Impact of Voluntary Sustainability Standards on Global Trade Q&A Manish Pande, Director QCI India

UNCTAD
Dr. Manish Pande, Director of Quality Council of India, shared his perspectives on VSS with UNCTAD.

 


Q:   Why are Voluntary Sustainability Standards important? Can they contribute to the implementation of 2030 Agenda?

A:    With almost 500 Private Sustainability Standards (PSS) in 199 countries and 25 industrial sectors, the PSS systems have become the new market reality as a tool for sustainable supply-chain management, marketing and competitiveness.

PSS have played a crucial role in ensuring product safety and preventing fraud since the early days of the industrial revolution in the 19th century. However, there are different types of PSS aimed at achieving different purposes.

Most PSS are B2B standards and are usually based on the principles of openness, transparency and consensus. Primarily focusing on ensuring the quality and safety of the end-product in the value chain, these standards represent the foundation of international trade.

As such they helped facilitate the integration of Global Value Chains and thus greatly contributed to economic empowerment, technical innovation and consumer welfare.

Becoming part of GVCs is crucial for developing countries in gaining access to crucial codified and tacit knowledge that eventually allows them to build up their own industries and increase their share in international trade.

In India for example, PSS are seen to compete with the national regulatory institutions in defining the mandate for safety and quality. Therefore, in addition to mandatory regulations, voluntary measures affecting market access of Indian products require close consideration.

The costs of compliance with eco-labelling criteria in the numerous sectors have been found to be prohibitive, compounded by difficulties in accessing technologies, developing testing facilities as well as compliance verification. However, PSS do take steps towards ensuring long term sustainability of value chains and prepare the national market for rising consumer awareness, demand for product, environmental safety, livelihood improvement of workers, together with improving competitiveness of industries, production practices of the fast-growing smallholder segment, and mainstreaming smallholders into the sustainability fold.

Since the 2030 agenda is a plan of action for people, planet and prosperity, the credible VSS focuses on achieving sustainability by the optimal use of man, machine and materials.

This in turn helps us to achieve optimal utilization of resources, improve and protect the environment, strengthen the livelihood of small holders at an individual level, increase competitiveness of SMEs at unit level and bring in efficiencies in larger corporates while at the same time managing transnational operations.

Q:   How can VSS support SMEs for a more inclusive and sustainable economic growth? (Case of India)

A:    Due to the increasing integration of the Indian economy with the global economy, especially during the last decade, enterprises of all sizes have been gradually exposed to global competition. Global buyers are basing their sourcing decisions not only on traditional commercial considerations such as price, quality and delivery commitments, but also on compliance with social and environmental norms in the workplace, covering, for instance, health and safety, social equity in employment and production as well as ecological compatibility of products and processes.

Besides existing international standards such as SA-8000, GOTS, Forest Management & Chain of Custody (FSC), Better Cotton, etc., India itself has responded to the development of standards in the form of voluntary standards such as Trustea, INDGAP, ZED, and Voluntary Certification Scheme for AYUSH Products, Ready mix Concrete Plant, Lead Safe Paints, Yoga Professional Certification Scheme, Forest Certification and Medicinal Plant Produce.

These have shown a promising way in India especially in the development of private and voluntary standards, thereby achieving quality production along with introducing sustainability in process both in food and non-food sector, helping the SMEs and small holders in the agriculture to increase both their productivity and their livelihood through the access to the global supply and value chains.

Having said this, it is important for us to also monitor and address the issues of duplication, accountability, traceability, legitimacy and costs in the implementation of PSS so that MSMEs can more extensively utilize the benefits of the same.

Q:   Kindly describe how the VSS national platform has contributed to Indian economic growth?

A:    The Indian Voluntary/ Private Sustainability Platform is a demand driven platform where key issues related to sustainability standards are identified, analyzed and dealt with.

The platform meets the requirement of the stakeholders that seek sector-specific, product-specific studies to understand issues concerning PSS. Currently the platform is working with various sectors/products such as manufacturing, agricultural products, textiles, and handicrafts.

Many Indian buyers are also beginning to incorporate these requirements into their purchasing decisions. Therefore, integrating sustainability in business, followed by calculable reporting of the same has become a must, especially in micro, small and medium enterprises (MSMEs).

The PSS Platform secretariat is being hosted by the Quality Council of India (QCI), an autonomous national accreditation body in India, is a public-private entity set-up by the Government of India along with industry associations – ASSOCHAM, FICCI, and CII. It has designed host of Schemes that span across various sectors that includes traditional medicines, medicinal plants, ready mix concrete, agriculture, yoga, etc. These schemes have been designed as per international best practices that include aligning them with ISO 17067, ISO 17065 for product certification and ISO 17024 for personnel certification.

All the Schemes have been designed to be operational a year after they are designed through the accreditation mechanism by using the third-party audit bodies. That process gives the Scheme much more credibility and acceptability of the products, processes and service in the domestic and international market. The PSS platform highlights the activities done by various arms of the QCI as well as other organisations such as National Interpretation of Global Standards in agriculture, disseminating information of Zero Effect and Zero Defect (ZED) model to introduce competitiveness in the Indian manufacturing sector particularly in the MSME sector which helps the country in embarking on quality journey to make them a part of the national and global supply chains.

Q:   What outcome do you wish to see at the end of the 1st NTM week?

A:    I hope we can move forward on:

  • a. Mechanism of identifying credible VSS and their continuous monitoring
  • b. Convergence of views on VSS and its contribution in meeting the objective of sustainability
  • c. Mechanism of co-operation within the growing economies to leverage on the VSS initiative within their economies and mechanism of inter-operability

 

Advertisements