Revisiting the Promise of Carbon Labelling

Carbon labelling systems can inform individual and organizational choices, which potentially reduce the carbon footprints of goods and services. We review the ways labelling is conceptualized and operationalized, and the available evidence on effectiveness. The literature focuses mainly on how labelling affects retail consumer behaviour, but much less on how labelling affects the behaviour of the organizations that produce, transport and sell products despite preliminary research suggesting that the effects on corporate behaviour may be substantial even without strong consumer responses. We consider key challenges for carbon labelling systems related to standard setting, data collection and use, and label design. We summarize the available knowledge, identify key research questions and identify steps towards achieving the promise of carbon labelling.