‘Conscious Badges’: Klarna adds labels flagging sustainability credentials of electronics

Klarna has partnered with Clarity AI to develop and add the so-called ‘Conscious Badges’ in the Klarna app, which is used by 26 million people globally.

Electronics brands can earn up to five badges, with each one pertaining to a different environmental sustainability focus area – low direct greenhouse gas emissions, low indirect greenhouse gas emissions, climate commitments, climate-related disclosures and renewable energy procurement.

Brands earn the renewable energy badge if they report that at least 90% of their annual energy use is met using renewable sources. The climate commitment badge, meanwhile, is for companies with verified emissions reductions goals aligned with the Paris Agreement’s 1.5C trajectory.

To earn the badges relating to low direct or indirect emissions, a company must be among the top 10% of Clarity-AI-tested firms for emissions.

Klarna has stated that the intention of the feature is to provide shoppers with “more comprehensive metrics” at “the touch of a button”. It is unclear whether they will influence customer decisions as, at present, they are only accessible after purchase. The badges will appear on the transactions details page of the Klarna App.

“We believe there should be nothing ‘black-box’ about metrics, and we’re excited Klarna can leverage our AI capabilities to provide detailed information for Klarna shoppers who want to know more,” said Clarity AI’s head of product and board director Angel Agudo. Agudo described the badges as the first of their kind.

Klarna notably launched similar ‘Conscious Collections’ badges for fashion brands in 2022, partnering with Good on You to develop them. Good on You ranks fashion brands on their environmental impact, ethics and governance and animal welfare policies.

More broadly, Klarna provides product-level emissions data for almost 60 million products across a range of categories, covering lifecycle emissions.

Whether the ‘Conscious’ label for electronics and fashion badges will stand up against intensifying efforts to combat greenwashing is debateable. H&M Group is currently the subject of two lawsuits – one in the US and one in Sweden – over concerns that its environmental product labelling is misleading customers. The retailer has been offering dedicated ‘Conscious Collection’ lines for several years.

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