Strengthening the Role of Voluntary Sustainability Standards in Trade Policy

With sustainability being recognized as a progressively more important trade goal, trade policy is increasingly referencing and utilizing voluntary sustainability standards (VSSs) to achieve sustainability outcomes. With this increase comes the question of which VSSs are worthy of trust to deliver on sustainability goals and their use in trade policy.

The ISEAL Credibility Principles, among other guidelines and frameworks, outline core values for effective VSSs, lending to their global credibility. Because different VSSs are designed to achieve varying environmental results, establishing their credibility is critical to how (and whether) they can be used in trade policy.

This interactive lunch seminar explored how different stakeholders (standards-setting organizations, policy-makers, non-governmental organizations, and international organizations are approaching the issue of VSSs’ credibility and how the World Trade Organization (WTO) can advance the integration of VSSs into trade policies.

Panelists discussed integrating VSSs in trade policy during the WTO’s Trade and Environment Week in Geneva.

Speakers

• Serra Ayral, Counsellor, Trade and Environment Division WTO
• Axel Marx, Deputy Director, Leuven Centre for Global Governance Studies
• Cameron Plese, Head of Government Affairs, Roundtable on Sustainable Palm Oil
• Ambassador Ronald Saborio, Costa Rica’s Mission to the WTO

Key Takeaways

Voluntary sustainability standards are increasingly being referenced in trade policies, particularly to drive sustainability outcomes. Countries like Switzerland and Costa Rica view VSS as essential tools to promote sustainable consumption and production, as well as to ensure market access for goods like palm oil under sustainability criteria.

The credibility of VSS is crucial for their effectiveness. Speakers emphasized the need for credible VSS, which can be established through principles such as transparency, multi-stakeholder governance, and robust assurance systems. ISEAL’s credibility principles and codes of compliance were highlighted as benchmarks to differentiate trustworthy VSS from non-credible ones. However, it was also highlighted that the credibility and reliability of VSS could vary depending on how they are used and the type of trade policy measure.

Ensuring that smallholders and producers, especially in developing countries, can meet VSS requirements is a challenge. The event emphasized the need for technical assistance, capacity building, and incentives – such as tariff reductions and price premiums – to help these producers comply with sustainability standards and gain access to global markets.

Policymakers were encouraged to integrate VSS into national frameworks to align trade and environmental goals. This includes creating transparent legal frameworks, and leveraging standards to influence consumer behavior toward sustainable choices. Speakers called for the need to have one, or a number of, common frameworks to identity credible VSS to be used in trade policy. The ACCTS agreement and initiatives within international forums like the WTO’s Committee on Technical Barriers to Trade were cited by speakers as examples of how VSS can be incorporated into trade agreements.

The road ahead is not an easy one. There are many challenges that come with VSS alone, such as the proliferation of standards and costs, and this needs to be also noted while furthering their use in trade policy.