OECD - MIT Experts Seminar on Sustianable Consumption and Production Patterns

ORGANISATION de COOPÉRATION ET DE DÉVELOPPEMENT ÉCONOMIQUES (OCDE)

ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT (OECD)

EXPERTS SEMINAR ON SUSTAINABLE CONSUMPTION AND PRODUCTION PATTERNS

Massachusetts Institute of Technology

Cambridge, Massachusetts, U.S.A.

18 - 20 December 1994

SUMMARY REPORT

Background

1. The issue of sustainable consumption and production patterns is now high on the international environment and development agenda. At its 1994 session, the UN Commission on Sustainable Development called for the elaboration of elements for a possible work programme in this area. It is generally accepted that the developed world will have to take the lead in making the necessary changes, and the CSD noted the important work of the OECD in analysing trends and outlining effective policy approaches to the issue.

2. To help define its future activities on sustainable consumption and production and to contribute to the 1995 session of the CSD, the OECD held an international Experts Seminar, in collaboration with the Massachusetts Institute of Technology (MIT) from 18-20 December 1994. The seminar brought together 70 participants from OECD Member countries, the European Community, the UN system, business, non-governmental organisations, and the academic world. The meeting examined both the conceptual foundations for action on sustainable consumption and production and the implications for policy making. It focussed particularly on the US energy sector as a case study of ways to approach the issue.

Setting the Sustainable Consumption and Production Agenda

3. Although the issues involved in sustainable consumption and production patterns are not new, it is only recently that governments, business and NGOs have focused on it as a strategic goal, and a crucial element of the broader sustainable development agenda. The meeting noted that substantial progress had already been made since UNCED. The North-South tensions that marked the negotiations of the Agenda 21 chapter on Changing Consumption Patterns have now given way to a more pragmatic debate, with a positive recognition by OECD governments and business that changes can be made to consumption and production patterns in ways that sustain standards of living and enhance competitiveness and economic performance.

4. There was general agreement that sustainable consumption and production provides a useful umbrella concept for integrating environmental and economic factors, particularly on the demand-side, thereby complementing the traditional supply-side focus of environmental policy-making. However, greater precision in the definition of key terms is still required, as well as a need to distinguish between both unsustainable and sustainable behaviour and between levels, patterns and rates of change of consumption. There was general support for focusing on the end-use consumption part of the equation, and moving back up the supply chain to address the life-cycle environmental impacts of particular consumption patterns. The aim should be to provide the same or better services for consumers, but with continually reduced environmental throughput, wastes, and damage.

5. It was also recognised that individuals and households are not the only end-use consumers, and that both business (through supplier policies) and government (through public procurement policies) can exert considerable pressure to change patterns of consumption. The interconnections between the supply and demand sides also require careful scrutiny.

6. What was significant about the approach to sustainable consumption and production that emerged from the meeting was the stress placed on highlighting opportunities rather than threats, and on broadening perceptions of individual responsibility and choice rather than narrowing horizons. Underlying this was a recognition of the critical importance of understanding the social, demographic, economic, cultural and technological forces which drive patterns of consumption. There was a general call for far greater clarity in the identification of the goals to be achieved in specific policy areas (such as energy, transport, waste and products), although there was some sympathy with the proposition that sustainability is an inherently vague concept. Part of the follow-up task lies in exploring the full ramifications ('ideological rucksacks') of critical concepts such as 'environmental space', which have now entered the policy arena.

7. Looking at the energy sector in the USA, especially at end-use, it was apparent that there are a number of potentially conflicting trends at play. Reduced energy intensity in the manufacturing sector and important energy efficiency gains in automobiles and household appliances have been offset by growth in transport volumes and increasing demand for household electricity. At the federal level, Clean Air Act amendments, the Intermodal Surface Transportation Efficiency Act, a new Energy Policy Act and the Climate Change Action Programme together provide a basis for tackling these negative trends. The US EPA has also launched a range of successful voluntary programmes to conserve energy (Green Lights for lighting, Energy Star for computers and Golden Carrot for refrigeration). There are concerns, nevertheless, that the progress in energy conservation achieved through demand side management (DSM) measures could be threatened by the forthcoming deregulation of the utility sector. Nationally, the President's Council for Sustainable Development (PCSD) acts as a focus for involvement of all sections of society, and has convened specific task forces on eco- efficiency and on population and consumption. Significantly, equity considerations have to be integrated into all aspects of the PCSD's work, and there was a call at the meeting for a 'new social contract' to underpin US policy action for sustainable development.

8. Discussion at the meeting pointed to a number of critical obstacles to progress on sustainable consumption in general, as well as in specific sectors. The environmental impact of consumption issues remains largely invisible to consumers: considerable work is required to collect, analyse and communicate relevant information to the actors involved to help them make informed decisions about what they consume. Furthermore, traditional policy actions to encourage changes in consumer behaviour through awareness raising and modest financial incentives have had limited success. As a result, more attention needs to be given both to the physical infrastructures that currently constrain consumers into making unsustainable consumption choices (eg transport) and to the community networks that can support changes in consumer habits (eg Global Action Plan's Eco-team approach). There was recognition of the gains made to date, and to the increased sophistication and awareness of consumers.

9. Although the main focus of discussion was on the OECD region, the need to address the interests of developing countries in both policy analysis and action was a running theme throughout the meeting. In particular, the potential impacts of measures taken by OECD governments on developing country prospects for sustainable development need to be assessed and taken into account on a systematic basis.

10. Traditionally, environmental measures, such as eco-labels and packaging requirements, have focused mostly on domestic priorities, by-passing the "NITBY" (Not In Their Back Yard) issue. This is no longer adequate in a globalising economy, and particularly in areas where policy harmonisation is at issue. This presents a new challenge for development cooperation policies, in particular to identify the public sector component of investment strategies needed to support moves towards sustainable consumption and production in developing countries. There is potential for technology "leapfrogging" to help avoid some of the environmental damage associated with development patterns common in the industrialised world, whilst not missing out on the benefits of increased economic prosperity.

11. Action by governments is only one lever for change, however. Leading corporations are attaining new efficiencies and market advantages from incorporating environmental quality and stewardship criteria into their product policies. The private sector is also now the major source of external investment and technology transfer into emerging economies, and the setting of global environmental standards by international corporations is helping to provide a role model for developing country industry. The consumer movement has also influenced change by testing products for their environmental impact, educating consumers, advocating the consumer interest and carrying out research into issues such as product durability.

Tools for Changing Consumption and Production Patterns

12. Aligning OECD consumption and production patterns with the imperatives of sustainable development will require some rethinking of the traditional policy tool kit. The scope of the challenge also means that priorities must be chosen. Four policy priority areas were identified at the meeting:

(i) Extending Information Collection and Analysis: a better understanding of driving forces and consumption trends is required efficiently to identify appropriate targets for action and to provide a baseline against which to assess "unsustainable" behaviour. Better information collection and analysis is needed in a number of areas, including the differential environmental impact of OECD consumption patterns between households, regions and countries, and the differences in environmental impact between goods and services within the same product category. Lessons from country experiences in demand side management, eco-labelling and product policy would also be helpful. Governments should also assess the impacts on developing countries, and the effectiveness, of their policies to change consumption patterns. Internationally, one area of work could be the introduction of standardised methodologies for the application of life cycle assessment by policymakers.

(ii) Applying Tools for Modifying Behaviour: The meeting stressed the need to achieve synergies between regulatory, economic and social policy instruments. Comprehensive product policies using the life-cycle approach and communicating information to consumers will be a critical area for governments. A concerted effort is also needed both to introduce economic instruments so that prices reflect environmental costs, and to remove the existing range of perverse subsidies for unsustainable patterns of consumption. The importance of social instruments, particularly at the community level, to help change behaviour was underlined, as was the need for governments to incorporate lessons from the social sciences and marketing into public policy.

(iii) Measuring, Communicating and Improving Performance: As with other policy debates, clear indicators need to be chosen to measure progress towards more sustainable consumption and production. To start with, these can be "rules of thumb" setting the broad direction, which can then be progressively refined. Annual scorecards of government performance could be prepared as a model. NGOs could also develop their own yardsticks for judging progress (for example, the Urban Stress Index produced by the US Zero Population Growth organisation).

(iv) Generating Momentum through Practical Demonstration: The relative novelty of the international focus on changing consumption patterns means that attention should focus on supporting and publicising successful demonstration projects, followed by the development of policies for scaling up. In the USA, for example, the PCSD's eco-efficiency task force is developing demonstration projects for an eco-industrial park, chemical product stewardship, pollution prevention, and the automobile industry.

Follow-up: Towards an International Work Programme

13. In 1995 and beyond, the pace of work on changing consumption and production patterns will accelerate. In February 1995, the Norwegian Government will host a ministerial Roundtable on Sustainable Consumption and Production in Oslo. The roundtable will focus on changing end-use consumption in the OECD region, and will address the measures that governments, business and society needs to take to sustain long-term quality of life.

14. The results of the Oslo Roundtable will be presented to the April 1995 session of the CSD as ingredients for the proposed work programme. Currently, this work programme is likely to focus on four main components: identifying the policy implications of projected trends in consumption and production patterns; assessing the impact on developing countries on changes in developed countries; evaluating the effectiveness of policy measures; and monitoring performance. The Korean Government has also announced its intention to host a workshop on the issue during the second half of 1995, looking particularly at the issues facing developing countries. During 1995 and 1996, the OECD's Environment Directorate will establish a new work programme on changing consumption and production patterns, containing three elements: clarifying the concepts, theories and methodologies; analysing key trends; and identifying policy options, instruments and impacts.

15. In the private sector, the new World Business Council for Sustainable Development (WBCSD) has established a task force on sustainable consumption and production, which will look at issues of product design, durability and end use options, examining the links and interactions between government, consumers and corporate marketing. The International Organisation of Consumers Unions (IOCU) is focusing on researching optimal consumer strategies for repair, replacement, upgrading or recycling of consumer products, critical reviews of LCAs, and monitoring environmental claims in advertising. MIT continues to forge research programmes on framing technology development policies, to contribute to "new technologies" and to help shape new paths of change for developing countries, as well as forming intellectual partnerships with universities and research institutions in the developing and developed worlds.

Conclusions

16. The contribution of the Experts Seminar to the design and implementation of an "international work programme" can be summarised as follows. The meeting :

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