label for low ethical quality avoids people losing face, companies to be seen as bad

“Ecolabels or marks suchs as Fairtrade don’t seem to convince consumers. A negative label would reward people by avoiding losing face or having to pass for bad. Many people are willing to avoid products marked as unsustainable or of low ethical quality.”

That’s what Ynte van Dam – Assistent Professor Marketing and Consumer Behaviour at Dutch Wageningen University – is convinced of. 7th March he defended his Ph.D. thesis “The Positive Side of Negative Labelling” (download: edepot.wur.nl/370623).

A RED CROSS LABEL TO VISUALISE THE UNSUSTAINABLE BOTTOM OF THE MARKET

A RED CROSS LABEL TO VISUALISE THE UNSUSTAINABLE BOTTOM OF THE MARKET


Ethical labels signal positive ethical quality of a product. The Ecolabel Index, the global directory of ecolabels, currently lists 463 certifications in 199 countries. Still, they fail to create massive demand for such products.

Based on regulatory focus theory and prospect theory, Ynte van Dam argues that negative signalling of low ethical quality would have a stronger effect on the adoption of ethical products than the current positive signalling of high ethical quality.

250 subjects were given the choice between tomatoes, yogurt or coffee (i) with an eco mark, but expensive or (ii) without such a label, but for a standard price. The vast majority of the test subjects found to choose the cheapest product.

When a product gets a negative mark, though – f.e. an ecolabel with a red cross through it – the preference is shifting to the more expensive but durable product, whether it has its own positive, ethical mark or not.

Van Dam proves negative labelling has more effect on attitude and preference than positive labelling. The effect of labelling is enhanced by regulatory fit and is mediated by personal norms.

Ynte van Dam:

I’m not a graphic designer and I am not a policy maker. I am a serious researcher, and can theoretically explain and demonstrate a negative label on the unwanted product works better than a positive label on the desired product. And I can show that it is a very robust effect. The result does not depend on measuring methods, and also not on the precise design of the negative logo.

People might not want to buy the most sustainable and most expensive product they can find, at the same time they don’t want to be seen as totally disinterested.

Van Dam thinks therefore the real bottom of the market should be well visualized.

ethical scores main banana brands below 10 on 20

F = FAIRTRADE, O = ORGANIC

F = FAIRTRADE, O = ORGANIC

Now, let’s take a look at Ethical Consumer’s recent shopping guide to Bananas and more specific it’s ethical Score table for the main banana brands.

Ethical scores for Chiquita, Fresh Del Monte and Dole are below 10 on 20; they represent the bottom of the (sustainable) banana market. Dole scores a meager 8 with it’s Fairtrade and organic certified range. All Chiquita-owned banana farms are Rainforest Alliance Certified™.

In the last few months (i) Asda/Walmart announced that 93% of its bananas would be Rainforest Alliance (RA) certified by March 2016, the remainder being Fairtrade certified, (ii) Lidl UK announced a similar strategy: by the end of this year the 88% of their offer that was not Fairtrade certified would meet RA standards; (iii) Press reports suggest Tesco will follow with a similar strategy.

the Dangerous Side of Questionable Labelling

“Despite the good principles and objectives set out in [Rainforest Alliance] certification standards and their theories of change, improvements for workers are hard to detect in practice,”

Dr Ruy Diaz and German Zepeda concluded in “Working Conditions in Certified Banana Plantations in Central America”, August 2015.

Chiquita has actively invested in its social, as well as economic, responsibilities over the last 25 years. Despite that it could be branded with a negative (low ethical quality) label. Not because of absense but because of using third-party certification (Rainforest Alliance Certified™ seal). The same goes for Asda/Walmart and Lidl.

unethical practices go unpunished

New research by Niek Hoogervorst and Pieter Desmet claims unethical practices go unpunished in competitive markets. Managers who believe their company operates in strongly competitive markets might more readily see unethical decisions simply as ‘acceptable business practices’.

Imposing stricter regulations and higher fines may help to address this, but would be challenging and expensive for enforcement agencies. Moreover this approach does not do very much to create more awareness about ethics, Hoogervorst and Desmet say.

Still a lot of work to do in order to avoid people losing faith rather than face.

2 gedachtes over “label for low ethical quality avoids people losing face, companies to be seen as bad

  1. Pingback: de methodiek achter Keurmerkenwijzer.nl en Oxfam’s Behind The Brands | recepten en nieuwsjes vanuit de Dorpsstraat, nr 31

  2. Pingback: ‘Het woud aan keurmerken is een kwaad’ | recepten en nieuwsjes vanuit de Dorpsstraat, nr 31

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