Zero net deforestation is the new standard for doing business in production of soy, beef, palm oil, paper, and other agricultural commodities. Today it is almost impossible for a business to maintain a large market share without integrating sustainability into the core of its business strategy, and creating prosperous partnerships with local and indigenous communities is widely seen as key to doing so. An increasing number of public, private and NGO actors are striking deals with local and indigenous communities with the aim of securing their supply chains, establishing strong ethical brands and reversing deforestation and forest degradation.
Researchers are positive about the value of such partnerships for business, environment and local communities. “Partnering local communities makes sense for companies because they can increase their chances of leaving a long-term positive impact where they operate. It doesn’t happen fast, but the benefits last longer. Partnerships also help companies to strengthen their reputation and avoid conflicts”, says Torsten Krause, a researcher at Lund University Center for Sustainability Studies (LUCSUS).
“Meaningful partnerships between companies involved in the production and international trade of agricultural commodities and the local communities that live in or adjacent to the landscapes where these commodities are produced are a cornerstone of companies’ efforts to become more sustainable and ethical operators. This goes beyond basic CSR or the legal regulations of countries where these commodities are produced”, says Toby Gardner, Senior Research Fellow at the Stockholm Environment Institute (SEI).
However, there are concerns that the notion of partnership could too easily become an empty mantra in the face of a range of complex issues. But can partnerships make a genuine impact on deforestation and reduce rural poverty?
Why has partnership become important?
The pledge to halt deforestation in the supply chains made by The Consumer Goods Forum in 2010 which includes such companies as Walmart, Coca-Cola, Unilever, Nestlé and Nike, has already made a big difference in reducing deforestation in the Amazon. The same commitment has also helped to improve production standards in the palm oil industry in Southeast Asia.
But it hasn’t always been like that, and despite progress, forest clearing, displacement of communities, human right violations and biodiversity loss are still the reality of agricultural production. Sadly, violence and assassinations of environmentalists are common in many countries.
A shift in thinking on deforestation in the Amazon can be traced to the murder of Dorothy Stang, who advocated for the region’s rural communities, and also to the scandal surrounding production of feed, sourced by Cargill, for poultry used by McDonald’s. Both cases gained a great deal of attention and were followed by strong pressure from consumers and civil society, and resulted in a series of arrests and fines of government officials and ranches, and ultimately led to Brazil’s soy moratorium.
Changes in palm oil product standards started to happen when Nestlé, after being publicly exposed by a series of Greenpeace campaigns, refused to buy from Golden Agri-Resources (GAR) and began demanding sourcing practices that would respect nature and rights of the local people. In both cases food production giants, threatened by losing profits because of bad publicity, were forced to change the way they do business, setting the standards high. In other words, paying attention to the interests of local people is valuable for branding. And, making partnerships with local communities offers an opportunity to sustain this value over time, secure steady supply, and diversify incomes through creation of new products and higher business efficiency.
Creating mutual value – something special to look for?
Practice shows that setting standards is only the beginning of the work. Partnerships are very heterogeneous; each individual project will have its own relationship dynamics that depend on a variety of factors – a bit like a marriage. This means there is no model to follow and that success requires hard work and mastering a multitude of skills from resource management to sophisticated psychology.
There are, however, success stories. One example is the work of RUNA – a hybrid organization which is both a private company and a foundation – in the Ecuadorian Amazon. RUNA established a new market for Amazonian tea made from the guayusa plant. RUNA sources guayusa from 3000 small-scale producers, who grow the plant using agroforestry techniques. The product is organic and certified fair trade, and brings the community US$250,000 in revenue annually. RUNA Foundation has also another project – the NAKU medicinal and wellness center situated in the Ecuadorian Amazon. The approach at this centre is based on the healing techniques of the Sápara people. The Sápara are a forest community numbering only 575 souls, with a rapidly disappearing culture that UNESCO is attempting to preserve. The NAKU wellness center is entirely run by the Sápara community.
Both of the examples show how finding something special about the communities you are going to work with can add up to a successful business case that benefits both local people and forests. Creating economic value that goes beyond timber is key to careful forest stewardship, because keeping forests and preserving ecosystem services becomes the basis of the business. In fact, there is data that shows that net deforestation in the areas where forests are managed by the local communities is close to zero, which answers the aim of the Consumer Goods Forum’s pledge.
“Partnerships with communities are more than the conventional giver – receiver relationship, which was very common in the past. Moreover, local people who own and use natural resources and who have a right to do so have to be an equal and respected partner in any development or conservation project that is carried out on their land”, says Torsten Krause.
“Much work remains to translate on-paper commitments to on-the ground changes in practice, and there is plentiful cause for scepticism, but the recent boom in private sector commitments for zero deforestation and more ethically grounded supply chains offer an unprecedented opportunity for changing the way in which agricultural commodities are produced, traded and consumed across the world. And it is an opportunity that should not be ignored”, adds Toby Gardner.
Together with a group of colleagues Torsten Krause is currently working on a policy brief which will gather experience from several community partnership projects and analyse key success factors and challenges when running such projects. The brief will be published in January 2016.
Toby Gardner is involved in the development of the SEI’s Transformative Transparency decision-support platformwhich makes it possible to trace the origin of products consumed in any country of the World down to subnational regions of production, such as municipalities.
Both of the researchers will participate in the Global Landscapes Forum 2015. You can meet them at the SIANI booth at the Food Security and Livelihoods Pavilion (B) and engage with them during a dialogue on how to ensure better practice along agricultural supply chains, an event organized by SIANI and Fairtrade International.