Most of the time, when consumers shop at the supermarket, they overlook much of the information about the food. Its ingredients, nutritional values or place of origin are “objective” characteristics, but there is another series of components that appear on their packaging that provide another series of data. While a few years ago labels such as “zero“, “light” or “contains omega-3” became trendy, today labels such as “organic”, “bio”, “100% natural” or “CO2 neutral” are becoming increasingly fashionable. However, there is no clear international agreement on what each one means, and often this has to do with the origin of the product or where we are buying it, as these concepts can vary from one market to another.
Eating food produced in EU member states, as a general rule, means quality and safety to the consumer, as European phytosanitary standards and production norms are the highest in the world. However, many of the most popular food on European shelves are not produced in Europe or not produced enough to satisfy consumer demand. This is the case for tropical fruits such as pineapples, bananas or coconuts, chocolate, coffee or tea, for which another type of package-labelling has become popular, the so-called “certificates” such as “Rainforest Alliance”, “Fairtrade”, “100% organic”, “100% responsible”, often attached to the labels mentioned in the first paragraph.
These labels provide the consumer with information about the commitment of the product towards labour rights, sustainable development, environmental responsibility or free use chemical pesticides. However, we cannot ignore the fact that this certification is not granted by any official body, but by private organisations that set their own standards. The consumer’s conscience receives the message that he is making a responsible purchase, helping the environment and combating labour exploitation, but is this really the case? In this case, several institutions, from the World Economic Forum to the European Commission, have not overlooked the high proliferation of certification agencies in recent years.
The World Economic Forum (or Davos Forum), which has no legislative power, serves as a platform for business, government and civil society leaders from around the world to meet. In 2015, it concluded[1] that, given the long supply chains and their increasing trend towards digitalisation, it was necessary to develop the concept of “Shared Responsibility”. In other words, the entire cost of production should be shared equally among all the actors involved, from the producer to the consumer, including all intermediaries.
The European Commission, which, although it cannot regulate the third countries where these foods are produced, can have an influence through the free trade treaties signed with them and through the agents operating in the supply chain. To this end, two European initiatives have been developed:
Therefore, we can see that the “Shared Responsibility” debate sems to open the can of worms and few are clear about how it is to be put into practice. From south Spain farmers to Latin American producers, it is clear to everyone that it is difficult to estimate a “minimum selling price”, especially when citification bodies are involved.
- Directive on unfair trading practices in business-to-business relationships in the agricultural and food supply chain[2]. his law calls on member states to draw up national laws to prevent abuse of European producers by paying a fair price that covers production costs, increasing transparency by publishing contracts and introducing penalties for those who do not comply with the law.
- Legislative initiative procedure on corporate due diligence and corporate accountability, already adopted by the European Parliament in March. This assesses much broader issues outside the European Union, aiming to ensure that companies operating in third territories can be held accountable.
Both documents meet consumer demand for more responsible products and empower producers, who have the lowest profit margins and can even sell below production costs.
The issue of “Shared Responsibility” is therefore starting to be debated, although few are clear on how this translates into practice. At the moment there already seems to be an objective, to divide production costs in a fairer way, but there are too many actors involved and each will fight to define a different production cost. In this sense, the question is: can voluntary certification be a cost of production? To begin with, the answer would be no, since it is not a requirement for it to be produced that a private agency certifies it. However, it’s bot that clear since many supermarkets are demanding certificated products in order sell them. This certification implies a cost which, due to disagreement over who should pay for it and fear of price increases, ends up being paid by the producer. In the end, the purchase of a consumer who is aware of a “responsible” product does not necessarily translate into the environmental improvements that are promulgated because there is no international public monitoring or control to confirm this.
This is the current situation: consumers are demanding more sustainable products and regulations are already moving in this direction. The new Common Agricultural Policy (CAP) and the recently created “Farm to Fork Strategy” show us that there is a trend that has arrived to stay. Moreover, the European funds approach has changed into a compliance model without the need to resort to sanctions. Knowing this, it remains to be seen whether “Shared Responsibility” will become a compulsory subject or whether it will only reward those who apply it. In the meantime, depending on who we ask, producers, intermediaries or consumers, the cost of sustainable food remains clear who should bear it. In the coming months, we will see which way the legislative development will tip the balance and whether a concept of “shared responsibility” will finally be developed that can satisfy all parties.
[1] http://www3.weforum.org/docs/WEF_GAC_Supply_Chains_%20A_New_Paradigm_2015.pdf
[2] https://eur-lex.europa.eu/legal-content/ES/TXT/?uri=CELEX%3A32019L0633