Tackling the climate crisis starts with consumer protection and empowerment

Consider, political leadership is nothing without the consent of those they lead. Likewise, companies exist to serve their customers – and not the other way around. In these relationships, it is the key to meeting the legitimate needs of consumers to get their buy-in and resolve the most critical issues of our time.

High on the list of critical issues is the climate crisis. Political decisions can be crucial in reducing and stopping dependence on fossil fuels and excess greenhouse gases, but consumer action will have the greatest impact.

The recent IPCC 6th Assessment Report recognizes the strong role that consumption shifts play in achieving the decarbonisation targets, and shows that 40-70 percent of future emission reductions can be achieved through demand-side interventions. At the same time, consumers want change; GlobeScan surveys show that, on average, 70 percent of people in all markets are concerned about the climate crisis and want political and corporate governance to address it. Circular business models do not catch on without consumer adoption.

Let’s be honest, consumers have already borne the bulk of a lot of disruption lately. The world has gone from the worrying economic consequences of the pandemic to a war in Ukraine that has contributed to rising basic costs, such as food and fuel.

Climate change can slide down on consumers’ priorities if no action is taken to ensure that sustainable choices are not expensive or unaffordable for all consumers everywhere.

While people are struggling, seemingly simplified answers may be standard, such as scapegoat in the race to achieve net-zero. Even without short-term provocateurs, it is clear that climate change can slip down on consumers’ priorities if there is no action to ensure that sustainable choices are not expensive or unaffordable for all consumers everywhere.

Consumer purchasing is therefore necessary in the solution. Climate change actions must be linked to broader consumer empowerment, otherwise declining consumer confidence will be ripe for exploitation. That’s why, most recently in Glasgow at the UN Climate Change Conference – COP 26 – we have called for a more inclusive roadmap for what companies should do and how other stakeholders can help them reduce the burden on consumers.

    The legitimate consumer needs as described in the UN Guidelines on Consumer Protection.  Photo: Consumers International

The legitimate consumer needs as described in the UN Guidelines on Consumer Protection. Courtesy: via Consumers International.

Golf in providing consumer protection and empowerment

At Consumers International, we are seeing more and more examples around the world that consumers feel they lack protection and lose confidence in companies to put their interests first.

Our latest insight tool – Consumer Protection and Empowerment Index – shows gaps and where we can build trust with and with consumers. The index is the first global assessment of how countries build, maintain and encourage safe, fair and sustainable markets for all across sectors. It has assessed 80 countries across five core areas for protection and empowerment, and although the results show some positives, there is demonstrably much work to be done.

Pillars of the Global Consumer Protection and Empowerment Index.  Photo: Consumers International

Pillars of the Global Consumer Protection and Empowerment Index. Courtesy image via Consumers International.

The average global score for the index was only 53/100, which shows that we do not provide consumer protection and empowerment. But encouragingly, our results show where we can focus and build across the five core areas of consumer protection and empowerment.

  • Consumer protection must be the core of business regulation. This means a systematic approach to ensuring that at every step of a consumer’s journey they have the tools and knowledge they need. Almost half of the countries have not yet had a constitutional provision on consumer protection.
  • A knowledgeable and informed consumer is more likely to buy well. Information for consumers must be easily accessible, clear, transparent and reasonable in their presentation. A Deloitte survey of 2,000 consumers in the United States found that 91 percent of people accept legal terms and conditions of service without reading them.
  • There must be global complaint systems as more people shop online and internationally. By 2021, 2.14 billion people were shopping online – over a quarter of the world’s population – which is politically unsustainable if left without security measures or with irregular protection. Therefore, access to justice, like transactions, must be valid across borders and jurisdictions.
  • It is also important to ensure that consumers’ buying choices do the least harm to our planet. Our research from 2020 showed that only 19 percent of the rated labels provide consumers with quality information to make informed recycling and purchasing decisions. Consumers can not be expected to track the organic journey and supply chain for every purchase, but regulation, sharing of best practices and accurate labeling can help them make informed choices.
  • Rapidly evolving technology should also center consumer concerns. Doing so will ensure that tomorrow’s tools are guided by long-lasting principles.

Building partnerships

Future markets will need to evolve significantly to keep up with e-commerce and environmentally conscious consumers. Relationships cannot remain unbalanced, exhaustive and exploitative, as together with the current global challenges, consumers’ continued sense of powerlessness may force a radical destabilization of democracies and economies.

The good news is that there is a global infrastructure of consumer organizations to build bridges to government, business and others to place consumer protection and empowerment at the heart of business models and legal frameworks. Every day, our members work tirelessly using their local knowledge, skills, connections and often statutory rights to represent the government to do this.

In fact, our belief in collaborating with multiple stakeholders between consumer organizations, businesses, and government is why we have adapted our strategy to realize this alliance. Therefore, our door is open to anyone who wants to work with us so that we can help deliver a safe and sustainable world from which we all flourish.

William

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