Davos Agenda

Consumers are key to tackling the global crises – let’s work with them

Consumers increasingly want to be active agents of change in the energy, food and climate crisis.

Consumers increasingly want to be active agents of change in the energy, food and climate crisis. Image: Freepik

Helena Leurent
Director-General, Consumers International
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Davos Agenda

This article is part of: World Economic Forum Annual Meeting

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  • Global shocks have led to consumers facing huge price hikes in their food and energy bills.
  • The cost of living crisis has highlighted the widening inequalities gap post-pandemic.
  • The public and private sector must work with consumers to find sustainable solutions.

We are all aware of the worrying statistics emerging from the twin shocks of COVID-19 and the war in Ukraine, both on economy and society. But what does this actually mean for consumers worldwide? And as leaders discuss how to address our current crises, how can consumers become involved in the solutions?

In a recent survey with our global members looking at the impact of the rise in food, energy and finance costs an astonishing 92% of our members said that people in their countries are adjusting their budgets to pay for food – some even going without. When asked how rising prices had impacted consumers, 68% said household debt had increased and 59% that access to healthcare had been affected.

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The crisis is not simply a problem at the margins, nor is it affecting those traditionally thought of as most vulnerable. It has shown that provision structures are broken – a rethink is needed and it is important that everyone has a role to play in that – including consumers alongside government, business and others.

The case for a consumer centric approach is ever more important now for two reasons. One, consumers increasingly want to be active agents of change in the energy, food and broader climate crisis. Our research on solutions to the cost-of-living and climate crisis found 78% of our members calling for sustainable food production and 68% for energy.

Two, leaders now recognise how important consumer action is in meeting the climate crisis. For example, the latest Intergovernmental Panel on Climate Change report showed that demand-side changes could reduce greenhouse gases by up to 70% in 20 years’ time.

We must grasp the window of opportunity we have to build with and for consumers. By doing so we can meet both the cost-of-living crisis and build a sustainable and inclusive marketplace. To explain this we can look at the concrete ways consumers can be brought into energy and food systems solutions.

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How is the World Economic Forum promoting responsible models of consumption?

Food systems that work for all

Between this July and September we brought together key players from across business, local and national government, consumer groups and civil society in Kenya, Indonesia and Ecuador to explore how we can build better food systems at home and to share lessons for others elsewhere. In particular, we found an overdependence on cheap food imports has flooded many national markets, forcing out local producers. This creates an unsustainable market, volatility when global prices rise and a lack of healthy choice for consumers. Consumers are now heavily paying the price – literally and figuratively – for the market dominance of suddenly insecure imported crops.

The solutions need to focus on short- and longer-term measures – inclusive of the consumer voice. This means emergency support for the vulnerable but also addressing systemic supply chain issues with countries adopting (and where need be) being supported to adopt more diverse, sustainable and local agriculture. It also means developing inclusive governance frameworks – hearing the voice of the consumer and a diversity of other voices in the discussion.

An action agenda for future food systems. Source: Consumers International.
Consumers are now heavily paying the price – literally and figuratively – for the market dominance of suddenly insecure imported crops. Image: Consumers International

This is not the kind of immediate response that many governments are reaching for, but in the long term it will do far more to empower consumers, help local farmers, meet climate goals and long-term stability. Too often those who wish to delay such progress conflate scare tactics on price with consumer rights. But our research shows that protecting consumers and their rights is actually an essential part of any just transition and will save consumers money.

Consumer-led just energy transition

The reality of the energy crisis has meant consumers either going without essential heat or cooling are taking risks to keep their head above water. Around 81% of our members shared that consumers in their countries are adjusting budgets to pay for energy. The crisis is also causing a major shift in the energy world – previously unlikely governments such as India are now making commitments towards clean and secure energy systems to help meet both economic and climate goals.

Whilst this shift is encouraging we must not forget to put people at the centre of energy transitions – supporting them to deliver change at the pace and scale required to avert both the climate and energy price crises. This means government and business adopting measures which make it easy for people to take the low-carbon option.

For example, heat pumps could provide a simple, important change that would be safer, cheaper and more sustainable for those living in cooler climates and which could save consumers up to 31% on their fuel bills compared to conventional heating. A win-win for consumers and the planet. But not nearly enough information is currently being provided to customers about them, preventing a barrier to their adoption.

Our latest research calls for concrete measures to empower consumers in clean energy transitions. Not only do we call for better information to consumers on the low-carbon options but the marketplace needs to provide affordable, available and safe options. Barriers need to be removed so consumers know where to invest and how to install new systems and emerging technologies to create sustainable homes for example. Finally effective repair and redress will be the bedrock to consumer confidence in the options available.

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Davos’s theme this year is “cooperation in a fragmented world”. It would take a certain level of naivety not to see that fragmentation. But there are also deep pockets of hope to be found everywhere as leaders develop solutions. New systems thinking is emerging and unlikely players are rapidly shifting – the key now is to ensure all the key actors are involved – including government, business and consumer advocates.

In recent years these consumer groups have provided essential support to consumers feeling the pain of global crises. They have shown their ability to think smart, run innovative initiatives, provide trusted advice to the most vulnerable, share solid evidence and make grounded advocacy calls. They must have a seat at the table.

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