Dossier

Certification: An imperfect, but useful, tool

In ACP countries, certification allows farmers to guarantee the quality of their produce, enter new markets and increase their income. To ensure maximum impact, this certification should be part of wider development programmes.

A tool, which compares the impacts of different certifications and helps producers meet required standards and demonstrate the sustainability of their production, has been used recently by GIZ in Madagascar © GIZ-Madagascar
A tool, which compares the impacts of different certifications and helps producers meet required standards and demonstrate the sustainability of their production, has been used recently by GIZ in Madagascar © GIZ-Madagascar

Wednesday, 27 June 2018

In the agricultural sector, certification often helps farmers to enter new markets and sell their produce at better prices. In order to ensure this system has a broader impact for small producers, it needs to take context into account. 

Over the past few decades, with the globalisation of the agricultural sector, there has been a proliferation of certification systems (CS). This development has resulted from the need to respond to increasing concerns from consumers about product traceability, and the desire of many businesses to demonstrate their commitment to social and environmental standards throughout the production chain. The Ecolabel index is the single largest database of ecological brands, with 463 ecolabels in 199 countries and across 24 different industry sectors. The majority were created in the past 20 years, in particular within the agricultural and food sectors. So how can farmers benefit from certifications for sustainability or quality? And does the certification process really work in their favour?

Successful standards

In Cameroon, Penja pepper is a good example of successful certification: since the award of a Protected Geographical Indication (PGI) in 2013, the farmers in this coastal region have significantly increased their sales and production has boomed (see the Spore article Intellectual property: Pepper certification secures farmer incomes in Cameroon). By respecting certain quality criteria in the production process, farmers have learnt to better understand their product, enter new markets and increase prices.

These benefits for farmers should certainly help to inspire the 52 small Jamaican plantain and banana producers who obtained GLOBAL G.A.P. (good agricultural practices) certification in 2017, which guarantees the quality of their products. “What this means is that farms should see their performance improving while they eliminate waste and boost competitiveness. Global G.A.P. certification has opened up the way for farmers to enter global markets and capitalise on the increased opportunities,” enthuses Janet Conie, the general manager of the Banana Board, which oversees banana production in Jamaica.

The benefits for certified farmers, or those belonging to certified organisations, are not only economic. A study on Ugandan coffee farmers by two researchers from the University of Göttingen in Germany showed that private standards – namely Fairtrade and UTZ – had a positive impact on gender equality: household income increased regardless of whether the household head was a man or woman. However, within non-certified households, the distribution of wealth remained heavily skewed towards men. Eva-Marie Meemkenand Matin Qaim, who co-authored the study, conclude that, “Private standards cannot completely eliminate gender disparities, but the findings suggest that they can contribute towards this goal.”

Diversity in certification

There are many types of certification including ecological, social and economic. Amongst the best known are the Rainforest Alliance (around 1.2 million certified farmers) UTZ Certified (1 million) and Fairtrade (1.65 million). These standards aim to guarantee that the production, processing or sales of food products are conducted with respect for the environment, social norms and economic improvements. Traceability is common to all, which requires a detailed and rigorous monitoring of farming practices, agricultural inputs, sale prices, etc. 

This monitoring requires resources that smallholders do not always have. A report commissioned by CTA in 2014 on certification in the coffee, cotton and fruit and vegetable sectors underlined that the factors influencing the success of certification are numerous, including the volume produced by each farmer, the technical assistance provided by development or business partners, the stability of the market and the involvement of buyers. It also notes the importance of the availability of contracts between farmers and buyers. An additional factor is the move to organic farming which can lead to lost revenue during the transition to the new farming regime and achieving certification. Finally, the individual characteristics of the farmers in question need to be considered, such as their skills in new agricultural practices, resources and ability to export. As summarised by a report from the NGO International Initiative for Impact Evaluation (3ie), “A multiplicity of factors shape impact, from the specific designs of interventions, to the fidelity of their implementation, and to the contextual elements that affect who benefits, when and how.”

Challenges remain

At the forefront of the barriers to certification are the costs. For example, Jamaican banana growers benefitted from a €4.4 million programme partly funded by the EU between 2009 and 2012, which included training in pesticide use and technical assistance to meet the requirements for local and new export markets and to improve productivity and cost efficiency– which is not always the case in certification programmes. CTA’s study also notes that, although certification aims to benefit small farmers, in general, “More organised small-scale producers with relatively high production levels are more likely to reach or surpass break-even point on certification costs. Depending on the level of implementation costs, above-average volumes per small-scale farmer must be produced for certification to be profitable.” Certification also provides more benefits to those farmers who have larger farms, are positioned closer to markets and are in favourable agro-ecological zones; meaning that the system tends to least benefit those farmers that most need the support.

In order for a farmer or farming organisation to benefit from certification, they must first negotiate the hazards of a certification organisation, which charges for its services based on the time their auditor spends on-site, the writing of the report and their travel costs. In addition, some companies charge a licensing fee for the use of their certified label, which not every company or cooperative is able to afford, and which can compromise the ability of more isolated farmers to obtain the label. The farmers also often need to purchase new equipment or adopt new farming practices, which incur additional costs. This is difficult, if not impossible, without external aid.

As described in the CTA report, in the coffee sector – one of the most certified – where producers involved in a certification scheme managed to obtain higher sales prices, this increase was offset by additional costs in the production and quality control processes. A positive outcome is that farmers often have better access to services such as training on better farming practises.

Local context is key

In order to have a positive impact on the lives of smallholders, a certification must take into account the specific social, economic and cultural contexts in which farmers operate. According to the 3ie report, the impact of CS is often limited. “It is easier for CS to improve immediate outcomes, such as prices or incomes from the sale of certified produce, than endpoint outcomes, such as producers’ incomes and general well-being. This is because, as we move along the causal chain towards endpoint outcomes, the number of contextual factors that can affect impact increases. Hence, contributions from CS interventions may be only marginally effective in improving them.”

“There is somehow a confusion between certification and development,” states Nicolas Mounard, chief executive of the NGO Farm Africa. “For a long time, both consumers and the private sector were expecting certification to deliver development. In reality, certification is a compliance exercise but does not deliver development per se. A development approach requires work on a whole range of challenges, from soil fertility, to access to market, from productivity, inputs, seeds to women’s economic empowerment, water management or business capacity. We believe in development. Certification can be a tool but has to be integrated within a wider development approach.”

The Farm Sustainability Assessment (FSA) is a tool designed to evaluate the sustainability of a sector developed by the Sustainable Agriculture Initiative platform. The tool groups together the world’s largest food businesses, compares the impact of different certifications, helps producers to reach the standards required by the systems and allows them to demonstrate the sustainability of their production even if they are not yet certified. Used for 46 crops in 32 countries and by 10,000 farmers, the FSA tool was recently used by the German cooperation agency GIZ to evaluate the sustainability of the Madagascan pineapple sector and, in particular, farmers supplying HavaMad, a juice export business. The study enabled GIZ to identify the economic, social and environmental practices that could be improved by the producers in order to increase their ‘sustainability score’. Now HavaMad, in partnership with GIZ, needs to take these recommendations into account.

Development opportunities

Even if the impact of certification is still a subject of discussion, CS allow supply chains to be structured around clearly established criteria, to facilitate access to markets, to improve efficiency and reduce costs, and to create long-term relationships between farmers and the other actors in the value chain. In addition, CS can open interesting new innovation and development opportunities by pushing the different actors in the supply chain to conform to quality criteria for products and social standards. “There is an increasing need to know where and in what conditions the agricultural products are produced, moved, transformed and sold”, explains Piet Visser, head of the agri-business and value chain team at CTA. “In practice conventional traceability systems are expensive, and prone to errors and fraud. ICT can reduce the transaction risks and related costs through increased accuracy and efficiency in monitoring. This will generate again an increased accessibility to finance and other services of value chain actors, because actors’ profiles are better known.” Therefore, whilst CS may not be perfect, they remain a key agricultural development tool.

Vincent Defait

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Facts and Figures

A tool, which compares the impacts of different certifications and helps producers meet required standards and demonstrate the sustainability of their production, has been used recently by GIZ in Madagascar © GIZ-Madagascar

SOURCE: UTZ based on https://tinyurl.com/ydda5l3z

The Technical Centre for Agricultural and Rural Cooperation (CTA) is a joint international institution of the African, Caribbean and Pacific (ACP) Group of States and the European Union (EU). CTA operates under the framework of the Cotonou Agreement and is funded by the EU.