Voluntary Sustainability Standards Research Articles

Beyond aroma: A sustainability performance analysis of Italian coffee roasting companies

AbstractCoffee consumption is becoming increasingly prevalent among a growing number of consumers worldwide. Despite ranking seventh in coffee consumption, Italy is the global coffee export leader, with almost 1000 coffee roasting companies across the country. As a product subject to increasing interest in sustainability, numerous studies address the economic, social and environmental challenges affecting coffee production. However, only a few evaluate the sustainability performance of roasting companies in consuming countries. This study examines the integration of corporate social responsibility (CSR) in business strategy to provide an overview of sustainability performance among Italian roasting companies. The analysis encompasses 78 sustainability practices across 49 businesses and assesses their communication to stakeholders. Furthermore, factors such as company size and specialty coffee sale were investigated for their influence on sustainability performance. The findings reveal a low commitment to sustainability within the Italian coffee sector, with 83.7% of companies in the first two stages of the five‐stage CSR assessment model. Although there is an interest in addressing product safety, quality, and consumer relations, responsible sourcing is often relegated to suppliers or voluntary sustainability standards. Communication is not effective, as more than half of the companies did not provide sustainability information on their websites. In this sample, the commitment to sustainability was directly related to the size of the business, and the same relationship was observed for roasters selling specialty coffees.

NAVIGATING THE REGULATORY LANDSCAPE OF VOLUNTARY SUSTAINABILITY STANDARDS IN INTERNATIONAL FOOD TRADE: A MULTILATERAL INTERPLAY - DOI: 10.12818/P.0304-2340.2024v85p171

Voluntary sustainability standards (VSSs) are non-mandatory criteria designed to foster sustainable practices throughout the global supply chain. These standards are particularly prevalent in the agri-food sector, where they aim to support wider public policy objectives such as sustainable food production, animal welfare, healthy lifestyle, and labour conditions. Significant challenges arises from the fact that VSSs, despite their voluntary nature, they often impose mandatory effect in the global supply chain. They also often lack easily-identifiable features of the product themselves. These creates systematic problems for the global food trade system, where conventional regulation address governmental measures on goods with specific inherent characteristics that can be clearly identified in the final product. This article explored the interrelationship among private VSSs, national regulations and international treaties within the agri-food industry. It highlights ambiguity surrounding the regulatory framework for VSSs under the WTO law, noting the absence of a consensus on how relevant provisions should be interpreted. Despite the diversity among various VSSs, VSSs, this article argues for the potential for harmonization and equivalence among VSSs. By aligning various VSSs and with technical regulations, it is possible to strike a balance between trade liberalization and promotion of sustainable practices.

Voluntary sustainability standards and technical efficiency of Honduran smallholder coffee producers

Sustainable coffee production promises to improve production techniques and enhance the socioeconomic conditions of smallholder farmers. Using primary survey data from 659 coffee producers in Honduras, this study assesses the impact of voluntary sustainability standards (VSS) on the technical efficiency of smallholder coffee production. The article uses the Stochastic Production Frontier Analysis model to analyze and compare the technical efficiency (TE) of certified and non-certified coffee producers. To provide reliable comparability between groups, the dataset was balanced using Covariate Balancing Propensity Score (CBPS). The results show that the mean technical efficiency was 52.86% for pooled certified farmers and 55.56% for non-certified smallholder coffee producers. Specifically, the technical efficiency of 4C farmers was 51.58%, 53.82% for the Fairtrade group, 60.56% for RA farmers, and 60.15% for the UTZ group, indicating substantial inefficiencies in the coffee production of the different certified groups. Results from Tobit’s model for the determinants of TE indicated that variables such as the age of the household head, access to credit, and training attendance are among the main factors that significantly drive the technical efficiency of certified and non-certified farmers. Based on the findings, enhancing education opportunities, improving infrastructure for better market access and farm management, and expanding credit access are recommended to improve efficiency in the study area. Honduran smallholder coffee producers have considerable potential to increase output with existing technology by improving their technical efficiency. Therefore, stakeholders’ efforts should focus on enhancing efficiency levels and capitalizing on potential gains for both certified and non-certified farmers, to ultimately improve the farmers’ livelihoods.

Multi-tier captive relations in the global value chain of tuna: The case of Fair Trade certification of small-scale tuna fishery in Indonesia

Voluntary sustainability standards have been used as a governance mechanism to ensure the sustainability of fisheries products traded from developing countries. Different standards have become market forces that actors along the value chain are expected to follow to access markets and remain competitive. Recent attention is also being paid to small-scale fisheries, but there is relatively little information about the efficacy of the translation of standards by all actors in the value chain. This study examines how a voluntary sustainability standard is translated from an international buyer down to the producer and the effectiveness of this on social and environmental sustainability. The global value chain (GVC) modular framework is applied to assess the implementation of and compliance with the standard. The analysis is done at the micro, meso, and macro levels. We use the first-ever Fair Trade USA certification for handline small-scale tuna fishery in Maluku, Indonesia, as our case study. The findings indicate that the captive forms of governance prevailing at the micro and meso levels of the value chain vary considerably. This adds a layer of complexity to the extent to which a sustainability standard changes the structure and governance of the value chain. The efficacy of such changes in promoting social and environmental sustainability is constrained by the unequal power dynamics among the various actors operating at the different levels. The findings from this study may contribute to optimizing the value chain for greater sustainability outcomes by involving local actors and accommodating various governance mechanisms to organize the value chain.

Cost reduction for upscaling voluntary sustainability standards: the case of independent oil palm smallholders in Central Kalimantan, Indonesia

Upscaling Voluntary Sustainability Standards (VSS) can generate ecological and social benefits at a scale that is meaningful to address pressing environmental issues such as climate change and biodiversity losses. Lack of resources and risks of implementation gaps may, however, hinder the success of upscaling VSS. This paper aims to fill the gap in the literature regarding options to reduce certification costs to upscale VSS amid the limited financial resources available for certification. The paper presents the result of action research involving 3,507 independent oil palm farmers who are members of six farmer groups in two districts in Central Kalimantan to achieve Roundtable on Sustainable Palm Oil (RSPO) certification. The research found that achieving economies of scale by increasing the total number of certified farmers can reduce the certification costs per farmer. By establishing a district-level entity, the costs related to audits, RSPO membership fees, and the establishment of farmer groups, such as developing standard operating procedures (SOPs), can be lowered. Implementation gaps were not found with the increase of farmers joining the project based on the training frequency and the external audit findings reports on farmers' compliance with RSPO principles and criteria. The findings of this study provide a basis for promoting the upscaling of VSS, including through the RSPO jurisdictional approach.

Do voluntary sustainability standards reduce primary forest loss? A global analysis for food commodities

Agricultural expansion is the main driver of forest and biodiversity loss. As a countermeasure, Voluntary Sustainability Standards (VSS) try to enhance sustainability in agricultural production but evidence if VSS reduce deforestation at country level is lacking. We used annual certification data of seven VSS (Fairtrade, Rainforest Alliance, UTZ, 4C, Round Table on Sustainable Palm Oil (RSPO), GlobalGAP, Organic) certifying five food commodities (cocoa, coffee, tea, palm oil, banana) and data on tree cover loss in humid tropical primary forest to study the impact of VSS on primary forest loss in 67 tropical countries. Using two generalised additive models (GAMs), one with VSS separately and one with VSS coverage aggregated, we found only Fairtrade to coincide with lower tree cover loss in primary forests at country level while we observed higher tree cover loss with higher certification for UTZ, RSPO and Organic. Using spatially explicit certification data in Google Earth Engine, we did not observe an effect of VSS on tree cover loss, thereby raising doubts on the potential of VSS to govern deforestation free supply chains. Reasons for this might be, among others, certification displacing unsustainable agriculture to other regions (leakage), weak or insufficiently enforced VSS criteria, and outcomes being context specific depending on, for example, institutional factors.

Assessing the impact of voluntary sustainability standards in Amazonian enterprises involved in the açaí value chain

The diversity of sustainable certifications raises questions about the credibility, intentions, and impacts of Voluntary Sustainability Standards (VSS) on Global Value Chains (GVC). Few studies show the impacts of VSS on different sustainable dimensions in sectors such as the non-timber forest product (NTFP) sector. This paper aims to investigate in the value chain of the most important NTFP in the Amazon, açaí, whether VSS contributes to sustainable outcomes in the Governance, Environmental, Economic, and Social dimensions. Using case studies in enterprises of the açaí chain and the use of tools and indicators was possible to generate information that is currently scarce for NTFPs in the Amazon from the VSS perspective. The results show that there is a great distance that the weakest links of the GVC (Micro, Small, and Medium Enterprises – MSMEs) must walk to adopt VSS and be inserted into the global market. The requirements are based on bureaucratic management activities, which are extraordinarily complex and involve many issues and indicators. The VSS lacks supplements that evaluate and validate the results reported by the companies as sustainable. Finally, the VSS is still far from ensuring an inclusive and fully sustainable chain by itself.

Global governance through voluntary sustainability standards: Developments, trends and challenges

AbstractVoluntary Sustainability Standards (VSS) are transnational governance instruments that can be leveraged to pursue sustainable development in global value chains. They have proliferated since the 1990s in terms of their number and the share of global production they govern. This paper shares some key insights arising from the considerable body of literature that has analysed the role of these instruments for sustainable production and trade. First, it introduces VSS, traces the evolution of their adoption and takes stock of the research on their sustainability impacts. Next, some major developments in the VSS realm are discussed, related to public policy and the emergence of national sustainability standards. The paper then zooms in on the challenges and limitations of VSS in transforming value chains towards sustainability, focusing on the shortcomings related to inclusiveness and the problems arising from their proliferation. The paper concludes by distilling recommendations on overcoming these challenges, especially in light of recent policy developments, and outlines what different stakeholders can do to make VSS more effective and inclusive instruments for sustainable value chains.

The elephant in the mine: Why voluntary sustainability standards are insufficient to ensure responsible mining

Environmental, social, and governance standards, along with mining sustainability and transparency initiatives, have taken centre stage in mainstream discussions about how society can source energy transition minerals responsibly. While we acknowledge the importance of private voluntary sustainability standards for improving mining performance and accountability, these must support and complement the crucial regulatory role played by the state and its enforcing agencies in resource-rich countries. From this perspective, we argue that the quality of public institutions remains ‘the elephant’ often overlooked in the room of global mining standards, and we call for re-centring the responsible mining debate around it.Tailings dam failures and uncertainties on the water impacts of brine-based lithium mining provide examples of why institutional strengthening in mineral-rich countries is crucial. The responsible mining agenda and its implementing instruments should shift from a focus on companies’ performances to one that is embedded in society with the aim of building trust in the sector and its governing authorities. For countries rich in transition minerals, this entails, among other things, reviewing organisational structures, strengthening authorities’ enforcement capacities, and allocating sufficient budget for regulators to deliver their oversight duties and avoid over-reliance on private standards.

Carrots rather than sticks: Governance of voluntary sustainability standards and farmer welfare in Peru

AbstractAligned with the 2030 Sustainable Development Agenda, voluntary sustainability standards (VSS) have gained prominence as market‐based tools for sustainability governance. However, whether VSS improve economic sustainability remains subject to vigorous debate. A major limitation of the evidence base is that it does not systematically examine which VSS design attributes affect their impact. In this study, we develop a conceptual framework disentangling three main governance mechanisms through which VSS may affect farmer welfare, which we operationalize using secondary data from a nationally representative farm household survey in Peru. Our results underscore the dominant role of market‐based incentives, followed by capacity‐building, while rule enforcement with good agricultural practices has no effect on farm revenue. Additionally, organizational membership is found to amplify the revenue effects of VSS through market‐based incentives. Our findings advocate VSS organizations to strengthen market‐based incentives and capacity‐building, while improving standard setting and enforcement to effectively improve economic sustainability.

Voluntary sustainability standards to cope with the new European Union regulation on deforestation-free products: A gap analysis

The European Union Deforestation Regulation (EUDR) has been recently adopted to fight deforestation and forest degradation associated with the trade of forest-risk commodities, including cattle, cocoa, coffee, oil palm, rubber, soya, and wood. Operators must exercise due diligence (i.e., information collection, risk assessment, and risk mitigation) to ensure these commodities and their products are deforestation-free and produced in accordance with relevant legislation. In recent decades, Voluntary Sustainability Standards (VSS) have been adopted in the private sector to promote sustainable and deforestation-free supply chains. The EUDR recognizes certification and other third-party verified schemes as supporting tools for risk assessment during the due diligence procedure. However, questions persist regarding the extent to which these schemes can assist operators in assessing compliance with the EUDR. This study addresses these concerns by developing an assessment framework to evaluate the suitability of VSS schemes in covering the due diligence requirements established in the EUDR. The assessment of five major agricultural and forestry VSS schemes against this framework revealed both potentialities and limitations in covering these requirements. Most of the indicators from the framework were at least partially covered. Nevertheless, the assessed schemes fell short in providing a comprehensive prohibition of deforestation and forest degradation. They also presented variable coverage of the relevant legislation outlined in the EUDR, as well as deficiencies in their systems to assure compliance with the standards. Overall, this study indicates that VSS schemes can be incorporated as elements of due diligence systems but are insufficient to demonstrate compliance with the EUDR.

SERTIFIKASI KELAPA SAWIT DAN PENGEMBANGAN EKONOMI BERKELANJUTAN: STUDY LITERATUR REVIEW

The palm oil industry has experienced significant growth in recent decades. Disparities in ownership and profit sharing are one of the main problems in the palm oil industry today. Even though the industry employs millions of people, especially in Indonesia and Malaysia, many palm oil farmers who comply with Voluntary Sustainability Standards (VSS) still struggle to earn decent money. This is due to low demand for VSS compliant palm oil and minimum prices or premiums. The method used in this research is descriptive bibliometric analysis using Vosviewer 1.6.19 software. Data collection was carried out through searching publications indexed by Scopus. The results of this research can illustrate future palm oil certification studies by paying attention to the economic development aspects of the implementation and application of palm oil certification

Coffee production networks in Costa Rica and Colombia: A systems analysis on voluntary sustainability standards and impacts at the local level

The systems analysis framework has permeated the social and political sciences, and its use is increasing in the analysis of global value chains. Nevertheless, minimal research has applied this systems analysis to investigate voluntary sustainability standards (VSS) in the value chain. This study employs systems analysis to explore the role and interactions of VSS in the coffee value chains of Costa Rica and Colombia. Using discourse analysis, the study identifies in the discourses of interviewed stakeholders system traps (this means specific archetypes systems tend to evolve when not balanced) and leverage points that can initiate rapid and significant changes in complex systems when introduced. The interviewed stakeholders cited numerous examples of events related to the identified traps and leverage points in the value chains examined. Another relevant finding is the coherence of these discourses, which were consistent and had no contradictions in different stakeholders’ expressions. The findings contribute to the research regarding private governance in the agricultural sector, introducing a new analytical framework.

State of the art: The impact of sustainability standards

Abstract Voluntary sustainability standards emerged in the 1980s with the promise of making agrifood systems sustainable, and have developed over time into rather sophisticated systems of rules and sanctions. With this promise of change, has also come an interest in understanding whether or not change has come about. This is particularly pertinent as public agencies and governments are increasingly seeking to use sustainability standards as proxies for progress towards sustainability. In this short commentary, I share some of the recent knowledge about the impact of sustainability standards and Fairtrade standards in particular. I explore the impact of the use of the Fairtrade Premium and the impact of engagement with the Fairtrade system on business practices. I conclude with some reflections on the importance of standards in current debates in Europe.

Voluntary sustainability standards and farmer welfare: The pathways to success?

Whether Voluntary Sustainability Standards (VSS) - such as Fairtrade, GlobalGAP or Organic - may contribute to economic sustainability has been subject to vigorous debate over the past decades. To analyze the welfare effects of VSS for family farms, previous studies rely on single equation models which enable analyzing if (some) VSS affect welfare, but not how (some) VSS affect welfare – or not. Hence, little is known about the mechanisms and the relative importance of these different mechanisms by which VSS contribute to farmer welfare. In this paper, we analyze the channel of effects through which VSS affect net farm revenue, as a proxy of farmer welfare, of family farms in Peru. We use nationwide data from Peru’s National Agricultural Survey covering five years, multiple agricultural commodities, and multiple VSS. We apply a multiple mediation model which allows to disentangle the main revenue-determining mechanisms and to compare their relative importance. We find that prices (and not yields) are the main channel through which VSS affect net farm revenue. However, higher prices cannot offset higher production costs, resulting in zero net revenue gains. We do not find an effect through yields, but identify a large potential effect on net farm revenue. We find heterogeneity in the effects by standard and crop, with crops certified to standards that apply a system of quality-based price differentiation having the largest impact on net farm revenue through a price effect. From a policy perspective, we highlight potential improvements in VSS design to effectively improve economic sustainability.

A comparison of stakeholder engagement practices in voluntary sustainability standards

AbstractPractices of stakeholder engagement vary widely across voluntary sustainability standard setters. This study examines how the sponsorship structure of standard setters affects the diversity of stakeholders included in consultations and the influence of stakeholder input on standards. I compare six sustainability standard setters through an original dataset of 7945 stakeholder comments submitted during public comment periods between 2012 and 2019 to answer two research questions. First, are some standard setters better at balancing stakeholder representation than others? And second, does stakeholder influence vary across standard setters? I find that industry‐sponsored standards tend to attract more industry input than multistakeholder initiatives, but both tend to over‐represent legacy stakeholders. I also find that sponsorship is a poor predictor of which comments will be influential. Comments that seek to weaken or clarify the rules in voluntary sustainability standards are more likely to exert influence irrespective of the sponsorship of the standard setter.

China reshaping green value chain initiatives: between global and Southern standards

The paper contributes to the growing debate about how China drives change in institutions and norms of global governance. It analyses the case study of China’s approach to transnational voluntary sustainability standards as concrete tools of Western-sponsored green value chain initiatives, between integration and contestation. Engaging international political economy scholarship, the paper shows that China participates in such initiatives by reshaping their focus away from contested market-based approaches to more internationally consensual state-led ones. This stance indicates that China’s reshaping of international norms and institutions conveys claims made by Global South alliances. These alliances are increasingly important for China, not only politically and militarily but also economically and for the success of key initiatives, like the Belt and Road Initiative.

SDGs trade‐offs associated with voluntary sustainability standards: A case study from the coffee sector in Costa Rica

AbstractThe transition toward a more sustainable agricultural production has become an essential step in achieving the sustainable development goals (SDGs), launched by the United Nations in 2015. Voluntary sustainability standards (VSS) have been proposed as a useful governance tool for guiding this transition. Thus, this article uses a case study from the coffee sector in Costa Rica to assess the contribution of VSSs to the achievement of the SDGs. We rely on panel data from coffee producers captured between 2017 and 2019 to carry out this assessment. Results of the statistical analysis suggest that VSSs alone are not enough to promote a transition to a more sustainable coffee production, as trade‐offs between the contributions of VSSs to the different SDGs emerge. If the VSSs are to promote sustainable practices among producers while ensuring socioeconomic benefits for producers, workers, and their families, implementation modifications are required.

The Role of Private Philanthropy in Sustainability Standards Harmonization: A Case Study

Voluntary sustainability standards are often inconsistent and fragmented in terms of governance, complementarity, global applicability, and traction. Calls to harmonize this space have been intensifying. The objective of this study was to better understand the role that private philanthropy has played in helping to pave the way for globally consistent and comparable sustainability-related standards in the corporate sector, through the analysis of a case study. Twenty-four interviews with 31 stakeholders were carried out between October 2021 and January 2022, using a semi-structured questionnaire. The interview responses and qualitative data were analyzed using Atlas Ti software and open coding procedures. All interviewees spoke positively about the philanthropic intervention in question, and five main themes emerged: (1) strategic relevance and effective targeting of the intervention; (2) trust-building tactics: expertise, neutrality, and facilitation; (3) flexible and strategic interventions; (4) cultivating the standards harmonization philanthropic network; (5) strategic directions for philanthropy, moving forward. Three specific tactical approaches were identified that could help to orient future philanthropic action: (a) the steering of philanthropic support (both funding and non-financial support) toward ventures where such interventions can be advantageous, relative to formalized governmental interventions; (b) the facilitation of partnerships and trust, amid delicate interpersonal and organizational politics among standard-setters and donors alike; (c) the flexibility and specificity of grant requirements, coupled with a long-term vision.

Trade effects of voluntary sustainability standards in tropical commodity sectors

This article investigates the trade implications of voluntary sustainability standards (VSS) in tropical commodity sectors. VSS are increasingly important, not only in corporate sustainability strategies, but also in trade policy, thereby shifting the responsibility for the governance of sustainability in the food system from the public to the private sector. There is no regulatory framework assuring that VSS do not distort trade while effectively delivering environmental and social sustainability benefits, and conclusive evidence on the trade effects of VSS is lacking. We compile an innovative database of country-level VSS coverage for five tropical commodities, seven VSS observed for seven years, and use a multi-country, -sector and -standard augmented gravity analysis to estimate the trade effects of VSS adoption. Our results confirm a general trade-enhancing effect of VSS, with on average a one pp increase in VSS coverage resulting in a 1.8 to 3.3% increase in export value. Effects are largest for banana, followed by coffee and tea – and are insignificant for cocoa and palm oil. The trade-enhancing effect of VSS certification does not vary with the income level of the exporter but increases with the income level of the importer and with the income gap between trading partners. Our results imply that VSS can be an effective tool to overcome the trade-inhibiting effect of governance distance between countries. Yet, for VSS to effectively reconcile international food trade with sustainability goals, policy attention is needed to VSS adoption and impact in the poorest countries.