Standards and Poverty Reduction

How can voluntary sustainability standards contribute to poverty reduction for smallholder farmers?

SSI Review: Standards and Poverty Reduction examines how voluntary sustainability standards (VSSs) can help reduce poverty for smallholder farmers and provides recommendations to VSS bodies, value chain actors, and governments.

There are an estimated 500 million smallholder farmer families globally, many of whom make up a large portion of the world’s poor. These farmers work small plots of land, often earning and producing enough to survive but not enough to rise out of poverty. Widespread poverty alleviation cannot be achieved without uplifting smallholder farmers, and this report from IISD’s State of Sustainability Initiatives examines how sustainability standards can contribute to reducing poverty among farmers.

This report presents findings on the examination of 13 widely adopted VSSs and reviews existing evidence—all to better understand how VSSs can improve the three dimensions of poverty reduction: access to resources; opportunities and choice; and power and voice.

It also includes an assessment of the factors determining smallholder farmer access to VSS-compliant markets based on 57 interviews with actors in six countries from a joint field study by IISD and UNCTAD.

Findings suggest that VSS compliance can contribute to poverty alleviation in important ways, such as supporting skills training for farmers, that can support more sustainable farming, producer knowledge, and capacity to grow higher-quality and more sustainable products. In turn, this can bring farmers higher and more stable prices and crop income, as well as increased social capital via stronger producer organizations and relationships with buyers and investors. Importantly, key conditions need to be in place to enable smallholder farmers to access markets for VSS-compliant products as explained in the report. Several actions can be taken to maximize the potential for VSSs to contribute to poverty reduction.

Related Article: More Say for Smallholders Will Help Standards Address Poverty

Key recommendations for VSS bodies, value chain actors, and governments include:

• Establishing a living income reference or other financial rewards for farmers
• Structure local value chains and coordinate support mechanisms for farmers
• Improving farmers’ VSS knowledge and implementation
• Stimulating demand for sustainable products.

Recommendations for VSS bodies include:

• Enhancing support for business and market diversification
• Improving assurance, monitoring, and learning systems
• Systematically including farmers in VSS decision making
• Adopting a gender-equality approach.