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As one of the world’s most traded agricultural commodities, coffee constitutes a significant part of the overall economy and a major source of foreign revenue for many developing countries. Coffee also touches a large portion of the world’s population in the South, where it is mainly produced, and in the North, where it is primarily consumed. As a product frequently purchased by a significant share of worldwide consumers on a daily basis in social occasions, the coffee industry has earned a high profile that also attracts the interest of non-governmental organizations, governments, multilateral organizations and development specialists and has been an early adopter of Voluntary Sustainability Standards (VSS). Responding to the trend of increased interest on sustainability, it is therefore not surprising that coffee continues to be at the forefront of sustainability initiatives that transcend into other agricultural industries. Based on literature and authors’ experiences, this article reflects on the VSS evolution and considers a sustainability model that specifically incorporates producers’ local realities and deals with the complex scenario of sustainability challenges in producing regions. Agreeing on a joint sustainability approach with farmers’ effective involvement is necessary so that the industry as a whole (up and downstream value chain actors) can legitimately communicate its own sustainability priorities. This top-down/bottom-up approach could also lead to origin-based, actionable and focused sustainability key performance indicators, relevant for producers and consistent with the UN’s Sustainable Development Goals. The initiative also aims to provide a sustainability platform for single origin coffees and Geographical Indications (GIs) in accordance with growers’ own realities and regions, providing the credibility that consumers now expect from sustainability initiatives, additional differentiation options for origin coffees and economic upgrade opportunities for farmers.
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Article
Towards a Balanced Sustainability Vision for the
Coffee Industry
Luis F. Samper 1and Xiomara F. Quiñones-Ruiz 2,*
1President of 4.0 Brands. Former President of oriGIn and former CMO of Federación
Nacional de Cafeteros de Colombia, Bogotá110221, Colombia; luis.samper@4point0brands.com
2Department of Economics and Social Sciences, University of Natural Resources and Life Sciences (BOKU),
Vienna, Feistmantelstraße 4, 1180 Vienna, Austria
*Correspondence: xiomara.fernanda.quinones-ruiz@boku.ac.at; Tel.: +43-1-4765473112
Academic Editors: Ming-Lang Tseng, Anthony SF Chiu and Ru-Jen Lin
Received: 22 November 2016; Accepted: 24 March 2017; Published: 5 April 2017
Abstract:
As one of the world’s most traded agricultural commodities, coffee constitutes a significant
part of the overall economy and a major source of foreign revenue for many developing countries.
Coffee also touches a large portion of the world’s population in the South, where it is mainly
produced, and in the North, where it is primarily consumed. As a product frequently purchased by a
significant share of worldwide consumers on a daily basis in social occasions, the coffee industry has
earned a high profile that also attracts the interest of non-governmental organizations, governments,
multilateral organizations and development specialists and has been an early adopter of Voluntary
Sustainability Standards (VSS). Responding to the trend of increased interest on sustainability, it is
therefore not surprising that coffee continues to be at the forefront of sustainability initiatives
that transcend into other agricultural industries. Based on literature and authors’ experiences,
this article reflects on the VSS evolution and considers a sustainability model that specifically
incorporates producers’ local realities and deals with the complex scenario of sustainability challenges
in producing regions. Agreeing on a joint sustainability approach with farmers’ effective involvement
is necessary so that the industry as a whole (up and downstream value chain actors) can legitimately
communicate its own sustainability priorities. This top-down/bottom-up approach could also lead to
origin-based, actionable and focused sustainability key performance indicators, relevant for producers
and consistent with the UN’s Sustainable Development Goals. The initiative also aims to provide
a sustainability platform for single origin coffees and Geographical Indications (GIs) in accordance
with growers’ own realities and regions, providing the credibility that consumers now expect from
sustainability initiatives, additional differentiation options for origin coffees and economic upgrade
opportunities for farmers.
Keywords:
coffee; sustainability; value chain actors; geographical indications; governance; voluntary
sustainability standards
1. Introduction
Coffee is a high profile product that touches a large portion of the world’s population. It is
estimated that 25 million mostly small scale farmers, mainly located in subtropical and equatorial
regions (Figure 1) [
1
], produce the beans that are part of the estimated well over 2.25 billion coffee cups
consumed every day around the world. According to the US National Coffee Association, 76% of adult
Americans consume coffee [
2
], while the European Coffee Federation asserts that consumers from
that continent have the highest per capita consumption in the world [
3
]. As one of the most traded
agricultural commodities internationally, it constitutes a significant part of the overall economy and a
major source of foreign exchange revenue for many developing countries [1,4].
Resources 2017,6, 17; doi:10.3390/resources6020017 www.mdpi.com/journal/resources
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Figure 1. Major coffee exporting countries and members of International Coffee Organisation (ICO).
Source: Authors based on [4,5] ICO (2016).
The last few decades have brought significant changes to the coffee industry. As a result of the
abolishment of the economic clauses of the International Coffee Agreement (ICA) in 1989 [6–8] and
the expanding supply of Brazil and Vietnam, an ensuing period of low and more volatile green
(unroasted) coffee prices brought very difficult times to millions of producers in over 40 countries. At the
beginning of the 21st century, coffee growers faced the lowest real prices on record for their beans
during the “coffee crisis” period.
Low and volatile prices for green coffee are not the only challenges that growers face. They also
have to contend with social issues such as food insecurity, ageing farmer communities, migration
and young people leaving to the cities and the poor social and economic conditions of coffee
harvesters; economic topics that include low productivity, ageing coffee trees, expensive fertilizers,
lack of market information, poor direct market access; and environmental challenges such as soil
erosion and degradation, changing climate conditions and poor waste water management among
many other factors [1] (Figure 2). Most farmers also lack adequate institutional support from their
local or national governments in the form of public goods [1,9]. The complexity of these challenges
over the last few decades and the coffee crisis forced governments, grower organizations, development
agencies and individual farmers to reevaluate their strategies and focus on higher priced beans [10].
From a demand perspective, major importing countries in the North saw in parallel significant
changes in consuming patterns. The market liberalization gave way to a more dynamic and
expanding specialty coffee segment that catered to more sophisticated consumers and was able to
pay higher premiums over commercial coffees sold in traditional grocery distribution channels [6,11].
Well known gourmet and specialty brands became a major factor in altering demand patterns in a
period of low prices, and pressure intensified on coffee brands to develop programs and initiatives
to support coffee growing communities [12,13].
Figure 1.
Major coffee exporting countries and members of International Coffee Organisation (ICO).
Source: Authors based on [4,5] ICO (2016).
The last few decades have brought significant changes to the coffee industry. As a result of the
abolishment of the economic clauses of the International Coffee Agreement (ICA) in 1989 [
6
8
] and the
expanding supply of Brazil and Vietnam, an ensuing period of low and more volatile green (unroasted)
coffee prices brought very difficult times to millions of producers in over 40 countries. At the beginning
of the 21st century, coffee growers faced the lowest real prices on record for their beans during the
coffee crisis” period.
Low and volatile prices for green coffee are not the only challenges that growers face. They also
have to contend with social issues such as food insecurity, ageing farmer communities, migration and
young people leaving to the cities and the poor social and economic conditions of coffee harvesters;
economic topics that include low productivity, ageing coffee trees, expensive fertilizers, lack of
market information, poor direct market access; and environmental challenges such as soil erosion
and degradation, changing climate conditions and poor waste water management among many other
factors [
1
] (Figure 2). Most farmers also lack adequate institutional support from their local or national
governments in the form of public goods [
1
,
9
]. The complexity of these challenges over the last few
decades and the coffee crisis forced governments, grower organizations, development agencies and
individual farmers to reevaluate their strategies and focus on higher priced beans [10].
From a demand perspective, major importing countries in the North saw in parallel significant
changes in consuming patterns. The market liberalization gave way to a more dynamic and expanding
specialty coffee segment that catered to more sophisticated consumers and was able to pay higher
premiums over commercial coffees sold in traditional grocery distribution channels [
6
,
11
]. Well known
gourmet and specialty brands became a major factor in altering demand patterns in a period of low
prices, and pressure intensified on coffee brands to develop programs and initiatives to support coffee
growing communities [12,13].
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Figure 2. Overview of the economic, social and environmental Challenges faced by coffee growers.
Source: Adapted from [1].
1.1. The Evolving Voluntary Sustainability Standards Landscape
To face the fierce competition and price fluctuations of commodity coffee, growers saw an
opportunity to differentiate their beans and access higher prices through Voluntary Sustainability
Standards (VSS) [14,15]. This option was particularly relevant during the coffee crisis, a period that
brought significant social and economic challenges for most producing countries. The farmers’
difficulties were widely reported in the media and academic literature, generating increased scrutiny
to high profile brands and prompting Non-Government Organisations (NGOs) and consumer
advocates to press for the adoption of farmer support programs [11,16–18], among many others).
Many of these brands shared these objectives and began their path to sustainability of their supply
chain through different certification schemes that provided them with additional differentiation
attributes and reduced their reputational risks [1,8,14,19–22].
The VSS model therefore arrived at the right time to the right industry. If one takes into account
the number of producers, consumers, brands, coffee shop outlets and clients, as well as those that
work in the farms and its different distribution and processing channels, it would be difficult to find
a product with as many stakeholders. Thus, the high profile of the coffee industry, the fact that
producing countries mainly sold green coffee at very low prices and the novel differentiation
initiatives for gourmet coffee consumption created the ideal “breeding ground” for VSS to take hold
and become a reference point to other industries. Currently, the most notable coffee VSS include
Nespresso’s AAA, 4C Association, Starbucks C.A.F.E. Practices, Fairtrade, Organic, Rainforest
Alliance and UTZ Certified. The coffee industry therefore became a leading example of VSS adoption
in agriculture and some of these models were adopted in the banana, tea, cocoa or flower industries,
to mention just a few examples.
Despite these efforts, coffee growers have not been able to capture a higher portion of the coffee
industry’s overall income, while international roasters and brand owners located in consuming
countries have increased their revenue share of the industry in all consumer segments [23,24]. This is
not only the case for the grocery retail segment (Figure 3) but more so in the higher end specialty out-
Food In secur ity
Mal nutri tion
Poor Acc ess to Educa tion and Hea lthcare
Lack of Retir ment - pensi on
Gender inequa lity
Ageing farmer c ommunities
Migra tion & young peopl e l eavi ng coffee farmi ng
Lack of i nstituti ons and a ppropri ate governa nce
Green Bean pri ce volati lity
Excha ngerate vola tili ty
Long term decreasi ng real c offee pri ces
Lack of ma rket in formation
la ck of product i nformation
Ris ing li ving cos ts
Ageing coffee trees
Land tenure uncerta inty
Limited ac cess to i nsutranc e and h edging i nstruments
Poor s ervices thr ough l oca l or farmer organi sati ons
No li ving inc ome
Deforestati on
los s of bi odiversi ty
soi l erosi on and degra dation
ina pproprate us e of agr ochemical s
degratati on of water qual ity and s upply
li mited waste water management
evolvi ng coffee pests and d iseas es
cl imate change and vola tili ty
Social IssuesEconomical issuesEnvironmental
Overview of the Economic, Social and Environmental Challenges
faced by small coffee growers
Figure 2.
Overview of the economic, social and environmental Challenges faced by coffee growers.
Source: Adapted from [1].
1.1. The Evolving Voluntary Sustainability Standards Landscape
To face the fierce competition and price fluctuations of commodity coffee, growers saw an
opportunity to differentiate their beans and access higher prices through Voluntary Sustainability
Standards (VSS) [
14
,
15
]. This option was particularly relevant during the coffee crisis, a period
that brought significant social and economic challenges for most producing countries. The farmers’
difficulties were widely reported in the media and academic literature, generating increased scrutiny to
high profile brands and prompting Non-Government Organisations (NGOs) and consumer advocates
to press for the adoption of farmer support programs [
11
,
16
18
], among many others). Many of
these brands shared these objectives and began their path to sustainability of their supply chain
through different certification schemes that provided them with additional differentiation attributes
and reduced their reputational risks [1,8,14,1922].
The VSS model therefore arrived at the right time to the right industry. If one takes into account
the number of producers, consumers, brands, coffee shop outlets and clients, as well as those that
work in the farms and its different distribution and processing channels, it would be difficult to
find a product with as many stakeholders. Thus, the high profile of the coffee industry, the fact that
producing countries mainly sold green coffee at very low prices and the novel differentiation initiatives
for gourmet coffee consumption created the ideal “breeding ground” for VSS to take hold and become
a reference point to other industries. Currently, the most notable coffee VSS include Nespresso’s
AAA, 4C Association, Starbucks C.A.F.E. Practices, Fairtrade, Organic, Rainforest Alliance and UTZ
Certified. The coffee industry therefore became a leading example of VSS adoption in agriculture and
some of these models were adopted in the banana, tea, cocoa or flower industries, to mention just a
few examples.
Resources 2017,6, 17 4 of 28
Despite these efforts, coffee growers have not been able to capture a higher portion of the coffee
industry’s overall income, while international roasters and brand owners located in consuming
countries have increased their revenue share of the industry in all consumer segments [
23
,
24
]. This is
not only the case for the grocery retail segment (Figure 3) but more so in the higher end specialty
out-of-home consumption segments. As explained by what has been termed as the coffee paradox, in
many cases, what growers sell and what consumers get in specialty channels are different products [
6
].
The evolving specialty coffee industry has been able to position itself by selling higher quality coffees
in more sophisticated environments, providing novel consumption occasions and satisfying more
complex consumer needs for which consumers are willing to pay, which surpass the basic need
for energy (caffeine fix) associated with coffee consumption of mainstream brands. Daviron and
Ponte argue that, apart from the beans, coffee consumers mostly pay for the symbolic quality and
in-person services reflected in the final price of specialty coffee sold at coffee shops or high-end
stores. While coffee sold by the cup in specialized shops incurs higher costs other than the coffee
itself, and, therefore, the additional revenue generated cannot automatically be considered a profit
by the coffee shop operator, the new distribution channels clearly provided opportunities for value
generation and appropriation for new brands in these novel segments. VSS also played a role in the
positioning of these higher end brands. The symbolic quality to which Daviron and Ponte refer to
not only includes the ambiance and consumption environment but also information that such brands
provide to substantiate their higher prices. In this sense, VSS became a medium to provide assurance,
communication, credibility and differentiation value to specialty brands.
Resources 2017, 6, 17 4 of 27
of-home consumption segments. As explained by what has been termed as the coffee paradox, in many
cases, what growers sell and what consumers get in specialty channels are different products [6]. The
evolving specialty coffee industry has been able to position itself by selling higher quality coffees in
more sophisticated environments, providing novel consumption occasions and satisfying more
complex consumer needs for which consumers are willing to pay, which surpass the basic need for
energy (caffeine fix) associated with coffee consumption of mainstream brands. Daviron and Ponte
argue that, apart from the beans, coffee consumers mostly pay for the symbolic quality and in-person
services reflected in the final price of specialty coffee sold at coffee shops or high-end stores. While
coffee sold by the cup in specialized shops incurs higher costs other than the coffee itself, and,
therefore, the additional revenue generated cannot automatically be considered a profit by the coffee
shop operator, the new distribution channels clearly provided opportunities for value generation and
appropriation for new brands in these novel segments. VSS also played a role in the positioning of
these higher end brands. The symbolic quality to which Daviron and Ponte refer to not only includes
the ambiance and consumption environment but also information that such brands provide to
substantiate their higher prices. In this sense, VSS became a medium to provide assurance,
communication, credibility and differentiation value to specialty brands.
Figure 3. Value distribution in the coffee grocery retail segment. Source: [23].
In the meantime, the commercial non-gourmet brands selling to traditional distribution channels
faced a growing concentration of grocery chains [25] and an increased competition of private label
store brands. As VSS became more prevalent in specialty channels, mainstream brands also began to
face significant stakeholder pressure to adopt VSS policies [26]. This resulted after a few years in a
“mainstreamization” of VSS coffees and an expanded market with lower premiums for coffee growers.
This competitive environment continued to exert pressure on the global coffee value chain, leaving
limited possibilities for paying significant premiums for VSS compliant coffees and for farmers to
achieve an economic upgrade other than by increasing productivity. Although it is arguable that
achieving scale of VSS coffees is desirable, this came at the cost of reducing economic incentives for
coffee farmers to adopt these standards and affecting the differentiating features that VSS provided
to higher-end segments.
The adoption of VSS and the higher interest in quality coffee were key features of the expansion
of the coffee industry in the last 30 years. Since 2011, the average annual growth rate in global coffee
Figure 3. Value distribution in the coffee grocery retail segment. Source: [23].
In the meantime, the commercial non-gourmet brands selling to traditional distribution channels
faced a growing concentration of grocery chains [
25
] and an increased competition of private label
store brands. As VSS became more prevalent in specialty channels, mainstream brands also began to
face significant stakeholder pressure to adopt VSS policies [
26
]. This resulted after a few years in a
mainstreamization” of VSS coffees and an expanded market with lower premiums for coffee growers.
This competitive environment continued to exert pressure on the global coffee value chain, leaving
limited possibilities for paying significant premiums for VSS compliant coffees and for farmers to
Resources 2017,6, 17 5 of 28
achieve an economic upgrade other than by increasing productivity. Although it is arguable that
achieving scale of VSS coffees is desirable, this came at the cost of reducing economic incentives for
coffee farmers to adopt these standards and affecting the differentiating features that VSS provided to
higher-end segments.
The adoption of VSS and the higher interest in quality coffee were key features of the expansion
of the coffee industry in the last 30 years. Since 2011, the average annual growth rate in global
coffee consumption has continued to increase at a rate of 2.5% per annum [
5
]. This process has taken
place amid consolidation of major industrial players as major roasting mainstream brands controlling
distribution channels continued to achieve a higher market share in many countries [
27
]. From the
VSS coffees perspective, in 2013, sales of coffee complying with voluntary coffee standards grew to
between 10% [
28
] and 15% of total coffee consumption [
1
]. Large coffee roasters (e.g., Nestlé, Starbucks,
or Lavazza) have pledged to increase their offtake of VSS coffees. Although the sustainability plans
for a major new player after the last wave of consolidation, JaconbsDouweEgberts, are still unclear, it
would appear that there is still room for growth for the VSS coffee market [1].
These trends are also confronted with the mixed results of the benefits of VSS in producing
regions. While in some cases they show monetary (e.g., price premiums, higher productivity), social
(e.g., creation of growers’ organizations, knowledge) or environmental benefits [
9
], the result of
available impact studies are not as conclusive [
29
]. Critical voices present VSS as strategies from the
North limiting the local scope of decision making, imposing high transaction costs on growers and
squeezing out small-holders not being able to comply with certification standards [
9
,
14
,
30
]. In the
context of diverse types of growers, processors, consumers and a variety of standards, all having
their own peculiarities, strengths, limitations and views on what is the best approach for scaling up,
policy-makers, managers and organizations advocating for VSS coffees face difficult choices as to
which path to pursue [
21
,
31
]. In addition, the presence of VSS in the mainstream segments has not
significantly changed the competitive dynamics of major roasters selling in traditional channels. They
continue to use their brands, economies of scale and distribution capacity as key competitive factors
and have opted for VSS as a form of protection of brand reputation.
On the other hand, VSS mainstreamization has brought challenges to specialty coffee brands.
As VSS symbols are used by mainstream brands, they lose their differentiating appeal for higher end
coffees and reinforce the importance of the standard as opposed to the importance of the coffee origin.
Coffee farmers appear to be trapped under these “differentiating from above” and “differentiating
from the middle” efforts [
32
,
33
] established by brands and other actors in the value chain, which
are viewed as top-down laid-out rules that do not allow for their own differentiation and long term
economic upgrading. As many realize that these strategies do not necessarily bring growers long term
benefits as VSS segments expand, they question whether VSS is an effective tool for their own financial
sustainability. Clearly, they face difficult scenarios to achieve economic upgrade and profitability.
1.2. The Role of Geographical Indications
In this context, over the last 10 years, a new trend of sophisticated and independent coffee shops
focusing on single origin and direct trade coffees began to influence the whole industry. The so called
“third coffee wave” movement is skeptical of VSS coffees, favors direct origin contacts and developing
partnerships with growing communities while finding very high quality coffees that can be sold
together with the content of how they were found and procured.
In parallel, growers have also begun to use Geographical Indications (GIs) as a form of
developing conditions to protect their coffee origin reputations and capture more value (e.g., Colombia
(
Caféde Colombia
, Caféde Nariño), the Dominican Republic (CaféValdesia), Guinea (Ziama–Macenta
coffee), Jamaica (Blue Mountain) or Mexico (CaféVeracruz)). With GIs and other intellectual property
tools such as certification marks, collective marks or trademarks (as in the case of Sidamo from
Ethiopia), growers and processors are focusing on differentiating, protecting and labeling their
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coffee [
34
,
35
] with origin branding initiatives that can be classified as “differentiation from below”
efforts [2933].
The GI protection aims to avoid appropriation of geographical names by groups or users not
linked to the area. There are cases in which large companies located outside of the production region
might take advantage of the quality reputation of products originated in a given region and erode the
benefits of origin production systems [
36
,
37
]. Well-known origins in different industries such as cheese,
wines or spirits have used GIs as a measure to avoid unfair competition and free-riding of their quality
reputation, empowering local producers to define the specific rules for using the origin label [
38
40
].
Thus, GIs are based on the principle that the equity and quality reputation associated with a given
origin belongs primarily to the producers located in that region. Therefore, the implementation of
GIs represent a bottom-up and differentiation from below effort, and an option for growers to protect
their reputation and a possibility to provide symbolic value. GI recognition can also limit unfair
competition, enforce quality standards and therefore provide conditions for long-term differentiation
to access a higher value for origin products. Nevertheless, promoting and defending GIs are long-term
efforts that, just like brands, require consistency and strategic planning. Clearly. GI protection does
not always imply an increase in prices after registration, just like registering a trademark does not
necessarily mean that it makes it automatically more valuable.
The third wave segment has given growers a possibility to accrue higher prices for high quality
coffees in relation to the premiums provided by VSS compliant beans (There are several trade references
to single coffees in the 3rd wave segment with or without VSS. Some useful sources https://www.
allianceforcoffeeexcellence.org/en/,http://transparenttradecoffee.org/insights and http://www.pqc.
coffee/serendipty.). The success of single origin coffees in this segment has created a renovated launch
pad for GIs in the coffee category, influencing the product portfolio of other specialty and traditional
segments that have also started to launch single origin coffees. Although the definition of single-origin
coffees is not exactly laid out, these trends certainly constitute a new market opportunity for coffee
GIs to provide transparency regarding the place of production or higher quality [
41
]. Whereas most
mainstream brands used to base their portfolio on blends of different origins, they are now expected to
have more product diversity.
However, GIs still lack a concrete sustainability platform. As it is clear that markets, consumers
and above all local stakeholders expect more from brands and GIs in terms of sustainability, deciding
on what GI sustainability strategy must be pursued is not an easy choice. On the one hand, VSS
may offer ready off-the-shelve solutions to accommodate GI sustainability information needs with
some degree of consumer awareness. On the other hand, adopting VSS for GIs may imply that
origin branding initiatives abandon their bottom-up approach, giving priority to external stakeholder
considerations over the expectations of local communities.
1.3. A Necessary Debate
Clearly the coffee industry is at a crucial moment to define the best sustainability strategy
going forward. The time has come for revisiting, revaluating and improving coffee sustainability
and differentiation models that can be more relevant to coffee origins. This implies additional
responsibilities to coffee industry members to continuously improve the current tools to pursue
an economic, social, governance and environmental sustainability for all actors in the supply chain.
This paper, based on literature review and previous work and experiences of the authors, attempts
to enrich this debate. Our main objective is to present and discuss a path towards an inclusive
sustainability agreement among supply chain actors that can provide economic upgrade opportunities
for farmers. We also aim to further promote critical voices and increase the debate to find alternatives
to the complex situation for the large portion of coffee farmers that still are far from profitable [
42
].
Our interest is not only to advocate for coffee growers to improve their social, economic, institutional
and environmental conditions. We are conscious that their future also depends on the ability to
enhance dialogue and create value for all industry members, so we aim for a balanced discussion that
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can lead to more focused and well prioritized sustainability investments and performance indicators,
relevant to the largest possible number of farmers in producing countries.
Our next section discusses the recent developments and difficulties that VSS has faced over the
last few decades. Afterwards, we review how the need to provide information on sustainability
through different sustainability reporting frameworks is currently being satisfied by some market
actors. We then discuss a proposed complementary sustainability model, and, finally, conclusions
are drawn.
2. Voluntary Sustainability Standards and Value Chain Governance
The value chain analysis proposed by Gereffi [
43
,
44
] involves at least four dimensions: the
input–output structure, the geographical coverage, the institutional framework under which value
chain actors develop their activities and their governance structure. The input–output structure
describes the stages of production. In the case of coffee, it deals with the harvesting, drying, exports,
roasting and sales. The geographical dimension deals with the spatial component, where the stages of
production are performed. The institutional framework surrounds the chains by regarding the local,
domestic and international circumstances and policies around the commodity chain. The form of
governance explains how the chain is controlled and coordinated (e.g., what stakeholders have a say
in what decisions). These dimensions serve as a device to contextualize the debate about a possible
sustainability agreement among supply chain coffee actors.
The coffee value chain has experienced significant changes in the last few decades, with an
increased importance of out-of-home consumption and higher priced coffees that require different
processes and, and as noted previously, more sophisticated environments where symbolic value can be
conveyed. On the geographic front, clearly the coffee industry’s international impact has continued to
grow, both in terms of production (with countries such as Vietnam, China and lately Myanmar as new
sourcing regions), as well as in consumption by more East Europeans, Asiatic and producing country
consumers. While these changes are clearly important, the more profound institutional changes that
resulted from the collapse of the International Coffee Agreement (ICA) in 1989 have made a more
significant impact to the coffee value chain. The absence of government intervention provided the
conditions for private operators, civil society and third party certifiers to gain an increased influence
in the coffee industry. Thus, the decreasing leverage of state-driven organizations dealing with
transnational policies in the coffee sector resulted in key changes in the governance of the international
coffee value chain [6,16,45,46].
As the coffee sector witnessed the emergence of VSS [
15
], other governance relations along the
chain emerged for certain segments. In a form of a captive value chain governance [
29
,
47
], coffee
growers received support to achieve VSS certifications, but they still depended on market demand
and buyer’s decisions to acquire their certified coffees at varying premiums. As many product lines
were still based on blends, the cost of switching suppliers of VSS coffees was still low for roasters.
Despite these shortcomings, a process of adoption of VSS to counter the low coffee prices started in
major producing countries, with varying degrees of success. However, the new governance conditions
for these segments did not significantly alter the coffee farmer’s strategic ability to differentiate and
capture more value [
48
]. Thus, like in most commodities under free market conditions, the coffee
industry value chain is now mostly described as a market or buyer driven governance chain that limits
the potential economic upgrade opportunities for farmers [49].
On the demand front, VSS were key to satisfying the needs of a more curious and responsible
consumer that required “credence” or “clean” labels [
29
,
32
,
50
56
]. VSS labels provided end
users with reasonable expectations of transparent labeling, complete information and compliance.
These information needs are part of the wider trends affecting the food industry and the higher
expectations of corporate responsibility. The implementation of these credence goods associated
with certain characteristics related to quality or production processes, not verifiable through simple
inspection or consumption [
29
,
57
], is another example of a top-down approach that required both
Resources 2017,6, 17 8 of 28
consumer promotional programs and roaster acceptance to mobilize supply networks to ensure the
supply of VSS coffees.
2.1. A Question of Impact
During the low price years, the valued-added markets based on VSS coffees seemed to be
a promising tool for smallholders in developing regions, particularly for Organic and Fairtrade
products [
8
,
11
,
14
,
19
,
21
,
41
,
57
61
]. These and other schemes were designed to offer an alternative to
the conventional commodity market regime by challenging market competitiveness based solely on
price [
61
] and by better valorizing local resources and internalizing social and environmental costs
of production [
61
63
]. VSS also offered a medium to alleviate poverty by bringing higher prices
for producers [
8
]. As credence labels, they are assumed to better connect producers and consumers,
providing information about the place and the people involved in production, and the growing
methods employed [14,41,62,64,65].
Certain evaluations have shown that VSS can provide benefits to growing communities. However,
the case for a long-term positive impact expected by the implementation of different VSS for coffee
growers with appropriate counterfactuals is still relatively weak and case-specific [
7
,
9
,
29
,
48
,
66
72
] and
varies depending on the certification scheme or the institutional conditions or regions where they are
implemented [
29
,
73
,
74
]. On the positive aspects for economic sustainability, increased productivity
is often portrayed as a significant benefit in many recent studies. Impact assessments often fail to
acknowledge national or regional agricultural policies that positively affect yields in a larger degree
than VSS protocols. In addition, for a crop that has a high component of variable costs, yields per
hectare are not the only factor to consider for a complete business case analysis of the required changes
to achieve economic sustainability. In addition, increases in farm productivity also provide benefits to
buyers, as that means a higher level of available supply and lower prices to them.
Impact by VSS can even be highly questioned. Some research has shown that certified producers
do not necessarily significantly change their conditions after VSS implementation. Studies made in
Nicaragua, for example, suggest that VSS farmers are more often found below the absolute poverty
line than conventional producers. [
11
,
66
]. Other works question the sustainability standard approach,
its ability to scale up and deliver benefits to both small and larger farmers and its impact in local
institutions [
75
,
76
]. One could argue that some producers or some regions may be in a position to
adapt to a particular VSS given their specific conditions, while, in some cases, other protocols, such as
adding shade in an excessively wet area, will probably put them out of business.
A more comprehensive FAO study on the impact of VSS on smallholders and on market
participation in developing countries also shows mixed results [
9
]. The study highlights a number
of trends that are also valid for the coffee sector [
9
] (pp. 55–56): (i) self-selection: growers and
exporters who have the means to make the initial investments are the first to join; the ability
of exporters and growers to meet requirements set by voluntary standards largely depends on
greater financial, environmental, physical and human capabilities at the farm level, which leads to
exclusions of poorer growers; (ii) there is evidence that buyer preferences, pre-existing buyer–supplier
relations and organizational structures of producers are selection mechanisms for the adoption of
standards by small-scale growers; (iii) institutional contexts in which smallholders operate do matter;
recent research pays attention to institutional contexts to comprehend how standards interact with
pre-existing norms of production and trade. National institutions are needed to support growers’
compliance with standards, but the support for increasing growers’ participation in markets is still
insufficient; (iv) compliance with standards and certification does increase costs but also farm-gate
prices. The impact of standards is also contested because there are no common measurement
methodologies and there is not statistically valid data for long-term impact assessments, a topic
that has begun to be addressed lately [
29
,
74
,
76
]; while some studies find positive socio-economic
effects for producers (e.g., [
19
,
48
,
67
,
77
79
]), others show that they do not necessarily achieve positive
outcomes or show mixed results [9,29,30,80].
Resources 2017,6, 17 9 of 28
As pointed out by FAO, how coffee growers effectively participate in these value added-markets,
capturing extra income in the long run for themselves, and how they share knowledge and expertise
on sustainable and/or quality production, depends, to a greater extent, on formal institutions
(e.g., national regulatory frameworks, national plans, assertive policies, functioning growers’ collective
organizations, state support for extension services, access to credits and infrastructure) and informal
institutions (e.g., forms of collaboration, cultural conventions such as degree of inclusiveness or
exclusiveness, ability to adapt practices, ways of thinking and acting) [38,40,81,82].
In terms of VSS adoption, major producing countries and those relatively more developed provide
better conditions for growers to attain VSS, whereas other countries in Africa or Asia face significant
difficulties. Therefore, the supply of VSS coffees has concentrated in a few countries, with Brazil,
Colombia and Vietnam accounting for 77% of the total [28].
2.2. Growing Pains: VSS Challenges
Contrary to the period when standards began to take hold during the coffee crisis years, current
price premiums for given standards may vary or be non-existent, adding to grower uncertainties.
No one can truly promise farmers that adopting these standards will mean a guaranteed market and
significant premiums for the beans in the long term (a coffee tree can produce for 15 years or more).
In addition, relative efforts across the chain may vary: the full extension of the farms has to be certified,
leading to higher capital expenses for growers, although, in certain cases, buyers (e.g., roasters or
brand owners) only have to buy a portion of certified coffees to be able to show consumers that the
coffee sold under their brands complies with the respective VSS.
While in many cases the adoption of sustainability protocols has been positive for coffee
growing communities, the first cohort of growers that reached them demonstrated that the ability of
farmers to comply with such standards is limited without significant institutional support and capital
investment [
74
]. Thus, a large number of coffee growers may not be in a position to obtain higher and
significant premiums in the long term based on following sustainability protocols in countries lacking
institutional support.
The mainstreamization of VSS has brought pressures for simplification or the implementation of
less stringent standards to ensure adequate VSS supply for bigger brands, bringing its own challenges.
Countries that have better institutional conditions, such as Colombia, face other types of challenges.
Data from the Colombian Coffee Growers Federation show that by 2015 nearly 200 thousand coffee
farmers operating in an aggregated area of 378 thousand hectares are working under one or more
coffee VSS [
83
]. A similar effort is taking place in other large coffee producing countries, notably in
Brazil and Vietnam [
28
]. This has resulted in an excess supply of “sustainable coffee” from a limited
number of origins, making it more difficult for the model to expand. In fact, matching supply and
demand of VSS coffee is perhaps the trickiest aspect of the current sustainability model. Demand
does not necessarily surface when harvests are being collected, and when it does, it is satisfied by a
portion of the certified farms. The world supply of sustainable coffee is estimated to be up to four
times the demand [
28
], and, in Colombia alone, the supply of certain verification initiatives accounted
for five times its demand in 2015. This means that the average premium for sustainable coffees has
been reduced, or that there might not be premiums and willing VSS coffee buyers when a portion of
the harvest comes to market, eliminating the financial incentives for growers to perform the required
sustainability practices. In that sense, the scenario of “mainstream pushing out niche” for the VSS
segment is clearly a source of discomfort from both the demand and supply standpoint [
79
], which
can lead to an eventual watering down of the meaning of VSS for most consumers.
In addition, voluntary standards focus on the standard rather than on the origin of the coffee,
favoring demand loyalty to the standard itself rather than to the coffee grower or his/her region
of production. As the coffee origin and its exposure as an attribute of differentiation becomes less
important than the sustainability standard in consumer communication, the farmers and their regions’
ability to differentiate and capture value through the symbolic quality and the origin information
Resources 2017,6, 17 10 of 28
that enhances consumer’s willingness to pay is curtailed. Thus, the standards become a factor that
contributes to the delocalization of production, and growers end up competing with other standard
compliant coffees with lower premiums from regions or countries with different production costs
and qualities. It is therefore not surprising that impact assessments of voluntary standards made so
far show that the value added, when generated, mostly stays with other actors of the supply chain,
including certifying agencies, while farmers obtain a limited participation in the resulting increased
revenues [9,28,29,74].
Although it could be argued that the mainstreamization of VSS is one of the stages of the sustainable
market transformation theory [
84
]. According to this concept, reaching a critical mass is the third
stage that follows the inception and early mover phases, before regulations and institutions can
lead to a truly sustainable industries. However, reaching the third (critical mass) phase requires
a balanced representation of actors along the chain, implying shared priorities across a number
of stakeholders, including governments, which is not part of what we have described as the
mainstreamization of VSS. Furthermore, under current conditions, the incentives for a continuing
expansion of demand and supply of VSS coffees are being reduced while the VSS model limits the
upgrade opportunities for farmers by delocalizing production. It would appear that the current
sustainability model is seen as a top-down (Northern) approach that does not necessarily provide the
necessary stakeholder engagement consensus and the conditions to achieve and maintain this critical
mass in a consistent manner.
2.3. The North and South Perspective
Voluntary sustainability protocols can also be viewed as well intentioned “private institutions”
predominately designed in the North, which may limit the local scope of decision-making, impose
high transaction costs on growers and squeeze out smallholders not being able to comply with the
required standards [14,30].
These private institutions insert themselves in buyer-driven global value chains, and imply
the use of transnational private governance arrangements and the implementation of standards
for sustainable and quality production. Nevertheless, the validity of many of these initiatives is
increasingly questioned since they are perceived as serving the interests and priorities set in consumer
environments. Agricultural policy makers seem to agree that growers are not adequately consulted
or are underrepresented in the process of defining priorities, which leads to an unbalanced standard
definition process and low applicability to local realities [
85
87
]. In contrast with retail and processors,
as well as NGOs and certifying agencies that have dedicated staff to sustainability areas, growers
and their organizations are unable to attend or prepare for technical and sophisticated forums where
standards are defined. As a result, decision makers often give excess weight to downstream industry,
consumer or public opinion perceptions on farmer realities. When producers are consulted, they tend
to have the chance to voice their opinion not on what priorities the standards should tackle but on the
implementation of priorities already defined.
Studies show that: (i) the participation by Northern stakeholders is not balanced both
quantitatively and qualitatively even if they encompass multi-stakeholder initiatives [
88
,
89
], and what
dominates is the Northern discourse on sustainability and the formal scientific knowledge over local
knowledge and growers’ preferences in the South [
85
,
87
,
90
]. This top-down criticism is reinforced by
the static market driven governance conditions in most commodity supply chains that limit the ability
of upstream actors to effectively interact with lead firms and value chain decision makers.
As a consequence of this imbalance and inconformity, groups of stakeholders who are excluded
from the development of standards or perceive themselves in a disadvantaged situation regarding
the outcomes of the standards are attempting to create (rival) VSS to affirm their own visions [
91
,
92
].
Some of these initiatives include the Trustea standard developed by the Indian tea industry, Flor
Verde in the cut flower industry in Colombia [
93
], IScoffee from Indonesia, the Brazil’s Certifica Minas
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CaféStandard [
94
] and Colombia’s recently launched initiative to develop its own sustainability
standards [95].
Southern standard developments may be considered as counter-initiatives to existing global
standards. However, it is still unclear how successful this bottom-up approach will be since: (i) they
have only just emerged and the socio-economic impacts are not known yet; (ii) the implementation and
enforcement of new regulations can be problematic in areas with weak institutional structures; (iii) they
may get some relevance in national markets but lack the resources to be known internationally [
85
].
According to Hospes [
91
] (p. 11), there is a challenge to develop “new perspectives on state, scale and
sovereignty over sustainability in a globalized, network society”.
More specifically, there is a need to establish the rules of the game in which producers in the South
are not only standard-takers but also included in design of the rules [
85
,
91
]. The ability to reframe
these initiatives with a sustainability value promise linked to single origin coffees or GIs is a possibility
to be considered, but would in any case require the participation of both the growing and consuming
industry. This would imply a bottom-up/top-down approach to satisfy the interests and needs of
upstream and downstream industry players.
In summary, there is no straightforward evidence that VSS can significantly contribute to
changing the coffee industry governance, and solving the large-scale challenges and the current
inequality in the global coffee market explained by the coffee paradox. The impact assessment of
the existent different initiatives varies significantly across regions and products. The success of a
sustainability intervention depends on the particular context where it is applied [
29
,
74
,
76
] and its
ability to significantly contribute to improving conditions at the scale required in growing regions is
limited. In addition, the current top-down model faces complex challenges. From the demand side, the
“sustainability of the sustainability model” in fact depends on the availability to continuously provide
additional demand for VSS compliant coffees at higher prices.
From a supply side, the lack of incentives and the additional and significant funds that will be
continuously required to support VSS adoption by small-scale growers, which are further below the
standards than the first adopters [
9
,
74
], also question the current model’s ability to expand. In addition,
apart from the possible lack of relevance of a given VSS for a producer or growing region, the current
VSS model does not provide conditions for coffee growers’ economic upgrade and “differentiation from
below” efforts associated with origin promotion. Finally, VSS might further shift power relations along
the international value chain in favor of international stakeholders, exporters and better educated,
bigger producers in developing countries to the detriment of smaller farmers, without significantly
altering the market driven value chain governance.
3. Sustainability Reporting
There is an evolving consensus on the importance of environmental, social and
economic sustainability for long-term brand and company performance [
96
102
]. Market
research [2,103,104]—among
others—shows that younger consumers around the world have
become less influenced by traditional advertising and more thoughtful of their purchasing decisions.
The evolving “reasons why” to buy a product or a service include, in many instances, the impact that
such products have in the communities where they are produced, their environmental footprint and
the labor practices used. These factors can be considered a new set of brand attributes or, depending
on the industry and the product, a set of minimum expectations. In fact, more than half (55%) of
global respondents of Nielsen’s corporate social responsibility survey say they are willing to pay extra
for products and services from companies that are committed to positive social and environmental
impact [
104
]. However, some consumers do not think that providing information is enough. Successful
brands deliver higher return of investment if they are considered “meaningful” or “loved” by
consumers, a condition that can only be obtained if they are trusted, and only if this condition is
fulfilled can the information they convey become a positive and differentiating attribute [105,106].
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In addition, corporations have the challenge of attracting and retaining talent. Millennials now
account for over half of the workforce in many countries, and their set of values and expectations
widely differs from previous generations. They are entrepreneurial, favor the underdog, and their job
fulfillment also depends on their employer’s ability to inspire and provide social value [
96
,
97
,
103
,
107
].
Investors, on their part, are requiring more disclosure and becoming more demanding to
companies and organizations [
98
]. In an era of high scrutiny and transparency, companies and
brand values can be significantly affected by reputational risks. It takes time and can be very costly
to recuperate consumer and regulator trust [
108
]. It is therefore not surprising that both retailers
and large corporations have significantly evolved in evaluating the impact of their operations from
an economic, social and environmental standpoint. Clearly, sustainability policies are now a tool to
identify potential risks and competitive opportunities to deliver higher returns [99,100].
Companies dealing with raw material sourced overseas also have to contend with long and
difficult-to-control supply chains. Industries such as coffee, minerals, diamonds, palm oil or sugar are
continuously scrutinized for their social and environmental impact. The ability to know the supply
chain actors and identify the specific origin of their products is not only an expectation by clients,
retailers and consumers but also a possibility to differentiate and provide brand emotional value [
109
].
Clearly, large companies are becoming conscious that their organizations and brands have to
take sustainability seriously and deliver a more complex set of benefits to clients and consumers.
Sustainability and clarity of purpose are now a key to success for established companies [
101
,
110
] that
need to compete for market share with newcomers that can sound more authentic and can more
easily communicate their contribution to society [
111
]. In the coffee category, it is clear that these
trends are reflected in consumer-oriented companies and brands. On the other hand, sustainability
reports are less frequent in upstream and business-to-business environments with low visibility. Global
sustainability reports published by coffee importers and exporters are difficult to find, even among
major operators. Grower organizations exceptionally publish their own sustainability policies and
indicators. In terms of reporting, there is clearly a lot to learn from “northern” actors to provide
consistent updates on long-term sustainability initiatives and priorities.
3.1. A Question of Materiality
Sustainability reporting has been the result of the increasing pressure from stakeholders and
the evolving material aspects that affect performance and surpass the financial topics traditionally
presented in financial reporting. Reporting has also evolved. As more practitioners and interested
parties became engaged in reviewing the sustainability policies, priorities and actions performed
by companies, reporting frameworks and methodologies were required to provide transparency
and credibility. Sustainability reports, in particular those developed under accepted sustainability
reporting standards, require stakeholder consultation and a sustainability materiality assessment to
identify the topics of priority for a company to be viable from an economic, social and environmental
perspective [
89
]. Materiality is a term originally used by accounting regulators to establish standards
for financial statement auditing. It has been defined in different ways by the US Supreme Court,
the Financial Accounting Standards Board (FASB), the International Accounting Standards Board
(IASB), the Securities and Exchange Commission (SEC), the World Business Council for Sustainable
Development (WSBCSD), the Global Reporting Initiative (GRI), among many others. However, in
practice, most coincide on the fact that the identification of material topics is a key factor to assess the
current and future performance of an entity [
112
]. A material assessment on sustainability therefore
identifies the sustainability topics that are considered a priority for the brand or company in question
and its stakeholders [113,114].
There are different methods to identify and prioritize key sustainability topics. The Sustainable
Accounting Standards Board (SASB) [
115
] and GRI have come up with tools that help companies
identify material topics of interest for certain industries. This exercise must be complemented with an
action plan to confront them, with their respective medium- and long-term objectives. Therefore, it is
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expected that companies belonging to the same industry will have similar sustainability materiality
assessments, allowing the best possible comparison of views and initiatives among industry members.
However, the set of priority issues and the degree of commitment to confront them can substantially
vary between competitors in the same industry. This may reflect the degree of commitment to
sustainability or an approach to sustainability that is merely considered as a way to respond to and/or
appease their stakeholders. The resulting Key Performance Indicators (KPIs) on complex sustainability
questions can also widely vary, both in their definition and in their objectives.
Over 5000 sustainability reports using GRI guidelines and standards were filed for calendar
year 2015 [
114
], suggesting an increased commitment to follow these methodologies. Many of these
companies are brand owners and retailers processing and distributing coffee as well as a number of
agricultural products, whose stakeholders (in particular clients and shareholders) increasingly expect a
clear commitment to continuous improvement in sustainable operations and practices. Others may file
reports with the primary objective to reduce reputational risks and satisfy more demanding consumers.
However, in an increasingly large number of cases, commitments regarding environmental, social
and governance factors also play a role in accessing or maintaining a client base, in order to apply
for public procurement contracts, to comply with regulations or to be in a position to adhere to fund
management policies to invest in such companies.
One of the key features of the materiality assessment framework now used by thousands of
companies and organizations around the world is deeper stakeholder consultations. The degree
and depth of consultation still leans in favor of downstream players (clients or consumers) rather
than upstream providers. In the case of the coffee value chain, the lack of institutions or relations
with grower organizations imply that consultations are often limited to the next step up the chain
for coffee brand owners, e.g., green coffee importers and occasionally exporters. Furthermore, the
GRI methodology is not exempt from criticism because of its inclusive multi stakeholder process,
which, according to some opponents, may lead to a sort of “paralysis by analysis” and less rapid
advancements on a progressive agenda [
116
]. Thus, while the principle of consulting and identifying
priorities with all stakeholders, including vendors, is of significant importance to global value chains,
it may not be thoroughly exercised or may be limited to a few actors whose main operation is not in
countries of origin.
3.2. Coffee Brand Reporting
The coffee industry is a notable example of a varying degree of depth of analysis in its different
sustainability reports [
117
125
]. Most coffee brands acknowledge that a viable future for coffee growing
is a key material area for the sustainability of their business. However, the degree of elaboration in
the different action plans significantly varies. While some brands like Keurig [
123
] or Nestle [
124
]
show more comprehensive approaches to the challenge of coffee growing sustainability, there are also
cases where brand owners support a wide variety of low impact initiatives to support farmers that
lack adequate impact assessments or focus.
In most instances, the sourcing sustainability policies result in the adoption of different VSS for
the green coffee procured as raw material by different brands. Companies turn to their vendors and
input providers to require them to adopt those standards for a portion of their total needs [
1
] exercising
their market power [
79
] under a traditional top-down approach. It is therefore not surprising that, for
many agricultural products, a significant number of these companies make public commitments to
buy a portion of their raw materials with products complying with a particular VSS [1,28,126].
In a concentrated market like coffee, where seven companies account for nearly 50% of the world’s
coffee grocery retail sales based on Euromonitor data and trade sources [
1
], these top-down policies
have significant implications for over 25 million coffee producers around the world [
9
]. Producers
learn the news from exporters and are then required to invest and change their practices in order to
adopt the standards believed to be sustainable. In the meantime, exporters and importers adapt their
processes and services to develop ways to ensure an adequate supply of VSS coffees. Unfortunately,
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this scenario, which could be described as “outsourcing sustainability to growers” does not give proper
weight to grower’s interests and their own material topics.
3.3. A Top-Down/Bottom-Up Approach
Clearly, sustainability reporting has room for improvement to better reflect the interests and
priorities of the farming community. From a coffee grower’s perspective, sustainability could be
the most appropriate way (or manner) in which economic, social, governance and environmental
conditions of supply chain actors (from coffee harvesters, growers, traders, coffee roasters and retailers)
produce less gaps/disparities. Under this view, an emphasis on legitimate farmer governance, a topic
seldom mentioned in brand sustainability reports, needs to be highlighted if farmer sustainability
priorities are to be identified and validated. Furthermore, existing standards can play a positive role
in many aspects but are more questionable when it comes to (sustained) economic-profitability of a
long-term venture called coffee growing.
There are already efforts to bring the southern perspectives into sustainability frameworks that
lead to KPIs and reporting by industry groups and VSS. The Sustainable Coffee Challenge [
127
]
actively promotes knowledge and project sharing, while UTZ has adopted a more inclusive policy
of farmer consultation at origin before its standards are formally implemented. The International
Social and Environmental Accreditation and Labelling Alliance (ISEAL) [
128
,
129
] has brought different
VSS and international stakeholders to reduce and simplify certification indicators. The Cocoa Action
plan [
130
] has also acknowledged that coordination is needed to achieve more impact on consensus
indicators in which origin governments participate. Likewise, the recently launched Global Coffee
Platform [
131
] has producer representatives in their board of directors and calls for national and
international platforms. However, these initiatives are still novel and lack a real bottom-up approach
where growers from different countries and regions can provide their feedback on priorities and
sustainability indicators.
Some companies are also conceiving positive developments to better incorporate coffee growers’
views. McCafé, under its Sustainability Improvement Platform (SIP) program, included a producer
collaboration component designed to identify and validate farmer needs [
120
]. Farmer Brothers,
a roaster based in California that is also a McCafe supplier, has developed its Direct Trade
Verified Sustainable (DTVS) program, which includes adopting sustainability priorities and KPIs
in collaboration with Committee on Sustainability Assessment (COSA) that are verified as relevant for
coffee growers in the regions from where they source [
121
]. The resulting KPIs and progress reports
would no doubt have more relevance and credibility for growers and consumers and for the industry
as a whole.
In summary, successful coffee companies are publishing sustainability reports. The discipline
of reporting and making sustainability materiality assessments is a significant step to getting the
industry to use useful methodologies to determine the priority topics that the coffee industry needs to
concentrate on for its long-term viability. These top-down experiences can be put to use for bottom-up
efforts in an effort to engage coffee growing organizations to arrive at more meaningful sustainability
initiatives that provide more benefits to farmers.
There are already efforts that lead to more quality reporting and consideration of coffee growers’
views that do not necessarily incorporate VSS. These more comprehensive efforts can increase consumer
trust and relevance in coffee growing regions. A commonly agreed set of material aspects to achieve
sustainability would provide legitimacy to the efforts of brands and origins, bring coherence to
sustainability reporting and develop additional differentiation opportunities based on sustainability
actions. This means that the equity of the brand, the retailer and the origin can work in tandem, as
they share priorities and objectives.
Providing consumers and stakeholders with a consistent industry narrative and helping
companies to report on their contribution to more impactful and significant sustainability KPIs would
probably be the next stage of coffee sustainability reporting. Focusing on material priorities relevant to
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different origins is another key aspect of what we have termed a top-down/bottom-up sustainability
vision. This approach will build on direct trade and relationship coffee trends that focus on individual
farmer or community stories as a way to bring more authenticity and excitement to the coffee category.
4. Toward a New and Complementary Sustainability Model
The past few years have taught us that sustainability is an elusive target. The mainstreamization
of VSS, while positive in many respects as it reaches a larger portion of the growing and consuming
population, may not be in a position to continue to expand due to decreasing grower incentives and the
substantial funds required for a new cohort of farms to comply with VSS requirements. Furthermore,
and despite VSS coffees accounting for almost 40% of the world supply, the economic viability of coffee
growing is still in question in many producing areas. In fact, a recent report [
42
] reminds the industry
that coffee production is not profitable in several countries and the ability to expand production in a
number of them may be put into question, whether they comply with VSS or not. This would imply
that the economic upgrade opportunities for coffee farmers once foreseen when adopting VSS models
tend to dissipate with time.
However, there have been positive developments that can bring new possibilities for the
sustainability of the coffee industry. The expectation that industry members will be under constant
“millennial” pressure would help to progressively increase the quality and consistency of brand
sustainability reports. In addition, the launch of the UN’s Sustainable Development Goals (SDGs) may
soon lead to concerted actions that could eventually call for industry realignment on sustainability
priorities. It is expected that grower organizations, exporters and importers will also need to adopt
consistent and coherent sustainability reporting standards rather than limit themselves to publish
isolated corporate social responsibility initiatives. There are already individual companies and industry
groups realizing the need to enlarge the “sustainability stakeholder consultation process” and involve
coffee growing communities in defining priorities. In addition, there is a renovated interest for
single origin coffees in the trendsetter segments of the market, which is filtering down to mainstream
segments and giving opportunities for GIs to promote themselves as a high quality and sustainable
coffee option. Clearly, we are at a critical junction to review the current coffee sustainability model and
evaluate possibilities for improvement.
In this context, we believe that the conditions to develop an approach to sustainability that
effectively involves farmers and their organizations in devising sustainability priorities have arrived.
As the future of the coffee supply is in question due to lack of interest for growing coffee by younger
potential coffee growers, upstream and downstream actors need to come to terms with sustainability
objectives and metrics that are relevant to the specific conditions of origin regions and attend to
consumers’ more demanding and credible information needs. Our proposed top-down/bottom-up
approach should also provide a sustainability platform for single origin coffees and GIs, providing
the credibility that consumers now expect from sustainability initiatives, and scalable differentiation
from below and economic upgrade opportunities for farmers. In this section, we provide details of our
model and how it can complement itself with the existing VSS frameworks.
4.1. The Need for a New Model
The few long-term VSS impact assessments available have shown that, under certain conditions
and contexts, VSS produce positive impacts in coffee growing communities. However, their overall
impact tends to be over-estimated while there is an increasing set of future challenges for coffee
farming. As noted before, coffee growers now have to contend with higher risks associated with climate
variability and climate change, which frequently mean more pest and disease incidences, significant
price and income instability in the post ICA world, an ageing rural population, an ever concentrated
demand that leads to a perennial income imbalance, the need to provide truthful information on
supply chains, market access limitations for smaller growers—in some cases, due to VSS—demand and
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supply uncertainties, lower profitability and higher costs of production. These and other challenges
are dynamic, and may affect different coffee growing communities in different ways at different times.
The coffee leaf rust pandemic that took place in Colombia, and in other Central and South
American countries starting in 2009, showed how dynamic and far-encompassing these challenges can
become. As hundreds of thousands of coffee farms became affected by the coffee rust fungus, many
VSS certified producers found that they were very vulnerable to pests and diseases—more so than any
sustainability standards could have anticipated. In fact, certain conditions recommended by standard
setters made the situation worse [
132
134
]. The recent Brazilian drought and the increased prevalence
of coffee berry borer in Colombia during dry periods have also shown cases in which producers with
drastically reduced yields face difficult economic conditions while, at the same time, they are deemed
sustainable according to certain standards [
135
]. Clearly, VSS do not necessarily adapt rapidly to an
era of rapidly changing farming conditions.
The limitations of VSS may also be associated with the emphasis on far encompassing standards.
Standards are defined as a “document, established by consensus and approved by a recognized body,
that provides, for common and repeated use, rules, guidelines or characteristics for activities or their
results, aimed at the achievement of the optimum degree of order in a given context” according to the
definition of the International Organisation for Standarisation ISO/IEC Guide. When applied to coffee
production and sustainability, a standard may become a tool that simplifies complex and evolving
challenges for millions of coffee producers. There is no single difficulty, economic, environmental or
social in nature that is not evolving. Different realities, no matter how much we try to simplify them in
order to understand them, are very complex. The framework of defining standards and checklists to
declare oneself “sustainable” when complying with an audit simplifies a clearly more intricate and
complex reality.
The problems to simplify complexity involved in the standard setting processes are compounded
with the lack of proper channels and institutions to gain knowledge and co-create with coffee farmers.
The SDG framework provides an opportunity to develop an origin and/or region specific framework
for sustainability. Relevant priorities and baselines can be defined with coffee growing communities so
that sustainability KPIs and goals are defined taking into account local coffee grower specific challenges
and realities. This implies an adoption of a continued improvement process for growers and regions
on their path to sustainability, and dynamic sustainability reports that would show a commitment to
sustainability rather than a declaration of being sustainable according to a given standard.
Furthermore, this sustainability concept and its KPIs will need to become region specific, acquiring
more relevancy for local authorities and legitimacy among coffee farmer communities. The approach
also favors public private partnerships on focused initiatives and programs with coffee industry
actors. These characteristics are consistent with the critical mass phase of the sustainable market
transformation theory. As pointed out in the previous section, current efforts under the Global Coffee
Platform [
131
] and the sustainable Coffee Challenge [
127
] appear to work in this direction, although
they still lack the region specific farmer community consultations implied in a bottom-up concept.
The Direct Trade Verified Sustainable (DTVS) program developed by Farmer Brother and Cosa [
121
],
while still not focused on single origins, as its main customers use blends, is a worthwhile initiative
that explicitly incorporates grower consultation and validation of its sustainability initiatives.
One major obstacle to develop region specific sustainability KPIs is the ability and practicality
to obtain farmer input. Most coffee growing regions still lack effective communication tools or
strong farmer organizations to channel this consultation process. On the other hand, regions that
have developed GIs usually have constituted more effective governance systems, which is a specific
condition that they must comply with for being recognized as a GI in most legislations.
4.2. The Challenge of Effective Consultation
A number of initiatives that help identify coffee producer communities and regional priorities
have been implemented under different frameworks. During the process that led to the application
Resources 2017,6, 17 17 of 28
of Colombia’s Coffee Cultural Landscape (CCCL, the CCCL covers areas of 51 coffee growing
municipalities in central Colombia) for inclusion into the UNESCO World Heritage List and the
definition of its management plan [
136
,
137
], dozens of stakeholder engagement meetings took place.
The initial management plan had KPIs that were regularly updated, for each of the exceptional
values that were considered by UNESCO. Progress was reviewed in local and regional follow-up
meetings and communication material was distributed to the region’s inhabitants [
138
]. As a result
of these efforts, local and national authorities enacted policies to support these initiatives [
139
],
give advice on implementing regulations and provide different materials to city councils that would
support the conservation of the region [
137
]. Taking into account different experiences, a regional
brand was launched to identify products originating from the region as well as tourism facilities
that complied with certain standards [
140
142
]. More recently, after several years of implementing
the original management plan for the landscape and evaluating its KPIs, a number of meetings and
workshops took place with local stakeholders and a new and more comprehensive management plan
is under consideration [
143
]. Both the previous and the new management plan focus on economic,
environmental, social and cultural activities and can be described as a comprehensive sustainability
policy [144].
Collective wisdom exercises based on appreciative enquiry methodologies have also been
widely used for corporate strategic planning and community development workshops [
145
,
146
].
The Colombian Coffee Growers Federation has put to use these methodologies in a number of
occasions to arrive at priorities and focus on strategies that would deliver a better return for coffee
production [
147
]. This more comprehensive approach, which takes into account grower’s interests and
priorities, aims for a more balanced set of objectives and responsibilities of actors in the industry and
can result in KPIs and targets that are adapted at regional and local realities.
The Farmer Brother–Cosa approach is somewhat different. It incorporates a bottom-up approach,
as it uses farmer surveys and follow-up instruments to validate the hypothesis on sustainability
priorities detected on (top-down) previous work. As the world moves to sustainable platforms that
can be adapted to national and local conditions, this framework can be useful for those regions with
weak governance and institutions. Although there is no single and unique approach for farmer and
community consultation, there are clearly a number of methodologies to obtain farmer feedback.
Clearly, anecdotal evidence and indirect consultation though exporters and importers is not enough.
The legitimacy benefits of a top-down/bottom-up approach to sustainability go beyond legitimacy,
relevance and origin specific equity. The co-creation of an industry materiality assessment can
complement the traditional scientific knowledge, which often omits taking into account user knowledge
and the ability for considering different conditions and contexts [
148
]. Thus, transferring the
core meaning of transdisciplinarity [
149
] to the understanding of the challenges faced by coffee
production and consumption implies the acknowledgement of the role of diverse actors (from growers
to consumers) and their knowledge to jointly promote dialogue, understanding and definition of
sustainability parameters and assessments.
4.3. Region Specific Sustainability KPIs and Global Priorities
The suggested coffee industry sustainability assessment can lead to a set of global material issues
that also reflect local contexts and priorities both in the coffee growing and consuming environments,
leading to common efforts, alliances and smarter resource allocation. Coffee industry members
might adapt their CSR policies to actions that can impact a set of commonly agreed Coffee Industry
Sustainability Performance Indicators.
These indicators, apart from complying with Specific, Measurable, Available, Relevant,
Time-bound (SMART) criteria, can take into account global compact and Sustainable Development
Goal (SDG) indicators and priorities, facilitating cooperation with multilateral and government
agencies. They will also build on previous work done by VSS, the impact assessment work done
by COSA and FAO’s Sustainability Assessment for Food and Agriculture (SAFA) indicators and
Resources 2017,6, 17 18 of 28
tools [
150
]. More importantly, as the regional sustainability KPIs are shared with local growers and
their organizations, they can be adopted by local governments, adapted to local coffee growing realities
and communicated under the SDG platform. By focusing on key priorities and measuring their
impact rather than investing resources in hundreds of initiatives that may or not be relevant to coffee
growing local contexts, additional funds from non-industry stakeholders can be leveraged and scale
can be achieved.
This implies the need to acknowledge that, in a complex world, not all indicators are necessarily
positive and some may deteriorate under certain conditions. The challenge of sustainability is therefore
not a pass/fail test, but the consistency of continuing work in prioritized sustainability material issues
despite the fact that one does not control all possible variables that affect the business. The overall aim
is that consumers and industry stakeholders must learn to value these long-term strategies and the
commitment and efforts made by origin regions and brands.
Another advantage for region-specific KPIs has to do with impact assessment. Defining baselines,
KPIs and sustainability evaluation criteria in specific regions are less complex than applying
generic KPIs to several coffee growing sources with different conditions at once. The impact
measurement results are therefore more transparent, less generic and more credible to consumers and
region stakeholders.
4.4. Benefits for Origins
One additional and possibly substantial benefit in the long run for the proposed sustainability
vision is that it can promote and complement the equity of the origin, providing differentiation from below
and economic upgrade opportunities for farmers and regions that develop a meaningful sustainability
track record. This would complement single origin coffee reputations and respond to consumer and
marketing trends that define origin as a significant piece of information that consumers now demand.
Growers have the additional incentive to develop GIs with sustainability indicators that connect
with SDGs and provide both marketing content and relevant data for those industry sustainability
reports that sell coffees from those origins. Under this vision, an Origin Sustainability Manifesto
could be the base for long-term win-win partnerships and commitments for joint sustainability and
marketing programs.
The proposed model requires that coffee growers themselves reflect (within their regions
or national organizations) on their own material sustainability questions and develop their own
sustainability reporting. This will necessarily require widespread consultation and transaction efforts
at the local level through workshops and appreciative enquire exercises with producers themselves
as well as a periodical revision of opportunities. The voice of a large majority of small farmers will
have a platform bringing some equilibrium to the interests of large growers and exporters that are
now benefiting more from the current sustainability standards regime.
GIs are uniquely well positioned for this consultation exercise thanks to their stronger governance
and institutions. The equity of a given origin would not only be based on its availability, consistency
and quality but on its commitment to sustainability, providing the conditions to launch sustainability
manifestos for individual GIs, which can become useful tools for origin sustainability reports and
for differentiating from below efforts. A region-specific and continuous-improvement approach to
sustainability KPIs will also have the benefit of not forcing coffee growers into sustainability pass/fail
corners that do not reflect different and evolving sustainability challenges.
For regions that have a quality reputation, the new framework will have expanded differentiation
from below opportunities as the suggested process can also provide to them the necessary content to
promote their own GIs with transparent sustainability KPIs. Thus, GIs can become a more robust and
value added offering for single origin marketing, as it has attached credible information and valuable
content that better meets the symbolic quality mentioned by Daviron and Ponte [
6
]. In other words,
the system helps to develop the necessary loyalty to the origin and becomes a powerful incentive to
promote a more complex and rewarding relationship with other actors in the value chain.
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4.5. A Platform for Fruitful Dialogue
Another important benefit of this approach is that it might help industry players to understand
and acknowledge the sustainability challenges that all members of the industry face, not only at the
coffee producing level but also at the coffee manufacturing and consumption levels. Producers and
other industry actors will look at sustainability in a more comprehensive way, acknowledging the
difficulties, challenges and progress of other actors of the industry. This aims to enhance the way
brands and other players communicate with consumers as an industry, building more credibility to the
concrete actions that each member of the industry makes to improve on wider materiality questions.
Communicating to consumers and retailers with a consistent industry message can result in more
visibility to the industry’s efforts, more focus on priorities that are relevant to coffee growers, more
relevant impact assessments and progress indicators and more incentives to local communities to
become actors in transforming their own realities. Once again, the coffee industry should be in a
position to lead the way and show other industries how to achieve significant progress and provide
the scale required for the needed industry transformations.
More importantly, the industry materiality assessment initiative does not undervalue or do away
with the voluntary standards model. It can complement and enhance the current model where it is
successful, aligning incentives to work and leveraging resources on similar programs and projects that
have a direct impact on grower legitimate sustainability concerns.
In short, the proposed material assessment model and corresponding KPIs has at least the
following benefits that enhance the current voluntary standard model:
1.
It is agreed upon and defined with the explicit participation of growers or a collective of growers,
reflecting their own challenges and conditions, as well as their priorities in terms of social and
natural capital and profitability concerns.
2.
It is inexorably linked to the origin where those growers live, therefore building upon and
complementing the equity of the origin of their coffees. If a collective of growers or a given
region demonstrates a firmer commitment to Sustainability KPIs that can be measured in a
given geography or community/communities, the equity of such origin in consumer minds
and industry buyers can correspondingly improve, as it will be more credible to consumers
and stakeholders. In fact, this would lead to GIs in general adopting Sustainability KPIs to
complement their own minimum quality policies.
3.
Assessing the impact and progress of sustainability indicators that are adapted to defined regions
and origins is simpler and provides more ready feedback to reassess policies and evaluate benefits
of sustainability investments.
4.
It reflects a complex reality where, at times, all KPIs may not be positive, without sacrificing
the transparency and the commitment to improve upon them in the long term, gaining
consumer’s trust.
5.
It has the benefit of scale, impacting a larger number of growers and not just those that can
achieve the standards with less effort. Materiality questions aim to achieve widespread changes
to a large number of farms and growers, not limiting itself to those that can more easily access a
given certification standard or with the financing to be able to comply with them. This allows for
forging alliances to invest resources in commonly agreed priorities rather than parceling available
funds in limited initiatives.
6.
It does not work against the current voluntary standards model. On the contrary, it complements
it, supplying a set of sustainability objectives for all coffee growers according to priorities defined
by themselves, consulting consumer and industry expectations. At the same time, it does not do
away with the existing certification and verification protocols, which aim for laudable objectives
for those growers and industry members that see benefit in their use.
7.
It provides a platform to industry members to communicate to the farming communities their
own sustainability challenges and efforts. At the coffee growing and supply chain levels, it allows
Resources 2017,6, 17 20 of 28
them to use available resources more effectively with commonly agreed priorities. At industry and
brand levels, it provides content and actions that allow communicating to clients and consumers
with long-term strategies that include an effective and measurable impact.
8.
Clearly, there is a lot more work on developing a far encompassing sustainability model. However,
as the coffee industry considers new paths for sustainability, we advocate for a framework of
continuous improvement on clearly defined material topics that take into account the economic
challenges of growers. The implied governance of the new model will require that farmer
organizations from different regions of the world are able to participate in the co-definition of
sustainability priorities that are relevant to their own realities and provide them with economic
upgrade opportunities.
5. Conclusions
The debate over how to best achieve sustainability in general and in the coffee industry in
particular is wide open. The coffee industry has been the leader in implementing VSS, influencing
other industries along the way. Certainly, literature shows that positive effects have been identified
since VSS started. However, the time has come to re-evaluate the current model, not with the objective
of doing away with what it has achieved, but to look for new ways to approach sustainability and
obtain a bigger and wider effect that more closely reflects the complex reality of coffee growing.
Available studies show that impact of the current model varies according to the specific context.
There is no “silver bullet” standard to improve sustainability indicators. Furthermore, VSS has not
altered the value chain governance. In addition, it appears that VSS will have difficulty growing and
achieving at a larger scale as the business case for sustainability investment is becoming more dubious
from a grower’s perspective due to the reduced economic incentives and excess supply of sustainable
certified coffees.
Both the industry and the coffee growing communities, as well as consumer and NGO advocates
have to come to terms and agree on what is important and a priority for the sustainability of the
coffee industry as a whole. A top-down/bottom-up industry wide materiality assessment is urgently
needed to focus on priorities, build effective alliances, achieve scale and provide effective tools for
participation that can be adapted to different coffee growing realities. This new approach will imply
the development of sustainability KPIs for individual coffee origins and the ability to provide farmers
with economic upgrade opportunities.
In the current market context where single origin coffees are favored by third wave market
trend-setters, the new sustainability framework should leverage this market opportunity by offering
Origin coffees and GIs, leveraging differentiation from below opportunities that provide value to both
farmers and downstream industry players by strengthening their quality and sustainability attributes.
Likewise, Origin sustainability manifestos developed based on the experience of GRI, VSS, SAFA
and/or SDG frameworks can become a useful tool to provide origin differentiation and credible data
for other value chain actors. A desired competition on quality and sustainability can help to develop
public private partnerships and long-term cooperation with those marketing given origins.
This origin-centric inclusive sustainability strategy will provide more authentic and credible
content to consumers and stakeholders and upgrade opportunities to all, not limiting the system to
convey differentiation opportunities for the marketing and distribution end of the value chain. As the
model provides for regional differentiation, it coexists with and learns from the successful farm-specific
and direct trade value creation processes that the third wave coffee segment has successfully positioned.
It also reduces the implicit delocalization risks that are part of the VSS model. Consistent with the
sustainable market transformation theory, it has the benefits of scale as whole origins are marketed
and positioned. Lastly, it gives positive incentives for all supply chain actors that can create value
along the chain.
Acknowledgments:
We are truly grateful to three anonymous reviewers for their comments and insights that
helped us to substantially improve earlier versions of this paper.
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Author Contributions:
Luis F. Samper and Xiomara F. Quiñones-Ruiz worked on this paper. Xiomara F.
Quiñones-Ruiz contributed with the starting literature and reference on the subject as well as with theoretical
background. Luis F. Samper provided additional literature and references and expanded the sustainability
approach for GIs, which was improved after the comments provided by the reviewers.
Conflicts of Interest:
The authors declare no conflict of interest. They did not receive any funds from anyone to
write this paper.
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... washed arabica (Coffea arabica) coffees [1]. Researchers have documented how these challenges have resulted in critical vulnerabilities for producers' livelihoods and a limited ability for the majority of smallholders to adapt to these conditions [2][3][4]. ...
... Washed arabica producers struggle to differentiate their product for consistent price premiums, making them vulnerable to commodity price shocks and volatility [5]. Global price fluctuations are felt most directly by smallholder producers of higher quality arabica, whose socioeconomic well-being, including access to education, food security, and other basic needs, is often negatively impacted by low, volatile coffee prices [1]. The threat of climate change to the viability of current and future coffee production compounds the risks to smallholder livelihoods [6]. ...
... The modern specialty coffee industry has been a leader in developing initiatives and standards to respond to social, economic, and environmental challenges facing producers [1]. Coffee buyers, roasters, and retailers contributed to the early and widespread adoption of foundational sustainability certifications like Fairtrade for fair trade and Organic coffee [8]. ...
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... For example, a study by Gaitán-Cremaschi and colleagues (Gaitán-Cremaschi et al., 2018) found out that social profit inefficiency, use of fertilizers and other farm management were closely related to sustainability. Worldwide, coffee contributes significantly to the overall economy and it is a major source of foreign revenue for many developing countries putting it as one among the sustainability agenda (Samper and Quiñones-Ruiz, 2017). The top five countries, led by Brazil (30%), Viet Nam, Ethiopia, Colombia and Indonesia have produced 10 million tons of coffee together in 2021 (Konema, 2021). ...
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Discovered in Ethiopia, coffee became a popular beverage in Asia, Europe, Latin America, Australia, Africa and the North America as a drink after water and the largest goods after petroleum. However, the coffee industry generates a huge biomass as its byproducts of which the spent coffee grounds (SCG) is concerning, especially in the production chain away from the farm. Therefore, the valorization and revalorization of the SCG has a huge impact on the socioeconomic and environmental sustainability of the industry, up to the realization of the circular bioeconomy. With the advancing biorefinery concept, even an almost complete recovery of the SCG is reported at an experimental level. Such kind of studies increased with time following the action of the Sustainable Development Goals by the United Nations Development Program promulgated in 2015. The current review highlights on the background, socioeconomic, environmental contexts of coffee production and the SCG valorization and revalorization studies. Refereeing to 154 screened articles published in over 30 years' time, the SCG revalorization efforts and its integrated biorefinery as a green management approach are uniquely addressed. Plenty of studies have reported the production of bio-products from the SCG, such as the derivation of adsorbents, biochar, bioethanol, biogas, biodiesel, bio-oil, compost, construction material aggregates, cosmetics, electricity and food ingredients. In conclusion, the recovery potential of the SCG is promising and can substantially contribute to a sustainable and green bioeconomy. Nevertheless, the recovery of bioactive materials through SCG fermentation is still lacking. Most studies are conducted on a lab scale, which needs to be piloted and commissioned. Furthermore, the link between climate change and variability vis-à-vis the sustainable management of the SCG remains unaddressed.
... Coffee is an important component of the overall economy and a major source of foreign currency for many coffeeproducing countries (Samper & Quiñones-Ruiz, 2017). More than 125 million families rely on the coffee industry to better their living conditions (Bliss, 2017). ...
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em> Coffee arabica species have already been affected by climate change, with economic and social implications. Small-holder farmers have faced and will continue to face significant challenges in sustaining the production of their coffee plants. This study aimed to determine the optimal bio-climatic factors for coffee production in current and future climate change scenarios by simulating coffee distribution's responses to nine selective bio-climatic factors under the scenarios of moderate representative concentration pathway (RCP4.5) and worst representative concentration pathway (RCP8.5). The Maxent model was used to simulate the distribution of C. arabica . Multiple regression models (path and response optimizers) were used to parameterize and optimize the logistic outputs from the Maxent model. Results showed that climatic factors such as total precipitation, precipitation seasonality, and mean temperature are the most important climatic factors in influencing C. arabica farming. Under the current condition, total precipitation significantly benefits C. arabica whereas precipitation seasonality significantly affects it (P < 0.001). The annual mean temperature has neither benefited nor affected it. Under the RCP4.5, C. arabica would positively react to the rising annual mean temperature and total precipitation but adversely react to the rising precipitation seasonality. For current, RCP4.5, and RCP8.5, the average five top-optimal multiple responses of C. arabica were 75.8, 77, and 70%, respectively. Under RCP8.5, the maximum optimal response of the plant will be an annual temperature of 23.77°C, total precipitation of 1806 mm, and 77% precipitation seasonality. In comparison to the current and RCP8.5 climatic scenarios, the distribution responses of C. arabica to the climatic factors would be significantly greater in the RCP4.5 scenario (P > 0.001). As precipitation and temperature-related variables increase, the cultivation of C. arabica will increase by 1.2% under RCP4.5 but decrease by 5.6% under RCP8.5. A limited number of models and environmental factors were used in this study, suggesting that intensive research into other environmental aspects is needed using different models.</span
... However, the long-term sustainability of this production chain depends not only on actions aimed at reducing these environmental impacts. In fact, the coffee value chain has to contend with social issues such as food insecurity and poverty in coffee communities, unfavourable working conditions due to the long working hours, health related problems in workers and many more (Samper & Quiñones-Ruiz, 2017). To these environmental and social issues must be added also the consequences caused by interests of businesses and international agreements, which contribute to making the need to develop strategies for a sustainable and resilient future more urgent. ...
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Editorial The RSD10 symposium was held at the faculty of Industrial Design Engineering, Delft University of Technology, 2nd-6th November 2021. After a successful (yet unforeseen) online version of the RSD 9 symposium, RSD10 was designed as a hybrid conference. How can we facilitate the physical encounters that inspire our work, yet ensure a global easy access for joining the conference, while dealing well with the ongoing uncertainties of the global COVID pandemic at the same time? In hindsight, the theme of RSD10 could not have been a better fit with the conditions in which it had to be organized: “Playing with Tensions: Embracing new complexity, collaboration and contexts in systemic design”. Playing with Tensions Complex systems do not lend themselves for simplification. Systemic designers have no choice but to embrace complexity, and in doing so, embrace opposing concepts and the resulting paradoxes. It is at the interplay of these ideas that they find the most fruitful regions of exploration. The main conference theme explored design and systems thinking practices as mediators to deal fruitfully with tensions. Our human tendency is to relieve the tensions, and in design, to resolve the so-called “pain points.” But tensions reveal paradoxes, the sites of connection, breaks in scale, emergence of complexity. Can we embrace the tension and paradoxes as valuable social feedback in our path to just and sustainable futures? The symposium took off with two days of well-attended workshops on campus and online. One could sense tensions through embodied experiences in one of the workshops, while reframing systemic paradoxes as fruitful design starting points in another. In the tradition of RSD, a Gigamap Exhibition was organized. The exhibition showcased mind-blowing visuals that reveal the tension between our own desire for order and structure and our desire to capture real-life dynamics and contradicting perspectives. Many of us enjoyed the high quality and diversity in the keynotes throughout the symposium. As chair of the SDA, Dr. Silvia Barbero opened in her keynote with a reflection on the start and impressive evolution of the Relating Systems thinking and Design symposia. Prof.Dr. Derk Loorbach showed us how transition research conceptualizes shifts in societal systems and gave us a glimpse into their efforts to foster desired ones. Prof.Dr. Elisa Giaccardi took us along a journey of technologically mediated agency. She advocated for a radical shift in design to deal with this complex web of relationships between things and humans. Indy Johar talked about the need to reimagine our relationship with the world as one based on fundamental interdependence. And finally, Prof.Dr. Klaus Krippendorf systematically unpacked the systemic consequences of design decisions. Together these keynote speakers provided important insights into the role of design in embracing systemic complexity, from the micro-scale of our material contexts to the macro-scale of globally connected societies. And of course, RSD10 would not be an RSD symposium if it did not offer a place to connect around practical case examples and discuss how knowledge could improve practice and how practice could inform and guide research. Proceedings RSD10 has been the first symposium in which contributors were asked to submit a full paper: either a short one that presented work-in-progress, or a long one presenting finished work. With the help of an excellent list of reviewers, this set-up allowed us to shape a symposium that offered stage for high-quality research, providing a platform for critical and fruitful conversations. Short papers were combined around a research approach or methodology, aiming for peer-learning on how to increase the rigour and relevance of our studies. Long papers were combined around commonalities in the phenomena under study, offering state-of-the-art research. The moderation of engaged and knowledgeable chairs and audience lifted the quality of our discussions. In total, these proceedings cover 33 short papers and 19 long papers from all over the world. From India to the United States, and Australia to Italy. In the table of contents, each paper is represented under its RSD 10 symposium track as well as a list of authors ordered alphabetically. The RSD10 proceedings capture the great variety of high-quality papers yet is limited to only textual contributions. We invite any reader to visit the rsdsymposium.org website to browse through slide-decks, video recordings, drawing notes and the exhibition to get the full experience of RSD10 and witness how great minds and insights have been beautifully captured! Word of thanks Let us close off with a word of thanks to our dean and colleagues for supporting us in hosting this conference, the SDA for their trust and guidance, Dr. Peter Jones and Dr. Silvia Barbero for being part of the RSD10 scientific committee, but especially everyone who contributed to the content of the symposium: workshop moderators, presenters, and anyone who participated in the RSD 10 conversation. It is only in this complex web of (friction-full) relationships that we can further our knowledge on systemic design: thanks for being part of it! Dr. JC Diehl, Dr. Nynke Tromp, and Dr. Mieke van der Bijl-Brouwer Editors RSD10
... The dimensions of sustainable coffee production include environmental, economic, and social dimensions. A sustainable coffee production system is built without reducing environmental quality (environmentally sustainable), providing economic benefits (economically profitable) and being accepted by the community (socially feasible) [4]. From the consumer side, sustainable coffee production is a demand that is stated in various international coffee trading and certification systems such as Fairtrade, Organic Coffee, UTZ, Common Code for Coffee Community (C4), and geographical indications [5] [6]. ...
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Climate change significantly impacts coffee production and quality. On the other side, the coffee plantation is dominated by smallholder plantations with limited capabilities. Farmers have implemented Climate-Smart Agriculture by improving the cultivation system. However, the level of technology adoption at the farmer level is not optimal due to the capacity and resources of farmers and the technology dissemination support system. This study aims to analyze the environmental management implementation in coffee smallholder plantations and design an Agricultural Innovation System to accelerate its implementation. The study was carried out in the Robusta coffee development area in Rejang Lebong Regency, Bengkulu Province. The analysis was performed using descriptive statistics. Environmental management in coffee smallholder plantations is related to water management, soil management, and integrated pest diseases management. The application of CSA practices is limited to a few farmers. Smallholder plantations have limited resources, weak risk management, limited access to finance and technology. Farmer organizations, networks, and social capital management have not been developed optimally. Hence the Agricultural Innovation System for supporting environmental management implementation on coffee plantations becomes strategic. The system consists of research and education, agribusiness, bridging system, and innovation ecosystem as a supporting environment.
Thesis
Purpose: According to the World Health Organization (WHO), one out of 10 people get sick from eating contaminated food. Complex food production processes and globalisation have made the food supply chain more delicate. Many technologies have been investigated in recent years to address food insecurity and achieve efficiency in dealing with food recalls. One of the most promising technologies is blockchain, which has already been used successfully in financial aspects, such as bitcoin, and it is attracting interests from food supply chain organisations. As blockchain has some unique characteristics, including decentralisation, security, immutability, tokenisation, and smart contract, it is therefore expected to revolutionise the food supply chain. Blockchain only started to gain the attention of the supply chain researchers in recent years. The current research is mainly conceptual, based on emerging empirical research. This research explores the application of blockchain in food supply chain management. It investigates why food companies implement blockchain in reality, including the motivations and the concerns. In addition, it explores how such companies implement the blockchain in food supply chain management. Research method: First, a content-analysis based literature review in blockchain adoption within food supply chain is undertaken. The researcher reviews 58 of the papers most related to this topic and lays a solid ground for further research. Then a multi-case study method is adopted to investigate the issues and opportunities within the food supply chain, and how food companies apply blockchain technology in their food supply chains. This research uses a theoretical sampling approach to investigate how food companies adopt the blockchain applications in supply chain management. The selected food companies are expected to have both strong interests and mature implementation in blockchain, have engaged with multiple supply chain stakeholders, and are willing to share their detailed implementations. Three food companies based in Australia, China and the Netherlands are selected to conduct interviews. After the interviews, each case is summarised by within-case analysis with company background, supply chain issues, blockchain implementation stages, benefits of blockchain, and barriers. Next, a cross-case analysis is conducted to compare the three cases. By applying the innovation process model and the practice-based view (PBV), the discussion chapter critiques the similarities and differences in the decision making and implementation processes of the three cases with existing literature. Findings: Following the innovation process model, this research deconstructs the implementation process into four steps (setting the stage activities, customer clue-gathering activities, negotiating, clarifying, and reflecting activities, and inter-organisational learning). Moreover, based on the PBV, which suggests that transferable company behaviours can influence a company's competitiveness, this research identified four key success factors (capabilities, collaboration, technology readiness, external environment). Next, four categories of barriers (intra-organisational, inter-organisational, systems-related barriers, external barriers) and the benefits are also summarised. This research introduces seven propositions and a conceptual framework to unite the identified constructs. The seven propositions are: 1) The identification of business needs is the requisite for blockchain adoption; 2) Sufficient blockchain knowledge and pilot adoption are essential for large-scale success adoption; 3) Pre-existing trust, benefits and risk sharing can lead to successful multi stakeholder engagement in blockchain adoption; 4) The blockchain system should keep updating according to the change of needs. 5) The successful adoption of blockchain can bring at least six benefits (efficiency, transparency, accountability, digitisation, resilience, and sustainability) to food supply chains; 6) There are usually four types of barriers that need to be overcome during blockchain implementation; 7) Blockchain implementation positively relates to supply chain performance by improving supply chain efficiency, transparency, accountability, digitisation, resilience, and sustainability. Contributions: This research makes a number of contributions to both theory and practice. From the theoretical perspective, this research is one of the first to empirically investigate blockchain in food supply chain management, and proposes an united conceptual framework based on the case findings and the literature. This research provides empirical evidence to verify academic findings such as critical success factors and barriers, but more importantly identifies the implementation process to answer the ‘how’ question. The research is one of the first to adopt the innovation process model and the PBV in food supply chain and blockchain studies. Thus, built on the original model and theory, this research enriches the theories to blockchain implementation in food supply chain management. Specific subconstructs are identified to advance the theories of the innovation process model and PBV. Finally, practical suggestions are provided to food supply chain focal firms, suppliers, and third parties.<br/
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Relationship coffee models are generally characterized by a shortened value chain and efforts to achieve social, economic, and environmental sustainability. In three case studies with farmers organized in cooperatives in Peru and buyers in Austria or Germany, we analyzed the proximity among the geographically distant value chain actors. This paper aims to provide a more nuanced perspective on relational (organizational, institutional, cognitive, and social) proximity in relationship coffee models. The comparative analysis of the proximities in our case studies revealed that initial face-to-face contacts are required to build further proximity dimensions. Proximate relationship coffee models have led to more recognition, pride, a good reputation of the actors, higher coffee quality and thus farm-gate prices, and stable long-term relationships. However, relationship coffees require more coordination and communication among chain actors and advanced farmer skills and efforts to produce high-quality coffee. In relationship coffee models, farmers still depend on buyers and roasters to benefit from higher quality of their green coffee.
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Σκοπός αυτού του paper είναι η έρευνα και η ανασκόπηση των πολιτικών Εταιρικής Κοινωνικής Ευθύνης (CSR) στη βιομηχανία καφέ, και πιο συγκεκριμένα, της Starbucks Corporation και της Nespresso. Μέσα από την ανάλυση της βιβλιογραφίας, αναλύονται τα ακόλουθα ζητήματα: δέσμευση των εταιρειών για το περιβάλλον, προς τους υπαλλήλους και προς τους καταναλωτές. Εντέλει, πώς αυτές οι πολιτικές έχουν αντίκτυπο και στους μετόχους.
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Purpose The coffee industry has experienced two major trends: the development of connoisseur consumption of specialty coffee and the importance of sustainability. Despite the increasing concomitant relevance of both trends, literature on how sustainability has been interlacing with connoisseur consumption is rather limited. Therefore, this paper aims to analyse how connoisseur consumers (CC) integrate sustainability into their coffee consumption practices. Design/methodology/approach The paper adopts a qualitative netnographic approach through an interpretive cultural analysis of specialty coffee bloggers narratives, conceived as a specific sub-group of CC that tend to be particularly active on social media. Findings Through the lens of social practice theories, the study reveals that CC are likely to implement and perceive sustainability very differently from the dominant mass market as subject to the influence of their shared rituals, values, norms and symbolic meanings. Such findings are relevant under a managerial perspective as they also generate insights on how to foster environmentally friendly practices in coffee consumers as well as on how to create more sustainable marketing strategies. Originality/value The study contributes to the literature on coffee consumption behaviour and sustainability. First, by analysing actual behaviours rather than intended, the study offers an alternative approach to the dominant paradigm of linear decisions models in the study of sustainable consumption. Second, because CC possess a unique consumption style, different from the mainstream market, the analysis has led towards the identification of alternative sustainable consumption patterns and enablers.
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The objective of this study is to map articles that present models for determining the territory size of Geographical Indications (GIs), a relevant factor for the management of GIs that is poorly explored in studies on the subject. The study was undertaken as a systematic mapping study (SMS), whose main objective is to identify accessible facts about a given research topic, which is also the most suitable approach when aiming to analyze the state of the art of a subject with little evidence available in the literature. Using the Scopus and Web of Science databases, in which 671 results were found, and the StArt tool to select the articles, 652 articles were excluded (30 duplicates and 622 that did not meet the inclusion criteria established in the systematic mapping protocol). Then, after a complete reading of the texts of the 19 remaining articles, 14 were excluded. Thus, this study included only five articles in which GI size models were developed, the oldest of which was published in 2007 and the most recent in 2021. We therefore conclude that few studies are available in the literature on this theme.
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For many years coffee has been regarded as a commodity. Recently, new trends both at consumption and production level created new opportunities for de-commodifying the coffee market, by a differentiation based on social, environmental and territorial resources, and consequently for strengthening local agro-food systems and improving the position of farmers in the value chain. In this perspective, territorial origin is one promising lever of differentiation, and there is a growing number of initiatives trying to develop protected Geographical Indications in coffee value chains. This work aims at identifying the different logics surrounding the construction of protected Geographical Indications (GIs) in the coffee industry in Latin America, and to discuss the role of history and tradition in relation to the link to specific local resources. Our analysis highlights a variety of typologies of GI initiatives, which follow different logics and strategies, and interpret the concept of "origin" in different ways, especially when compared to the European Union one. However the role that history and traditions play in American coffee GIs is not yet relevant.
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This accessible report, with illustrations and many visual aids, outlines the extent of the crisis in the coffee market and the reasons behind it, and presents a strategy for action.
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By 2050, the world's population is estimated to grow to 10 billion. To feed everyone, we will have to double our food production, to produce more food in the next 40 years than in the whole of the last 6,000. Changing the Food Game shows how our unsustainable food production system cannot support this growth. In this prescient book, Lucas Simons argues that the biggest challenge for our generation can only be solved by effective market transformation to achieve sustainable agriculture and food production. Lucas Simons explains clearly how we have created a production and trading system that is inherently unsustainable. But he also demonstrates that we have reason to be hopeful - from a sustainability race in the cocoa industry to examples of market transformation taking place in palm oil, timber, and sugarcane production. He also poses the question: where next? Provocative and eye-opening, Changing the Food Game uncovers the real story of how our food makes it on to our plates and presents a game-changing solution to revolutionize the industry.
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Using newly-available materiality classifications of sustainability topics, we develop a novel dataset by hand-mapping sustainability investments classified as material for each industry into firm-specific sustainability ratings. This allows us to present new evidence on the value implications of sustainability investments. Using both calendar-time portfolio stock return regressions and firm-level panel regressions we find that firms with good ratings on material sustainability issues significantly outperform firms with poor ratings on these issues. In contrast, firms with good ratings on immaterial sustainability issues do not significantly outperform firms with poor ratings on the same issues. These results are confirmed when we analyze future changes in accounting performance. The results have implications for asset managers who have committed to the integration of sustainability factors in their capital allocation decisions.
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Fair trade is a fast-growing alternative market intended to bring better prices and greater social justice to small farmers around the world. But is it working? This vivid study of coffee farmers in Mexico offers the first thorough investigation of the social, economic, and environmental benefits of fair trade. Based on extensive research in Zapotec indigenous communities in the state of Oaxaca, Brewing Justice follows the members of the cooperative Michiza, whose organic coffee is sold on the international fair trade market. It compares these families to conventional farming families in the same region, who depend on local middlemen and are vulnerable to the fluctuations of the world coffee market. Written in a clear and accessible style, the book carries readers into the lives of these coffee producer households and their communities, offering a nuanced analysis of both the effects of fair trade on everyday life and the limits of its impact. Brewing Justice paints a clear picture of the complex dynamics of the fair trade market and its relationship to the global economy. Drawing on interviews with dozens of fair trade leaders, the book also explores the changing politics of this international movement, including the challenges posed by the entry of transnational corporations into the fair trade system. It concludes by offering recommendations for strengthening and protecting the integrity of fair trade.