The world lost more than 4 million hectares of tropical forests last year. Among the leading drivers of this deforestation is the production, trade and consumption of agricultural products like soybean and palm oil. Agricultural expansion has also caused biodiversity loss, soil degradation as well as the loss of freshwater stocks in some vulnerable regions predominantly in the Global South.
The demand for cheap produce adversely impacts labour working conditions and living incomes. Because of the unequal distribution between demand (often from consumers in the Global North) and supply (often from farms in the Global South), some of these impacts may be offshore or ‘embodied’ in products, and therefore liable to be forgotten.
These impacts have not gone unnoticed. Lately, the need to tackle unsustainable production and consumption practices has come to the forefront of the global climate and environmental agenda. Stopping agriculture-driven carbon emissions has long been considered an effective solution to tackle climate change. Some of the targets adopted by the recent UN Biodiversity Conference focussed explicitly on tackling consumption to ensure biodiversity conservation.
The World Water Conference followed suit – it witnessed the adoption of the Water Action Agenda to catalyse action towards achieving Sustainable Development Goals.
What all these commitments indicate is a collective desire to adopt a fresh approach to what and how we consume, and a common aim to encourage agricultural supply chains towards adopting more sustainable practices.
Low-carbon sustainable development is also a priority domestically. While India’s net-zero goals and Long-term Low-Carbon Development Strategy developed as part of the landmark 2015 Paris Agreement does not distinguish between agricultural sectors or explicitly mention the need to make agricultural supply chains sustainable, effective actions here can have long-term benefits.
What is a ‘sustainable supply chain’?
A prerequisite for having a ‘sustainable supply chain’ for agricultural products is to know where they come from and to take responsibility for their production and processing before it gets to the final consumer. This includes the selection of inputs, value addition, waste handling, packaging, warehousing, transportation and distribution.
Tracing this movement of a product is the first step in making supply chains more visible, and therefore, more sustainable. The logic here is that a product’s traceability makes it possible to intervene at key points to reform activities and nudge it towards alternative practices.
For example, some coffee producers monitor on-farm biodiversity and promote restorative practices as an additional form of value addition for consumers.
This is an example of a process where stakeholders themselves, or through third-party auditors, assess products across a range of criteria based on their production and supply chain characteristics. If those criteria are suitably met, then those products are said to be meeting certain social and/or environmental objectives.
This has meant that efforts to be more sustainable are not only a response to policies, laws and regulations of national or state governments, but also an outcome of increasing stakeholder interest in agricultural supply chains.
Where voluntary commitments and certification may fall short
Such initiatives can contribute towards achieving transparency and traceability in agricultural supply chains by offering stakeholders guidance in reforming production practices and labour codes of conduct.
Notably, several of them have proliferated in India. For example, certifiers like FairTrade advocate for better prices, decent working conditions and environmental sustainability for commodities like tea, coffee and spices, while Better Cotton promotes robust standards within the cotton supply chain in India.
Producers and sourcing agencies then use information from these sources to initiate action and assess progress.
However, success is hard to achieve and sustain. In many cases, voluntary initiatives may lack accountability, overlook the needs and circumstances of on-ground actors (farmers, workers) who ultimately may be tasked with implementing recommended practices, fail to provide structured incentives or consistently reward compliance.
Enforcement remains a challenge as there may not be legal risks if companies fall short of meeting specified targets.
Voluntary initiatives may also take a myopic view of supply chain sustainability and neglect the environmental and social impacts of a product’s complete life cycle. In the absence of standardised monitoring and reporting norms and legal enforcement, the misrepresentation of a product’s environmental impact (or ‘greenwashing’) remains an ever-present threat.
What that means is that their scalability, influence and sustained impact over a large region or a product’s complete supply chain may be limited.
Ultimately, are voluntary initiatives effective? There is mixed evidence on that front too.
The need to integrate public policy with private initiatives
Sustainability at scale requires larger collective participation. Here is where public policy can play a role.
There is precedence for it – the Amazon Soy Moratorium, an agreement under which commodity traders agreed to avoid the purchase of soybeans from areas in the Amazon that were deforested after 2008, was found to have avoided significant amounts of deforestation in the region.
Voluntary initiatives impact several different stakeholders and systems – farmers, farm workers, distributors, retailers, national and international trade flows as well as the environment. This makes the involvement of state policies and regulations imperative in achieving better outcomes beyond immediate and targeted support.
Advancing sustainable production standards in one region often has the threat of the shifting of production to other regions with relatively weaker standards, a process known as leakage. Well-designed policies can allow for impact at scale, restricting the threat of leakage to other regions.
This is often beyond the scope of private sector initiatives which may be focussed on specific commodities, in specific regions and often with specific and limited objectives.
It is important to recognise that policies and regulations can either promote or even undercut sustainability standards. In this case, mandatory standards may often become the minimum criteria to be met – in terms of reporting norms or transparency requirements.
This makes it imperative that the private sector and certification agencies work together with the government to raise the floor on minimum targets, internalise standards into their operations and ensure widespread adoption of a minimum set of practices in their supply chains to truly achieve impact at scale.
This is especially relevant to the Indian context. The Indian market is highly competitive and cost-sensitive, with the average consumer having limited access to and understanding of eco-labelling. This makes the average Indian consumer partially dependent on public efforts to evolve a minimum set of criteria which is followed industry-wide, rather than depending on scattered initiatives across the private sector.
Inequality is, perhaps unintentionally but undoubtedly, built into current sustainability efforts. There is an inequitable distribution of power, risk and reward.
Smaller traders and distributors may often be implicitly excluded from voluntary initiatives as they face high entry barriers. The burden to undertake action may often fall on the producer, who may have the least agency in decision-making but have the greatest responsibility to act.
Smallholder farmers, which constitute the bulk of India’s landholding, may be excluded from private sustainability efforts altogether because of their inability to make and keep ambitious commitments in the absence of wider support.
How can the transition towards sustainability be supported for these sets of farmers? Currently, the monetary and transactional costs of meeting commitments and achieving certification remain relatively high. Without policy support, these costs would be extremely difficult to meet, limiting the widespread adoption of improved practices.
In this problem of who moves first – producers, sourcing agencies, distributors, consumers, or policy actors – the onus falls on policy actors to make the first move.
Coordinated actions towards supply chain sustainability
Commitments and certification initiatives are merely one part, albeit an important part, of the larger journey towards continuous improvement and sustainability within agricultural supply chains. The disclosure of supply chain information can be transformative only when it is part of a cyclical process of learning and implementation – with information being used to strengthen both decision-making and accountability.
This is a step-by-step process. It involves first calling attention to unsustainable production practices; then encouraging powerful supply chain actors in making more sustainable decisions; then ensuring that those same actors are held to account and are not falling behind in delivering on their commitments; then providing updated information to inform renewed efforts.
State involvement and robust regulation can support such a process of continuous improvement by investing in capacity building among all actors.
All in all, because of India’s status as a key producer and consumer market, the space for public and private initiatives to work together is vast. There is an opportunity to tap into the growing national and international conversations on sustainability in agricultural supply chains.
Making this opportunity a reality – with a long-term perspective and at scale – would require concerted action in and between the public and private sectors.
Dr Manan Bhan is a fellow in residence at the Ashoka Trust for Research in Ecology and the Environment (ATREE). He is an interdisciplinary sustainability scientist who aims to ensure that sustainable land use can lead to positive outcomes for climate action and human well-being.