Voluntary Sustainability Standards Research Articles

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

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

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.

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.

The uneasy marriage of private standards and public policies for sustainable commodity governance

AbstractGlobal value chains for commodity agriculture have been the target of a broad array of sustainability governance efforts led by both public and private actors. In this paper, we ask: how do public policies and private standards interact in commodity‐exporting countries? To answer this question, we examine the interactions between voluntary sustainability standards and domestic public policies in three cases: soybean farming in Brazil, palm oil production in Indonesia, and pangasius aquaculture in Vietnam. We find that in each case, public and private governance interactions go through a period of competition before ending in a state of reluctant complementarity. We argue that this reluctant complementarity results from the need of governments in commodity‐producing countries to maintain export markets for their goods. This finding challenges the idea that complementarity between public and private sustainable commodity governance is driven by goal alignment and tempers expectations that standards and certifications can mitigate deforestation.

Sustainability assessment in agriculture: emerging issues in voluntary sustainability standards and their governance

Sustainability assessment in agriculture: emerging issues in voluntary sustainability standards and their governance

Contemporary narratives about asymmetries in responsibility in global agri-food value chains: the case of the Ecuadorian stakeholders in the banana value chain

Global concerns over environmental and social issues in agrifood value chains have increased and are reflected in a number of voluntary sustainability standards and regulatory initiatives. However, these initiatives are often based on poor knowledge of production realities, creating a disconnect between producing and consuming countries. Through narrative analysis, this paper reveals asymmetries in the responsibilities of the various actors participating in Ecuadorian banana value chains, providing clear problem- and solution-framings. Despite the broad range of actors interviewed, our analysis reveals convergence in two main narratives that reflect asymmetries amongst local actors in terms of their ability to participate, ability to maintain participation, and adaptation strategies in view of changing external factors. One narrative relates to sustainability adaptations, the cost of which is not shared among all value chain actors. This is combined with a downward trend in the price of bananas and the lack of a differentiated price to account for losses and costs arising from increasing sustainability standards. Another narrative reflects a value chain structure that threatens small-farm survival. It highlights the urgency of protecting small-farm activity by enforcing national regulation and developing new market segments/models that understand small-scale producer reality. Study results show that the multitude of standards is not seen as beneficial and that downstream actors rather wish for common minimum standards to reduce business costs. Compatibility between standards and local realities should be a priority for global sustainability standards adoption. Building on the problems and solution-framings of local value chain links, we give voice to local actors, and link their perceptions to existing literature and discursive politics while contributing to social transparency and addressing the democratic deficit in agrifood value chains.

Governing spillovers of agricultural land use through voluntary sustainability standards: A coverage analysis of sustainability requirements

Voluntary Sustainability Standards (VSS) are prominent governance instruments that define and verify sustainable agricultural land use at farm and supply chain levels. However, agricultural production can prompt spillover dynamics with implications for sustainability that go beyond these scales, e.g., through runoff of chemical inputs or long-distance migrant worker flows. Scientific evidence on the governance of spillovers through VSS is, however, limited. This study investigates the extent to which VSS regulate a set of 21 environmental and socio-economic spillovers of agricultural land use. To this end, we assessed the spillover coverage in 100 sustainability standards. We find that VSS have a clear tendency to cover environmental spillovers more extensively than socio-economic spillovers. Further, we show how spillover coverage differs across varying types of standard-setting organizations and VSS verification mechanisms. Finally, we discuss the role and limitations that VSS can have in addressing the revealed gaps.

The voluntary sustainability standards and their contribution towards the achievement of the Sustainable Development Goals: A systematic review on the coffee sector

AbstractIn 2015, the United Nations adopted the Sustainable Development Goals (SDGs). Voluntary sustainability standards (VSSs) precede the SDGs and are a major governance tool for sustainability. Consequently, it is important to understand the role of VSS towards the achievement of the SDGs. This article contributes to answer this question through a systematic review of literature. Results revealed research gaps for key SDGs, such as SDG 5 (Gender Equality) and SDG 10 (Reduced Inequalities). Another relevant finding is that more than half of the studied variables showed no significant difference between intervention or control group, or no significant change over time. This article encourages VSSs and policymakers to work collaboratively towards the use of common indicators and increased data transparency.

Sustainability standards and blockchain in agro-food supply chains: Synergies and conflicts

Blockchain-based technologies have emerged as a mechanism for governing sustainability in agro-food supply chain, where voluntary sustainability standards have been the main governance mechanisms over the past decades. Despite a growing body of research on blockchain-based technologies, the relationship between these two mechanisms for supply chains remains poorly understood. Therefore, this study aims at addressing this research gap and explaining their interaction. We described and assessed 16 cases of blockchain-based technologies and voluntary sustainability standards against twelve sustainability-related assessment criteria. The results show that the relationship between blockchain-based technologies and voluntary sustainability standards can be co-existing, synergistic, and antagonistic. While most cases fall under the co-existing relationship, we identified a few cases with synergistic relationships, and one case with an antagonistic relationship. We explain each type of relation and show how the system architecture and goal of a blockchain-based technology implementation are key determinants of this relationship. This study can support stakeholders in agro-food supply chain in better understanding the application of blockchain-based technologies for sustainability governance in relation to existing voluntary sustainability standards. It can further inform those stakeholders of possibilities to constructively collaborate and focus on positive social and environmental impacts within agro-food supply chains.

How do companies implement their zero-deforestation commitments

More than 500 companies engaged in supply chains of forest-risk commodity have adopted zero-deforestation commitments (ZDCs). We use corporate social responsibility strategy and policy implementation theories to analyse the processes and conditions for ZDC implementation. We base our study on 35 semi-structured interviews with company representatives and sector actors, publicly available ZDC data, and company reports. The objective is to understand the opportunities and challenges of ZDC implementation at the level of companies. While past research addressed ZDC coverage and effectiveness, knowledge is still lacking on companies' perspectives on the implementation of their commitments. This study provides a unique perspective by integrating the direct experience and knowledge of private actors on an environmental governance regime. We find that companies see implementation of ZDCs as a journey and often rely on voluntary sustainability standards, aligning their strategies and key performance indicators (KPIs) to these. They engage directly in the supply chain, conducting projects “on-the-ground.” Implementing ZDCs requires the involvement of procurement departments and upper management, and collaborations within and between companies. Companies rely on service providers for in-depth knowledge and field implementation. They use monitoring tools, e.g. remote sensing, and see supply chain traceability as a prerequisite for implementation. Companies face numerous implementation challenges. Internally, companies often lack leadership on their ZDC, struggle to align commitments with the organization's operations and to manage suppliers, especially smallholders, and allocate insufficient resources. Externally, they lack common standards and stakeholder support, and face challenging regulatory conditions and missing market incentives. An uneven playing field creates leakage markets. Companies identify better leadership, technology and pre-competitive collaboration as potential solutions. Zero-deforestation commitments are unlikely to greatly contribute to reducing deforestation until better implementation processes, mechanisms, and conditions are in place.

Voluntary standards and the SDGs: Mapping public-private complementarities for sustainable development

To strengthen global sustainability governance, academics and policymakers have called for a better integration of private governance with public policy instruments. Surprisingly, however, systematic research on the state of such public-private complementarities in the field of sustainable development is lacking. With a focus on voluntary sustainability standards and the United Nations 2030 Agenda for Sustainable Development, this article addresses this research gap. It uses a novel dataset of 232 voluntary standards to examine how their policies and organizational processes interact with the 17 Sustainable Development Goals and their targets. We identify significant public-private complementarities, but also areas of institutional disconnect. We further explore how the creation of institutional linkages in this issue area is driven by instrumental, managerial, and normative concerns and develop an agenda for future research. This includes research on whether and how intensifying public-private interactions at the transnational level translate into tangible impacts for sustainable development on the ground.

Input Legitimacy of Voluntary Sustainability Standards and Acceptance Among Southern Producers: A Qualitative Comparative Analysis

Abstract Voluntary standards are key instruments to address sustainability concerns in value chains. The legitimacy of these initiatives has been debated, particularly related to acceptance by Global South stakeholders. The governance literature has predominantly argued that initiatives employing democratic approaches to governance are more likely to increase their legitimacy. In this article, we use a configurational approach to test this proposition in relation to standard acceptance by southern producers. A qualitative comparative analysis of eight cases was carried out, linking three elements of input legitimacy (inclusion, participation, and accountability) to the outcome of standard uptake in the Global South. While our findings suggest that an inclusive governance structure is important, overall, they show no evidence to explain the presence or absence of standard acceptance in the Global South. We conclude that theoretical assumptions about democratic legitimacy cannot be confirmed and argue for further opening up the scholarly debate to include conceptualizations, methods, and approaches inclusive of different ways of creating and perceiving legitimacy.

Impact pathways of voluntary sustainability standards on smallholder coffee producers in Honduras: Price premiums, farm productivity, production costs, access to credit

Coffee production in Honduras is under constant economic pressure, social unrest, and climate challenges. This largely affects the living conditions of thousands of smallholder coffee producers as the weakest actors in the coffee value chain and exacerbates the level of poverty and inequality that they face. A considerable part of the coffee production in Honduras is under different Voluntary Sustainability Standards (VSS); a major goal of these standards is to improve the livelihoods of smallholder farmers. Thus, this paper assesses the economic impact of Fairtrade, UTZ, and 4C on smallholder producers against a control group, using Propensity Score Matching with data of the coffee year 2015/2016. The main economic variables studied in this paper are gross profit, household income, and poverty likelihood. In addition, this study develops a conceptual framework to explore different impact pathways –price premium, farm productivity, production costs, and access to credit– that could improve farm performance and ultimately the economic conditions of farmers. The results of this study suggest that smallholder coffee producers in Honduras are not obtaining a higher economic impact from the different certifications assessed. Among the pathways, only the price premium was statistically significant for the three certifications assessed, displaying higher prices per unit than the control group. In line with their economic conditions, these producers have a probability between 56% and 58% of living under the national poverty line according to the Poverty Probability Index (PPI), concluding that certifications do not always improve the livelihood of coffee producers.