Why we need lawmakers, and why we need them now
Time is not our friend. Although by now we pretty well know what we have to change to make this world a better place, we keep postponing true action and passing on the responsibility. Time for governments to step in: we need laws, and we need them now.
Although most of us are heavily dependent on our daily cup of coffee, growing it is getting harder without many of us understanding why. In 2019, the coffee price crisis confronted the world with the industry’s vulnerability. An enormous surplus in Brazil, the global leader in production, led coffee farmers all over the world to break. Prices plummeted as consumption continued to rise, generating an unfair competition from which small farmers in low- and middle-income countries still struggle to cover the effects.
With few regulations in place, scientists point that another crisis is imminent. Climate change is affecting conditions in Southern countries in charge of producing, reducing the places that can sustain these crops, threatening whole families of coffee farmers. A recent study estimates that by 2050, the amount of land that can sustain coffee will have fallen by 50 percent, and at the same time, demand is expected to increase.
The paradox of regulation
Why are we talking coffee? Because it is just one example of a crop where we are failing to make a positive, much-needed change. Do we shift our focus to the agri-food sector as a whole, we can clearly see that inequalities are still intrinsic to our food today. In 2020, nearly 50 million people were victim of modern slavery, and around 150 million children were working illegally.
Surprisingly, best practice to tackle such problems often means staying ahead of the regulatory curve. Leading CSR companies are those adopting a principled and harmonised approach towards issues such as living wage, privacy rights, cybersecurity and child labour, among many other basic rights ignored by regulation. Meanwhile, the absence of rules obligating businesses to address human rights risks within their supply chains, allows them to comply with the bare minimum. In the UK, for example, the Modern Slavery Act requires companies to report on any steps taken to prevent forced labour in their supply chains, but it does not require companies to take any action when confronted with that.
After adopting a similar approach through the Dutch Child Labour Due Diligence Law in 2017, the Dutch Ministry of Foreign Trade and Development Cooperation announced in 2020 it would join efforts with the EU Commission, that committed to introducing legislation for international corporate social responsibility at EU level, as part of Ursula von der Leyen’s (president of the EU Commission) plan of working towards “a Europe that takes the lead on the major challenges of our time”. The idea of having a continental approach to more sustainable supply chains and due diligence is promising, but the policy proposal can also be seen as a way of transferring the responsibility of protecting human rights of countries’ own supply chains to Europe. Brussels, after all, has a lot on its plate, and aligning the different goals and interests from different European countries can take time. So far, two consultations were made available by the Commission, and civil society can participate until February 8.
While policy-makers and the average company refuse to make the commitment a priority, the ongoing pandemic of COVID-19 widens the chasm for the commodity-producing developing countries. Heavily affected economically, they once again rely on alliances and partnering to recover. And, ironically, the pandemic served to remind us what good leadership looks like. Decision-makers were able to literally save lives when managing the crisis in a firm and human-centered way, while the lack of action guided only by economic values led to more inequalities. What is then missing for leaders to address the humanitarian crisis that is endemic to our food system?
An ugly truth
- Voluntary measures are not enough. Although EU countries lead the world on ending extreme poverty, it faces its greatest SDG challenges in the areas of sustainable agriculture and diets, climate, and biodiversity – and in strengthening the convergence of living standards across its countries and regions.
- Even before the onset of the pandemic, no European country was on track to achieve all 17 SDGs by 2030. Overall, Nordic countries perform best on the SDG Index, with Finland leading the 2020 Europe SDG Index followed by Sweden and Denmark, but even these countries face major challenges on several SDGs.
- Lack of accountability: EU countries are generating large, negative spillovers outside the region – with serious environmental, social and economic consequences for the rest of the world. Unsustainable supply chains also lead to deforestation and increased biodiversity threats.
- Food industries are also lagging behind. Only 12 out of the 350 global leaders in the sector demonstrate a comprehensive level of commitments across environmental, nutritional and social dimensions, despite the fact that about 100 of those have caused 71 per cent of all climate damage in the past 30 years.
- Companies are not driving social change. Although nearly 50 million food workers are still victims of modern slavery, and 150 million children work illegally, 40 per cent of companies made no public commitment to eliminate child and forced labour.
- Regulation is the limit. Despite the fact that 80 per cent of food companies show strong commitments to improving the health, safety and well-being of their workforce, an area which is highly regulated and often legally required, only 13 per cent commit to paying employees a living wage, an area which is weakly regulated and provides a more complex operating context.
High-income countries are not only failing to achieve their own goals, but their unsustainable supply chains and trade-related spillovers are undermining other countries’ capacities to achieve their own as well. To ensure international legitimacy, the EU must not only track, but find ways to address negative international spillovers through liability provisions. This will require coherent trade and external policies through the Green Deal and Human Rights Diplomacy, strengthened tax cooperation and transparency, the application of EU standards to exports, and curbing trade in waste. Lack of tangible progress should require governments to step in with regulation and enforcement to ensure a safe and trustworthy system that leaves no one behind.
“There’s a new reality for CEOs today: employees, customers and investors alike expect business leaders to go beyond rhetoric and take meaningful action on climate change”, defended the President of the Environmental Defense Fund, Fred Krupp. Elsewhere, he added made a case for corporate lobbying: “CEOs need to unleash the most powerful tool they have to fight climate change: their political influence. Corporate voices matter to Congress, but the vast majority of businesses have been silent on the need for climate policy, or even opposed to it.” In order to make sustainability a real commitment, the entrepreneur is part of a group of entrepreneurs advocating for a law that sets clear rules for businesses, claiming that only governments can ensure the needed level of collective actions.
Levelling the playing field
As self-regulations largely failed small farmers, common rules and standards can level the playing field. Trade-policy terms must not only encourage, but ensure companies to tackle violation of human rights and environment in their value chains. In our current situation, it means having corporations committed equally, and most important, proportionally, to the Sustainable Development Goals.
The absence of legal standards which define companies’ duties and ensure access to justice for victims of corporate malpractice has produced serious accountability gaps. Such urgent situations cannot be hanging on discussion level, while the ones in charge of our food perish, together with our planet and natural resources. Climate change is no longer an IPCC forecast, but a reality affecting food-producers and a series of different nature-based businesses today. Legislation is the only way to speed up this process. Measures around contracts that can be offered to workers, for example, or restrictions on the amount of pollution certain industrial processes are allowed to produce. It’s about fair and open competition: taking responsibility and being held accountable for both the positive and the negative impacts, shifting the paradigm to one based on short-term results to long-term build on value chains.
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Understanding the context
Innovations in the agri-food sector are often guided by a productivity approach. If we are going to be walking this earth with 10 billion people in 2050, more food is needed, therefore, we need technologies that guarantee it. Right? Wrong. Intensive farming already produces more than we need. One third of global food production is being wasted yearly as an effect of poor management, triggering a domino-effect of intertwined socio-environmental crises like depletion of resources, global warming and poverty.
But as the climate crisis advances, so do the responses. New technologies, new policies, new business models, and other forms of collaboration are increasingly observed. Prior, terms such as “e-agriculture” or the promise of a “third food revolution” answered an intensive and unsustainable demand; now, innovations like blockchain and information technology allow us to assess the global route of food, enabling smarter resource management and more awareness of the challenges workers are facing. More than “ticking” the boxes of CSR, it allows us to understand different contexts and reacting to that.
The wide array of stakeholders committed to making international trade more sustainable comprehend producers, retailers, government, trade unions, NGOs, certification bodies and research institutes exploring creative and innovative solutions. Instead of production efficiency, transparency and accountability took the core of responsible businesses. We are now able to do more with less to ensure basic targets such as nutrition security, digitalisation and gender mainstreaming for a really sustainable world – one that is observed systemically, from social, environmental and economic perspectives.
Photo licensed by: CC-BY-4.0 © European Union 2019