Human Rights and Environment Protection Standards as Market Access Barriers for Poor Producers

Currently, we face a growing demand for business compliance with non-binding standards and binding regulations regarding human rights and environment protection. High thresholds usually imposed by these standards and regulations may have the adverse and unintended effect of excluding small-scale producers from global value chains. Questioning who is in a position to observe said instruments is crucial for the use of trade in the interest of local development and extreme poverty alleviation.

In the past few years, the rush for human rights-friendly and environment-friendly businesses has increased significantly. Several tragedies and breakthroughs have risen global awareness regarding the need for responsible businesses. The tragedy of Rana Plaza, the scandals involving Apple and Nike, the alleged findings behind chocolate supply chains, and the uncovered relationship between tuna fishing and dolphin killing are some of these high-profile cases.

Either rooted in sincere awareness or mere marketing strategies, firms are more prone to abide by non-binding standards or binding regulations regarding human rights (“HH.RR.”) and environment protection – and more interested in publicly showing said abidance (Nadvi, at 325-26). Likewise, empowered consumers are decisively seeking for a deeper commitment from enterprises with these core values (Hofmann, Schleper, and Blome, at 116).

In this scenario, certification standards have been useful communication tools between both producers and consumers. On the one hand, certification schemes serve as a mechanism for businesses to publicly communicate their commitment to consumers and to firms located in their supply chains. On the other hand, the demand for standard-compliance serves as a mechanism for consumers to voice their concerns. This soaring trend has been accompanied by the development of Due Diligence, Responsible Business Conduct, and Business and HH.RR. disciplines.

These standards and procedures have not only focused on the individual operations of firms. Certifications and related procedures with a particular focus on standards for complex supply chains have gained special attention. The latter, in the context of a globalized economy characterized by a growing reliance on global value chains and an unwavering fight for efficiency-seeking foreign direct investment.

The shift towards a rising demand for these certification standards and schemes has proven valuable for the enhanced protection of HH.RR. and the environment. Nonetheless, the demand for higher business-commitment through the use of certification standards and related procedures may have fallen short in responding to its unintended negative effects. Most notably, it may have faltered in promoting the integration of small-scale producers into global value chains, which is crucial for the promotion of local development.

Gold mining is, probably, the best example of a case where one could study the intended positive and unintended negative effects that come as a result of the demand for higher business-commitment via certification standards and related procedures (Young, at 1440). In this case, certification standards and related procedures may be acting as significant market access barriers to artisanal and small-scale miners (“ASM”). In particular, the high thresholds imposed by existing certification standards and procedures -such as the Conflict-Free Gold Standard– may exclude ASM from legal global value chains and, by means of restricting ASM market access, may affect local development (Barney, at 341-59; Baller, at 7).

Responding to the call of the World Bank Group and of the World Trade Organization for more study on the impact of standards for poor producers, I have the aim of inviting further debate and study on global governance through certification standards, gold supply chains, and -hopefully- on the role of trade in the creation of local development and extreme poverty alleviation. Questions such as who is in a position to observe said standards and who is capable of successfully using related conformity assessment schemes should guide the future discussion.

Author:
Sara Lucía Dangón-Novoa[1]
International Legal Affairs Officer
OALI

References

[1] Sara Lucía Dangón-Novoa, International Legal Affairs Officer at the International Legal Affairs Bureau of the Colombian Ministry of Trade, Industry, and Tourism (“OALI” per its acronym in Spanish language). Before joining the OALI, she was a junior associate at Posse Herrera & Ruiz and held the post of researcher at Universidad de los Andes’ School of Law. She has a Cum Laude master’s degree in international law (LLM) from Universidad de los Andes, Colombia, and holds a juris doctor (JD) from the same institution. She is currently pursuing a certificate of advanced studies (CAS) in international law and economics from the World Trade Institute, Switzerland.

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