Day 2 - Session 1 - IPIECA

Sustainable Biofuels 

Regulations Standards and 

Certification Workshop 

18 – 19 September, 2012 

Brussels Belgium 

Cosponsored by:

Workshop 

Objective: Review the status of biofuels regulations, understand 

how sustainability standards are implemented, and consider how 

to improve standards’ effectiveness. 

Meeting Participants: Petroleum Companies, Biofuels Producers, 

Regulatory Bodies, Academics, Auto Companies, NGOs, 

Consultants 

A healthy dialogue, a status check, an opportunity to improve the 

industry, a chance to give feedback, a chance to reconnect with 

colleagues or make new contacts

Workshop: Recap Day 1 

• What did we learn? 

• What questions remain?


• Bioenergy and agriculture: today and tomorrow 

– Martina Otto (UNEP): Biofuels in the future of agriculture: 

competitive or transformational?


• Regulatory expectations for biofuel sustainability schemes 

– Development process, current requirements, model, and iLUC 

– Ignacio Vazquez Larruscain (DG Climate Action): The EU’s 

Renewable Energy Directive 

– Margo Oge (US EPA): The US Renewable Fuels Standard 

– Denise Green (Hart Energy): Snapshot of sustainability 

regulations in Australia, Brazil, California, and Japan


• Basics of biofuel certification & sustainability standards 

– What do they cover? How do they work? How are they similar? 

– Ortwin Costenoble (NEN): CEN’s sustainability standard 

– Hans Nordström (Swedish Standards Institute): ISO’s 

sustainability standard 

– Alain de Plaen (SynergOil): CEN and ISO compared with RED 

– Melanie Williams (RSB): Roundtable for Sustainable Biofuels 

– Gert van der Bijl (Solidaridad): Bonsucro, RSPO, and RTRS


• Implementing biofuels sustainability schemes 

– What works, what doesn’t and unintended consequences 

– Michelle Morton (Shell): Chain of custody options 

– Peter Smith (Cargill): Ensuring sustainability compliance in 

global supply chains 

– Kristell Guizouarn (Sofitproteol/Diester): Complying with 

2BSvs 

– Yotsawin Kukeawkasem (GIZ): Case study: RSPO producer 

certification 

– Paul Argyropoulos (US EPA): Implementing the RINs system


• Measuring the impacts of voluntary standards and 

certification schemes 

– How to measure social, environmental and economic impacts of 

voluntary schemes? 

– Kristin Komives (ISEAL): The ISEAL Code of Good Practice 

– Jessica Chalmers (Winrock Intl): Building capacity for 

monitoring compliance 

– Measureable impacts of voluntary standards 

• Mohammad Rafiq (Rainforest Alliance): On the environment 

• Andrea Rossi (FAO): On producers and communities

Workshop: Day 2 Looking Forward 

• Learning from Others: Electronics industry’s conflictfree 

minerals programme 

• Context, instruments, mechanism necessary for 

standards to achieve desired outcomes 

• Discussion: 

– Creating sustainable and scalable solutions 

• Discussion: 

– Workshop conclusions 

• EU iLUC Update 

• Workshop Close

Conflict Minerals: 

A Program in the Making 

[for IPIECA and CONCAWE] 

Bob Leet 

Intel Corp / EICC Extractives Co-Lead 

19 September 2012 

10

Agenda 

• How the conflict minerals issue was raised up to the 

electronics industry 

• Effective collaboration with multiple stakeholders – 

what to expect, what not to expect 

• Balancing supply chain complexity, regulations, 

reputation (company and industry perspectives) 

• Developing and executing an industry-wide program 

– a timing perspective 

• Success of the Conflict-Free Smelter Program, and 

conflict minerals due diligence tools and methods 

11

EICC ® Members 

As of 27 February 2012 

12

GeSI Members 

(As of 6 January 2012) 

13

Extractives WG Partners 

( As of September 1, 2012 ) 

Partner Industry Associations 

Non-Member Partner Companies 

14

The Rise of the Conflict, 

from the DRC to Electronics Supply 

Mineral 

wealth 

funds 

bloodshed 

in the 

Congo 

• United Nations reports (2001, 2008 

and 2009) that minerals trade directly 

contributes to funding the war in the 

Congo. 

• “Conflict minerals” issues have 

become the focus of numerous nongovernmental 

organizations (NGO), 

as well as the media. Engagement 

with EICC & GeSI in 2007. 

• US legislation signed in 2010 requires 

US companies to disclose sources of 

tin, tungsten, tantalum and gold; and 

to conduct due diligence in their 

supply chain (Dodd-Frank Wall Street 

Reform and Consumer Protection 

Act)

Multi-stakeholder Collaboration 

• Who and why 

– Industry, Civil Society (Non-Government Organizations, NGOs), 

Government, and Investors 

– Stakeholders balance each others’ interests 

• What to expect 

– Each stakeholder plays a role, yet each stakeholder does not have 

to be engaged on each topic 

– NGOs come in all different flavors – advocates, implementers, 

opinionated, fair/unfair 

– NGOs and Government can bring credibility to Industry’s work, 

which leads to investment 

• What not to expect 

– Nobody will be coming to you with open wallets 

– Government needs to be educated, but still may not agree with you 

– Don’t expect NGOs to change their position, even though they may 

be friendly when working with you 

16

Collaboration Towards a Process Standard 

Smelters 

Electronics 

Industry 

EICC/GeSI 

members 

Metal industry 

associations 

LEADERSHIP 

Other 

Industries 

Non-Government 

Organizations 

Conflict Minerals 

efforts have been 

successful by 

multiple supply 

chain and external 

entities working 

together to 

achieve agreeable 

processes and 

tools 

Source: Intel 

17

Balancing Supply Chain Complexity, 

Regulations, and Reputation 

• Fixed: Regulation and 

preservation of 

Reputation are 

requirements 

• Variable: Companies 

must be creative in how 

they engage their 

suppliers 

• Collaborate with the 

Supply Chain, don’t 

treat them as a 

commodity 

• Peers can work together 

with the supply chain 

and not be in an antitrust 

situation 

Civil Society 

(Reputation) 

Government 

(Regulation) 

Company X 

Supply 

Chain 

18

Philosophy on Program Direction 

Quality and CSR initiatives started on these types of trajectories 

Company 

Program 

Developed 

• Passion 

• Motivated 

• Learning 

Industry / 

Sector 

Harmonization 

• Common Suppliers 

• Common Customers 

•Common Expectations 

• Efficiency Gains 

International 

Standards 

Established 

& 

Accepted 

We Are Here 

0 ~5 ~8-10 

Years 

Source: Bob Leet 

19

Conflict Free Smelter Program 

2007-2009 

2010 

Inception 

Researched the 

issue. 

Held first supply 

chain workshop & 

developed idea of 

working together 

on conflict 

minerals. 

Development 

Created Conflict- 

Free Smelter 

Program protocols. 

First Ta smelter 

compliant. 

Progression: 

• http://www.conflictfreesmelter.org 

• The compliant smelter/refiner lists are publically available in order to 

maintain credibility and transparency of the Program. 

• 21 refiners/smelters compliant to date 

2011 

Launch 

Published first 

compliant Ta 

smelter list. 

Published Sn, W, 

and Au CFS 

Program protocols. 

CFS Program 

recognized by 

OECD. 

2012 

Grow 

Completed first Sn 

and Au audits. 

Engaged W 

industry. Added 2 

industry assoc. 

and companies 

from other sectors. 

2013 

Grow & Maintain 

Continue to 

engage additional 

smelters, refiners, 

& industries 

Source: EICC-GeSI 

20

Concerted Efforts Lead To Key Results 

Effort 

EICC-GeSI Conflict Minerals 

Reporting Template 

EICC-GeSI Conflict-Free 

Smelter Program 

EICC-GeSI Outreach 

Smelter Incentive Program 

In Region Sourcing Initiatives 

International Framework 

Result 

Considered Industry Standard for identification of 

smelters/refiners sources 

•Majority of Ta industry compliant 

•Collaboration agreement with Au industry 

•Heavy discussion with some progress in Sn 

•little progress in W 

•Strong attendance at bi-annual workshops 

•Addition of partners outside the electronics industry 

Launched by RESOLVE in Q2’12 – Intel, HP, GE 

Foundation are founding partners 

•ITSCI Bag and Tag 

•Solutions for Hope 

•Public Private Alliance for Responsible Mineral Sourcing 

Drove industry participation in the development of the 

OECD Guidance 

Source: Intel 

21

What We’ve Learned 

Be “On the Ground” 

Collaborate toward common goal 

Drive standards for global implementation 

Encourage and enlist fellow travelers 

Help Others 

Source: Intel 

22

When and how do voluntary 

sustainability standards work? 

Gabriela Alvarez 

Consultant 

International Trade Centre 

Gabriela Alvarez – Sustainable Biofuels Workshop – September 2012

What is the International Trade Centre – ITC ? 

The UN body for design of 

policy recommendations to 

achieve economic and social 

development through trade and 

investment. 

The forum to negotiate 

multilateral trade rules, monitor 

their implementation and handle 

trade disputes 

ITC mission 

ITC works with local and regional 

institutions and business 

stakeholders to build trade capacity. 

“ITC, as an agency of the United Nations, enables business 

export success globally by providing, with partners, trade 

development solutions to the private sector, trade support 

institutions and policy-makers” 


25 

What is Trade for Sustainable Development? 

• A partnership-based effort to provide access to comprehensive 

information on private voluntary standards & increase opportunities 

for sustainable production and trade. 

Who are our partners? 

… as well as 95 participating standards initiatives (as of September 2012). 

Gabriela Alvarez – Sustainable Biofuels Workshop – September 2012 

…

26 

Standards Map: @ the Crossroads of Sustainability 

An online database of the ITC 

offering information on over 75 

standards, codes of conduct and 

audit protocols addressing 

Responsible Sourcing and 

Sustainabiliy in Supply Chains 

applicable to 80 sectors and 200 

countries. 


Data Quality Protocols 

Neutrality, credibility & confidentiality 

1. Information is entered in T4SD Global 

Database by ITC staff; 

2. External experts are mandated by ITC to 

quality control the information; 

3. Each standard organization gets an access to 

the database to review the data; 

4. Final discussions and sign-off on the data. 

Ownership, update & maintenance 

T4SD 

T4SD operates as a central repository of information, the data is 

owned by each standard and can be modified – corrected – updated at 

any time; 

Quarterly updates of information in T4SD database; 

Yearly full review of the information in T4SD database. 


StandardsMap: Online Comparison Tool 

www.standardsmap.org 

28 


StandardsMap: Online Comparison Tool 

www.standardsmap.org 

29 


VOLUNTARY STANDARDS 

RESEARCH 


30

Gabriela Alvarez – Sustainable Biofuels Workshop – September 2012 31

Regulation or voluntary 

standards? 

When and how do voluntary 

standards work best? 

Gabriela Alvarez – Sustainable Biofuels Workshop – September 2012 32

The Research 

• Systematic Literature Review: 

– ‘A replicable scientific and transparent process which aims to 

minimize bias through exhaustive literature search of published and 

unpublished material, providing an audit trail of the reviewer’s 

decisions, procedures and conclusions’ (Cook, Mulrow and Haynes 1997). 

• A total of 217 documents reviewed in four parts: 

– Impacts of voluntary standards on value chains 

– Impacts of voluntary standards on producers 

– The interplay of public/regulatory and voluntary standards 

– When and how do voluntary standards work? 


33

Do voluntary standards work? Assessing their impact 

Easy to measure 

Hard to measure, 

Hard to attribute to specific activities 

Source: ISEAL, Evaluation Approaches: How it Is Being Measured, 2008 


34

Research on this field 

• Significant expansion of research on voluntary standards and on 

impact assessment 

• However, still many limitations: 

• Limiting data collection and analysis methods: 

• Majority of studies based on case study approach. 

• Minority of studies establish counterfactuals allowing for establishment of 

causal relationships. 

• Wide disparity in coverage with over-representation of: 

• Crops: Coffee, Cocoa, Bananas, 

• Certifications: Fairtrade, Organic, 

• Aspects: Economic 

• Regions: Latin America 

• Limited theory building work 

• Lack of theoretical underpinnings. 

• No theoretical framing of results. 


35

Impact: Voluntary standards effects in developing countries 

Why? ? How? 

Neutral or negative 

Positive 

Source: Alvarez and Von Hagen, Impact of voluntary standards on producers in developing countries, 

International Trade Centre, 2011 


36

A systemic view: The CIME Framework 

• Natural factors 

• Institutional conditions 

• Government 

• Voluntary standards 

• Regulations 

• Other private/public instruments 

• Triggered by interventions 

• Changes in behavior 

• Ex. Empowerment, 

relationships, etc. 


37

Context 

• Adoption of voluntary standards is favored in certain contexts: 

– High traceability requirements 

– Extractive businesses 

– Commodities are identifiable in end products 

– Shorter supply chains with fewer actors 

– Activist action 


38

Context 

• Positive impact of standards associated with higher levels of producer and 

institutional preparedness (selection bias) 

Cocoa production and certification 

Source: State of Sustainability Initiatives, 2009 


39

Context 

• Regulatory framework as an enhancer or deterrent of voluntary standards: 

– Property rights 

– Clear rules of engagement 

– Enforcement of regulations (cost to comply) 

Cost to 

comply 

Cost to 

comply 

Regulations 

Voluntary 

standard 

Enforcement of 

regulation 


40

Instruments 

• Standards need to be recognized as ‘legitimate’ by relevant stakeholders: 

– Inclusiveness and transparency, congruence, Balance between global scope 

and adaptation to local conditions, effectiveness, science supporting it 

• Implementation of voluntary standards is enhanced when clear and visible 

incentive for their adoption exist, at least in the short term. 


41

Instruments: The interplay of voluntary and regulatory 

standards 

• Voluntary standards often fill the gap where governments do not 

implement/enforce existing regulatory standards. 

• Potential regulatory action can also act as a stimulus for more aggressive 

voluntary standards development 

• Disconnected voluntary and regulatory standards create inefficiencies that 

can result in duplication of compliance costs, auditing and bureaucracy. 

• Voluntary standards perceived as legitimate by policymakers can influence 

regulatory action and harmonization among public and private spheres. 

? 


42

Mechanisms: Making it all work 

• Positive impacts of voluntary standards appear to be mediated by 

the generation of mechanisms: 

– Enhanced buyer-seller relationship 

– Producer’s increased credibility or self-assurance 

– Empowerment 

– Cross-institution relationships 


43

Mechanisms: The role of the buyer 

• The role of buyer is critical in determining the effect for producers and 

environment: 

Ex. Rooibos Tea in South Africa 

Market driven 

Mission driven 

Conventional sourcing strategy 

from fairtrade certified farms 

and cooperatives 

Buyer involvement and network 

partnerships including technical 

support 

• Limited medium term 

impact 

• Upgraded facilities 

• Value added /captured in source 

• Empowerment 

Source: Raynolds and Ngcwangu, Fair Trade Rooibos tea: Connecting South African producers and American consumer markets, 

Geoforum, 2010 


44

Summary: Ten things we have learned on voluntary 

standards 

1) Voluntary standards can result in positive effects at the producer and at the supply chain level. 

2) The effects of standards need to be analysed in its broader context conditions, instruments 

and mechanisms 

3) Adoption of voluntary standards is favoured in contexts where the product has high traceability 

requirements, in extractive businesses, when commodity is identifiable in end products. 

4) Voluntary standards tend to be more viable in contexts with higher levels of ‘preparedness’. 

5) Voluntary standards need to be recognized as ‘legitimate’ by key stakeholders, both in terms 

of inputs as well as outputs. 

6) Successful implementation of voluntary standards requires a balance between global scope 

and adaptation to local conditions. 

7) The implementation of voluntary standards is enhanced when clear and visible incentives for 

their adoption exist, at least in the short term. 

8) The role of the buyer is critical in determining the outcomes for producers, with positive 

impacts often being associated with mission-driven buyers. 

9) Positive effects for producers participating in voluntary standards are mediated by generation 

of mechanisms such as empowerment, buyer-seller relationships and increased credibility. 

10) There is a need to take a more systemic view of voluntary standards, assessing the factors 

that influence their effectiveness at a single point in time as well as over time. 


45

Thank you! 

Gabriela Alvarez 

galvarez@intracen.org 

alvarez@latitudeglobal.com 


46

Day 2 - Session 1 - IPIECA

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