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Expanding Understanding through Research: What We’ve Learned about Improving the Effectiveness of Supply Chain Sustainability Initiatives

17 December 2020

More and more companies are making pledges designed to achieve ambitious sustainability goals that reduce deforestation, preserve natural resources, and decrease pollution. Many of these sustainability commitments and initiatives have been in place for years—so, why aren’t we seeing more results on the ground?

This year, four teams of experts tackled one piece of the puzzle by researching corporate sustainability initiatives in cocoa, beef, palm oil, and cotton supply chains. Their studies, supported by the Walmart Foundation and Gordon and Betty Moore Foundation through the Supply Chain Sustainability Research Fund (an initiative launched and coordinated by Meridian), provide a deeper understanding of how sustainability initiatives actually work—and why they sometimes fall short.

To be effective, cocoa sustainability initiatives must consider smallholder farmers’ motivations and roles.

It might seem obvious: smallholder farmers form the base of the cocoa supply chain, so their adoption of sustainable practices is foundational to the effectiveness of cocoa sustainability initiatives. And, indeed, researchers from Climate Focus found that initiatives that respond to smallholder farmers’ needs and motivations were more successful. Expanded land tenure, trainings, and support such as finance and agriculture inputs for smallholder farmers led to greater adoption of Good Agricultural Practices and improved cocoa productivity—changes that help curtail deforestation.

That said, these efforts need to be tailored, comprehensive, and sustained. They need to tackle broader systemic issues, such as low market prices for producers and significant poverty, that undermine sustainable practice adoption. And they need to be implemented by companies working together pre-competitively to achieve landscape- and systems-level change.

Property-level characteristics influence the effectiveness of Brazil’s Zero-Deforestation Cattle Agreements.

As a study from the University of Wisconsin Land Use for Environment Lab highlights, we see some promising results in Brazil following the establishment of the Zero-Deforestation Cattle Agreements. Yet, there is still not full compliance:

  • It is common for ranchers to own multiple properties and choose which properties they report to slaughterhouses for monitoring. Unmonitored properties have a higher risk of deforestation.
  • Deforestation is more likely in remote areas, and large forested properties are more likely to be cleared than smaller ones.
  • A high volume of cattle and deforestation come from a small number of properties. Indirect suppliers who do not sell directly to slaughterhouses account for most deforestation.

A better understanding of these property-level characteristics of deforestation can help pinpoint strategies to close gaps in implementation and monitoring. However, this must be matched with closer alignment between corporate initiatives and government policies, expanded monitoring and transparency efforts, and incentives that effectively target producer and supplier motivations.

To truly understand commodity-tied deforestation, we must look across borders and biomes.

The research team from the University of Minnesota Institute of the Environment makes an important distinction: full compliance with a zero-deforestation commitment does not equate to zero deforestation in a landscape or in a commodity sector. Commodity-driven deforestation is decreasing in certain regions of the world, but unfortunately, these location-specific gains may be offset by losses elsewhere.

Tackling this leakage problem is critical to making meaningful global progress on deforestation. As individual companies strengthen sustainability within their supply chains, this study also calls on researchers and decision-makers to zoom out and investigate how different parallel approaches interact and complement each other to avoid displaced deforestation.

The U.S. cotton sector lacks a coherent, cohesive approach to sustainability.

We enlisted a team from Wake Forest University, The Sustainability Consortium, and the University of Arkansas to lead a study on the U.S. cotton sector, where adoption of sustainability practices has been challenging: “Every actor in the supply chain [is] struggling with the definition of what sustainable cotton is. […] Sustainable cotton initiatives are all using different metrics,” Roian Atwood, a member of the Wake Forest research team, explains.

To improve the sustainability performance of cotton production and cotton sustainability initiatives, the study recommends:

  • Developing a global definition of sustainability that includes region-specific metrics
  • Developing monitoring methodologies that align practical information collected from the field with standards for progress
  • Including social justice issues as a core component of sustainability metrics and improving communication of sustainability metrics to consumers
  • Strengthening connectivity between farmers, companies, and other supply chain actors

The four studies distilled valuable lessons for the future of corporate sustainability efforts and have already spurred productive dialogue. There is much more to unpack in each study, new avenues of research to pursue, and great potential to translate these lessons into improved decision-making and implementation—helping move companies from ambitious commitments to on-the-ground achievements.

Dive into the research!

Explore the other factors that influence the effectiveness of corporate sustainability initiatives.