Abstract
Private standards have been emerging as governance mechanisms throughout the last decade in various industries, especially for global commodity chains. Whereas public standards and other governmental governance methods receive their legitimacy from electoral processes, private standards are forced to seek legitimacy through stakeholder support since these standards are voluntary. This research examines why private standards are perceived legitimate by important stakeholders, specifically in indirect commodity value chains, by examining the case of private standards for sustainable soy in the feed value chain.
The results indicate that consumers exert a lower degree of influence on the level of legitimacy of private standards for indirect commodities, relative to direct commodity standards, since consumers are less aware of when and how they consume indirect commodity products. Furthermore, the results indicate that the lower degree of consumer influence on private standard legitimacy causes a redistribution of the level of influence among the remaining stakeholders, whereas the business actors in the global value chain gain a higher level of influence and non-governmental organisations gain a lower level of influence on providing legitimacy to private standards.
Keywords: private standards, global value chain, legitimacy, indirect commodities, sustainability, sustainable performance, stakeholders, soybean, agricultural commodities, indirect commodity.
Acknowledgement
Since the agricultural sector and international trade both raise my interest, I wanted to gain in depth knowledge about the global value chains in commodities. Private standards have been emerging in the recent decades to govern global value chains and its actors in ways that are beyond reach for governmental institutions. Therefore, I have chosen to write my master thesis on this subject as part of my master International Business and Management at the University of Groningen. Conducting this research enriched by knowledge and competence on this topic.
1. Introduction
Private standards have been emerging as governance mechanisms throughout the last decade in various industries, including dominantly global commodity chains (Schouten and Glasbergen, 2011). Private standards are developed to govern a diverse range of attributes, such as standards regulating food safety, food quality, and environmental and social impact of the food value chain (Smith, 2009; Henson and Humphrey, 2009), as well as international accounting standards (Zaman and Rahaman, 2005), and standards to govern environmental practices in the forestry sector (Gulbrandsen, 2005). Bernstien and Cashore (2007: 348) define private standards as “deliberative and adaptive governance institutions designed to embed social and environmental norms in the global marketplace that derive legitimacy directly from interested audiences, including those who seek to regulate, not from sovereign states.”. What is perceived as legitimate is a generalized perception that differs across place, time and organisational context, depending much on socially constructed norms, values and beliefs (Suchman, 1995; Koppell, 2008). This makes it very difficult to develop a framework for legality that is generally applicable to all countries or regions, and whereas public standards and other governmental institutions receive legitimacy from their formal authority as a governmental institution, private standards are forced to seek legitimacy through other channels since they lack formal authority(Schouten and Glasbergen, 2011).
As private standards have been emerging, there is also an increasing interest in research on legitimacy for private standards (Bernstein and Cashore, 2007; Marin-Burgos, Clancy and Lovett, 2015; Schouten and Glasbergen, 2011). The concerns for private standard legitimacy are grounded in two characteristics: (1) private standards cannot derive legitimacy from electoral or legislative processes to gain legitimacy for rule-making in national democracies, and (2) many of these private standards seek to govern issues that affect different groups of stakeholders at different scales, therefore the impacts that they aim to tackle can be part of a complex field of social and economic conflicts and competing forces of different stakeholders (Marin-Burgos, Clancy and Lovett, 2015; Schouten and Glasbergen, 2011). Ponte (2012) adds that legitimacy of private standards seems to result from the acceptance of local actors and industry stakeholders that these standards aim to govern.
(FAOSTAT, 2016). Only 2-3% of the global soybean production was produced under a private sustainability standard in 2013 (KPMG, 2013) while there are 33 private standards for sustainable soy (Nevedi, 2015; Standards Map, 2016), this seem a relatively high number of standards compared to its global effect. This number of existing standards seems to be significantly larger than those of other commodity products. For instance, for sustainable forestry there are only two main standards, the Forest Stewardship Counsel (FSC) and the Program for Endorsement of Forest Certification (PEFC) standard.
Other than the surprisingly high number of private standards aiming to govern the soybean value chain, this value chain is interesting because of its relative invisibility to the consumer. The soybean consumption is mainly indirect; 75% of the global soybean production is used for animal feed (Nevedi, 2015b) and according to the WWF (2015), European citizens annually consume approximately 61 kilograms of soy of which 57 kilograms are consumed indirectly via the animal products that consumers eat daily such as meat, dairy, eggs and fish. Therefore, we label soybeans as an indirect commodity product, which is an important aspect in the light of this case study.
Whereas much research has been done on private standards governing direct commodities that are visible to the consumer, such as sustainable fish (Ponte, 2012), sustainable forestry (Gulbrandsen, 2005), cacao (Haynes et. al., 2012), and coffee (Gielissen and Graafland, 2009), there has been less emphasis on standards governing the less visible indirect commodities. A decreased level of visibility for consumers might cause a shift in bargaining power between the different stakeholders influencing private standard legitimacy since consumers might be less aware of their soy consumption and the sustainability issues concerning soybean production. This research divides the important stakeholders of the global soy value chain into four categories; consumers, governmental institutions, non-governmental organisations and business actors. When the influence of consumers on private standard legitimacy is decreasing, we expect this influence to be redistributed among the other stakeholders.
sourcing guidelines, a benchmark for private standards for sustainable soy established by the European Feed Manufacturers Association (FEFAC), were only published in late 2015. The dates of these developments indicate that competition among private standards for sustainable soy has been increasing especially in recent years, which might be the reason that there is so little research conducted in the context of the global soy value chain, and more specifically in the context of an indirect commodity value chain.
In summary, this research examines why and how private standards are perceived legitimate by important stakeholders in an indirect commodity value chain. First, we review previous research on private standards, stakeholders and their ways to gain legitimacy. Secondly, in a single case study design we review secondary data sources from the industry and private standard organisations complemented by the analysis of three qualitative semi-structured interviews with industry professionals - a commodity-buying cooperative, the Dutch feed industry association and a private soy standard owner - to explore how and why private standards gain legitimacy in an indirect commodity value chain. In the last section we review our findings and derive 6 propositions about the redistribution of influence on private standard legitimacy among various stakeholders in the global value chain, highlight our contributions to existing literature, explain the limitations of our research and provide opportunities for future research.
2. Theoretical background
increased their attention to the appearing privatization of governance (Cashore, 2002; Levy and Kaplan, 2008).
2.1 Private standards and legitimacy
The increasing importance of private standards follows the understanding that transnational NGOs derive their legitimacy from the states’ failing legitimacy (Collingwood, 2006). In the move from state-driven governance methods of political legitimacy to an open system with non-state driven governance methods citizens confer legitimacy to decisions based on other characteristics than electoral processes (Benner, Reinicke and Witte, 2004), in addition, Suchman (1995) describes these characteristics in its definition of legitimacy; “a generalized perception or assumption that the actions of an entity are desirable, proper or appropriate within some socially constructed systems of norms, values, beliefs and definitions”.
The role of private standards governing global value chains raises important questions regarding legitimacy since private standards do not have electoral accountability. Legitimacy is not only related to political authority and therefore remains a contested concept in social science research (Johansson, 2012). Legitimacy can be seen in two views, a normative view and the sociological view. In the normative view institutions gain legitimacy through the
formal right to rule, whereas the sociological view provides legitimacy to actors that are
widely believed to have the right to rule (Black, 2008; Johansson, 2012). In other words, there is a difference between when a governance system should be perceived as legitimate and whether it is perceived as legitimate by important stakeholders (Black, 2008). This paper is concerned with the latter definition of legitimacy, that is why and to what extent private sustainable soy standards are perceived as legitimate by various stakeholders.
Johansson (2012) argues that the private governance processes must logically include a third party mediation by a party that is perceived as legitimate.
According to Cashore (2002) and Ponte (2012), private standards derive their authority to pressure the global supply chain from external audiences such as consumers, NGOs, activist groups, supply chain actors and the evaluation of the governance system by the parties the systems aims to rule. For instance, soybean producers. In addition, Gulbrandsen (2005) concludes that the balancing of various stakeholder interests appears crucial for rule-making authority and advices to pay attention to political, legal, and socioeconomic contexts that constrain or facilitate legitimacy. According to Ponte (2012), who studied the private standard Marine Stewardship Counsel (MSC) for sustainable fish, the market for private sustainability standards is characterized by three concerns: (1) finding a market for certified products, (2) securing supplies of certified products, and (3) securing support from influential (non-) governmental institutions as a way of lending legitimacy and rule-making authority to the certification standard. This requires the development of standards with which producers are able to comply and which are at the same time able to gain external support from third parties such as governmental institutions, non-governmental organisations and business actors to derive legitimacy and ensure proliferation of the standard.
We will review previous research, categorized in the aforementioned topics defined by Ponte (2012) in order to analyse how private standards address supply and demand concerns and handle stakeholder influences which enable standards to achieve legitimacy. Furthermore, we will argue how and why these influences are expected to in the different contexts of direct and indirect commodity value chains.
2.2 Supply and demand of certified products
To fully exploit all opportunities for proliferation of the standard, private standards have to secure their supply of certified products through producer compliance on the supply side and adaption of the standard on the demand side. Securing the supply and demand of certified products comes with many challenges, mainly concerning the balancing between costs of adaption and compliance, and the quality of the standard (Ponte, 2012). We discuss the main challenges that arise on the road to legitimacy for private standards.
high reputational risks (Schouten and Glasbergen, 2011; Bäckstrand, 2008). On such basis, retailers and processors might prefer more demanding standards that are a safeguard against moral hazards and that have also developed a high level of recognition among consumers.
2.2.1 Supply concerns
Agricultural commodities are produced on farms of various sizes. Typically, large farming entities have access to financial resources and are therefore able to invest in sustainable practices to comply with a standard. However, there are widespread claims that smallholders, specifically in developing countries, are not able to meet the requirements of the European market standards due to high compliance costs and the increasingly exacting requirements (World Bank, 2005; Garcia Martinez and Poole, 2004; Jensen, 2004). On the other hand, there are private standards who specifically target smallholders in developing countries for their products e.g. Max Havelaar who also promises a minimum price level for their products if the market price drops below the production costs. However, these standards do come at a higher cost (Loureiro and Lotade, 2005). Furthermore, some studies provide evidence of cases where smallholders have maintained or enhanced their market share in exports (Lemeilleur, 2013; Lee, Gereffi and Beauvais, 2012). Therefore, evidence on small farm producer exclusion due to compliance costs is mixed but seems dependent on the strategies and intentions of private standards.
It seems clear that lower compliance costs lead to a higher level of producer compliance, especially for small producers with limited financial resources. The MSC standard is an example of a standard that spurred an increase of their number of certified suppliers through developing their certification process to be more efficient and cost-effective. They have developed the Fishery Assessment Methodology, which lowered the compliance costs without lowering the standard (Ponte, 2012).
2.2.2 Demand concerns
announced in 2006 that it would only sell MSC certified fish from 2011 on. This announcement created a domino-effect with other large food companies following the lead of Walmart, which created a large demand for fish certified by the MSC standard. This might imply that adaption by large industry players results in a higher level of legitimacy and subsequent adaption of the standard.
As NGOs effectively organize big global media campaigns to force companies into reforming their sourcing policy (Gulbrandsen, 2006; WWF, 2016), private standards could use equal means to persuade consumers to buy products certified by their standard. In addition, previous research concludes that consumers are willing to pay a certain amount for the enhancement of food quality attributes and the effect of consumer demand for quality in the food value-chain emphasizes quality differentiation. However, not all is in the direction of upgrading food quality since the basic price/quality markets for low-income consumers remain strong (Caswell and Joseph, 2008; Veisten, 2002).
In addition, recent surveys showed that companies did not adapt to private standard certification only because of the premium being paid for certified products, but also for other reasons such as building brand equity and protecting a company’s licence to operate (UNEP, 2005; Derichs, 2005). This is amplified by Gulbrandsen (2006), who sees the global marketplace as an environment for political commotion by consumers, interest groups, social and political movement organisations which could cause serious harm to a company’s reputation. Therefore, companies might also adapt to private standard certification to avoid reputation damage.
2.3 Stakeholders’ influence on legitmacy
Since the balancing of a broad range of stakeholder interests in standard development and rule-making appears crucial for legitimacy (Gulbrandsen, 2005; Henson and Humprey, 2009), this section reviews various stakeholders that are assumed to influence private standard legitimacy. We distinguish between governmental institutions, non-governmental organisations and business actors.
2.3.1 Governmental institutions
Governmental institutions can have a large impact on the proliferation and legitimacy of a private standard in their country or region. Governments can lend moral support to private standards, improving their reputation among professional buyers and consumers, and facilitate implementation processes (Cashore, 2002; Foley 2013). Furthermore, governments can signal that certain private standards are credible and legitimate governance systems that buyers and corporate procurers can rely on, by approving these standards through public procurement or other policies. The rejection of a standard is likely to result in the reverse signal (Gulbrandsen, 2014). In addition, Ponte (2012) argues that when a certification scheme wants to be competitive it has to be both independent from political influence and efficient enough to keep up with the moving business environment. So, while it is beneficial for private standards to have support from influential governmental institutions, it can become a constrain when politics have the bargaining power to influence the standard.
Johansson and Lidestav (2011) show that governments can play a central role in the proliferation of a standard; in the last decade it is not uncommon that states share their rule-making policies with market-driven governance methods such as private standards, several countries have done this regarding the sourcing of sustainably produced wood. The reviewed literature shows that governmental support is a base-line requirement for private standards in their journey towards legitimacy.
2.3.2 Non-Governmental Organisations (NGOs)
The impact of NGOs on the proliferation and legitimacy of private standards seems substantial. In the cases of the Marine Stewardship Council (MSC) for sustainable fish, and the Forest Stewardship Council (FSC), the World Wildlife Fund (WWF) was involved in the creation of these standards. With support of the powerful public relations department of the WWF, these standards gained legitimacy relatively easy and became standards with rule-making authority in some of their markets (Johansson and Lidestav, 2011; Marx and Wouters, 2012; Ponte, 2012). Furthermore, NGOs, ethically and politically motivated activists have been using the power of ‘naming and shaming’ and their capability to bring damage to brand reputation by forcing policy reform through criticizing specific producers for their questionable choice of resources, up-stream producers and products (Boström and Hallström, 2010; Gulbrandsen, 2006). They use the force of ‘naming and shaming’ and media attention to force governments, private standards or companies to change their policy towards the goals of their idealism, controversially, they can us equal means to promote their preference for a particular standard by supporting it publicly.
The MSC standard dominates the market for sustainable fish and is a good example of how private standards gain legitimacy through the influence of NGOs and other non-governmental commercial organisations. The standard was initiated by the WWF and Unilever in the 1990s, with Unilever being a large buyer of fish securing a certain level of demand and the involvement of the WWF provided the standard with legitimacy in the global marketplace. Furthermore, the first MSC chairman was a former UK fisheries and environment minister providing an even higher level of legitimacy and signs of political support (Ponte, 2012). The previously mentioned adaption of Walmart to only sourcing MSC certified fish, and the following domino effect, further enhanced proliferation of the standard. This example shows that private standards should seek approval and support from independent organisations and seek ties with governmental institutions to achieve legitimacy for their standard. To gain support from large and influential NGOs such as the WWF, a private standard should show that is more effective in addressing certain sustainability issues than other private standards (Ponte, 2012).
influence is expected to be less powerful since it is harder to leverage their public relations and campaigning capabilities without the awareness of consumers. The WWF has had a great influence in the legitimacy and proliferation of the FSC and MSC standards for sustainable forestry and fish as Gulbrandsen (2006), Johansson (2012) and Ponte (2012) show, but it is expected to have a less powerful degree of influence for the RTRS standard in the indirect commodity supply chain of sustainable soy.
2.3.3 Business actors
A private standard can differentiate itself through focussing on commercial organisations by promoting itself as more business friendly. The difference between the UTZ and Max Havelaar certification illustrates this point; both of these standards were initiated to make sustainable agriculture the new standard. UTZ was initiated by Ahold, a large Dutch retailer, and a Guatemalan coffee producer as an alternative to Max Havelaar. These certifications differ in terms of guarantee of a bottom price and the size of certified producers. Whereas Max Havelaar focuses on small producers and guarantees a minimum price for their products, UTZ focuses on large as well as small producers and has close ties with the industry. UTZ guarantees no minimum price level and complies to market pricing. For these schemes, Max Havelaar is more likely to gain support from social NGOs whereas UTZ is more likely to be preferred by large business actors. Both certificates have gained legitimacy for equal products, but due to their differentiation strategy these schemes can exist alongside each other (Ingenbleek and Reinders, 2013; Gielissen and Graafland, 2009).
It seems that to gain legitimacy and adaption, private standards have to differentiate themselves from other standards either in focusing on widespread social and environmental issues, being excellent in a specific niche that has positive values for consumers such as Max Havelaar, or other competitive advantages such as the UTZ standard has done.
2.4 Lessons learned from previous literature
The previous section of this research has reviewed literature on determinants of private standard legitimacy. Previous literature is predominantly focussed on standards and commodities that are visible to the consumer because of their direct nature. The findings for determinants of private standard legitimacy are expected to differ for the soybean value chain, because of its indirect nature. This paragraph will shortly summarize the differences that we expect to find.
This research examines why private standards are perceived as legitimate by important stakeholders in an indirect commodity value chain. We argue that the factors that explain why private standards are perceived as legitimate differ between indirect and direct commodity value chains. The main argument for expecting different determinants is that for indirect commodity standards the influence of the consumer is expected to be considerably lower. For the soybean value chain this is because it is expected that consumers are not aware of when and how they indirectly consume soy, which is mainly through feed for the production of livestock products such as dairy, meat and eggs. Since consumers are not able to boycott non-sustainable soy when making purchasing decisions, they are expected to exert a lower degree of influence on private standards legitimacy. As a result, the reasons why private standards are perceived as legitimate by important stakeholders are expected to change. As a result of consumer exclusion, or at least a lower degree of influence, the influence of stakeholders on private standard legitimacy is expected to be redistributed among two groups of remaining stakeholders in the value chain; NGOs and business actors. Furthermore, we expect that business actors gain a higher level of influence on private standard legitimacy and that NGOs will have a lower level of influence. That is because we expect that it is harder for NGOs to leverage their public relation and campaigning capabilities for commodities that are less visible for consumers. We don’t mention the third group of stakeholders here, governmental institutions, since these institutions have formal authority which is not expected to change with a lower degree of consumer influence. We summarize the findings for the main actors in these value chains; governmental institutions, NGOs and business actors.
institutions are not expected to have a different degree of influence on legitimacy for indirect commodity standards since they have the independent authority to govern and their authority is not affected by consumers.
The WWF has had a great influence in the legitimacy and proliferation of the FSC and MSC standards for sustainable forestry and fish as Gulbrandsen (2006) and Ponte (2012) show. However, for indirect commodity value chains NGOs are expected to have a different degree of influence. They can still force companies and standards to change their policy because of their ability to cause reputational damage and promote a specific standard. However, they are expected to have a less powerful degree of influence in the indirect commodity value chain since these types of campaigns are typically aimed at consumers.
A lower degree of consumer influence causes that commercial differentiation strategies, like the example of Max Havelaar, might be less fruitful since this type of certification draws on the appeal of a specific type of consumer. We argue that diversification could still provide legitimacy in the indirect commodity value chain, but that this differentiation is aimed at business actors instead of consumers. The business actors, like the downstream feed industry and livestock product processors and upstream soybean producers, might exert a higher degree of influence on what type of diversification strategy is enhancing the level of legitimacy of a standard in the indirect commodity value chain.
3. Methodology
3.1 Research design
A case study method was chosen because it can generate knowledge that cannot be extracted from a purely statistical analysis and is perceived suitable for studying “how and why” type of questions (Meredith, 2002). Furthermore, case studies are especially suitable for the study of phenomena in a highly complex context (Stuart et. al., 2002). Therefore, a case study seemed the most suitable for exploring how and why private standards gain legitimacy in the context of an indirect commodity value chain.
Industry Association (Nevedi), is taking a leading position through their commitment to exclusively source soy that is certified by private standards compliant to the FEFAC soy sourcing guidelines since 2015. In addition, the soybean value chain is the first indirect feed commodity value chain that is intensively governed by private standards and is seen as a leading example and learning curve for future development of sustainability governance for other commodities in the feed value chain. Together with the recent developments of the establishment of the FEFAC soy sourcing guidelines and the Dutch commitment to these guidelines this makes the soybean value chain an ideal setting for studying how and why private standards gain legitimacy in indirect commodity value chains.
3.2 Data collection
This research studies the process of shaping which standards are perceived as ‘legitimate’ by important stakeholders. The selection of the 9 private sustainable soy standards for the feed value chain that are being examined in this research is based on the FEFAC soy sourcing guidelines (FEFAC, 2015). The FEFAC soy sourcing guidelines is a benchmark for sustainable soy standards established by the European Feed Manufacturers, and it shows to what extent the available private standards for sustainable soy comply with the European feed industry’s minimum requirements for sustainability certification. The 9 studied standards are the only standards out of the 33 standards in total that have passed the benchmark to date, passing this benchmark provides these standards with a base-line of legitimacy for the European feed industry. Furthermore, the Dutch feed manufacturers association has agreed to only source soy that is certified according to the FEFAC soy sourcing guidelines which emphasizes the role of these guidelines in providing legitimacy to standards in the European market.
sustainability and innovation. All interviews took place at the headquarters of these firms with time ranging from 90 to 110 minutes, the interviews were transcribed afterwards through audio recording the interviews.
A semi-structured questionnaire guided the interviews, and certain areas of the questionnaire were given more or less emphasis, depending on the area of expertise of the interviewee. The questionnaire contained questions about their company and its position in the value chain, private standard legitimacy and stakeholder influence on private standards legitimacy.
3.3 Data analysis
these stakeholders are able to influence private standard legitimacy, and what sustainability issues private standards should aim to overcome. Second, we have analysed the 9 sustainable soy standards that passed the FEFAC soy sourcing guidelines and examined their characteristics that might influence their ability to be perceived as legitimate by important stakeholders. Last, we have contrasted the lessons learned in the literature section of this research to the interview data and the conclusions we were able to draw from secondary data. In the last section we review our findings and derive 6 propositions about the redistribution of influence on private standard legitimacy among various stakeholders, highlight our contributions to existing literature, explain the limitations of our research and provide opportunities for future research.
4. Findings
4.1 Research setting: The soybean value chain
In this section we will briefly explain the main characteristics of the global soy value chain and its actors to provide some information on the context of this research. Figure 1 shows a chart of the soy value chain from the farmer to the consumer. After the soybean has been crushed, the process to separate the soy oil and soy meal, 75% of the production is consumed by the feed industry, some 6% is consumed directly via food and the remainder is used for the production of biofuels and other products such as detergents (WWF, 2014a; Nevedi, 2015b; Soja Coalitie, 2014). Since the feed industry consumes 75% of the total soy production and commodity certification by private standards is not mandatory for this industry, this section of the value chain is the most suitable for studying legitimacy for private standards.
The following section will discuss the main actors in the soy value chain as they are shown in figure 1, with exclusion of the shipper since this is purely a way of transporting soy from the producing location to the processing destination. In addition, the last two sections of this paragraph will elaborate on the influence of NGOs on private standard legitimacy and explain the major sustainability issues that have caused the emergence of private standards in this value chain.
4.1.1 Soy farmers and cooperatives
The soybean supply chain, is a natural resource-based supply chain and is bounded by geographical boundaries and institutional environments of its production region. The global soybean production has increased from 81 million tonnes in 1980 to 276 tonnes in 2013 (FAOSTAT, 2016) and its production region covers a combined area of Germany, France, Belgium and the Netherlands together (WWF, 2014b). Through the rise of industrial-scale livestock farming, the soy production has undergone the largest growth of any crop. It is argued that its production could almost double between 2014 and 2050 (WWF, 2014a). Figure 2 shows the average soybean production volume of 2012 and 2013 of the largest producing countries. Especially Brazil and Argentina have been growing their soybean at a high pace in recent years, and together with the US they were accountable for approximately 80% of the global production in 2013 (FAOSTAT, 2016). The production of soybeans is conducted by small and medium farmers, cooperatives and the worlds’ largest agribusinesses (WWF, 2014b).
Figure 2: Average soybean production (2012-2013) of the largest producing countries (FAOSTAT, 2016)
soybean production arise in the Latin America, where the rapid deforestation and other social and environmental issues have triggered NGOs and activist organisations to call for sustainable practices (Institute for International Trade Negotiations, 2011; Hospes et al, 2012). Therefore, the attention of private standards seeking to govern sustainability issues in the soy value chain is predominantly focussed on Brazil and Argentina. The US is the largest soybean producing country, however, sustainable practices are enforced through national legislation and their developed institutional environment. To provide evidence for this statement, the United States Soy Export Council (USSEC) has developed the Soybean Sustainability Assurance Protocol (SSAP), which is a certified approach audited by a third party to demonstrate sustainable soybean production at a national scale. The main sustainability issues for soybean production in Latin America will be highlighted later in this part of the study.
Private standards in the soy value chain aim to govern the practices of local soy producers to improve the sustainability of soybean production. Soy producers are part of the stakeholder group ‘business actors’, and can influence private standard legitimacy and proliferation through complying or not complying to a certain standard.
4.1.2 Soy crushing and trading companies
The four largest commodity trading and crushing MNEs, the so-called ABCD companies; ADM, Bunge, Cargill and Dreyfus, are important actors for the global soybean trade. These companies can in fact be considered as the focal companies for the total global grain trade since they account for between 75% and 90% of the global grain trade (The Guardian, 2011)1. The ABCD quartet are essential to the global commodity trade since they own essential networks of ports, ships, storage silos and farmer relations and sell to customers ranging from Nestlé to the Egyptian nation wheat buying board (The Financial Times, 2013).
In the context of the soy value chain, these companies own many acres of arable land for the production of soy in Latin America and source from local soy producers. Furthermore, soy crushing, the process to divide the soybean into soy oil and soy meal, is dominated by the ABCD companies. Soybean crushing is a capital-intensive industry, producing soy oil costs roughly twice as much to produce than palm oil. Therefore, processors have to exploit significant economies of scale to remain competitive. The ABCD companies are dominant in
all major exporting countries and in the USA, Bunge, Cargill and ADM crush more than 70 % of the total soy production (Oxfam, 2012).
According to Greenpeace (2016), these traders play an important role in reducing deforestation caused by agricultural production since growers of agricultural products depend on the power of the ABCDs to process and export their products. Whereas all four ABCD companies have developed their code of conduct to show their environmental awareness and limit un-sustainable practices, only Cargill and ADM have developed a private standard for sustainable soy that was able to pass the FEFAC soy sourcing guidelines. Bunge has also developed its own private standard for sustainable soy, which is in the process of being benchmarked against the FEFAC soy sourcing guidelines. Dreyfus is only certified for by the 2BSvs scheme for sustainable soybean production, compliant to the EU-RED legislation, since their soy production is mainly used in the biofuel value chain. Other than having developed their own private standards, these commodity traders are all a member of the RTRS organisation; the owner of the RTRS standard.
The commodity trading companies are business actors with much influence in the soy value chain. However, since these companies are also the owner of their standard, their standard has to be perceived legitimate by other stakeholders. Furthermore, through membership of the RTRS organisation it seems that these actors also perceive the RTRS standard as legitimate.
4.1.3 The feed industry
The feed industry is an important stakeholder in the soy value chain since this industry consumes approximately 75% of the global soy production (WWF, 2015a). It seems that the European feed manufacturers have collectively produced a benchmark method to objectively assess whether a private standard can be perceived legitimate according to their standards.
4.1.4 The livestock industry
The European livestock industry is composed of many farms, producing meat, dairy and eggs, that are the link between the feed manufacturers and the livestock product processors. It seems that these farms do not take a pro-active role in sustainable soy sourcing. They are in between two major industries that both experience peer pressure for sustainable performance, so it seems that this industry moves along with the developments of their up- and downstream value chain actors. A reason for this might be that all these farms are of relatively small size compared to the upstream and downstream businesses actors and are simply the link between the input products produced by the feed industry and the sourcing requirements of the processing industry. Therefore, the livestock industry is not considered an important stakeholder in the light of sustainable soybean standard legitimacy.
4.1.5 The processing industry
The processing industry are the processors of dairy, meat and egg products. In this research we focus on the Dutch processing industry since the Dutch feed industry has a clear position in providing legitimacy to a certain selection of standards and the processing industry even distinguishes between the standards that are perceived legitimate by the feed industry (Nevedi, 2015b). Namely, the Dutch dairy processors demand that the soy used for their dairy production is certified by the RTRS standard. Furthermore, the meat and eggs processing industry will only allow RTRS certified soy for the production of meat and eggs for the Dutch retail market. However, for the meat and eggs that are produced for export they allow all standards that have passed the FEFAC soy sourcing guidelines benchmark (The Sustainable Trade Initiative, 2015; Nevedi, 2014).
4.1.6 Retail and consumers
Whereas consumers are expected to exert a low degree of influence on the level of legitimacy of private soy standards, retail chains still seem to take initiative towards sustainable soy sourcing. The two largest supermarket chains in the Netherlands, Albert Heijn and Jumbo, state on their website that they have made an agreement with the WWF to exclusively source RTRS certified soy for the production of their private label products starting in 2016 (Albert Heijn, 2016a; Jumbo, 2013).
However, since they mention that this is an agreement with the WWF, one of the main initiators of the RTRS standard, is seems that they have made this agreement because of peer pressure for sustainable sourcing.
4.1.7 NGOs
In 2006, right before the emergence of several initiatives for sustainable soy production, 60 activists of Greenpeace took over the cranes and conveyor belts of commodity trader Cargill in the port of Amsterdam to prevent the unloading of a shipment of soy. Their aim was to make Cargill stop sourcing soy from the Amazon area in Brazil, where soybean production is a major reason for deforestation (Greenpeace, 2006). It seems that NGO pressure and their ability to cause serious reputational damage to business actors have been the main driving force behind the emergence of private standards governing sustainable soy production. Furthermore, the WWF is one of the initiators of the RTRS standard which shows that NGOs do not only pressure for sustainable practices of other actors, but also take initiative to provide solutions for these issues.
Especially the WWF is focused on sustainable sourcing in the soy value chain, and has published many reports and articles on the sustainability issues and practices in this value chain. It seems clear that, since the WWF has co-established the RTRS organisation, the WWF only supports the RTRS standard publicly and thus seem to perceive only this certification as legitimate.
4.1.8 Major Sustainability issues
FEFAC soy sourcing guidelines since their benchmark requires a base-line level of sustainability for all three dimensions of sustainability. Some sustainability attributes for soybean production can be technically quantified and measured, however, for most attributes there is much room for personal interpretation depending on education level, interests and objectives (Berkum and Bindraban (2008). We shortly summarize the most pressing issues below, according to Berkum and Bindraban (2008) who conducted a field study in Brazil.
Important natural ecosystems in Latin America are facing increasing pressure since more and more of its hectares are given up to be used as arable land. The conversion of forest, grassland and savannah to agriculture is a trend that mainly manifested in developing countries. Due to the increasing soybean production many hectares of the Brazilian Amazon have been deforested. The Brazilian government has taken initiative to stop this deforestation through renewing their forest code in 2012. However, since the institutional environment in Brazil is apparently not powerful enough, there is still much illegal deforestation for the production of soy. Soy is an intensively grown crop which has an impact on its environment, also outside of the Amazon area. The main issues for the soybean production in this regard are the effects of pumping up groundwater to irritate the crops and the use of chemicals and fertilizers. The use of groundwater for irrigation leads to a lower water availability in the long run. And intensive use of agrochemicals, such as pesticides, herbicides and fertilizers, impacts downstream water quality and can impose risks for human health (WWF, 2014b). Furthermore, in the realm of social sustainability Berkum and Bindraban (2008) suggest private standards should safeguard against over-exploitations of employees and support small scale farmers in their ability to comply to their standards.
It is important to mention that for passing the FEFAC soy sourcing guidelines, a standard must address all sustainability issues covered by the report of Berkum and Bindraban (2008).
4.2 Private standards in the soybean supply chain
An important distinction between these standards is the type of owner and the purpose of the standard. We identify five types of owners; a round table organisation, a private standard owner, a commodity crusher and trader, a commodity trader and supply chain manager, and a national industry association. These type of owners all have their own incentives to develop a private standard for sustainable soy production and are expected to act in the interest of the standard owner.
RTRS is the only round table organisation. A round table organisation is a multi-stakeholder initiative, which means that it consists of members that represent all actors in the soy value chain, NGOs and members of civil society. These players from different areas and interests obtain equal rights in this organisation. This standard carries the support of the WWF organisation and is seen as the highest standard for sustainable soy in the value chain, this is a statement that we base on all three interviews. The mission of this standard is to encourage responsible current and future soybean production and to reduce its environmental and social impact while maintaining or improving the economic status of the soybean producer. Since all stakeholders in the value chain have an equal vote in the organisation of RTRS, we expect that this standard is perceived as legitimate by most important stakeholders.
ISCC is also one-of-a-kind, it is a private standard owner. The core-business of ISCC is the development and execution of private commodity standards for several commodity supply chains, such as the bioenergy sector, the food, feed and chemical market. The standards are expected to act in the interests of the standard owner, but since ISCC has no other interest in the soy value chain than solely providing a certification scheme that can be adapted by any actor, it is expected that will not lead to a lower degree of legitimacy.
Cefetra, the owner of the CRS standard, is a commodity trader and supply chain manager. Cefetra is a Netherlands based company that sources commodities globally and distributes it to their European customers, they own several locations in Europe to facilitate the distribution of these commodities. So where Cargill and ADM have a reach over the value chain from production to the global market, Cefetra has a reach from the global market to the feed industry. It seems that Cefetra has developed their standard to facilitate the process towards sustainable sourcing and for the purpose of serving its customers. It is important to note that CRS is the first sustainable soy standard for the feed industry that was available. It seems that Cefetra has developed their standard to provide their company with a competitive advantage and maybe even the first mover advantage. Since they take the objective role of merely facilitating the process towards sustainable sourcing for their customers, it can be expected that they are perceived legitimate by the feed industry. Furthermore, being the first standard in the feed industry for sustainable soy highlights their proactive approach towards sustainable sourcing and might even provide the standard with moral support from other parties such as NGOs. However, the standard is not publicly supported by the WWF or Greenpeace.
The last type of standard owners are national industry associations, which can be sub-divided into the national feed industry associations of Belgium and the UK and the national soy producer associations of Argentina and the US.
For the feed industry associations of Belgium and the UK it seems that their standard works different than the others in practice. Their standards seem to be benchmark tests for private standard, assessing their sustainable performance. For these countries only import soy that is certified by the standards that are able to pass the benchmark test of their standard. It seems that these standards are a national interpretation of the European-level operating FEFAC soy sourcing guidelines. Clearly, these standards are perceived legitimate by the stakeholders in their home markets, however, they don’t seem to certify soy that is sourced for other markets. Therefore, it is expected that these standards do not receive a high level of legitimacy from important stakeholders outside of Belgium and the UK because of the multinational character of the soy value chain.
standard to demonstrate their compliance to the base-line requirements of the FEFAC soy sourcing guidelines on a national level. All US soy for export is certified by the SSAP standard, and therefore we argue that this standard is perceived legitimate by the US producers. The Agricultura Certificada (AC) standard of Argentinean soy producers aims to provide Argentinean farmers with the tools and knowledge to improve agricultural practices and farm management. So other than the US standard which demonstrates their sustainable practices, the AC standard aims to proliferate sustainable practices in among their national producers.
Both standards are owned by associations that aim to improve the competitive position of their national soybean production and verify sustainable practices of those that comply to their standards. These standards seem to be quite objective and therefore it is expected that these standards are perceived legitimate by most important stakeholders.
4.3 How certain standards gain Legitimacy over other
Based on the interview data we conclude that there are two dominant standards in the European feed industry which are perceived the most legitimate by important stakeholders, namely the Round Table of Responsible Soy (RTRS) and Certified Responsible Soy (CRS). In this part we reflect our findings to the assumptions made in our literature review to understand why these standards are perceived most legitimate by important stakeholders. Since we have argued that gaining legitimacy for private standards in a market for indirect commodities is different from gaining legitimacy in a market for direct standards because of the redistribution of influence among stakeholders, we have categorized our findings per stakeholder group and review their influence on private standard legitimacy.
4.3.1 Consumers
First, we have argued that how private standards are able to gain legitimacy differs between indirect and direct commodity supply chains because of the lower level of consumer influence in the indirect value chain. Based on the following interviewee statements we provide evidence for our assumption.
Nevedi: “I would say the consumer has almost no influence. I don’t think that the average
but not for soy. This might be because most of the soy consumed by consumers is indirect through eggs, meat and dairy.”
Company A: “Cargill has been promoting their sustainable soy standard at the consumer
level, however they did not succeed. The goal was to make their certificate the standard for soy sourcing, which would have given them a large competitive advantage compared to other standards.”
Company B: “Soy is a so-called hidden ingredient; therefore, the consumers’ influence is
less. Furthermore, the consumer wants the supermarket to take care of sustainability attributes, it wants that everything they buy at their supermarket is produced responsible.”
It seems that our assumption is confirmed by our data, the consumer is less aware of their consumption of indirect products than their consumption of direct products. This might also be the reason that Cargill did not succeed in promoting their standard among consumers, since these are not aware of their soy consumption. The statement of Company B indicates that consumers do care about sustainability attributes, but that they expect business actors to take care of these issues.
4.3.2 Governmental institutions
The data indicates that governmental institutions, such as the Dutch government, did support the transition of the supply chain toward sustainable sourcing. However, they did not influence the level of legitimacy of specific standards. The Dutch government provided financial support for the Initiative of Sustainable Trade (Dutch: Inititatief Duurzame Handel) and the Dutch Foundation for Chain Transition to Responsible Soy which were both established to guide the feed value chain transition towards sustainably sourced soy.
However, their financial contribution was not available for investing in private standards, but only for local projects in producing countries to improve the ability of producers to comply to these standards. The Dutch government has supported the supply chain transition towards sustainable soy, but neither enforced a choice or showed a preference for a specific private standard. Therefore, we argue that the Dutch government did not influence the legitimacy of private standards for sustainable soy. When we compare this to the value chain of the direct commodities cacao, we see a similar approach by the Dutch government. For this value chain they also subsidize local producers to improve the sustainability of their production methods (LNV, 2013).
sustainable sourcing in the direct commodity value chain of timber products. The EU Timber Regulation (European Commission, 2016) was established in 2010 and however is does not require certification by private standards per se, in practice private standards like Forest Stewardship Counsel (FSC) and the Program for Endorsement of Forest Certification (PEFC) ensure compliance to these regulations.
In the literature review we proposed that governmental institutions did not have a different degree of influence on legitimacy between direct and indirect commodity value chains since their authority is not influenced by the difference between these value chains. This proposition seems to hold after analysing available data. Furthermore, the data shows that governmental action to encourage sustainable sourcing is typically not through providing legitimacy to a specific standard, but through establishing base-line requirements for the sourcing of these goods.
4.3.3 Non-governmental organisations
Non-governmental organisations are expected to have a lower degree of influence on the legitimacy perception of private standards in an indirect commodity value chain since their campaigning capabilities are typically aimed at consumers (WWF, 2016).
The WWF has taken initiative in the market for sustainable soy through establishing the Round Table of Sustainable Soy (RTRS) in 2006. First of all, RTRS is a multi-stakeholder initiative which means that all important stakeholders of the soy value chain are represented in their decision making process, including business actors, NGOs and members of civil society. Because of this characteristic, the RTRS standard is perceived legitimate by the most important stakeholders in the value chain. In addition, the interviewees recognize that the RTRS standard is the strictest standard available for sustainable soy, probably because of the involvement of NGOs in the decision making process who require a zero-deforestation policy. In the Dutch market, most animal product processing industries only allow RTRS certified soy for their production, which indicates that RTRS is perceived legitimate by this industry. This is also the reason that of the 2 million tons of certified soy annually imported by the Dutch feed industry, 820.000 tons is certified by RTRS. However, our data shows that the Dutch dairy industry did not commit themselves to RTRS because they perceived this standard as the most legitimate, but because of NGO pressure and the lack of the FEFAC soy sourcing guidelines at the time.
Nevedi: “There were activists chained to the gates of Campina, a large Dutch dairy
action to undertake to react to this pressure. The dairy producers did obviously not want to become the scape goat with their reputation of high quality dairy products.”
Company B: “In the current state of the market they would have had more options and
alternatives to RTRS, but since they are already committed to RTRS there is no way back. If they stop exclusively sourcing RTRS soy they will be publicly punished by NGOs as WWF who is a great supporter and initiator of RTRS. In this way the Dutch industries that are committed to RTRS are not committed because of the quality of RTRS, but because of NGO pressure and the danger of negative publicity.”
This statement of Company B highlights the pressure that NGOs are able to exert. It seems that NGOs have strong influences on the proliferation of private standards in this value chain, specifically through threatening with negative publicity. However, NGOs are not the only actors in the value chain that influence the level of legitimacy of private standards. In the next section we will discuss the influence of business actors.
4.3.4 Business actors
We have argued that diversification strategies of private standards aimed at business actors instead of consumers could provide private standards with legitimacy in the indirect commodity value chain of sustainable soy and that business actors have a larger influence on private standard legitimacy in an indirect value chain than they do in a direct value chain. To explain our findings, we will discuss the influence of the important stakeholders on private standard legitimacy in the soy value chain.
Soybean producers
The national producer associations of Argentina and the US have developed their own sustainable soy standard to prove and improve the sustainable practices of their members. Company B mentions:
Company B: “CRS, Cargill, ADM and RTRS are big organizations throughout the supply
chain and they are being recognized by multiple parties. A certificate like AC will never reach this scope because they are only representing one type of actor, the farmers.”
various actors. However, Europe mainly sources its soy from Latin American countries and not from North America since the Latin American soy is available at a lower price through more competitive shipping routes.
Crushers and traders
The traders that are actively involved in the sustainable development of the soy value chain through developing their own private standard for sustainable soy are ADM, Cargill and Cefetra. To start, we have to explain the differences between the firms ADM, Cargill and Cefetra. ADM and Cargill seem quite similar. These large multinationals are the “A” and “C” of the four giant ABCD companies of the global grain trade. These companies own their own soy production land and additionally source from local producers, have multiple crushing plants and shipment ports in all important soy production regions and some major export destinations. Cefetra is a commodity trader and supply chain manager. It has several locations in Europe to facilitate the logistics of commodity distribution to their customers. ADM and Cargill typically ship their commodities to the destination of highest returns, whereas Cefetra aims to efficiently and economically source and distribute the required commodities from the most attractive export market to the feed manufacturing plants of their loyal group of European customers. Since ADM and Cargill are similar organisations, not comparable to Cefetra, we will discuss Cefetra separately.
First, ADM and Cargill will be discussed. Company B states that ADM and Cargill are large organisations throughout the value chain and are being recognized as important stakeholders by multiple parties and definitely the European feed industry. Furthermore, Company B argues that ADM and Cargill have developed their own standard since do not want to commit themselves to a specific standard.
Company B: “They’d rather develop their own standard for sustainability throughout their
subsidiaries and supply chain because then they are not dependent on a third party in case of sudden changes in a standard.”
pressures from other stakeholders, allowing them to formulate a ‘lighter’ sustainability standard. However, Nevedi states the following.
Nevedi: “Especially in the beginning, the large traders did not develop their standard in a
transparent way and therefore they did not receive much support from NGOs and governmental institutions. A requirement of the FEFAC guidelines is that the standards have to make their standard and standard requirements publicly available, so that is not the case anymore.”
Nevedi: “We experience through the FEFAC guidelines that there are considerable
differences between standards and that the FEFAC guidelines are high level and not easy to comply to...”
It seems that due to the requirements of the FEFAC soy sourcing guidelines, these traders had to make their standards publicly available and transparent. Furthermore, the FEFAC guidelines are high level and they are increasing the strictness of their requirements on a yearly basis. Therefore, it does not seem possible for any standard that passes the FEFAC soy sourcing guidelines to produce a ‘light’ standard.
In the remaining part, the Certified Responsible Soy (CRS) standard, owned by Cefetra, will be discussed. Nevedi mentions that the Belgium feed producers mainly source CRS certified soy and only a small amount of RTRS certified soy, and Company B adds that RTRS used be perceived as the most legitimate standard, but that the CRS standard is currently the most adapted standard in the feed industry. So it seems that CRS is perceived to be more legitimate than the RTRS standard by the business actors, our data shows that CRS has mainly gained this position through their differentiation strategy and the organisational difficulties of a multi-stakeholder standard as RTRS.
Company B: “RTRS has received much attention in the beginning, but they were setting the
norm too high for producers. They should have been working towards this norm on a step-by-step approach since the soy producing farms are not able to transform overnight. That is the reason that the impact of RTRS on sustainable soy is less then it could have been and they are less leading in the Dutch sustainable soy market then they used to be.”
Nevedi: “I do not agree that RTRS has a global leading position regarding sustainable soy
CRS clearly had a more effective way of gaining legitimacy in the market for sustainable soy than the RTRS standard. The CRS standard is based on the principles of the RTRS standard, but the standard is taking a step-by-step approach for the implementation of this standard at the producer level. The RTRS is recognized as the strictest standard in the market, however, because the standard is this strict, compliance is very hard for local soy producers. Company B makes an important statement about this subject.
Company B: “Through the lines I read that you wonder why all companies do not simply
comply with RTRS. That is not the case, because you have a certain amount of soy that is needed and that we would like to certify. This volume is impossible to certify completely through RTRS since this is the golden standards which is very hard to achieve. Companies that can comply with RTRS is what we call low hanging fruit and is easy to certify. When we want to reach larger volumes we need other certificates, and that is the reason for developing the FEFAC guidelines; to make sure that we can certify a large volume of soy and realize impact.”
The CRS standard is providing a standard that is easier to comply to by local producers, resulting in a larger amount of certified soy by this standard. Business actors seem to appreciate this strategy of CRS since whereas it is based on the principles of a multi-stakeholder initiative, the standard is adapted to meet the needs of the industry instead of highest the highest, but too hard to reach, standard.
In summary, the RTRS standard is recognized by the business actors as being the highest standard, but the requirements of this standard are considered too idealistic. Only the large and financially resourceful producers are able to comply to this standard, whereas the largest part of the industry is not. CRS is based on the principles of the RTRS standard, but has made the requirements more practically applicable for local producers and therefore has been able to certify large volumes of sustainable soy. Through their strategy, the standard has gained much support from the business actors.
Whereas diversification strategies aimed at consumer conscience, like the example of Max Havelaar in the cacao and coffee industry, seems to provide a private standard with legitimacy in a direct value chain. A diversification strategy aimed at business actors like CRS has applied, seems to provide legitimacy to a private standard in a value chain for indirect commodities.
chain, the private standards of the large crushing and trading companies ADM and Cargill are also perceived legitimate by important business actors.
The feed industry
The soy crushers and traders are the business actors that are selling their commodities in the global market, that might be the reason for them to prove the sustainable practices of their products through developing a private standard. The European Feed Manufacturers Association (FEFAC) are representing the feed industry that is the main buyer for these commodities. The FEFAC has defined the FEFAC soy sourcing guidelines to explain their perception of a legitimate standard, something that the RTRS organisation also aimed to do. Nevedi: “Through the FEFAC guidelines we now have a benchmark for sustainable soy
standards for which we have been waiting too long. Through this benchmark the RTRS loses much of its bargaining power and authority. The FEFAC Soy Sourcing guidelines are not a certification program in itself but it facilitates sustainability programs and initiatives to benchmark themselves towards a specific set of sustainability criteria which will become increasingly stricter over time. If the FEFAC guidelines were in place at the time that sustainable soy was a hot topic of discussion, the dairy industry might have committed themselves to these guidelines. However, they already have agreed to only sourcing RTRS soy, which makes it difficult to switch now. Especially since many NGOs are heavily involved in the RTRS organisation and may organize negative publicity for the companies that stop their commitment to only RTRS.”
Nevedi: “A standard that complies to the FEFAC soy sourcing guidelines is legitimate in the
European feed market.”
It seems that because the RTRS organisation failed to adapt their standard to the needs of the industry, the feed industry has taken matters into their own hand and established the FEFAC soy sourcing guidelines. This indicates that the business actors overrule the influence on legitimacy of the WWF in this indirect commodity value chain.
industry, however, they are more effective in enhancing environmental protection in forestry than the forest owner-dominated scheme PEFC.
In both value chains of soy and forestry there seems to be competition between NGO standards and industry standards. Whereas the industrial FEFAC soy sourcing guidelines have the upper hand in the indirect sustainable soy value chain, the NGO standard FSC seems to be more powerful in the direct sustainable forestry value chain. This adds to our assumption that NGOs have a higher level of influence on private standard legitimacy in direct value chains, than they do in indirect value chains.
The processing industry
The Dutch processing industry has committed itself to exclusively sourcing RTRS soy for their non-export production due to NGO pressure, which is explained in paragraph 4.3.3. This shows that the processing industry is subject to external pressure and sensitive for negative publicity and reputational damage. There is no further evidence that the processing industry has exerted influence on private standard legitimacy through other ways than being subject to external pressure. Therefore, we assume that this industry is content with the actions of the European feed industry through the FEFAC soy sourcing guidelines.
The retail industry
The retail industry does not seem to have a major role in providing legitimacy to private standards in the soy value chain. Company B states:
Company B: “Soy is a so-called hidden ingredient; therefore, the consumers’ influence is
less. Furthermore, the consumer wants the supermarket to take care of sustainability attributes, it wants that everything they buy at their supermarket is produced responsible.”
