By TEEB Team, Oct 23


Certification and Businesses

Growing consumer environmental concerns have stimulated markets for products and production practices that conserve biodiversity. These markets are supported by a range of certification schemes that verify the environmental claims of companies with respect to their products and practices. At TEEB we feel that certification can be an important tool for capturing the value of ecosystem services. We hope that certification will motivate businesses to make changes in their businesses practices and not just Green Wash.  Although few of the existing social and environmental certification schemes focus on biodiversity, most address some aspects of the biodiversity challenge. For example, in the coffee sector, one can find schemes that emphasize landscape or ecosystem protection, such as Rainforest Alliance certification, others that promote environment-friendly farming practices (e.g., organic agriculture), and still others that emphasize social equity in the use of biological resources (e.g., Fair Trade certification).  Here at TEEB we feel that, although the system is not yet perfect, certification has an important role to play in informing consumer choices, improving markets and helping businesses achieve more environmentally friendly practices. 

Certification and Business1
Taken as a whole, these certification schemes contribute to biodiversity-responsible business practices. A few of them, however, are particularly noteworthy in terms of their contributions to biodiversity conservation at the landscape and ecosystem level; these are highlighted below:

Rainforest Alliance certification is a comprehensive process that promotes and guarantees improvements in agriculture and forestry. Their independent seal of approval, one of the most widely-recognized and ubiquitous in the growing ‘sustainable marketplace’, ensures that the goods and services it approves were produced “in compliance with strict guidelines for protecting the environment, wildlife, workers and local communities.”

The Marine Aquarium Council (MAC) brings together fisheries and organizations that collect, produce and handle marine aquarium organisms around the world, committing its members to work towards compliance with a shared set of standards. The MAC vision is to certify the entire supply chain, starting with sustainable and responsible management of the marine site, from which fish and marine organisms are harvested. Its core Ecosystem Fishery Management Standard includes the commitment: “To verify that the collection area is managed according to principles of ecosystem management in order to ensure ecosystem integrity and the sustainable use of the marine aquarium fishery”.

In addition, there are attempts to assess or certify the biodiversity performance of individual companies. One of the more promising initiatives, coming out of Brazil and gaining international prominence, is the LIFE Institute. They have created and are responsible for managing LIFE Certification, which qualifies and recognizes public and private organizations that promote biodiversity conservation and sustainable development initiatives, thus ensuring the protection of ecosystem integrity.

Each of these certification schemes provides structures; standards and certification processes that can help companies verify their biodiversity responsibility to the market and also make them more attractive to the growing number of responsible consumers and investors

Consumers demand change2
Public awareness of biodiversity is growing: a 2010 survey by IPSOS revealed that 60% of consumers in Europe and the United States (and 94% in Brazil) had heard of biodiversity, representing an increase on the previous year3 Increasing awareness is likely to influence purchasing behaviour, with 81% of consumers interviewed in the same survey declaring that they would cease buying products from companies that disregard ethical sourcing practices. In another survey of UK consumers, conducted in May 2010, around half of all respondents indicated that they would be willing to pay between 10% and 25% more for purchases up to GB£100, in order to account for their impacts on biodiversity and ecosystems.4 

The proliferation of ecologically certified products is another indication of changing consumer preferences: the IPSOS survey referred to above also revealed that 82% of consumers would have more faith in companies that subject themselves to independent verification of their sourcing practices.5

Business is booming
In addition to the increased number of eco-labelling schemes, total sales and the market share of certified products are also growing, albeit from a small base. Between 2005 and 2007, for instance, sales of FSC labelled goods quadrupled6 while spending on ethical food and drink in general has increased more than threefold over the last decade, growing from GB£1.9 billion in 1999 to over GB£6 billion in 2008 (The Cooperative Bank 2008), corresponding to US$ 3 billion and US$ 11.7 billion respectively. In another example, between April 2008 and March 2009, the global market for MSC-labelled seafood products grew by over 50% to reach a retail value of US$1.5 billion.7

The behaviour of some FMCG (Fast Moving Consumer Goods) brand owners suggests that eco-labelling is moving from niche markets into the mainstream. In recent years, several brand owners and retailers have added ecologically-friendly product attributes to their major brands, often through certification. Examples include Domtar (FSC certified paper), Mars (Rainforest Alliance cocoa), Cadbury (Fairtrade cocoa), Kraft (Rainforest Alliance Kenco coffee) and Unilever (Rainforest Alliance PG Tips).

Importantly, all of these brands offer biodiversity attributes through certification schemes but do not ask consumers to pay a premium or to compromise on quality, taste or availability.

 Retailers are also taking action on biodiversity and communicating that action to consumers. In the UK, for example, the Waitrose supermarket chain links their Palm Oil Policy to customer labelling: 

“Waitrose already has in place a technical policy to name oils, rather than use the term ‘blended vegetable oils’. As a result we can confirm that palm oil is used as an ingredient in only a small number of our own branded products, which are identifiable to our customers.”8

Raising the standard
Businesses are already starting to respond to consumer demands and recognise the business opportunities involved in accounting for their impacts on biodiversity: 

Conservation Grade Nature Friendly Farming Certification9
The UK-based Conservation Grade certification system of ‘nature-friendly farming’ provides food brands, producers and consumers with efficient food production while enhancing biodiversity and ecosystem services and preventing wildlife declines on farmland. It does so by requiring Conservation Grade farmers to take 10% of their land out of production for conversion to wildlife habitats. In return, these farmers are able to use the Conservation Grade logo on all of their products and have access to a supply contract for their produce for which there is a guaranteed premium over the market price.

 And Conservation Grade Nature Friendly Farming brings results: Independently monitored research has identified that following the Conservation Grade farming protocols can achieve whole farm increases of 41% in bird numbers (including a 1400% increase in tree sparrows on one farm); 13.5% increase in bird species; 22% increase in butterfly species; and an overall 25% increase in total species on farm.

The global association for social and environmental standards10
ISEAL is the global association for social and environmental standards and has become an umbrella organization for a growing number of sustainability standards and certification schemes. ISEAL members include Fairtrade Labelling Organizations International (FLO), Forest Stewardship Council (FSC), International Federation of Organic Agriculture Movements (IFOAM), International Organic Accreditation Service (IOAS), Marine Aquarium Council (MAC), Marine Stewardship Council (MSC), Rainforest Alliance, and Social Accountability International (SAI). One of the key roles of ISEAL is to harmonize the ways that different sustainability standards are administered, verified and assessed. To this end, in 2010 ISEAL is launching a new “Verification Code of Good Practice for Assessing the Impacts of Standards Systems.”  

The long road ahead:11
Although the overall market share of certified products remains relatively low, it does show real potential. For example, MSC-certified seafood products have grown steadily over the past decade but still account for just 7% of the FAO’s total recorded global capture fisheries production (MSC, pers. comm).

The expansion of certified biodiversity-friendly products may be hampered by the cost and complexity of implementation, reflected in relatively low levels of certified production in developing countries. The direct costs of certification may be insignificant for large operators but can be a challenge for many small-scale producers and community enterprises.

Of great concern to us at TEEB is that many certification systems do not yet make their relationship to biodiversity explicit. Organic farming labels, for example, have been reported to be generally beneficial but the certification does not set out to ensure biodiversity and, depending on local circumstances, could actually reduce species richness.12 To further confuse matters, there are substantial differences between standards in terms of how they treat biodiversity. 

For consumers, more work needs to be done to make the environmental impacts or the sustainability of products more explicit. Certification is a significant first step but does not always guarantee sustainability or environmentally friendly production. The next steps for businesses and policy makers is to implement clear standards which include clear guidelines on the best practices to promote biodiversity so that consumers and businesses alike can move towards better, more informed choices. 

The future for business and biodiversity looks bright
There is a lot of ground to cover with regards to creating a fair and adequate certification scheme for biodiversity but from a business perspective, the reasons and opportunities to invest in biodiversity and ecosystems are increasingly compelling. These opportunities are most evident in cases where business profitability depends directly on the quality and quantity of ecosystem services – in ecotourism ventures, for instance – but also for businesses that rely on natural resources like wood, water, fibre, fish and wild genetic material. Biodiversity business opportunities can be found in a surprisingly wide range of sectors, including mining, energy, agriculture, fisheries, construction, forestry, tourism, pharmaceuticals, cosmetics, banking and even fashion.

Better biodiversity practices; better business; better for everyone.

  1. Taken from TEEB for Business, Chapter 5 “Increasing biodiversity business opportunities.” []
  2. TEEB for Business, Chapter 1 “Business, Biodiversity and Ecosystem Services.”Page 20 []
  3. Union for Ethical BioTrade (2010) Biodiversity Barometer 2010 (last access 25. May 2010 []
  4. Survey carried out on behalf of PricewaterhouseCoopers by Opinium, in May 2010, with over 2,000 respondents across the UK. Respondents were asked a mix of single and multiple choice questions. []
  5. Union for Ethical BioTrade (2010) Biodiversity Barometer 2010 (last access 25. May 2010) []
  6. Forest Stewardship Council (2008), Facts and Figures on FSC growth and markets. (last access 9 January 2009) []
  7. MSC (Marine Stewardhip Council) (2009) Net Benefits: The first ten years of MSC certified sustainable fisheries. []
  8. Waitrose (2009), Palm Oil Policy.(last access 9 October 2009) []
  9. TEEB for Business, Chapter 5, page 9, Box 5.2 “Conservation grade nature-friendly farming.” []
  10. TEEB for Business, Chapter 5, page 29, Box 5.13 “The association for social and environmental standards.” []
  11. TEEB for Policy Makers, Chapter 5 “Rewarding benefits through payments and markets.”Page 50-51, []
  12. Bengtsson, J.; Ahnström, J. and Weibull, A. (2005) The effects of organic agriculture on biodiversity and abundance: a meta-analysis, Journal of Applied Ecology 42: 261-269. []
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