New Standards Enthusiasts: The Role of Governments in Scaling up

The ISEAL conference session “Driving the uptake of standards: the role of governments” opened with a nod to the irony of such a topic: Many of the leading sustainability standards trace their origins to the perceived failure or unwillingness of governments to enforce stronger regulations on business and a reaction from civil society to independently shape business behaviour.

Panel moderator Michael Conroy clarified the notable shift in government attitudes toward sustainability standards and the growing enthusiasm to endorse standards and even incorporate them into legislation to achieve policy objectives.

But should this increased government recognition of the validity of standards be seen as a boon to the ambitions of standards or a potential detriment? And how might we solve the challenges of reconciling governments and standards? These were some of the questions the panel was tasked with answering.

Greener building in Brazil

In Brazil government support for the green building sector appears to have yielded overwhelmingly positive results. Felipe Faria from Green Building Council Brazil explained how the organisation brings together leaders in the sustainable construction industry and provides support for achieving LEED Certification (Leadership in Energy and Environmental Design). By working with influential actors in the private sector and demonstrating the long-term economic and environmental benefits of greener construction practices, standards have won the approval and backing of the Brazilian government. Through monetary and tax incentives, the Brazilian government has helped catapult the country to number four in terms of LEED registered projects and has fomented major partnerships on the Olympics and World Cup.

Creating demand for jewellery certification

The interest on the part of Western governments in the jewellery sector has also led to mostly positive outcomes for credible standards, according to Fiona Solomon from the Responsible Jewellery Council (RJC). With growing awareness about the link between precious metal extraction and trade and civil conflict, governments have become more active in promoting human rights and transparency in these supply chains.

Solomon explained how this has created wide ranging opportunities for RJC to influence ethical practice in the jewellery industry. Government initiatives and regulations, such as the OECD’s Due Diligence Guidance and the US Dodd-Frank Act, are creating market demand for certification because companies are under more pressure to address risks in their supply chains and provide evidence of “conflict-free” materials. The positive impact that government interventions have had on certification is owed to the compatibility between government requirements and the services that RJC can offer.

But Solomon also cautioned that government authority in this space can have unintended consequences, especially if a government approach narrows in on certain sustainability issues at the expense of others, in contradiction to the holistic approach that credible standards take.

Government regulation not without risk

Bringing experience from the forestry sector, Fiona Wheatley from Marks & Spencer voiced more mixed results regarding the involvement of government, specifically in legislating forest sustainability. On the one hand she argued that civil society pressure has led to stronger government action to promote legal timber production. This is exemplified by timber procurement policies implemented by the UK Government as well as the EU Forest Law Enforcement, Governance and Trade (FLEGT) initiative, both of which address illegal logging.

According to Wheatley these government initiatives are progressive steps for ensuring that businesses and governments work together to improve traceability in timber supply chains. However, she also suggested that “scaling up the impact of standards through government legislation is not without risk.”

For one, there is a risk that government legislation could treat lower bar standards as being equivalent to more credible standards. With timber in particular, Wheatley feels that government legality requirements could lead some companies to downgrade their interest in social and environmental best practices that are not legislated.

Among the discussion points that were picked up from the audience, the panel noted that government regulations could create considerable supply chain costs for ensuring due diligence. It is important that producers benefit from these initiatives and are not burdened with unreasonable costs. The panel also tried to address the relationship between international standards and national standards from producing countries. Marks & Spencer, answered Wheatley, prefers to work with credible international standards, whose quality has been verified, because the company does not have the capacity to assess local standards.

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