A frog the size of a fingernail. A poncho-clad farmer leading his mule. Such logos are stamped on labels of coffee, cocoa, and a myriad of other products, certifying that the object for sale is in some way "sustainable" — made in a way that meets humanity's needs without jeopardizing the ability of future generations to meet their own.
The idea of sustainable economic development was first proposed in the 1980s, when a commission established by the United Nations concluded that human activities were exhausting natural resources and launched efforts to tackle the problem. The concept spans three dimensions: social (for example, ensuring workers are treated fairly), economic (increasing profits, improving quality of life), and environmental (managing land, water, and biodiversity so they aren't lost to future generations). A slew of standards that focus on these dimensions in different ways have been implemented by nonprofits and multinational companies.
Consider coffee farms. The Rainforest Alliance standard (that little green frog) requires coffee farmers to increase tree cover on plantations and ensure fair treatment of workers, among other things. Fair-trade certifications — there are a variety, with logos of leafy yin-yangs, dancing figures, and more — require farmers to use water efficiently, prohibit bonded labor, and offer safe working conditions. The Smithsonian Migratory Bird Center's Bird Friendly certification checklist requires a coffee farm to have at least 10 different tree species and at least 40 percent of the plantation covered in shade. Farmers who comply can then sell their certified products at a higher price.
These efforts have led to more than 400 ways to certify goods and services — and much confusion for consumers who want to choose responsibly. What's more, the data are still unclear on which certifications truly make a product better for the planet or for farmers, says environmental scientist Eric Lambin of Stanford University and the Catholic University of Louvain, who co-authored an article on the topic in the 2018 Annual Review of Environment and Resources.
Why are there so many different ways for a product to get certified as sustainable?
In the 1980s, it was largely thought that sustainability objectives would be achieved via government policies that would mandate certain basic sustainability practices. Over the years it became clear that most states — especially developing countries — were not able to do this effectively because they had other priorities and limited capacity. This whole realm of voluntary sustainability standards emerged when private actors, such as non-governmental organizations, various societies, and private companies, stepped in.
This history explains why each certification emerged independently, rather than in an organized fashion. A lot of these certifications are specific to one commodity, or to a place. It's an uncoordinated, sort of free-market approach.
Sustainability standards can emerge from a number of different routes and players. Variables include who sets the standards, such as an NGO or private company, and who verifies compliance: the firm who set the standard (first party), a party associated with the firm (second party), or an independent group (third party). | (E.F. Lambin/AR Environment and Resources 2018/Courtesy Knowable Magazine)
Is it useful to have so many standards?
Yes and no. Some competition forces standards to demonstrate effectiveness. But too much duplication leads to wasted resources in terms of transaction costs, manpower, verification work, fundraising, and advertising.
The other problem is that when you have many organizations that do exactly the same thing, one of them might create a very easy sustainability certification that anyone can get because it doesn't require much change. And that leads to a race to the bottom. But some do try to be more effective and demonstrate real impact.
Are some standards emerging as clear winners?
We are only starting to have reliable evidence on this. Until four or five years ago, most studies trying to evaluate the impact of the standards were not sufficiently rigorous. Even now, the evidence is still very mixed.
For example, we found that in one province of Colombia, coffee farmers who were Rainforest Alliance–certified planted more trees on their farms compared to neighbors who were not certified. We also noticed that these farmers' children had studied more years at school than the kids of their neighbors who were not certified. There was a significant difference between the two groups.
It turned out that because a farm must meet 90 criteria to receive certification, many of these farmers, who were not literate, were happy to keep the kids at school for a few more years so they could help with the administrative work of reading forms and filing reports to get certified. In this way, certification provided more than just environmental benefits — it provided social and potentially economic benefits, too.
But when another research group studied coffee certification in Honduras, they came up with slightly different results: While few Rainforest Alliance–certified farmers were expanding their fields into forests, farmers certified by Fairtrade, UTZ, and 4C were still causing deforestation.
Why the difference?
Mostly because the social and policy context in Honduras is different. Also, these studies are done by different teams, and we use slightly different methods and definitions, making it tough to compare results. The field is only starting to adopt a systematic approach to compare and evaluate the effectiveness of eco-certification.
In more recent work, we have found that these sustainability certification standards become clearly successful and transformative when they are supported by, or get integrated into, public policy.
How does a voluntary certification become public policy?
Here's an example: Bolivia was reforming its forestry code a few years ago. A few forest concessions [public lands that timber companies lease from the state for wood extraction] were eco-certified under the label of the Forest Stewardship Council (FSC), and they were more productive and profitable. So the government decided that rather than write a forestry code from scratch, they would reuse entire segments of the FSC guidelines as the new code.
Suddenly this certification system that was purely voluntary was now public policy.
Large multinational companies also contribute to such upscaling. A company such as Unilever might say that by 2020 or 2030, they commit to completely eliminating tropical deforestation from their supply chain. That means the property of every producer from whom they buy palm oil has to be deforestation-free.
But how does the multinational meet that goal? They might try mandating a certification by the nonprofit Roundtable on Sustainable Palm Oil (RSPO) for their palm oil suppliers. Now suddenly every producer who wants to sell to Unilever has to be RSPO-certified. Again, you have this powerful upscaling mechanism of a voluntary certification system. And that's when you start to have big impact.
It's almost as if the idea of governance without government doesn't really work.
Exactly — and for another reason that's even more fundamental. One of the reasons the Rainforest Alliance coffee certification was successful in Colombia, or RSPO for palm oil is more likely to work in the Sabah state in Malaysia, is because these governments made sustainability a goal with a range of supportive policies. These supportive policies are necessary for a certification system to succeed.
Do consumers also contribute to the success of sustainability efforts?
Commodities that have a consumer-facing aspect tend to be certified more often than ones that are processed and integrated into other products.
For example, you or I make an individual decision to buy this pack of coffee or chocolate over another one, perhaps based on packaging marked with a "certified sustainable" label. For these products, there's a very short supply chain linking the producer to you, the consumer. So the pressure from the consumers on retailers — and therefore on the whole supply chain — is much more direct, and there's a greater incentive for producers to make this claim of sustainability.
The products that sport these seals have been manufactured in ways that are considered sustainable from an economic, environmental, or social standpoint, but measuring the success of these certification programs is difficult and the labels can be confusing for consumers. | (Courtesy Knowable Magazine)
But that's not the case for other types of products. Take palm oil — about half the goods that you find in a supermarket have some palm oil in them, but you never go and buy a bottle of palm oil. So there's also less direct consumer pressure on companies to improve standards.
Can consumers play a part in improving the standards?
Yes, it's a combination of consumers and non-governmental organizations. Consumers often have a very poor understanding of the nitty gritty of a certification. But large companies conduct marketing campaigns, and the companies clearly sense that, at least in Europe and North America, there is a new wave of consumer demand for sustainably produced items.
What can consumers do to support sustainability efforts?
Just buying certified products and pushing for more stringent standards helps. Consider coffee: Only 25 percent of the coffee that's produced under some certification label is sold with a certified label. The rest is sold as conventional coffee with no price premium. In surveys, consumers say sustainability is important to them, but studies of market behavior show that their purchasing of certified products is still very low.
Think about it, these smallholder coffee farmers in remote areas are quite poor. They make the effort to comply with 90 different criteria and get audited every year. And if there's little consumer demand for certified coffee, the price premium for producers decreases over time. In our Colombia study, the price premium decreased from 20 percent to 2 percent above the price of conventional coffee, and some farmers were abandoning the certification because it was too much work for 2 percent more income.
All that's needed is for consumers to take a second, check on the package whether the product is certified, and pay a few extra cents for it.
Read the rest of the story at Knowable Magazine. Knowable Magazine is an independent journalistic endeavor from Annual Reviews.