Developing countries and emerging economies are being encouraged to adopt voluntary sustainability standards (VSS) in order to drive trade by a new United Nations (UN) report.
The report, launched in Delhi yesterday, found that VSS were trade facilitators as consumers are increasingly demanding sustainability labels on the products that they buy.
“Standards can push the frontier of best practices in sustainable production methods that enterprises can follow and uphold,” said UN Conference on Trade and Development (Unctad) deputy secretary general, Isabelle Durant. “And they can also build their credibility in sustainable production and consumption practices among their consumers and other stakeholders with adherence to these practices.”
She noted that standards would be key to unlocking new markets. Meanwhile, the report found that there were both direct and indirect consequences when sectors like agriculture committed to proven standards regimes that built confidence in sustainability.
“The direct impact is that producers can produce more appealing products that meet consumers’ demands tied to sustainability,” added Durant.
She said the quality of products would therefore improve as there would be stringent compliance to international standards.
“Indirect impacts mostly reflect the financial or market share gains, the improvement of quality of life of the workers and producers, gender participation and economic growth,” she said.
The report found that, while standards could play a pivotal role in changing the baseline calculation of companies’ performances – particularly those involved in international trade, the fact that products made to comply with VSS in developing markets were preferred over products not compliant could result in the marginalisation of small-scale producers who could not afford to comply.
According to Durant there are almost 500 VSS eco labels in 199 countries covering 25 industrial sectors. The labelling is driven by consumer awareness and demands, product differentiation and pricing policy.
