following Safeway’s integrated approach:
- Build sustainability into all existing business processes.
- Ask each business unit to tie its top goals into positive impact in at least one of the following measures: energy/greenhouse gases, water, waste, health/wellness or social/community.
- Tie at least one employee performance objective to corporate social responsibility.
Safeway sees its sustainable product offerings as tied to profit, reputation and risk mitigation, Consler said.