Social and economic effects of partnering for sustainable change in agricultural commodity chains

Indonesian project leader: Prof. Bustanul Arifin, Agribusiness University of Lampung Dutch project leader: Prof. Pieter Glasbergen, Maastricht University

Indonesian actors have become closely involved in many global certifying partnerships that connect southern production to northern consumption. These partnerships aim to promote the sustainable production of agricultural commodities and are expected to simultaneously serve business and development interests. This change in global commodity chains will have a particular impact on the export-driven part of the Indonesian agricultural economy, which is very important to development. For suppliers in developing countries, the global standards are becoming de facto market requirements. In the face of this change, Indonesian actors in business, civil society and government need to redefine their position. However, the social and economic effects of partnering for sustainable change in agricultural commodity chains are still widely debated. The current state of research indicates that little is known about the activities of such partnerships in producing countries and what they achieve for the beneficiaries they intend to serve. The tendency of partnerships to compete with one another for market share, prominence and legitimacy adds to the confusion.

Sumatra coffee beans. Photo: Ron Corvers

Against this background, this research project aims to fill the knowledge gap regarding the capacity of global certifying partnerships to deliver on their proposed added value, particularly by analysing the social and economic effects of global certification for smallholder farmers in Indonesia. The sustainability challenges of the commodity chains are understood as a ‘development problem’ and an interrelated ‘governance problem’. Our research will take an institutional systems perspective to study these interrelated problems. This entails focusing on the interrelations between the main actors in the field of research, their activities, and the effects of these activities, while assuming that in the short term, the characteristics of the agricultural production system may constrain any system changes. Focal points of the project are intervention logics, effects, options for change and strategies for change, which are connected through the main actors’ joint knowledge production. The global coffee and palm oil chains serve as main fields of research in the assessment part of our project. The prospective part of our research includes cocoa, spices, and aquaculture, commodities with new certifying partnerships in an early stage of development and implementation. These agricultural commodity chains face various sustainability challenges, including environmental degradation, abundant use of agrochemicals, poor working conditions, and widespread poverty. The analysis part of the project combines governance theory and agricultural and institutional economic theory and applies a variety of quantitative and qualitative sustainability assessment methods. Representatives of governments, NGOs, certifying partnerships, and farmers’ organizations have expressed a willingness to participate in the project and its multi-stakeholder workshops.