On Friday I went to the launch of the Sustainable Consumption Institute’s report, ‘Consumers, business and climate change’. The conference had an impressive line up of speakers, including the CEOs of Tesco, Coca Cola, Unilever, SC Johnson and Reckitt Benckiser, as well as the chief executive of WWF, Robert Putnam (the academic who brought the idea of social capital into mainstream thinking) and David Cameron, leader of the Conservative Party.

During a panel debate, those representing the consumer products industry agreed that consumer demand for sustainable products is going to be their major concern over the next decade. The CEOs outlined the measures their companies are taking to meet this rising demand, including new packaging from Coca Cola that is made partly of plant based material, and Tesco’s new ‘Buy one get one free – later’ initiative (see ‘Tolkien tackles food waste?’, 20 October, 2009).

In keeping with the theme of the conference, the speakers all agreed that consumers hold the key to a low carbon economy. The SCI’s report concurs, stating that the millions of choices made by consumers every day have the power to cause a more rapid reduction in carbon emissions than government action alone.

So if business is the lock and consumers hold the key to a low carbon economy, what will be the role of government? David Cameron thought that government telling consumers what to do will never work and, with regard to business, he emphasised “cooperation, not coercion.” Similarly, the overall message from the industry leaders was that business, rather than government, is best placed to respond quickly to the challenges of climate change and should be left to innovate freely in this regard (this prompted a heroic riposte from the legendary Professor Putnam, “in defence of government”, as he put it). So should government take a back seat?

The answer to this question comes partly from the CEOs themselves. SC Johnson’s top man described how one of their best selling packaging brands (Saran wrap) is about to come off the market: in a bid to be environmentally responsible, SC Johnson removed the chlorine from the plastic wrap, but consumers are not buying the new, thicker, more expensive product. The other CEOs agreed that they too often find themselves waiting for regulation to provide a level playing field, because innovating alone has a poor outcome.

The fact is, consumer choice is limited to the available options, and businesses will only ever provide choices that are economically viable. Perhaps the role of government is to help shape the framework that determines (a) the choices that are available and (b) what makes sense to consumers and businesses. Climate change is, as Lord Stern says, “the greatest market failure the world has seen”. Where markets fail, governments must step in to reset the rules of the game. In this case, that means ensuring that the sustainable choices are also the most economically viable choices. The transition to a low carbon economy will depend not just on consumers, but rather the co-evolution of consistent responses from civil society (both individuals and groups), business and government.