Deforestation, Certification, and Transnational Supply Chains: A Study of the Palm Oil Sector

Abstract

Commodity production increasingly drives environmental change and degradation. But globalization geographically separates production from consumption, making it difficult to assess who is driving these impacts. Although the literature has established general flows connecting land-use change in one region to consumption in another, we lack the methodological approaches necessary to connect specific actors (e.g., domestic and international corporations, state-owned enterprises, and traders), to their impacts. Unraveling often complex and opaque supply chains presents a distinct challenge. At the same time, voluntary certification schemes have emerged as primary mechanisms for advancing supply chain transparency and improving commodity production practices. However, there are gaps in our understanding of how certification influences supply chain structure and governance. This dissertation contributes to theory, methods, and practice by addressing these gaps through three mixed-methods studies on deforestation, certification, and transnational commodity supply chains. Chapter 1 introduces the work. Chapter 2 focuses on uncovering the supply chains of three transnational food conglomerates that link environmental impacts associated with palm oil production in Guatemala to consumption nodes in the U.S. It also assesses the performance of Roundtable on Sustainable Palm Oil (RSPO) certification in insulating these supply chains from deforestation risks. Results reveal supply chain connections to plantations that drove over 24,500 hectares of forest loss (2009-2019). Reliance on RSPO-certification does not insulate palm oil supply chains from risks associated with deforestation, at least in the context of palm oil sourced from Guatemala. Chapter 3 extends this work on supply chain reconstruction but narrows the focus to the “first-mile” problem, i.e., the challenge of identifying supply chain origins. Through 14 propositions, the chapter outlines how variations in supply chain input-output structure, territoriality and temporality, and governance contribute to the problem. This chapter details how they unfold in practice across four divergent sectors (agriculture, fishing, timber, and mining). Emerging technologies provide a means, and legislation an impetus, for overcoming the challenge as various stakeholders assume their necessary roles for realizing equitable and just first-mile traceability. Chapter 4 revisits Guatemalan palm oil supply chains to explore the extent to which certification standards contribute to differences in the embeddedness, i.e., durability and stability, of trade relationships. A novel network analysis metric is used to quantitatively compare the embeddedness of RSPO-certified and non-certified supply chain actors across time. Results indicate that certification indeed fosters more embedded trade relationships between actors. This dissertation contributes to the research and practice of environmental supply chain governance in the palm oil sector and beyond as it generates rigorous spatiotemporal evidence of forest loss, captures supply chains from end-to-end, and discerns how certification-based governance influences both environmental outcomes and trade relationships. Although the empirical components of this research largely focus on palm oil supply chains originating in Guatemala, the findings are generalizable to other commodity supply chains. This work should be of broad interest to scholars working on the structural, geographical, and governance configurations of supply chains, as well as their impacts across time and space.