Stimulating: The green production chain in Brazil

From the original article Labels Gain Momentum in the Production Chain, by By Camila Cordeiro and Isabella Pileggi. With kind acknowledgements to FGV-EAESP, the GVces Center for Sustainability and the magazine P22_ON.

Arinaldo Ribeiro de Oliveira

Located behind a white gate, on a narrow dirt road that crosses BR462 in Brazil, you can find the farm that belongs to Arinaldo Ribeiro de Oliveira, commonly known as Seu Arinaldo. The property is located in an area known as ‘Cerrado mineiro’, a region that is popular as one of the largest coffee producers in Brazil and spans a total of 210,000 hectares of production area. The farmer, who was born in the municipality of Patrocinio, Minas Gerais State, lives on his small 15-hectare farm, out of which 11 hectares are exclusively dedicated to coffee plantation. For over 40 years he’s been supporting his family with the money he earns selling his production, and one of his major customers is Nespresso, from Nestlé Group.

Stimulating – what else?

Seu Arinaldo’s farm has not been certified yet, but, to be able to produce coffee for Nespresso, it had to start complying with the ‘AAA Sustainable Quality Program’ – widely known as Triple A, a number of basic production criteria required by Nespresso that attest the property’s environmental and social sustainability. Currently, he has been doing all he can to adapt his farm and qualify it to obtain Rainforest Alliance certification label, a type of international social and environmental certification whose goal is to ensure diversity, product quality and sustainable livelihood in the property. But why is obtaining the certification so important to Seu Arinaldo?

The social and environmental certification is an instrument created to test and assure best practices in the facilities. The demand for that type of instrument came directly from consumers, in search for the assurance that, when buying a certain product, they would not be indirectly encouraging environmental or social damages. In other words, consumers wanted to be assured that they would not be polluting rivers and land when buying a cleaning product from an industry that does not properly discard sewage, for instance, or that, by replacing their clothes, they would not be buying clothes from a factory that uses child labor or slave-like conditions. That type of concern led to the creation of certification labels.

Large businesses like Nespresso and Natura, committed to keeping their values and concerned with being part of a production chain involving suppliers with dubious practices, decided to adopt more stringent criteria to select their suppliers, elaborating their own production standards (as is the case of Triple A at Nespresso), or only buying products from facilities that have social and environmental certifications. Thus, even though Seu Arinaldo can provide coffee to Nespresso, getting the Rainforest certification label would open up more doors to the farmer, ensuring international recognition of the quality of his product and, mainly, the social and environmental sustainability of this property.

For coffee production chain, the most popular certifications in Brazil are UTZ and Rainforest Alliance, according to Guilherme Amado, Green Coffee Project Manager at Nespresso Brazil. Those labels first appeared in the country in 2002, a time when the farms started to adjust to different demands that emerged from consumers, and have been increasingly requested (please read more in the article entitled Demandand access the video on certification in Drops).

Go it alone or do it together?

Photo by Rawpixel

To control and maintain certifications, properties must go through audit processes. According to Amado, there are two types of audits: individual audits, conducted on a single property, and the ones conducted in a group, involving many properties. Individual audits are conducted twice a year: an internal audit, conducted by an agronomist from a cooperative or exporter (trader) of a specific product; and an external audit, conducted by the Instituto de Manejo e Certificação Florestal e Agrícola (Imaflora, Forestry and Agricultural Management and Certification Institute), a representative of Rainforest Alliance and of the major certification labels in Brazil. Both processes aim at checking whether a specific farm still meets the criteria established by the label it is certified with. As for collective audits, although the process is similar in some aspects, the difference is that the process is conducted with a sample, and there is co-responsibility between members that belong to that group: one or more farms that form the group are randomly selected for the on-site audit. In case of any non-compliance in any member farm, all the others will be accountable, too. But there are also benefits, such as reduction in the price of audit, and a collaborative knowledge created by the group.

To conduct audits, properties must properly follow the processes of traceability which, by definition, is to keep records of a process, whether it is physical or financial. However, regardless of the type of traceability we are talking about, it is necessary to take notes of all the processes and circumstances of production. On Seu Arinaldo’s farm, for instance, there is a certain amount of coffee fields. Before harvest, it is necessary to write down all that occurs in each field, from levels of soil moisture to the presence of crop protection. As soon as the product gets prepared for drying, it is controlled once again, now with measurements of weight and size. Traceability of the chain of custody continues throughout the process, tracking all steps and changes that might eventually occur with that product. All the information is written down, compiled and shared with the auditor annually, enabling him or her to assess the performance of their 130-lb (60 kg) coffee bags.

One of the great issues is exactly that the traceability process is performed manually, becoming a time-consuming stage, with low level of efficiency. César Júnior, an employee at Stockler, a coffee exporter and trader, says the process could be much easier, if integrated into an application, and maybe this is the major bottleneck of certified production processes.

A great challenge is to obtain the certification for smallholders, such as Seu Arinaldo, even though it is a group audit. As the criteria are stringent, it is very costly to maintain the standards required and, at the same time, afford the value charged for the certification audit. Given that scenario, farmers have been seeking new ways to obtain the recognition of origin for their products.

Lean, green and responsibly clean

Production of agro-ecological and organic goods has many requirements, assessing a number of items, from the products used on the soil, such as natural fertilizers and crop protection, to a sustainable relationship not only with the environment, but above all with society. The need to assure the products comply with the standards required boosts the creation of different forms of certification of those processes.

For farmers, certification is seen as a way to add value to products, making them more attractive in the market and enabling increased profitability in sales. With the labels, products gain higher reliability on the shelves, allowing for enhanced sales. ‘If we had the certification, we would be able to sell our products in Manaus and increase production, bringing more people to work with us’, points out Maria de Jesus Pascoal, an organic farmer in Manaus.

Maria de Jesus is an organic farmer who does not have a certificate for her products yet. According to her, the certification process is hard, since there are many requirements with which smallholders should comply. According to Law 10,831, as of 2003, popularly known as ‘Organic Product Law’, for a product to be sold as organic it must have a certificate granted by a legally recognized institution. However, in case of direct trade between family farmers and consumers, certification may be optional. For this to be feasible, it is necessary for farmers to be ‘inserted into proper processes of organization and social control, previously filed with a supervisory body’, as established by Item I in Article III.

Brazil and the PGS: Peer pressure is good pressure

Photo by Marta Branco

This enabled another form of certification, the Participatory Guarantee System (PGS). That system is formed by Organizações de Controle Social (OCS, Social Control Organizations), and each one of them has their own base groups. The base groups, on their turn, are formed by small groups of family farmers who will jointly monitor the production processes. Each group is assigned a collective responsibility, and all members are responsible for ensuring the production stages are performed according to the norms established by law. That system consists of granting a collective certificate to the group members. More than that, it is an empowering system for smallholders.

In this certification system, there is a mechanism of peer visits, in which the members themselves, followed by two or more technical people, pay annual visits to the properties of group members. Those visits work as a verification of the properties. In addition to that, all farmers must present an Organic Management Plan, specifying the productive areas, the crops grown, among other specificities. The Ministry of Agriculture, Cattle Breeding and Food Supply (Mapa) conducts an audit sampling on the Participatory Guarantee System, to check whether the system complies with the legislation. PGS follows the same rationale of collective audits; if one of the OCS members does not comply with the standards, the whole group will lose the certificate. As mentioned, not only environmental aspects and use of agrochemicals are assessed, but also social aspects during production processes.

José Rodrigues Pinto, a smallholder who is a member of the OCS Associação dos Produtores Orgânicos do Amazonas (Apoam, Association of Organic Farmers in the Amazon) and a member of the PGS Associação Maniva de Certificação Participativa (Maniva Association of Participatory Certification), lists the items observed during peer visits. He highlights some of them: if there is waste spread throughout the property posing any risk to contaminate the produce; if there are dogs, especially in the areas greenery is planted; if the produce is sanitized before going for sale; if labor is outsourced or done by family members; and if there are children helping their parents while they should be at school.

That alternative certification system reinforces trust between OCS members. Since it is a co-responsibility system, PGS fosters a rationale that is actually reverse to certifying bodies. There is no hierarchy; instead, there is cooperation between members. According to Mariana Gama Semeghini, from Rede Maniva, the greatest strengths of PGS are participation and the process of training, integration and empowerment of all members (farmers, technicians, students, managers, consumers), specially farmers. In addition to that, she points out international recognition as one of the major challenges of the system, because the PGS, created in Brazil, in spite of allowing for the use of the organic label, is not recognized in other countries.

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