Malte Diederich 1 , Aynur Bozoglu 2 , Clemens Simmer 1 , Alessandro Bataglia 1 1 University Bonn
Brussels Briefing 44: Aynur Mammadova, IISD Associate, SSI Team Member - Sustainability of supply...
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Transcript of Brussels Briefing 44: Aynur Mammadova, IISD Associate, SSI Team Member - Sustainability of supply...
State of Sustainability Initiatives:
Sustainability of supply chains and fair schemes
Promoting Responsible Value Chains and Sustainable Sourcing Through Fair Trade
22 June, 2016Brussels
• The SSI is a partnership that was launched out of the joint IISD-UNCTAD Sustainable Commodity Initiative (2003) which sought to mainstream sustainable commodity production and trade by leveraging the different and growing number of voluntary sustainability standards on the market and by promoting core fair trade principles.
• Launched in 2008 the SSI is a collaborative effort funded by the State Secretariat for Economic Affairs (SECO) and led by the International Institute for Sustainable Development (IISD), the International Institute for Environment and Development (IIED) and the Finance Alliance for Sustainable Trade (FAST).
To facilitate efficient decision making for sustainability by providing timely, accurate and pertinent information on the performance of voluntary sustainability initiatives on
international markets.
• A voluntary sustainability initiative, or VSI, is any non-obligatory initiative explicitly designed to promote the objectives of sustainable development, including ecolabels, certification initiatives, standards, CSR programs, business to business initiatives, roundtables and other collaborative or multi-stakeholder initiatives.
Who we are
SSI Review
The SSI Review is an independent evidence-based report on the characteristics, performance and market trends related to
sustainability initiatives.
Content
2. Sustainable market statistics and data3. Social, Environmental & Economic criteria of VSS4. Opportunities through Fairtrade certification5. Overall challenges6. Conclusion
Sustainable market statistics and data
Fair Trade{Commodities coverage
Bananas Coffee
Cotton Cocoa
Tea Sugar
Soy Palm oil
Forestry Biofuel
10 key commodity sectors in
agriculture and forestry
{
Standards coverage
16 standards operating in agriculture and forestry sectors
Growth in sustainability market
Compliant production as percent of global production, 2008 & 2013/14Source: SSI Review 2014
Development of VSS compliant area worldwide, 2008-2013 (Minimum)Source: SSI Review 2014
Production vs. Sales
Sustainable markets: Standard-compliant production vs. standard-compliant sales for 2012Source: SSI Review 2014
Single sector initiatives lead in production volume
Source: SSI Review 2014
Single vs. multisector standards
Sustainable MarketsProduction Growth Rates 2008-2014
Cocoa Coffee Cotton
20082010
20122014
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
1,000,000
UTZRainforest AllianceFairtradeOrganic VSS
PRO
DUCT
ION
(MT)
20082009
20102011
20122013
20140
200000
400000
600000
800000
1000000
1200000
1400000
1600000
1800000
BCICmiAOrganic VSSFairtrade
PRO
DUCT
ION
(MT)
20082010
20122014
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4CUTZFairtradeRainforest AllianceOrganic VSS
PRO
DUCT
ION
(MT)
Geographic distribution
Board representation
Source: SSI Review 2014
Social, Environmental & Economic criteria of the VSS
Environmental criteria: Indicator and indices coverage
Average coverage of SSI environmental indices by VSSSource: SSI Review 2014
Social criteria: Indicator and indices coverage
Average coverage of SSI social Indices by VSSSource: SSI Review 2014
Economic criteria: Indicator and indices coverage
Average coverage of SSI economic Indices by VSSSource: SSI Review 2014
Opportunities and challenges
Smallholders
Additional exceptions for smallholder producers which further accommodates for smallholders by extending the certificate period from three years to six years for “small licensees”.
Opportunities
Concentration on developing countries
Fairtrade certification is only available for products sourced from developing countries.
Contractual transparency
Fairtrade is the only initiative with criteria covering all aspects related to contractual transparency between buyers and sellers.
Price premiums
Price premiums illustrate the second-lowest average coverage across all 16 voluntary sustainability initiatives, with only Fairtrade and UTZ covering this index.
GovernanceFairtrade is a leader in enabling equitable governance among developing country smallholders.
Challenges
Mainstream Markets
Voluntary initiatives, whether Fairtrade or not, cannot be expected to overcome market imperfections—they can help the market in being more attentive to such imperfections but ultimately it will take government intervention and support to do so in a way which is in accordance with the objectives of sustainable development.
Building the market
Continuing need to build the market—and, especially allow for the existence of premiums/compensation for the adoption of more stringent practice (preferential tariffs/taxes and public procurement policies).
Facilitating access
Need to facilitate market access and inclusiveness (technical assistance to unorganized smallholder organizations (SCAN) and facilitation of access to finance for smallholders (FAST)).
Information transparency
Need to improve information transparency—info on markets (SSI) and impacts (COSA).
Conclusion
The general trend towards market growth BUT market concentration in more developed economies.
Fair Trade's focus on marginalized communities is entirely pertinent and appropriate.
The problem is that Fairtrade doesn't meet the needs of the entire market and therefore there is a need to help other initiatives also reach more marginalized markets.
Fair trade has the right priorities, but offers a limited vehicle for their implementation, policy makers need to be open to exploring other opportunities for promoting the "principles of fair trade" by leveraging other instruments as well.
Contact us
Thank you!Any questions?www.iisd.org/[email protected]
Lead Researcher, Jason Potts:[email protected]