Only if we fight poverty Due Diligence legislation will become effective

DISCLAIMER: All opinions in this column reflect the views of the author(s), not of EURACTIV Media network.

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Credit: Solidaridad

By Gert van der Bijl, Senior Policy Advisor, and Heske Verburg, Managing Director at Solidaridad Europe.

Solidaridad is an international CSO operating in over 40 countries worldwide on fair and sustainable supply chains, inspired by 50 years of solidarity with under-resourced producer communities.

In our newly published joint paper with Fair Trade Advocacy Office and Rainforest Alliance, Legislating for Impact (co-signed by a variety of international civil society organizations, also from the Global South), we call on the European Commission to ensure that the upcoming mandatory Human Rights and Environmental Due Diligence (HREDD) legislation is inclusive of the interests of smallholder farmers in various regions worldwide. Moreover, the European Commission should recognize that poverty is an underlying cause of many human rights abuses and negative environmental impacts in global value chains that the legislation aims to tackle.

To ensure inclusivity, the Duty to Collaborate must be a vital part of the Due Diligence legislation, and should be added as a 4th pillar to the UN Guiding Principles on Business and Human Rights, next to the current three pillars: the Duty to Protect, Duty to Respect, and Duty to Remedy. This 4th pillar should stimulate companies to work together with suppliers to bring positive change and enhance the livelihoods of farmers, workers and miners. It is imperative that the EU, companies and all stakeholders throughout the value chains recognize that sustainability is not a free ride, and take action accordingly.

Acknowledge poverty and collaborate with producers

The HREDD legislation is a milestone opportunity to promote respect for human rights and the environment in global value chains, make responsible practices the legal norm, and address unfair purchasing practices by creating a level playing field for companies. But the question is: how can we ensure this legislation will really have the desired impact for smallholders, and actually reduce poverty while respecting the environment?

The first step is to recognize that smallholders are a vital part of the solution to ending persistent poverty and creating inclusive and sustainable value chains. The EU must prioritize this in creating legislation that will have a truly sustainable and inclusive impact. While smallholders can be active drivers of sustainable development, the conditions for them to produce their goods sustainably are often lacking. EU due diligence regulation can have an enormous impact on their livelihoods. Deterioration of their livelihoods is a big risk since living up to and monitoring the EU requirements will come with an extra burden and extra costs, often passed to the weakest shoulders in the chain. Suppliers are squeezed between conflicting demands: to deliver at a low price whilst upholding demanding standards subject to monitoring. It is crucial that the EU delivers smallholder inclusive legislation as part of a smart mix of measures to ensure the right conditions are in place.

Key recommendations for inclusive legislation

The focus in the debate on HREDD legislation so far is on stopping bad practices. Focusing on this only has the risk that supply chain actors become risk averse, which may even result in shifts in value chains away from actors in vulnerable situations. This is why it is imperative to ensure that HREDD legislation is inclusive of the rights and interests of these smallholder farmers; acknowledges the importance of living income and living wage; and does not lead to further impoverishment and exclusion of smallholders from supply chains.

Our joint paper Legislating for Impact strongly recommends that the legislation and accompanying guidance should:

  • Focus on living incomes, living wages and responsible purchasing practices to reduce poverty among smallholder farmers.
  • Encourage lasting trade relationships and continuous improvement in global value chains.
  • Require the engagement and active collaboration of rightsholders, including smallholders, in all the stages of the human rights and environmental due diligence processes. There should be a particular emphasis on engaging and collaborating with stakeholders facing greater barriers to participation, such as women in producing countries.

EU should work jointly with producer governments

On October 11-14, CSR Europe hosted the European SDG Summit 2021, involving over 200 sustainability leaders in a variety of panel discussions and roundtables on the themes of climate action and just transition. Heske Verburg, Managing Director at Solidaridad Europe, spoke during the high-level plenary session on Resilient and Inclusive Supply Chains, stressing the importance of inclusive due diligence legislation that prioritizes the livelihoods of smallholders and is combined with the appropriate accompanying measures.

Verburg urgently called on the EU to partner closely with the producing countries to realize a truly sustainable and inclusive impact. Because yes, we can strive for smallholder-inclusive legislation, but it’s just one element of the puzzle. Without the right instruments to provide support to producing countries and key actors in the supply chain, such as smallholder farmers, legislation is dead on arrival.

In order for this smart mix of measures to be effective, the EU will need to jointly develop and implement roadmaps with producer countries to help producers, smallholder farmers, factories and small mines to comply with EU requirements following Due Diligence legislation. These roadmaps need to be developed and implemented with the full participation of the producers themselves, and with sufficient funds available. The EU should also promote financial incentives for smallholders to move towards sustainable practices, in partnership with producer countries and the industry.

Building Forward Together  to eradicate poverty

Smallholder farmers are responsible for producing a third of the world’s food supply and play an essential role in global value chains. Yet, around 63% of the world’s extreme poor work in agriculture, many of whom are smallholder farmers. Sunday 17 October is the annual International Day for the Eradication of Poverty. On this day the UN puts the spotlight on the global poverty rate and the necessary actions to tackle it. More than 1.4 billion people around the world live in persistent poverty, and millions of people have been pushed into poverty due to the Covid-19 pandemic. In our new publication, we join the international community in the call to action to end poverty and the urgent need for Building Forward Together.

Learn more about the work of Solidaridad at www.solidaridadnetwork.org.

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