Common EU policies needed for scaling up sustainable supply chains

In the Netherlands, market shares of sustainably produced and imported resources have soared, over the past two decades, thanks to the collective and voluntary action by traders, producers and social organisations. The Dutch Government has been playing a mainly facilitating role in this process. Today, the Netherlands is one of the EU’s frontrunners. However, there are limits to what such national, mainly voluntary initiatives can achieve. For further scaling up of sustainable resource production and trade, there are policies and instruments needed on an EU level. Instruments that would help to establish a level playing field include accounting rules on supply chains transparency, compulsory minimum standards for imported products and resources, and harmonised public procurement policies.

These are the main conclusions of the PBL report ‘Sustainability of international Dutch supply chains: Progress, effects and perspectives’.

Certification and market standards contribute to global sustainable development goals

Market labels for sustainably produced natural resources are based on widely supported production standards, developed by market parties. The criteria that must be adhered to in order to obtain market labels cover a variety of sustainability issues. They help to secure resource availability for European economic sectors and consumers, and also contribute to global sustainability goals, such as halting biodiversity loss, eradicating extreme poverty and encouraging sustainable economic development. More attention must be given to monitoring, investigating and reporting the intended impacts of market labels, in order to more clearly demonstrate their added value and to increase consumer confidence in these labels.

Market shares of certified products have increased

Imported natural resources and products, such as coffee, timber, palm oil, cacao, fish and soya, increasingly more often carry a sustainability label in the Netherlands. The sustainable market shares are the result of collective action by traders, producers and social organisations. The Dutch Government has helped to stimulate sustainable market shares by playing a mostly facilitating role, through its public procurement policy, by creating public-private partnerships for numerous supply chains and through financial support for market initiatives.

Obstacles to a further scale up of sustainable markets

Even though voluntary sustainability initiatives have effectuated considerable market shares in several EU Member States, it is unlikely that these alone will be able to further expand this share and the desired global sustainability effects. There are a number of obstacles, such as certification costs and the absence of a level playing field for all market parties on the common market. Therefore, the limits to this national and mostly voluntary approach are now in sight.

An EU-wide level playing field is required to mobilise more market parties

For a scale up of sustainable trade and a reduction in the import of illegally produced resources, sustainability standards and market labels should be used more widely. A level playing field should be established for all market parties and all supply chains. Companies could be required to provide more transparency about their resource chains, public procurement policies and their sustainability criteria could be harmonised throughout Europe, and compulsory minimum standards could be set for imported products and resources. EU-wide minimum standards are already in place for combatting the import of illegally sourced wood. It is worth investigating whether this approach also could be applied to other supply chains.