7 trends in the very important area of standards
Dr Shaila Divakarla, GECA | 2 July 2015
The keynote address question by WWF International’s Jason Clay at A Roadmap to Change – ISEAL 2015 Global sustainability standards conference was: “With the earth today and the speed of change on the planet, what can standards do to contribute to the wider global transformation we seek?”
It set the scene for the conference held in Berlin, Germany in May, and provided plenty of food for thought for everyone in attendance.
For those unfamiliar with ISEAL, its mission and work, ISEAL is the global membership association for sustainability standards whose mission is to strengthen sustainability standards systems for the benefit of people and the environment. ISEAL is the global leader in defining and communicating what good practice looks like for sustainability standards, which are built upon ISEAL’s set of core principles that define credibility in standards.
The conference was well attended, with representatives from a broad range of interest groups including standards organisations (Rainforest Alliance, FSC, Fairtrade International, UTZ Certified, GECA and many others) advocacy and capacity-building groups (WWF, Greenpeace, Consumers International, NEPCon, UN Global Compact) producers and industry bodies (IKEA, Marks and Spencer, Royal Ahold, 2 Degrees), as well as auditors, government organisations, consultancies and experts.
The big picture
The gravity of the keynote question arises from some interesting as well as alarming statistics presented by Jason. China doubled its per capita GDP in 12 years, at a speed more than 12 times that of Britain during the industrial revolution and at 100 times the scale. The other emerging economy, India, doubled its per capita GDP in 17 years.
Added to this is the projected steep rise in global population. In striking contrast, the time taken from the observation of an ecological threat by WWF to achieving meaningful results has taken more than 20+ years! Clearly, ”the pace of global threats is accelerating faster than we can address it” and thus raises the questions “will today’s sustainability standards get us to 2050?” and “should we reward the best or move the rest?” if the significant transformation required is to be achieved.
The last question sparked some tension with interesting as well as convincing arguments for and against the issue led primarily by WWF and Greenpeace, with the former arguing for “lifting the floor” to achieve bigger gains while the latter that standards should “raise the ceiling” and “not dilute what they stand for”. While there was no clear resolution, there was absolutely no doubt that standard setters need to acknowledge these trends and look at creative ways to continue to push the boundaries while at the same time be more inclusive if they wish to achieve their mission and the transformation they seek – and that is where the challenge lies.
Meeting the challenge – Seven key trends and developments
1. Credible Sustainability labels – Sorting wheat from chaff
The proliferation of sustainability labels and claims especially in the recent times and the need to cut through this “jungle” of confusion to assist both consumers as well as professionals was a theme that echoed through the conference.
ISEAL has taken the lead by creating a new website and educational tool called “Challenge the Label” to help understand a sustainability claim and assess its credibility. Credible claims follow the five universal truths: clear, accurate, relevant and based on a system that is transparent and robust.
BMZ (Federal Ministry for Economic Cooperation and Development of Germany) in partnership with GIZ Germany (consultancy) and various other experts has also created the “Label Clarity” website that provides an evaluation and rating of various sustainability labels. Originally set up to inform their own public procurement and tender documents, this has now been expanded for the general public as well. For the public, the rating is simple in the form of a range of smiley faces, while for professionals and others, it contains detailed information on the 400 criteria used for evaluation.
2. Continuous improvement and capacity building
“Not everyone can get certified but everyone can get better”, as expressed by a panellist (UN Global Compact), perhaps best captures continuous improvement in this context. They have created an online platform that provides comprehensive, verified and transparent information on sustainability standards with the objective of strengthening the capacity of all players involved in sustainable production and trade (food sector).
Users can identify standards most relevant to them, assess and compare these standards and finally create their own roadmap toward compliance with the standards. SMEs (small and medium enterprises) in particular require greater capacity-building assistance and often do not have the knowledge, skills, finances and resources required for certification.
As a representative of SAN (Sustainable Agricultural Network) remarked, certification bodies and auditors should not just be “policemen” but also assist the producers to improve by sharing knowledge. Certification is not simply about getting a certificate or label – there should be benefits in all areas of the business automatically and should bring about behavioural change.
3. Measuring the Impact of Standards
Another question posed by Jason as part of his keynote address was, “Which standards learn fast enough from producers and continuously improve?” Continuous improvement applies as much to standards organisations themselves as to the producers they certify. In this regard there was a great deal of interest from standards organisations in how to measure and improve their impacts, as well as the extent of change/transformation they set out to achieve. This not only helps the organisations themselves but can also contribute to demonstrating a better business case for certification to producers. Such monitoring and measurement can also help with risk profiling (as in No 7) to reduce the cost of certification.
BCI (Better Cotton Initiative) demonstrated how as a result of measuring and monitoring they improved on several impact metrics – 60 per cent reduction in pesticide use, 40 per cent water use reduction, 15 per cent to 20 per cent increase in income for cotton farmers.
ASC (Aquaculture Stewardship Council) experience showed that to get a good monitoring and evaluation (M&E) system up and running can take up to five years. Good data collection and management form the foundation of an effective M&E system.
4. Hot spots versus sweet spots
A shift in business models is beginning to be noticeable, from doing ”less bad”, that is, reducing environmental impacts, to “more good”, that is, creating value. The typical business case for sustainability based on legal compliance, reduced risk and reputational damage is slowly giving way to value creation opportunities such as market differentiation, cost and other efficiencies, access to finance, safeguarding future business, greater resilience of the supply chain, customer confidence, and of course, doing the right thing by people and the environment.
As mentioned by a representative from a major global bank the role of certification is very important in this regard – for example, banks now view certification less for lowering commercial and reputational risk and more for assuring longer term financial security through improved economic efficiency for customers. This is good news for standards organisations, although more effort on their part in monitoring and demonstrating such benefits can greatly contribute to building the business case for certification.
5. Performance vs practice based standards
Standards are increasingly moving from being practice to performance based as this offers greater flexibility to producers to choose any strategy or solution suitable to them for reaching the specified outcome.
Performance based standards are also integral to the M&E system for assessing the impacts of standards. Performance is about measurement and so should be based on metrics that are actionable and verifiable. One challenge, as expressed by representatives of ASC (Aquaculture Stewardship Council) and Bon Sucro (for sustainable sugarcane) based on their experience, was that data on what methods were used to achieve the outcomes is often not available so useful information on good practices cannot be shared with everyone (especially SMEs). Even if the data did become available, the sharing of that data and information with other producers also needs to be addressed.
6. Collaboration and alignment
Standards organisations are usually small to medium in size and based on a not for profit business model which often places constraints on time and resources. Aligning themselves and collaborating with other similar organisations and standards to avoid unnecessary duplication of work, to share rather than compete, and to increase harmonisation of work can result in improved efficiency for the sustainability standards community as a whole. This message was quite loud and clear. Such unity then equips the group with greater power in influencing change. Engaging more actively with other players (for example governments who can do more) in building consensus and broader alliances can also greatly accelerate transformation.
7. Cost of certification
The real cost of certification is not so much in the certification process itself as it is the preparation for the certification, in preparing the data and information required for the audit. Thus capacity building to assist producers, especially SMEs, in being better prepared to make data readily available for the audits can greatly reduce the time taken for audit which is directly proportional to the cost of certification. “Risk profiling” that is, a risk based approach to non-conformities is also a technique used by standards organisations, such as FSC, to reduce the cost of certification.
Dr Shaila Divakarla is standards and technical manager at Good Environmental Choice Australia.