What Can Policy Makers Do?

Nordic retailers have launched numerous initiatives aimed at promoting more sustainable consumption and production but trends show that more action is needed.

Constraints of competitive markets often make it difficult for companies to act alone. Government has an important enabling role to play in using policy levers to support the development of a business case for manufacturers and retailers to produce and deliver more sustainable products.

Many of the policy instruments introduced in the Nordic region over the last decades to promote SCP directly influence retailers. A common feature of these policies is that they also create opportunities for the more proactive retailer. However, current levels of consumption in the Nordic region remain unsustainable and further policy support is clearly needed

Brief Overview of SCP Policy Instruments Affecting Retailers

A broad range of environmental and non-environmental policies determines the framework conditions for retailers. Some of them directly target the retail sector, however, most do not. Some of the policies influencing retailers may promote sustainable consumption; however, others may counteract more sustainable consumption patterns and levels.

The focus of this web-site is on policies developed to encourage more sustainable consumption and production that at the same time directly or indirectly influence the retail sector.

These include policies that aim to promote more sustainable operation of retail stores, but also policies that aim to transform the markets of green and more sustainable products more widely, i.e. through greening production, promoting the provision of greener products (supply) and by stimulating the take-up of green products (demand).

Read more about the various kinds of measures that governments may take to promote SCP

A Structured Overview of Policy Options for Promoting SCP Through Retail Action

The table below provides an overview of different options for policy intervention aimed at reducing the overall environmental impact (direct and indirect) of food retail.

The table is structured according to the different types of policy instruments in the vertical dimension and along the product life cycle in the horizontal dimension (overall, upstream, in-shop and downstream).

The table is based on a desktop study of both existing policies in Nordic countries and elsewhere as well as other policy options discussed but not yet implemented. However, the table does not intend to present an exhaustive list of policy options for promoting SCP through retail initiatives.

Table of Policy Options for Promoting SCP Through Retail Action (PDF, 192KB)

Description of Selected Policy Instruments

This section describes and discusses nine selected policy options amongst the numerous options presented under "A structured overview of policy options for promoting SCP through retail action".

These nine policy options are divided into those that are cross-cutting and those that have specific focus upstream, in-shop or downstream. The nine policy options were selected based partly on expert priorities raised at a Nordic expert Workshop on Sustainanble Consumption and Green Lifestyles held in Copenhagen on November 24-25th, 2010, and partly on suggestions from the Danish EPA.

Read more about the nine policy options

Nordic Retail Forum on SCP

A Nordic Retail Forum on SCP could provide a useful platform for public-private collaboration for achieving environmental improvements within the Nordic retail sector. A key focus area could be scaling up existing small-scale initiatives through exchange of best practices and a role of the retail forum could involve establishing a baseline and committing to continuous improvement and a variety of other initiatives.

Such a forum could be limited to Nordic retail companies and public authorities but could also involve a broader group of key stakeholders and rules for membership of such a Nordic retail forum could take many shapes.

While the success of a retail forum depends on a number of factors including the level of commitment as well as the work programme agreed upon overall, the starting point for a Nordic retail forum is promising.

Read more about the opinion of stakeholders and the EU Retail Forum for Sustainability

Discussions of Selected Policy Instruments

A total of ten different policy options aimed at promoting SCP through retail action are described and briefly discussed at this web-site.

These ten policy options have been rated in low, medium and high for the following three categories: environmental impact (i.e. what are the potential environmental gains), practicality (is the policy option accepted and can it be easily implemented) and economic efficiency (how cost-efficient is the policy option).

Policy option

Environmental impact

Practicality

Economic efficiency

Nordic Retail Forum

Uncertain

High

Medium

Promotion of ecolabel for retail stores

Low

High

High

Environmental benchmarking system for retailers

Medium/High

Medium

Medium

Annual "green retailer" awards

Low

High

Medium

Public-Private partnerships on sustainable supply chain management

High

Medium

High

Substance/product bans, phase-out and substitution programmes

High

Low

Medium

Education and information on sustainable management of stores for staff

Low

High

Medium

Voluntary agreements with food retailers on limiting food waste

Medium/High

Medium

High

Differentiated VAT based on environmental performance of products

High

Low

High

Tax/fee exemptions for eco-labelled products

High

Low

High

The rating is by nature somewhat subjective and not based on thorough analysis and thus cannot be used to rank the ten policy options in a top ten of most appealing policy options.

However, the table does reveal that some policy options have greater potential for environmental gains than others. Those with greatest potential for environmental gains include benchmarking system, partnerships on sustainable supply-chain management, substance/product bans, voluntary agreements on food waste, differentiated VAT and VAT exemptions for eco-labelled products.

Unfortunately some of these policy options appear to be less practical to implement.

Recommendations

From an overall point of view, any strategic approach towards policy development in the area of SCP would benefit from the establishment of a more integrated and coherent policy framework encompassing the sustainability aspects of the food retail sector.

In addition to national overarching Sustainable Development/SCP strategies, two key areas for further action were highlighted by experts at the Nordic Workshop as being critical: Development of eco-tax reforms shifting tax from labour to material consumption and development of more ambitious GPP strategies with mandatory requirements.

Consideration should also be given to preparing integrated food strategies at a more detailed level and preparation of strategies or action plans dedicated to high-impact product groups, such as e.g. meat or dairy products.

It is of key importance that both the relevant problems and possible means to tackle them are framed in a holistic manner, considering the full life-cycle of products and that a mix of different complementary policy instruments. Research institutions also have a part to play in providing a solid evidence base to support and inform national policymaking. National governments could consider establishing cross-ministerial research agendas focusing on the retail sector.

It seems that a Nordic retail forum could provide a useful platform for voluntary collaborative efforts among retailers, authorities and other key stakeholders.

For further information, download the background document:
Potential Policies to Promote SCP via the Food Retail Sector in Nordic Countries (PDF, 400KB)