True Price

What is a True Price?

      The true price of a product reflects the visible as well as the hidden costs of its production, so called externalities. It is defined as the sum of the retail price and the unpaid environmental and social costs, like water use and underpayment.

A True Price analysis:

      • Measures and values the social and environmental externalities of a productMakes externalities comparable with the retail price by expressing them in montetary terms
      • Uses a standardized list and definitions of impact indicators for social and environmental externalities
      • Is in line with international developments in integrated reporting, e.g., the framework of the International Integrated Reporting Council (IIRC)

True Price

 

 

 

 

 

 

 

 

 

What we offer

  • Product scan
    An all-round analysis including a supply chain analysis, sector benchmark and an overview of the business case for improving a product’s impacts.
  • Supply chain analysis
    The analysis shows the financial, social and environmental costs throughout the supply chain of a product.
  • Sector benchmark
    The benchmark shows the average social and environmental costs of products in the sector at hand.
  • Improvement scan
    The scan identifies projects that can bring down the environmental and social costs of production.

For each analysis, we can include positive impacts on financial, social, environmental and human capital. We provide clients with visuals, graphs and charts with all relevant data.

How can you benefit from our services?

  • Reduce buisness risks
  • Identify profitable innovations that increase sustainability (reduce external social and environmental costs)
  • Communicate about impact internally and possibly externally
  • Drive innovation towards more sustainable products

Example projects

Tony’s Chocolonely committed to source cocoa with zero social and environmental costs in five years. Results of the True Price Scan show the social and environmental footprint of cocoa.

The study provided IDH and its stakeholders insight into the external costs of soft commodities cocoa, coffee, tea and cotton. Industry players can now use this information to reduce their costs with innovative projects.

The study provided Fairtrade International with a True Pricing of banana production to understand the hidden social and environmental impacts.