4.9 Certification

Do you need a third party to certify compliance with sustainability standards?

Compliance with a sustainability standard may be formally checked by a third party who then grants a certificate to the company and/or the raw material or product delivered. Certification can be the last step in the process described in this guide. But it is important to note that certification can in no way replace any of the efforts needed to ensure a sustainable sourcing base for your company. Certification is not a goal in itself, but a means to an end. It can be viewed as a common language to refer to sustainability throughout the supply chain, and it is often seen as a first step towards more far-reaching improvements rather than an end-point in itself. Before deciding for or against certification, you should ask yourself the following questions:

  1. Do you need certification to ensure compliance with your sustainability requirements?
    If your company has strong control over its supply, through direct sourcing from farmers or through suppliers, the added value of certification may be less than in situations where the company is getting its raw materials from distant sources (such as commodity markets).
  2. Do you need certification as a protection against reputation risks? And will certification give you this protection?
    Certification can be important for agricultural materials faced with important and publicly high-profile sustainability issues. In such cases, even if your firm does have high-level standards and is in a strong position, third-party certification may bring credibility (depending on the credibility of the standard and certification system themselves). Certification can be important for raw materials linked to deforestation issues and human rights for example. Multi-stakeholder supported standards can give more protection than standards without such support (see 4.6).
  3. Will certification create added value in consumer markets, e.g. through labelling?
    In some markets, products from certified ingredients (possibly labelled as such) may have a competitive advantage in comparison to products from non-certified sources. For a case example, refer back to the Unilever/Lipton tea case referred to in Example 2.
  4. What are the expected costs of certification for my company and for farmers?
    Certification usually comes at a cost, not only for the sourcing company, but also for the suppliers and farmers. Farmers are likely to demand a premium for their certified products. Are these costs justified in terms of their contribution to sustainability and protection against reputation risks? Are they a necessary step to entice farmers – often poor smallholders – to participate until they achieve the more relevant benefits of yield improvements? Are there any options for reducing the costs without losing the added value of certification? Is certification the real cost, or is the cost really of reaching remote farmers that you’ll have anyway with or without the actual certification cost? Only a thorough analysis and answers to rigorous questions asked to your suppliers will help you answer this question.

Chain of Custody Certification, Buying ‘Green Certificates’

Is there a need for chain of custody certification? Is it a good idea to buy ‘Green Certificates’ instead of buying certified raw materials?

If your company plans to sell end products with a claim that they were made from sustainably grown raw materials, you must make sure that these raw materials which you source, come from farms that comply with sustainability requirements. In the case of margarine, if you claim that it is made with RSPO certified palm oil then the palm oil that is actually contained in the pot of margarine has to be sourced from certified palm oil plantations. No mixing with non-certified palm oil may take place. In this case, non-certified and certified shipments have to be strictly separated.

If your company’s objective is solely to promote the sustainable production of certain commodities overall – without a link to specific claims on the brand – then identity preservation (IP) is not necessary. To take the margarine example again, what is important is that a certain volume of palm oil sourced by a company has been produced sustainably somewhere. It is not important that exactly that production ends up in specific pots of margarine.

It is up to you to choose what levels of separation and identity preservation you need for your sustainable sourcing needs. You have the following options:

  1. To require separation of certified and non-certified agricultural raw materials and to know exactly where these are coming from (full IP);
  2. To require separation of certified and non-certified raw materials, but allow the supplier to mix these coming from different certified sources;
  3. To accept a mix of certified and non-certified agricultural raw materials, but control the percentage of each that is physically present in the volume which you source;
  4. To accept a mix of certified and non-certified raw materials in a certain overall percentage, but without knowing the exact percentage that is physically present in the volume sourced;
  5. To buy sustainability certificates for all or a part of your raw materials such as palm oil. Similar to the situation with ‘green electricity’, the sustainably produced raw materials will be delivered to any customer, not necessarily the customer who buys the certificates.


Example 12. Roundtable on Sustainable Palm Oil (RSPO) - Supply Chain Systems

In addition to Identity Preserved palm oil The Roundtable on Sustainable Palm Oil (RSPO) supports, three alternative supply chain options: 1) segregated, 2) mass balance and 3) book and claim. RSPO has formulated the following requirements for these three options:

  • 1) Segregated
    The Segregation approach requires that the RSPO certified palm oil from estates/plantations is kept separate from material from non-RSPO certified estates/plantations at every stage of production, processing, refining and manufacturing throughout the supply chain.
  • 2) Mass Balance
    The basis of the supply chain requirements for mass balance will consist of reconciliation between quantity of RSPO material bought and the quantity of CSPO material sold. This includes control of purchases and sales of RSPO certified palm oil and its derivatives which will be independently verified. There will be no requirements for separate storing or controls in the production process.
  • 3) Book and Claim
    Volume credits can only be introduced into the system by RSPO certified mills and their supply base up to the annual output of the certification unit. Volume credits are traded electronically directly to end users. These requirements are designed to ensure that all palm oil and/or its derivatives that are claimed to be sustainable under this supply chain model are indeed covered by sustainable certificates.

Source: RSPO Supply Chain Certification Systems, November 2009, approved by RSPO Executive Board, 5 November 2009.


Chain of Custody (CoC) certification may be necessary to secure the origin of a particular raw material, especially for options b, c and d mentioned above. It is not needed in case of complete separation (option a) or in case of certificate trade (option e). CoC certification, however, can be complex, difficult to implement and expensive. Costs and benefits should be carefully analysed before deciding for CoC certification. Here are some questions to ask:

  1. Do you really need to know the origin of the raw materials used?
    The answer partly depends on the sustainability issues and risks related to that particular material. It also depends on other parameters such as quality, health and safety. For markets with extremely high food safety standards, such as baby foods, IP is often preferred.
  2. Should you completely exclude non-certified sources?
    This may be the case if the use of even minor fractions of non-certified sources can severely damage your company’s reputation. Otherwise, it may be feasible to opt for a mixed model (options c or d in the above list).
  3. Is it sufficient to buy ‘green certificates’?
    If your company’s main goal is to contribute to sustainable agriculture, this is by far the most cost-effective option. But be aware that green certificates do not protect you against reputation risks linked to agricultural practices used to produce non-certified raw materials.
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