ARE smaller agribusinesses instrumental to the agri-food sector’s sustainable future? Sustainability is beyond environmental concerns. The Food and Agriculture Organization (FAO) of the United Nations has developed a unified approach towards sustainability through a set of five principles of sustainable food and agriculture. These principles are improved resource utilization efficiency; immediate and direct action to protect, conserve, and enhance natural resources; protection and improvement of rural livelihoods and the social well-being of rural households equitably; enhanced resilience of communities, people in these communities, and the surrounding ecosystem; and enforcement of responsible and effective governance systems. The inclusion of governance expands the sustainability dimension beyond the triple-bottom line.
In fact, according to the FAO, governance systems must result in a “right balance between private and public sector initiatives,” among others. At the small enterprise level, this means that sustainability is to be integrated with strategy, operations, and culture in value creation and delivery. How can this be possible? The United Nations Global Compact (or the world’s largest corporate sustainability initiative) introduced the “Roadmap for Integrated Sustainability” that seeks to explore means of sustainability integration by way of best practices, tools, and strategies. Using a Sustainability Stages Model, the roadmap illustrates to entrepreneurs and their teams that the sustainability journey of businesses is unique, and recognizes the iterative nature of moving from the current stage towards the desired stage of sustainability integration.
In a fairly recent book chapter entitled, “Integration of Sustainability into the Corporate Strategy” that was written by Nicole Oertwig and her colleagues, a framework for the management of enterprise sustainability performance was presented. The framework consists of a sustainability business model, a sustainability strategy, business processes that result in sustainable value creation, action planning and monitoring, and integrated reporting. The authors cited a set of profiles for sustainability strategy that was recommended by Rupert J Baumgartner and Daniela Ebner. A lower strategy profile, for example, focuses merely on “conformity and compliance with sustainability rules and guidelines.” This is followed next by publicly communicating the enterprise’s sustainability commitment to society. For the business to be categorized as a “systematic visionary,” it must equally address the current and future concerns of stakeholders as well as the requirements of markets.
What future sustainability concerns and trends do agribusiness SMEs and their stakeholders expect to face? According to the FAO, these include a global population of 10 billion by the year 2050; food losses and waste increasing along the food chain and at consumption points; about 650 million malnourished individuals by 2030 expected; more males seeking employment opportunities outside of agriculture as the ‘feminization’ of farming in many parts of the world are observed; and a rising proportion of undernourished people living in low-income countries. Meanwhile, pests and diseases have been identified as emerging transboundary agriculture and food system threats; pro-poor growth programs must move beyond the rural areas and into poverty-stricken urban neighborhoods; observed threats from the environmental footprint of longer food supply chains; and achieving the 2030 Agenda for Sustainable Development.
One of the ways for agribusiness SMEs to get actively involved in the agri-food sector’s sustainable future is to participate in the “Grow Asia” initiative of the World Economic Forum. With current active multi-stakeholder partnerships in Vietnam, Indonesia, Myanmar, Cambodia and the Philippines, “Grow Asia” aims to engage 10 million smallholder farmers by 2020 by capacitating them to increase their productivity, profitability and environmental sustainability by 20 percent.
A green value chain approach to development is inevitable for these partnerships to succeed. This approach recognizes that high-input agriculture and a resource-intensive farming system are not sustainable as these accounts for approximately 30 percent of total greenhouse gas emissions, and consequently damages the ecosystem. To help realize a food-secured scenario under climate change conditions, climate-smart agriculture (CSA) may be pursued. The FAO states that CSA seeks to achieve “sustainably increasing agricultural productivity and incomes; adapting and building resilience to climate change; and reducing and/or removing greenhouse gas emissions.”
Louie A. Divinagracia is a licensed agriculturist. He is also an eLearning author in agribusiness under the Self-Learning Course Project of the Asian Productivity Organization, which provdes open-access learning as a continuing education initiative. Dr. Divinagracia teaches graduate-level courses at the University of the Philippines Los Banos, and at Ramon V. del Rosario College of Business of De La Salle University where he mentors master’s degree students and doctorates. He welcomes comments at email@example.com.The views expressed above are the author’s and do not necessarily reflect the official position of DLSU, its faculty, and its administrators.