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Consumer Choice and Food Policy. A Literature Review

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Environmental management

Consumer Choice and Food Policy. A Literature Review

A. Popaa, M. Draghicib, M. Popab*, P. Niculitab aNewcastle University, UK E-mail: [email protected] bFaculty of , University of Agronomic Sciences and Veterinary Medicine, Bucharest, Romania E-mail: [email protected]

Abstract. This paper is a product of a research national project that is examining the food consumer behaviour by analysing the drivers for consumption in Romania in order to develop marketing strategies useful to key players in the organic food market. The analysis of the existing literature review in this paper reveals a changing food culture that reflects today lifestyles and the society interests on environment and health related issues in the world. Where, when and what people eat are changing, though currently good intentions are not always translated into action. Consum- ers increasingly want food to be healthier and more ethical, as well as to taste good. Nevertheless, the demand is not increasing at the same rate, because there is a gap between what people do and what they say. At the same time, it is being argued that buying ethical food (organic food, fair-trade products and locally grown products) may do more harm than good, in the long-run, in terms of environment-nutrition-health relationship. Keywords: ethical food, food policy, consumer choice, environment-nutrition-health relationship.

AIMS AND BACKGROUND The food market in Romania is changing. Like in the rest of the world, the Roma- nian food consumer is becoming more health and environmental conscious than ever before. Nevertheless, the demand for healthy and environmental-friendly products is lower than European average. The present paper is focusing on consumer choice of ethical food, the demand for ethical food products, and the implications for food policy. By reviewing the available literature, we were able to identify possible approaches for the Romanian food policy and topics for which further research is needed.

* For correspondence.

708 EXPERIMENTAL METHOD In order to identify the trends in demand for ethical foods and, also, the changing food culture both at international and national levels, a systematic literature review was undertaken. The literature search was largely conducted on English language articles, but also included articles in Romanian. From the literature review, complexity of ethical food definition, arguments for and against three groups of ethical foods (organics, fair-trade and locally produced), market trends and food policies on the subject were identified. Furthermore, both behavioural changes in the food consumer and the characteristics of an ethical consumer were identified. In the subsequent sections, we elucidate the relationships and trends shown by the ethical food sector, looking at ethical food from a consumer choice perspec- tive, and the changes of food consumer behaviour. Possible implications for food policy makers in Romania are also identified.

ETHICAL FOODS Ethics is a science of moral acting, in a sense of good living, fair acting, and an aptitude to make reasonable decisions and judgement. The mission of ethical norms is to give orientation, without obliging, because it is the food chain stakeholders own initiative to act morally. Without this personal motivation and responsibility, standards and regulations guided by ethical dimensions would not be significant to society1. Organic, fair-trade and local foods are considered to be ethical foods because of their common values: better, healthier living, fair acting, and sustainability. The organic food and farming principles are based on the values of health, ecology, fairness and care2. The European Commission defines as ‘a system of production based either on no use, or very limited use, of artificial fertilisers, synthetic , growth regulators or hormones, and livestock feed additives. Instead, organic production methods utilise agronomic techniques founded on the rational use of natural resources, such as crop rotations and intercropping with nitrogen fixing legumes, animal manures, green composts, biological pest control, pest- and disease-resistant plant varieties and other techniques’3. The European Commission acknowledges the potential of organic food and farming and sees it as a priority by establishing an European Action Plan for Or- ganic Food and Farming. Several studies showed that organic agricultural meth- ods contribute in preserving food security and facing climate change, thanks to its reliance on fossil-fuel independent and locally-available production assets4–6. However, the implications of a reduced agricultural productivity for the socioeco- nomic system should be considered and suitable agricultural policies worked out7.

709 This could be solved by means of appropriate ‘eco-functional intensification’, i.e. more efficient use of natural resources, improved nutrient recycling techniques and agro-ecological methods for enhancing diversity and the health of soils, crops and livestock6. Hence the need to look at organic as systemic in terms of the whole food chain approach8. The organic lifestyle implies authentic food, better quality of life, improved health and immunity, promoting foods of vegetable origin6. There is an aversion of committed organic consumers to all aspects of genetic modification. Besides ethics, this particular issue has very far-reaching implications as to whether organic and GMO-using conventional systems can even coexist in the same area, due to the great distances that pollen can be dispersed by wind and bees8. Consequently, organic has regulations to ban the use of GMO (Ref. 9). Nanotechnology is currently unregulated, and nano-products are not required to be labelled. There is an opportunity for the organic community to take the initiative to develop standards to exclude engineered nano-particles from organic products. Such a step will service both the organic community and the otherwise nano-averse consumers. An exclusion of nanotechnology from the organic food chain keeps faith with the philosophy and principles of organics, serves as a precautionary act to protect organic consumers, processors and farmers, and there is the opportunity to attract a new cohort of consumers to organics – the nano-averse10. The core challenge to the pioneer organic farmer and consumer groups, which remains to this day, is that it was, and still is, not possible to test a product organic integrity by measurement or analysis8. Therefore, organic foods have a strong credence element and they rely on certification and labelling schemes11. As the organic industry continues to grow in volume and profile, so too does the resistance to the industry by vested interests, aided by the sensationalist media. Information and misinformation concerning the quality and safety of organic foods is being conveyed to consumers via the mass media and the Internet. Reducing opportunities for critics can be accomplished through rigorous organic product quality control and ensuring that the advertised product benefits match the actual product attributes12. ‘Going local’ is a movement that promotes local development sustained by local consumers. There is a growing interest in sourcing local food products. Com- munity Supported Agriculture (CSA), a good practice example of USA marketing strategy where consumers buy ‘shares’ in the farm before planting begins and receive a portion of whatever is available each week of the growing season. Along with weekly deliveries of fresh produce, group involvement has led to social and nutritional benefits for CSA customers13. In this growing trend towards empower- ing local economies, organic agriculture will play an important role. It is low-risk and high-value agriculture with an excellent tracking and tracing system, and its

710 principles and added value are easy to communicate to other actors and partners in rural areas. Organic farmers are especially good at using direct sales channels such as local farmers markets, farm shops, house delivery and Internet marketing. Organic food culture has the potential to be the driving force behind a sus- tainable, natural and healthy lifestyle6. Another important aspect of an increased demand for locally grown products is related to decreasing food miles, thus helping to lower the environmental impact of food transportation. A reaction to exploitation of the Third World farmers and small producers has been ‘fair trade’. Organisations like the Max Havelaar Foundation, Transfair, and the Fairtrade Foundation have established standards and provide inspection and certification services for fairly traded products8. The International Federation of Organic Agriculture Movements (IFOAM) incorporate ‘social justice’ provisions in their standards for organic agriculture and processing, to require fundamental fair trade principles9. Fair Trade is a trading partnership, based on dialogue, trans- parency and respect, that seeks greater equity in international trade. It contributes to sustainable development by offering better trading conditions to, and securing the rights of, marginalised producers and workers14,15. Fair trade initiatives give consumers the opportunity to contribute towards sustainable economic and social development in developing countries through their purchasing preferences and constitutes a tool for consumers education toward consumption habits that are more respectful for the environment and the people16,17. Industrial production imposes geographical, economic and cultural distances between producers and consumers. Hence most of the consumers are not aware of their impact on the environment, the Third World development or even local economy. Often methods such as eco-labels or recycling pamphlets are ineffec- tive because consumers are not motivated to use the information, or work under pressures of finite time, resources and cognitive capacity. The missing objects are means of capturing and communicating data in acces- sible forms. By constituting missing objects – representations, tools, practices or artefacts that stand in for something that can not be easily experienced or envis- aged – people can speak about things that they previously could not. The concepts of food miles18, ecological footprint19, ghost acres, shade coffee20 or carbon label21 are all examples of missing objects. If people can not only see the effects of their consumption, but also compare them with other people and observe what alterna- tive actions can do, they are more likely to act18.

CHANGING FOOD CULTURE People are more informed, have stronger voices, and have easier access to infor- mation and expertise. Following broadcast and print, online media ranks third in importance of opinion influence among all consumers, globally. Despite the ‘modern’ consumers demand for more information, consumer confidence in in-

711 formation is relatively low in some parts of Europe22. Consumers in general feel confuse because too much information, mixed or contradictory messages. They need help with viable selection criteria and support from public authorities (through food and nutrition policies) and from the private sector (through corporate social responsibility programmes). At the same time, they like to have a choice when going shopping. Ethically speaking, they should act morally by their own initia- tive; they should get involved23 in sustainable development because it is the right thing to do. In his speech on Discussion on Agriculture and Food, on the 21st September of 2001, Dr. Franz Fischler, Member of the European Commission responsible for Agriculture, Rural Development and Fisheries, stated that: ‘It is not necessary to discuss on end which way of production is better, or whether organic food is better than conventional food. Let the consumer choose! We have to guarantee, however, that the consumer has the choice. We have to introduce a labelling system that clearly shows what a product contains. And again the national control authori- ties have to guarantee that the producers observe the labelling rules.’24 However, labelling in most West European countries is already a ‘burden’ for the consumers. There is a need for clearer and simpler design of information on labels. Consumers values to make a choice for ethical food can be seen from two perspectives – personal use values, such as utility from taste, health and freshness, symbol for owns self-concept, and social use values that are public good values related to improved environment, local communities, trade conditions and animal welfare. Most of the consumers value both personal and social use values. Consumers values, priorities, perceptions and attitudes towards food choice are affected by global changes in terms of6,25: increase level of nutritional malfunction, childhood obesity and other diet-related diseases, lack of time, high level of stress, lack of knowledge and awareness of food, small households, rising gross domestic product (GDP) and energy costs, food safety, and the quest for variety, novelty, premium and ethics. Therefore, the demand for convenience foods, simplified and unbalanced diets, fast food and low price community catering in schools, canteens and nurseries has increased. Nevertheless, the same thing happened with the de- mand for food that is health-boosting, low in ‘bad’ ingredients, and/ or ethical. European consumers consider not only price, but also quality, when purchasing food26. In Romania, apart from economic factors (price and income), non-economic factors such as habit, quality/freshness, taste and family members preferences were reported by consumers as the most important to impact on their food choice27. Ro- manians have experienced substantial changes in their diets and significant annual variation in levels of consumption of individual products28. A.N.P.C.P.P.S. Romania, one of the partners in the CONSUMECO project, conducted a quantitative research among Romanian consumers during the first stage of the project.

712 The main findings of the study were related to the consumers perceptions of organic foods. Thus, from the Romanian consumer perspective, organics are natural, environmental friendly, GM-free products with no chemicals that use natural fertilisers, a special certified production process, in a clean environment, on an organic farm. In addition, organic foods are perceived as premium priced high quality products. Uncertainty regarding the true attributes of organic, and scepticism about organic labels, part of which stems from reported cases of (inadvertent) mislabel- ling, and product misrepresentation, and partly because of non-uniform organic standards and certification procedures, may hold some consumers back from purchasing organic. The proportion of consumers who are willing to pay a price premium for organic food decreases with premium level. Yet concern for human health and safety motivates consumers to buy organic food as insurance and/ or investment in health29. There is evidence that the situation remains the same when both ‘organic and fair trade’ labels30 are used, while ‘organic and local’ foods have a better image on the market31. Also, a market opportunity may arise when informed people also know about residues and take actions to reduce their own intake, buying organics32. Recent research results indicate that organic consumers have a healthier diet than other consumers. This suggests that there might be a positive relationship between organic consumption and a healthy lifestyle33. Market studies give evidence that the growth of organic consumption relies much more on occasional consumers than on exclusive ones, revealing a ‘nor- malisation’ in which organic food is incorporated into mainstream, standardised, high-volume distribution and stops being seen as a niche market34,35. Research unveiled a gap between what consumers say and what they actually do. These results should be regarded when interpreting and designing consumer surveys on buying organic products36,37.

DISCUSSION For the moment, organic agriculture remains a niche on the global level38. Never- theless, the market for ethical food in Europe has expanded rapidly in recent years. Organic farming responds to consumer demand for high-quality food delivered with minimum environmental impact. Fair trade responds to consumer demand for a reaction to exploitation of the Third World farmers and small producers. Local foods deliver benefits in terms of rural development and environmental impact39. Central and Eastern European countries (CEECs) have seen a steady decrease of in-conversion area, which limits the potential for further growth. Moreover, other supporting measures (mainly demand-pull), such as support for marketing initiatives, promotion, professional advisory services, education and research

713 and development (R&D), are needed for the stimulation of more market-oriented production40. The main barriers to organic food consumption growth in CEECs are low availability of organic food in the sale channels, high prices for organic prod- ucts, related to the undeveloped nature of organic markets in Central and Eastern European New Member States (CEE NMS). Further development of the organic sector in CEE NMS will contribute to the growth of organic food consumption by overcoming the above-mentioned supply-related barriers. Nevertheless, to increase the consumption of organic food, many efforts needed to communicate the benefits of organic food and farming to target potential consumers. Lowering the prices of organic food in CEE NMS will not enlarge the market if there is no coherent long-term strategy to communicate various attributes associated with organic food and organic farming. There is no research that characterises organic consumers in CEE NMS and there is a need to learn more about CEE NMS organic consumers emotions, cognition and behaviour to develop effective marketing strategies41. Organic agriculture in Romania has, mainly, a subsistence character, being also less technology intensive. The agricultural efficiency is low, compared to western countries, but the sector has a strong growing tendency and an excellent potential. So far, this potential was exploited for export, mainly for mature markets, like Germany or Austria, the national demand for organics being low. Production is primarily organic hay and other feed crops, cereals, honey, sunflower oil and organic milk. Distributors estimate that 10% of final organic products produced in Romania are consumed domestically. With less than 0.01% of the products consumed in Romania being organic, compared with 3–4% within Europe, growth is inevitable. According to Natura Land the demographics of the organic product consumers is 25–39-year old, urban, and educated (and 70% fe- male). The net income level of average organic product consumers starts at 3000 RON (1215 USD). As the Romanian middle class expands more consumers will enter this economic-demographic segment42. It is often claimed that consumers will soon vote with their trolleys, balancing price against quality and sustainability parameters43. Ethics aim to find a supreme and reasoned principle, which is qualified to assess and rank values, norms and aims and if necessary, to add them into new perspec- tives; which finally to contribute to an optimisation of humans (and nature) living together in harmony1. In this case, the supreme principle could mean sustainable development. Efforts in the education and training sector are important as they lead to the practice of ethical values along the whole food chain.

CONCLUSIONS The literature review findings revealed that public and private institutions have to set up clear definitions, standards, policies and strategies on ethical foods and

714 sustainable development. In this way, consumers food choice would become easier, the information asymmetry would decrease and their role in sustainable develop- ment would become clearer. Hence the demand for ethical foods would increase. If consumers get mixed messages from policy-makers and stakeholders, their level of involvement and motivation will decrease Consequently, there are several research questions that need to be addressed through further research: • Are Romanian consumers health and environment-conscious enough to be willing to pay premium prices for ethical foods? • Is sustainable development achievable in times of recession, considering Romanian consumers trade-offs? • Could an increased demand for ethical foods support sustainable develop- ment or will ethical foods remain niche products? • ‘Organic, local and fair’ product – is this 3 in 1 concept of any value for Romanian consumers?

Acknowledgements. This paper is a review of the state of the art description task delivered in the first stage of the national funded project CONSUMECO – Research concerning the elaboration of a comprehensive behavioural model of organic agro-food products consumption for development of new marketing tools and methods useful for enhancing of Romanian producers competitiveness, Ctr. PN II 92075/2008. The authors gratefully acknowledge the support of Dr. Hubbard who contributed to this study by commenting on the draft paper arising from the literature review.

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