You guessed it: POLICY.
Ric Rhinehart spoke during the 2014 Let’s Talk Coffee event to the importance of public policy in shaping the composition of the coffee sector in growing countries. (Ric and I further explored the implications of policy for the future of coffee in Mesoamerica in an illuminating conversation here.)
More recently, I suggested here that whether we like it or not, policy shapes the way we engage all along the coffee chain, from origin to the marketplace.
And last week’s outstanding SCAA events surfaced plenty of big, thorny issues in sustainability–all of which are too big for the coffee community to solve alone, and all of which require enlightened public policy to address in any meaningful, lasting way.
Our friends at CIAT–the International Center of Tropical Agriculture–are fond of this Venn diagram, which helpfully underscores the importance of policy for achieving lasting change in the coffeelands:
As the reference to new business models suggests, it comes out of CIAT’s work linking farmers to markets. And indeed, the framework may be most valuable in the context of trading relationships. But it is no less valid for all the threats to the sustainability of the specialty coffee supply chain that made “the origin agenda” of The SCAA Event: smallholder profitability, farmworker protections, gender equality, incentives for environmental conservation, price risk mitigation, effective engagement of the next generation of coffee growers, coffee breeding and research, cup quality, and–most important of all–climate change.
During some of the breakout sessions during Symposium last week, there was some despair about the magnitude of the challenges specialty coffee faces. And if specialty coffee had to solve them alone, I think despair would be an appropriate response. But it doesn’t. Indeed, it can’t. As the CIAT diagram suggests, sustainable change is a three-legged stool. Industry may lead the charge, but an enabling environment to catalyze, scale and sustain supply chain innovations is critical. What I see as cause for encouragement over despair is that so much of what specialty is working hard to achieve on the ground in the coffeelands–thriving smallholder economies, production systems that conserve and enrich ecosystems, fair treatment of farmworkers–are just the kinds of outcomes policymakers in growing countries want to deliver.
Policy is messy. My own (modest) experience in trying to influence policy suggests the process is decidedly non-linear and can be uniquely frustrating. But the successes, when they come, aren’t just sweet–they attach that third leg to the stool and stabilize our efforts to generate positive financial, environmental and social returns on our joint investment in the coffee trade.
In the coming weeks, I will take up some of the big issues in sustainability mentioned above with a particular focus on policy.
Michael, glad you said the P word. As always, I’ll look forward to your incisive views on the issues. May I request a topic?
Yes? Thanks. The SEC.
Why? What set of policies more clearly shapes buyer behavior (at least for those US companies who are publicly traded) than the SEC’s, policies that are rightly designed to protect investors by requiring that companies maximize shareholder interest, but often–perhaps because of flaws in the policy framework?–create a myopic results framework, a zero-sum economic paradigm, and ultimately, the exact opposite of responsible fiduciary management?
Ben – great insight. If only we could get the SEC to adopt the indicators the certified B Corp program is offering as “the” way of being a for-profit company instead of an alternative.
Thanks, Ben. Can’t accuse you of not thinking big!
I was going to reply with reference to state-level benefit corporation legislation on the regulatory side and B Corp certification on the market side, but Ruth Ann beat me to it. I wrote (breathlessly) about the benefit corporation model and B Corp certification here, and do think the growing popularity of both is encouraging, as they do precisely what you propose: they legitimize decisions made on the basis of a blend of financial, social and environmental considerations rather than only financial ones. My question is whether the B model is viable for the biggest publicly traded companies whose actions may matter more for people and the planet than all the B Corps combined given the scale of their operations. There has been some interesting coverage lately of the compatibility of the two regimes. Notwithstanding the B Corp Certification of a few publicly traded companies, questions persist, whether in relation to the coming IPO for Etsy or rumors that Unilever may make the jump. If they prove to be compatible, it may be a significant advance that stops short of reform.
Not that I am opposed to reform. As I suggested in my post on B Corp Certification, if we can’t begin to narrow the gap between the value we place on social and environmental returns and those we place on financial returns, our time horizon as a species gets considerably shorter.
Also, the FTC. While it is true that sustainability as it exists is a sum of initiatives and efforts performed by producers, businesses, NGOs and other entities at origin and in consumer markets, and that none is perfect or complete on its own, there should be strong marketing regulations and enforcement. Not all sustainable initiatives are created equally. A traceability system alone does not equal sustainability.