Why are companies hiding their sustainable credentials?

By Niamh Michail

- Last updated on GMT

Why would a company seek certified sustainable status - and then try to keep that under wraps?
Why would a company seek certified sustainable status - and then try to keep that under wraps?

Related tags Palm oil Sustainability

A sustainable logo is known to add value to a brand – so why are so many manufacturers not showing their Fairtrade, organic or sustainable credentials?

Eco-labels make food taste better​ and consumers feel better about themselves. They boost a company's image and consumers are willing to pay more.

And yet despite these benefits, only around half of total RSPO certified palm oil is sold as certified sustainable according to a report​ by the International Institute for Sustainable Development (IISD), while just 35% of cocoa​ certified by the Rainforest Alliance, UTZ or Fairtrade bear a certification logo.

For sugar the figures are even lower – in 2012 only 16% of certified sustainable cane sugar was sold as such, said the Food Climate Research Network (FCRN​).

But why would companies go to pains to certify a key ingredient and then not inform their consumers?

Keep a premium price

With price premiums for certified cocoa sitting at 5% for UTZ certified cocoa and 18% or more for Organic cocoa according to IISD, manufacturers may choose to communicate sustainable credentials for a select few products only - allowing them to market those brands as upmarket and niche and up the price tag.

Andy Harner, global cocoa vice president at Mars Chocolate, told our sister publication Confectionery News that the idea of sustainability needed to resonate with the brand and its target consumers before adding a logo.

No choice?

But European director of outreach and engagement at the Roundtable on Sustainable Palm Oil (RSPO), Danielle Morley told FoodNavigator that in the case of palm oil logistical complexities were to blame.

[It] is caused in part by the logistical complexity of the palm oil supply chain, which means that supply and demand are not always in sync and in part by a lack of industry commitment in certain consumer markets to sourcing and paying for certified sustainable palm oil.”

Meanwhile Nicole Pasricha, sustainable value chains manager at the Rainforest Alliance said that its logos were protected by strict guidelines and sometimes manufacturers didn't have the right to use it. For instance, the Rainforest Alliance seal could only be used if the certified ingredient was a ‘core ingredient’ – such as vanilla in vanilla  ice-cream – or if it made up at least 30% of the total product. Some products, such as Clif bars, used Rainforest Alliance certified palm oil but did not qualify for seal use, said Pasricha.

The FCRN report suggested yet another reason – that manufacturers weren't looking to conceal the sustainability of the ingredient – but rather the presence of the ingredient itself.

Chocolate manufacturers can be wary about putting the RSPO logo on a product because it draws attention to the presence of palm oil as an ingredient; a presence that is associated with poor quality and health concerns.”

Or no interest?

Meanwhile for other commodities, such as sugar, it could be that consumers did not associate the product with unsustainable sourcing – meaning there was no demand for certified a supply.

“The relative absence of any major news media coverage on sugar sustainability issues in recent years may result in reduced downstream demands for compliant production,” ​wrote Tara Garnett, lead author of the FCRN report -  although this may change as Bonsucro’s partnerships with high profile companies such as Coca-Cola, Cadbury Schweppes and Bacardi raise the profile of sustainable sugar.

Garnett also suggested that in some countries sustainability issues simply do not resonate with consumers – such as India and China which are the top two palm oil importers in the world – so manufacturers don’t bother adding it to a product’s packaging.


Meanwhile, at the other end of the spectrum, it could be the exact opposite problem  – that Western consumers are suffering from eco-label fatigue. A 2012 report​ identified fragmentation, consumer confusion and a lack of consensus on qualifying criteria as a great challenge to the survival of eco-labels, and called for standardisation of eco-labels to address a saturated market.

And with some of the world’s biggest confectionery manufacturers – Hershey, Mars and Ferrero – pledging to certify 100% of their cocoa from certified sources by 2020, perhaps this standardisation of sustainability will further reduce the need for companies to communicate their efforts.

Related topics Commodities

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