Market for Sustainable Products Expanding Rapidly

REUTERS- Markets for sustainable products have expanded significantly over the last five years, growing much faster than those for conventional products, according to the State of Sustainability Initiatives (SSI) Review 2010, published last week.

The SSI Review 2010 is a collaborative effort by the International Institute for Sustainable Development, the International Institute for Environment and Development, Aidenvironment, the United Nations Conference on Trade and Development, and ENTWINED--Environment and Trade in a World of Interdependence--research consortium.

The SSI Review 2010 gives a comprehensive overview of major voluntary sustainability standards and initiatives in the forestry, coffee, cocoa, tea and banana sectors, including detailed information on market performance, governance, criteria coverage and implementation practices.

Recent years have witnessed a remarkable rise in the number of environmental and social standards attached to commodities. The SSI Review 2010 includes information on Fairtrade Labelling Organizations International, Forest Stewardship Council, Programme for the Endorsement of Forest Certification schemes, Rainforest Alliance, UTZ Certified, International Federation of Organic Agriculture Movements, GLOBALGAP, Sustainable Forestry Initiative, Social Accountability International (SA8000), and 4C Association.

Key findings in the report include:

- Forestry: the land area under globally recognized sustainable forestry certification has grown by 181 percent over the past five years, reaching 343,603,088 hectares in 2009, up from 122,267,222 hectares in 2004, and accounted for nearly 9 percent of global forested land in 2009.

- Coffee: sales of certified sustainable coffee have more than quadrupled over the past five years, reaching 392,347 metric tons in 2009, up from 73,602 metric tonnes in 2004. Total sustainable coffee represented more than 8 percent of global coffee exports and 17 percent of global production in 2009.

- Tea: sustainable tea production has grown by more than fifty times over the past five years reaching 281,105 metric tons in 2009, up from 4,969 metric tons in 2004, and accounted for 7.7 percent of global exports in 2009.

- Bananas: sustainable banana sales have grown by almost 63 percent over the past two years, reaching 3,480,565 metric tons in 2009, up from 2,133,653 metric tons in 2004, and accounted for 20 percent of global exports in 2009.

- Cocoa: sustainable cocoa sales have grown by 248 percent over the past five years, reaching 46,896 metric tons in 2008, up from 13,473 metric tons in 2003, and accounted for 1.2 percent of global sales in 2008.

The SSI Review 2010 reveals that major voluntary initiatives are altering the way supply chain decision-making is made by providing civil society and developing country stakeholders with a more active role in setting trade rules and production practices.

Overall, there is a trend toward multi-issue initiatives that apply a wide spectrum of sustainability criteria. The SSI Review 2010 highlights, for example, that:

- Environmental criteria are the most prevalent and robust across these initiatives and, in some cases, have expanded to include a wide variety of considerations such as energy conservation, genetically modified organism prohibition and greenhouse gas emissions.

- Social requirements focus on criteria related to compliance with the International Labour Organization's core labour standards, worker health and safety and employment conditions, with less emphasis on gender, employment benefits, community involvement and the humane treatment of animals.

- Economic criteria, although the least developed across the initiatives surveyed, increasingly focus on transparency and sound commercial relations.

Growth across voluntary sustainability initiatives is being driven by growing demands for transparency in global supply chains. The Review reveals that voluntary initiatives are playing an important role in improving supply chain transparency by bringing more credible systems for monitoring, enforcing and reporting on good practice.

However, it also reveals that further growth in the market for sustainable products will likely depend on ensuring the continued integrity and credibility of voluntary sustainability initiatives through more systemic reporting. More in-depth reporting on market and field-level impacts across initiatives represents a key area where further investment will likely be needed as markets mature.

The full report is available a the link below (PDF).

Website: www.iisd.org/markets/

Photo by Ian Ransley/flickr/Creative Commons

Reprinted with permission from Sustainable Business