On 21 January 2021, ITC’s Youth & Trade Programme in collaboration with the Trade 4 Sustainability & Development team (T4SD) organised part 3 of the Ye! Enterprising Youth: Sustainability mini-series. In Part 3 we discussed “Accessing markets & buyer requirements: Target markets, trends, and certification”. In this mini-series, we provide practical and actionable insights to young entrepreneurs on sustainability, certifications, trade, trends, and markets, as well as address why having sustainability integrated into your business model can lead to greater profitability.
In part 3, we shared insights into trends in sustainability and how to ensure your business is meeting the needs of buyers worldwide, with the help of ITC’s tools, such as Sustainability Virtual Network and Sustainability Trends. They are free to use and can help SMEs chart their path to more sustainable trade by connecting with business partners and better understanding the sustainability initiatives landscape.
A demonstration explaining how to navigate a number of ITC tools developed for sustainable ventures was offered. In addition, the experts took questions from the young entrepreneurs about applying sustainability standards and trends in practice. Here are some highlights and key takeaways.
What does the ITC Virtual Network module offer?
The Virtual Network is a free online gateway that enables businesses to promote their sustainable practices, gain visibility in the international supply chain and connect to international buyers. Companies can easily create and manage their online profile and start marketing their businesses. Currently, over 60’000 companies including international buyers, intermediaries and producers from more than 20 countries have created their company profiles on Network.
Case study 1: I am a buyer from the garment and textile industry, looking for qualified suppliers in India. How can the Network help me find relevant companies?
The answer: with a few simple clicks!
Step 1: Once you are on the Network platform, use the Search menu to look for entities per product, country, and data source or even by name. In this case, all you need to do is to choose Textiles/Garment under Product, select Country as India, and click Search. Voila, more than 1000 business profiles in the Indian textile/garment industry become available to you.
Step 2: Zoom in to choose specific businesses in certain areas, and check on their detailed profiles. For example, you are interested to see a company named Zodiac Clothing Company Limited, based in Bangalore. As demonstrated below, you can find their company information and certification details all in one place.
With the help of the Network, you can easily find potential suppliers’ basic information and performance in sustainability, in your target markets.
Case study 2: I am the owner of a small bean to bar chocolate company, how can I get my company featured on the Virtual Network?
Again, you can publish your business profile with a few simple steps.
Step 1: Register on the platform with your email/phone number and password.
Step 2: Upon registration, you should have access to your dashboard, where you can click on 'Get Featured'. This will prompt you to fill in your business information and create your business profile. Once your profile is complete, you can choose to make it public (or to keep it private for the time being), so that your company can become visible to others on the Network.
On your page, you can also display the products and the obtained certifications, which makes your business even more attractive to potential buyers and financiers, etc. See the example from the Virtual Network below.
What are the benefits of publishing your company on the Virtual Network?
- Network with potential buyers and/or suppliers
- Showcase certifications
- Take self-assessment against Voluntary Sustainability Standards (VSS)
*Note: self- assessment results cannot be formally verified or to replace official certification.
Now, let’s move on to another useful feature for SMEs, the Market Trends tool.
What does ITC’s Market Trends module offer?
The Market Trends module provides harmonized and verified information on the evolution of the global market share of certified/verified products, with interactive charts and graphs for
presentation. Based on the data from the Market Trends module, while the four largest certified product areas remain cotton, cocoa, oil palm and coffee, we also see certified areas continue to grow and standard compliance gaining ground in a number of other sectors.
Another notable trend visible below demonstrated the fact that almost 75% of the certifications acquired in agriculture are around products being organic. Visible from the images below is that the trend towards increasing demand by both the market and consumers for environmentally friendly and sustainable products.
What are some key trends in VSS and sustainability to watch?
1. Companies have shifted from having their own sets of requirements, i.e. their own standards or 3rd party standards, to co-designing industry-wide sustainability frameworks. A good example is the creation of Social & Labour Convergence Program (SLCP). SLCP is a non-profit multi-stakeholder initiative that aims to eliminate audit fatigue in the apparel & footwear industry.
2. VSS have broadened their scope of focus, and evolved in accordance with changing market dynamics. An increasing number of VSS have not only focused on environmental components and concerns, but also have integrated “ethics” components, such as anti-money laundry, laundering and pro well-being of labour, etc.
Questions from the youth entrepreneurs
Q: What are some standards on technology services, i.e. IT and / or e-waste, if any?
Yes, there are standards for electronics and e-waste. For example, we have the Responsible Recycling (R2) Standard for electronics recyclers, which provides a common set of processes, safety measures and documentation requirements for businesses that repair and recycle used electronics. For detailed information about R2 Standard and other standards on electronics, search on ITC Standards Map.
Q: How can VSS standards ensure small farmers in rural areas are not left behind in achieving sustainability?
ITC’s programmes strive to create an inclusive mechanism to connect small rural farmers with international markets, in collaboration with partners on the ground. Meanwhile, one of the most common approach adopted by different VSS is to regroup individual small-scale farmers into farm management groups and cooperatives, in order to scale up their collective impact. A good example is the Fairtrade Standard for Small-scale Producer Organizations, which applies to small-scale producers. It helps them improve their farming performance and generate more benefits for their members and their communities.
In addition, the experts emphasised on the various focuses that apply with different standards. For instance, areas such as logistics, data sharing, traceability of products, and work condition, means there are many different standards and businesses at the last mile can find a standard that supports them. But it may take some research.
Q: Does the current crisis have any influence on VSS certification?
First, the Standards have shifted to virtual verification and assessment for the application, due to the restrictions on physical travel.
Second, despite the pandemic affecting all businesses, it is evident that the companies who are more committed to sustainability in their social and environmental strategies, have thus far received greater support from their buyers and financers, and in turn have shown more resilience in the crisis.
Lastly, technology has played a significant role in businesses around the globe successfully transitioning to sustainable models in the context of the covid-19. With the increased use of e-commerce tools and platform, it is critical that the SME owners share their information and communicate with their customers and funders, so to keep their business relevant and competitive in the market.
Q: Can changes in government affect sustainability standards and trends?
Yes, it can. For example, the newly elected President of United States, Joe Biden, who has signed an order stating the US will rejoin the Paris Climate Agreement, has signalled a great shift back to climate and environmental sustainability by the US, one of the largest development funders and potential climate funders in the world. This in turn has an impact on other governments and the success of various climate related policies and projects, worldwide. Sustainability at large is influenced as a result.
Overall, we remain optimistic about the future of trade, including reduced trade barriers and promotion of social and environmental responsible practices. Additionally, as reflected in the African Continental Free Trade Agreement (AfCFTA), policy makers in Africa are expected to focus on the cut-crossing themes, i.e. gender and youth, in order to create inclusive and sustainable growth.
Q: How does ITC ensure the companies that register to its Virtual Network are as sustainable as they claim to be?
All the companies that register Virtual Network are listed as ordinary ‘company’ users before going through a validation process. The ITC team is connected with all standards included in the Sustainability Map, thus enabling ITC to check and confirm the companies’ relevant certifications. Any companies providing false information are removed from the platform. Companies on the Virtual Network are free to conduct a self-assessment, to learn which certifications they may be most applicable to. However, the self-assessment does not replace the official certificates, but may still be a helpful process for the enterprises own learning and evaluation.
Once again, you can review the full presentation on the Ye! Resources page.
Interested to learn more about sustainability and how you can adapt your business to be more ‘green’? Register and join our upcoming sustainability webinars:
Part 4: Innovative ways to embrace sustainability
11:00 -11:45 AM (CET), 4 Feb 2021, on Zoom. Register here.
Watch the full recording of the Part 3: Assessing markets & buyer requirements: Target markets, trends, and certification below: