Ecolabels in tourism: do they have a future?

Ecotourism certification’s (or ecolabelling) primary purpose is to indirectly minimise the environmental impacts of tourism or to ensure that tourism benefits the environment, by creating awareness in travellers with a view to influencing their behaviour, and specifically their selection of tourism products and services.

As such it is a market-driven mechanism designed to influence demand on the one hand by shifting responsibility for improving environmental management to individual travellers, and supply on the other, by being a potential source of competitive advantage to businesses and destinations.

The previous articles in this series (What are they and why so many? and Eco-colonialism or eco-protectionism?) may appear to have been fairly critical of ecolabels while attempting to give an overview of the debates that have raged about them. This does not necessarily mean that I do not regard certification as a useful and necessary tool in responsible environmental management - I do. But I do have a problem with the way in which it is positioned as a market mechanism and as a voluntary, industry-driven initiative. In this article I will attempt to explain why the belief that ecolabels are a source of competitive advantage to businesses is flawed (we already know that their ability to influence travellers' buying behaviour is negligible - thus far at least). I will also challenge the assertion that ecolabels should be voluntary - i.e. private sector - initiatives.

Examples of ecolabelled products in Africa

Kenya's Eco-Rating for lodges and camps

Bronze: Olonana (Masai Mara Reserve), Tortilis Camp (Amboseli National Park) , Kicheche Mara (Masai Mara), Cottars 1920s Camp (Masai Mara).

Loisaba (Laikipia), Elsas Kopje (Meru National Park)

Heritage Environmental Rating

Gold: Bakubung game lodge, Pilanesberg National Park, South Africa.

Fair Trade in Tourism South Africa

Djuma Game Reserve, Singita and Sabi Sabi Private Game Reserve (all in Sabi Sand Game Reserve), Umlani Bushcamp (in Timbavati) and Singita Lebombo (in Kruger National Park)

Ecolabels may influence consumer behaviour if there are a few recognisable, perhaps regionally dominant ecolabels. So for southern Africa, for instance, a single, recognisable, independent, credible ecolabel that can readily be associated with the subcontinent may indeed help travellers select travel products in the desired way. That ecolabels should be credible and independent is self-evident, but the sheer number of ecolabels is perceived by critics to be a critical impediment to their recognition and acceptance.

Furthermore, it can be argued that the ultimate state of an ecolabel - for it to have been completely successful - is for it to "paint the earth", or at least a region. Once all products and destinations have been "ecolabelled" it means that those that failed to meet the qualifying criteria are no longer around and that only environmentally responsible products have survived. The "paint the earth" end state is unlikely, but it is useful in making the argument that follows.

Suppose that a few, dominant ecolabels established themselves. Would tourism businesses embrace them in order to gain sustainable competitive advantage? In my opinion - no.

Why? Because as any MBA will tell you, differentiation is the dominant competitive strategy in the generally low-margin tourism industry (the other generic strategies are: cost leadership; and a combination of cost leadership and differentiation while focusing on the target market segment). And being "ecolabelled" with a certification that is shared by every other business, including your competitors, is anathema to marketeers in pursuit of differentiation in the market. As my colleague, Lynton Burger rhetorically asks, drawing on his experience of environmental consulting to corporations: if 'green' is a differentiator, why share it with the world? Research in South Africa has shown that large hotel groups place more value on the effectiveness of their own brands in the marketplace, than that of a grading system (or, one can assume, an ecolabel). Gradings, ratings and labels that everybody else can qualify for amount to effective "commoditisation" of products - in the eyes of businesses.

Recommended Reading

The Corporation: The Pathological Pursuit of Profit and Power by Joel Bakan (from amazon) is a rational but frightening analysis of the dominant institution of our time. The idea of the socially or environmentally responsible corporation is challenged: corporations are amoral by design and single-minded in their pursuit of self-interest.

An Epler Wood Report: Stepping Up: Creating a Sustainable Tourism Enterprise Strategy that Delivers in the Developing World (.pdf file).

One can invoke the "corporate responsibility" argument to appeal to firms' sense of ethics, but by their nature and guided by the immutable laws of the marketplace, businesses are "unblinkingly committed to their own self interest" (see Recommended Reading). "Self interest" ultimately translates into strategies and tactics that benefit the bottom line, and in any well-run business that would mean actions that achieve sustainable competitive advantage (as in "commercial sustainability" - solely). Companies will almost certainly see the competitive advantage of developing their own ecolabels as company brands - ecolabels or brands that only they could have and use - rather than join a scheme that effectively commoditises their offering.

There are many other arguments to be made against ecolabels-as-competitive-advantage in the context of tourism industry structure analysis, such as the imbalance in power relationships between tourism businesses in the North as opposed to those in the South. I touched on some of these arguments in the Eco-colonialism or eco-protectionism? article.

When the private sector does throw its weight behind certification or ecolabelling, it is often as a defensive tactic to forestall regulation or to protect an industry by erecting barriers to entry. This is why ecolabels are "voluntary" and "self-regulatory" in most cases. It is common cause that the World Travel and Tourism Council (WTTC), "the forum for global business leaders comprising the presidents, chairs and CEOs of 100 of the world's foremost [travel and tourism] companies", created the original Green Globe certification scheme to avert regulation in travel destinations. The private sector leads and finances many of the larger schemes, but is also not averse to pressurising governments and state agencies to defer the implementation of certification in other cases when its self-interest is better served.

Yes. But the key to interpreting this conclusion is to understand that even though the tourism industry is dominated by the private sector, destinations, predominantly in the South where ecotourism mostly takes place, are generally owned and managed by the public sector. Governments and state agencies in the South should use ecolabels as a regulatory tool to achieve what ecolabels are meant to do - to help protect the natural environment from untrammelled tourism and to ensure that tourism benefits conservation. It comes as no surprise that governments generally support certification schemes, and in many cases, lead them. The public sector can use certification to exclude operators from activities, areas and destinations if they fail to meet the minimum standard.

This might sound like heresy from someone who is involved in private sector ecotourism, but I don't believe that environmental protection can be left to the market, however noble the intentions of voluntary ecolabels are. Nor can governments abdicate their responsibilities and expect NGOs and other civil society groupings to play watchdog - they don't have the teeth nor the wherewithal to take business on. State regulated certification is a tool available to governments to ensure responsible travel. It's not the only one, and it certainly isn't a "marketing tool".

This article is based on a research application entitled Ecolabelling, certification and accreditation: elements of a possible model for the ecotourism industry in southern and eastern Africa, submitted to Stellenbosch University in April 2004 by Ralph Pina (contact the author), chairman of ecoAfrica Travel, in partial fulfilment of an M Phil in Environmental Management. The application's references are listed here.