Throughout the agricultural sector, there exist a variety of certification schemes (CS) intended to improve social sustainability and environmental impact. From organic certifications like USDA Organic to international export standards like GLOBAL GAP, an increasing number of certification schemes are improving agricultural supply chains. But are these schemes really effective in achieving their stated goals?
The answer, simply put, is yes. The most fundamental benefit that CS offers to small farmers comes in the form of the premium that consumers are willing to pay for certified goods. By complying with international export standards, small farmers can access high-end markets in the developed world. This process integrates smallholders into global supply chains and rewards them with higher prices. The available literature is clear – certification schemes raise incomes, improve sustainability, and contribute to a variety of development goals such as labor formalization and fair labor practices.
“Certification tends to operate in areas that are really important for biodiversity, so that’s great news,” wrote Catherine Tayleur, director of a study on certification schemes. “A certification standard can give you some assurance that what you’re buying has been produced in a way that is good for the environment and good for the farmers.”
For markets susceptible to price volatility, such as coffee, CS can offer a safety net to producers who otherwise would be unable to cover their costs when prices fall. This is especially relevant for farmers producing goods that experience considerable seasonal market swings, like citrus, coffee, and cacao.
But despite the success of certification schemes in many regions, there is a general concern that they may not be as widespread as they should be, and that the high costs of obtaining certain certifications can in some cases outweigh the benefits. Smallholder farms often lack access to the type of financing that could permit them to acquire international certifications.
Another criticism of international certifications is that they have failed to access areas in which they are most needed. A study published in Biological Conservation found that “Despite the rapid increase in the number of certification schemes… only around one percent of global cropland is certified.” Clearly, there is room for improvement.
How can certification schemes do a better job of achieving their stated goals? One solution is to increase access to CS through third-party financing. The process of obtaining any type of international certification is often costly and complicated, and actors across the agricultural sector can help provide the financing and knowledge necessary to incorporate more smallholders into the value chain. Not only does certification add value at the time of sale, but it also helps vertically integrate businesses, allowing poor rural farmers to participate in the value of selling in high-end markets.
Certification schemes have certainly come along way, and it is likely that their prevalence will continue to grow. Helping small growers to obtain international certifications is an effective way to both add value to a product and increase incomes for farmers. If properly implemented, certification schemes are a win-win for all parties involved.