jason potts, iisd geneva, january 31, 2014...jason potts, iisd geneva, january 31, 2014 the state of...
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Jason Potts, IISD
Geneva,
January 31, 2014
The State of Sustainability Initiatives Review 2014:
Standards and the Green Economy
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Data Collection Partners
SSI Implementation Partners SSI Funding Partners
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Purpose: To facilitate efficient decision making
for sustainability by providing timely,
accurate and pertinent information
on the performance of voluntary
sustainability initiatives on
international markets.
Relevance: Clarity is
increasingly required to
make sense of the complexity
of the voluntary sustainability standards and
initiatives landscape and their existing and
emerging sustainability claims.
The State of Sustainability Initiatives
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SSI Review 2014: Standards and the Green Economy
Bananas
Biofuels
Cocoa
Coffee
Cotton
Forestry
Palm Oil
Soybeans
Sugarcane
Tea
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In the beginning...
• Prior to Agenda 21 in 1992 only two of the 16 sustainability standards
included in the SSI Review 2014 had been established
• Since then, we have seen a shift from an initial focus on product
differentiation towards large scale transition of mainstream compliance
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Market Overview
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www.bonsucro.com
Sustainable Markets: Compound Annual Growth Rates, Sales 2008-2012:
Growth in compliant vs. conventional sales
Commodity Growth in
compliant sales
Growth in
global sales
Cocoa 58% 1%
Coffee 20% 2%
Cotton 47% -1%
Forestry (change in
forested area) 6% 0%
Signifantly higher growth rates among standard compliant products
than in growth of sales in conventional markets
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Sustainable
Agriculture Markets VSS Compliant Production (Ha 2008-2012)
• Approximately 3.5 million
hectares in 2008 has grown
to nearly 10 million hectares
in 2012
• Most hectare growth* linked
to five specific sectors:
cocoa, coffee, cotton, palm
oil and soybeans
* Excluding forestry sector not shown here.
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Sustainable Markets: Production Growth Rates 2008-2012
Coffee Cotton Cocoa
• Recent growth in most commodities driven by one or two initiatives
• Points to a trend towards mainstream oriented initiatives, which
are focused on rapid and significant market uptake
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Compliant production as percent of global production, 2008 & 2012
Sustainable Markets:
Production Market Share
Substantial market penetration of compliant production over past four years
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Compliant production vs. compliant sales, 2012
Sustainable Markets: Sales vs. Production
• Consistent oversupply of compliant production
• Can raise issues associated with pricing
• However, there needs to be certain degree of supply
in order to build supply base and segue into
larger market uptake
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Distribution
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Global vs. Sustainable
Distribution
of Supply (Select Commodities,
ha and mt, 2011/2012)
• Trend toward more
economically
endowed economies
excelling in supply
of standard
compliant products
• Lower economies
must be able to
more effectively
participate
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Governance
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Board Representation by
Stakeholder Role in Supply Chain
Initiatives are integrating diverse voices
into decision-making and standard-setting process
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Board representation by geographical location (developing/developed countries)
• General predominance of Northern stakeholders on boards
of initiatives
• However, significant representation from Southern stakeholders
pointing toward the potential for more equitable governance
within boards
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Conformity
Assessment
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Conformity Assessment Procedures & Frequency
• Recognition
of the need
to ensure
credibility and
independence
of claims
• High level of
discretionary
authority in
application
across
initiatives --
ensuring
process is
risk-based,
targeting
areas that
most need to
be addressed
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SSI Content
and Criteria
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• Coverage of each index matches the degree of compliance
(short term, long term, recommended, etc.) that each initiative
requires across each SSI indicator
• Analysis DOES NOT speak to specific impacts of a given initiative
• Impacts may be related to criteria contained within initiative,
but impacts rely on number of other factors such as
implementation of systems and geographic specificities that
define applicability and relevance
• However, degree of coverage can point to level of aspiration and
accountability of an initiative
• Therefore, SSI content and criteria can speak to intent and
effort of sustainability standards operating in market
SSI Content and Criteria
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SSI Social Criteria
See next slide for key findings...
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SSI Social Criteria - Key Findings
• Strong convergence with SSI indicators among core ILO
standards: labour rights, health and safety and employment
conditions
• Somewhat less coverage across community involvement and
human rights
• Likely explained by reliance of supply chain actors on local
communities to deliver on these rights
• Least coverage on positive rights like gender and employment
benefits
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SSI Environmental Criteria
See next slide for key findings...
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SSI Environmental Criteria - Key Findings
• General convergence toward the SSI soil, waste and synthetic
inputs indices--likely explained by direct relationship with
productivity and reinforcing interests
• Less coverage on water and biodiversity, which involve
a broader landscape management
• GHG and energy show the lowest coverage across SSI indices
• One would expect some GHG reducing effects through
coverage of soil and synthetic inputs criteria; however,
explicit GHG criteria is not (or very minimally) covered
by half of the initiatives reviewed
• GMO prohibition reveals an even split among initiatives
reflecting the debate in society about the sustainability of GMOs.
• Initiatives at the bottom of the table tend to be newer initiatives
targeting mainstream markets, which points to a generalized
trend toward lower breadth and depth of coverage among
environmental criteria included in these systems
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SSI Economic Criteria
See next slide for key findings...
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SSI Economic Criteria - Key Findings
• Little in way of economic criteria covered among initiatives
reviewed
• Largely explained by underlying theory of change that many
initiatives adopt:
• As market-based instruments they should be responsive
to and operate within the market rather than dictate
terms of the market
• Generalized understanding that economic benefits
associated with standard compliance will be delivered
through compliance (access to markets, increased
productivity, improved product quality) rather than being
dictated by standards themselves
• However, there remains a generalized agreement on criteria to
enforce compliance with minimum wage laws across initiatives
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Conclusions
• Standards compliance is increasingly becoming a condition of
market entry
• Single-sector, mainstream-oriented initiatives are increasingly
dominating the market
• Mainstream uptake appears to be fueling a lower average
criteria coverage across sectors
• Standards are improving participation of developing country
stakeholders in supply chain decision-making
• Access to sustainable markets is inconsistent with some
evidence that less developed regions are being further
marginalized as sustainable markets grow
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Moving forward...
Future required work:
• Need for more detailed and regular reporting of market
information
• Consumer markets
• Industry specific uptake and commitments
• Multiple certification
• Need for more detailed and regular impact reporting
• Need for more concerted technical assistance to ensure
that less developed producers can gain access to
sustainable markets
• Need for strategic policy intervention to ensure
standards fulfill their promise of contributing to
sustainable development
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The SSI Review 2014 can be accessed at:
http://www.iisd.org/publications/pub.aspx?pno=2899