Voluntary sustainability standards to cope with the new European Union regulation on deforestation-free products: A gap analysis

Abstract

The European Union Deforestation Regulation (EUDR) has been recently adopted to fight deforestation and forest degradation associated with the trade of forest-risk commodities, including cattle, cocoa, coffee, oil palm, rubber, soya, and wood. Operators must exercise due diligence (i.e., information collection, risk assessment, and risk mitigation) to ensure these commodities and their products are deforestation-free and produced in accordance with relevant legislation. In recent decades, Voluntary Sustainability Standards (VSS) have been adopted in the private sector to promote sustainable and deforestation-free supply chains. The EUDR recognizes certification and other third-party verified schemes as supporting tools for risk assessment during the due diligence procedure. However, questions persist regarding the extent to which these schemes can assist operators in assessing compliance with the EUDR. This study addresses these concerns by developing an assessment framework to evaluate the suitability of VSS schemes in covering the due diligence requirements established in the EUDR. The assessment of five major agricultural and forestry VSS schemes against this framework revealed both potentialities and limitations in covering these requirements. Most of the indicators from the framework were at least partially covered. Nevertheless, the assessed schemes fell short in providing a comprehensive prohibition of deforestation and forest degradation. They also presented variable coverage of the relevant legislation outlined in the EUDR, as well as deficiencies in their systems to assure compliance with the standards. Overall, this study indicates that VSS schemes can be incorporated as elements of due diligence systems but are insufficient to demonstrate compliance with the EUDR.