Nationally Driven Sustainability

International Supply Chain Management Congress Amsterdam, 29 Nov, 2012

Shatadru Chattopadhayay

4 issues covered

1. Whether Asian markets ready for sustainable transition?

2. Why do we need locally owned sustainability standards in Asia?

3. How do they relate to international sustainability standards?

4. Why should global North should engage with this agenda?

China, India, Indonesia, UAE, Brazil USA, Western Europe

Consumers in Rapid Growth Economies (RGEs) appear to care more than their Western colleagues

Source - Edelman goodpurpose® 2012

BBMG, GlobeScan and SustainAbility, November 2012

Sustainability spectrum

BBMG, GlobeScan and SustainAbility, November 2012

not important at all

not so important

indifferent

important

highly important

Our Survey in Two Major Indian Cities Show-> 50% Indian Consumers considers certified tea & Coffee is IMPORTANT

And 45% are willing to pay 5 to 10 Percent extra for such product

Yes

No

Not w illing to pay e

76-100%

51-75%

26-50%

11-25%

5-10%

<5%

Other examples

Other examples

New Sustainable Outlets are coming up in India

The need for locally owned standards

1. The top down-fit all approach of global standards is resisted by the stakeholders even when there is a export market. Cultural issues come on the way.

2. Governments are getting active in the field of sustainability by developing voluntary systems themselves. (E.G. ISPO from Indonesia, China Social Compliance 9000, IS 16001 from India).

3. India, China and Brazil are the biggest producer and consumer of most agro-commodities. Yet, most international standards do not operate in these markets.

4. International standards are costly to implement in a low margin business model of Asia.

5. Global businesses are increasingly seeking to provide sustainable products to all customers in all markets.

One size doesn’t fit all

208 292.24162.5

410.35

2219.02

191.1 91.83 20.72

Tea Markets In Million Kilograms

West Europe East Europe America West Asia Asia other than West

North Africa Africa other than north Oceania

Partially Certified

Not

Cer

tified

Even if the total tea markets of West Europe and Americas are Certified-90% of Tea Would Still Remain Unsustainable

Local standards v/s International-Common Concerns

• Start with what is local and what is international?• Local standards reduces the sustainability criteria and

have less credibility?• The local standards could be base line or “stepping

stone” standards to international ones?• More standards/codes are bad as it increases the

cost and confuses stakeholders?• The governance of local standards are weak?• More……..?

International and Local standards-how to relate

• Standards are tools for sustainable change. The challenges are so vast that all can co-exist.

• The domestic standards will be mostly targetting high-hanging fruits-potential clients for international standards.

• May fuel innovation and lead to more efficient systems

A potential learning from aviation industry?

Why should global North engage?

• The agro-commodities like tea, coffee, sugarcane, cotton, fruits, vegetables, livestock, soy, palm oil which has a huge impact on land and water are mostly produced and consumed in emerging markets of India, China and Brazil.

• A level playing field for businesses from North to participate in outperforming markets of Asia.

• Sustainable agriculture will act as a future bridge between needs of feeding the 9 billion population in 2050 and a increasing global requirement of feed, fiber and fuel.

Conclusion

• Major Asian markets are ready for sustainable transition

• Large scale transformation of Asian agriculture sector covering more than half of world population requires local solutions

• Existing international standards could co-exist along with the standards emerging from new markets.

• There is one planet and there is one agenda!

www.solidaridadnetwork.org

THANK YOU