September 2018

Ethnographies of the global value chain of certified tea (SUSTEIN)

By Hannah Elliott, Martin Skrydstrup and Matthew Archer.

Why SUSTEIN?

Currently, the world’s tea industry is on a race with time to source tea sustainably before 2020. But what is “sustainable tea” and how do we know if tea is sustainable or not? This project entitled SUSTEIN (SUStainable TEa INfrastructure) will focus on this question by way of looking at localized translations of transnational sustainability standards in Kenya, United Arab Emirates and corporate headquarters in Europe. We aim to advance our understanding of the global value chain of certified tea.

3 Research lines

The theoretical objective is to venture beyond the notion of global value chain by reinterpreting sustainable supply chain management through the concept of infrastructure, a notion anthropologists and other social scientists have deployed in recent years to emphasize the political and temporal aspects of networks such as transnational supply chains. We hope that this concept will allow us to better comprehend how sustainable certification schemes manifest in global value chains.
SUSTEIN consists of three sub projects, which each address a core question posed by the project:

How does certification shape agrarian production in the form of cultivation and factory processing, and vice versa? Who benefits from which sustainability standards? (Line A)
How does certification influence the valuation of tea, assessed in terms of taste, grade and price? How is the value of certification performed and capitalized? (Line B)
How do corporate professionals and independent auditors distinguish between “sustainable/unsustainable”? What lines of evidence are recognized? (Line C)

Each of these questions will be answered by the corresponding research line:

tea plantation — Tea plantage in Kericho; one of SUSTEIN’s field sites.

Research line A

explores agrarian questions, enquiring into the ways contemporary drives towards sustainability shape and are shaped by modes of tea production in Kenya. The research focuses on the institution of the tea plantation and its associated factories and outgrower farms, all key components of the infrastructure of sustainable tea. The tea plantation has been described as having a “dual character” (Besky 2008: 1); it has its roots in British colonialism while being contemporarily positioned in international markets for certified sustainable commodities. This research line enquires into what ‘sustainability’ comes to mean and materialise within this apparently contradictory setting. How do contemporary measures seeking to ensure sustainable tea production, such as certified standards, affect the way tea is produced in the context of the plantation? And to what extent do longer-standing modes of plantation production endure through the present, in turn shaping contemporary sustainability ideologies and practices? The research line addresses these questions through ethnographic inquiry. The researcher will spend time with the people working on tea plantations and in factories certified by different certification bodies and on the farms of outgrowers contracted to supply the companies owning plantations with supplementary sustainable tea. Through interviews and participant observation, the ethnographer will enquire into the social, political and ethical worlds surrounding sustainable tea production in contemporary Kenya.

Research line B

will follow through on the plantation and factory sites to the auction sites in Mombasa and Dubai. Ethnographic fieldwork will be conducted in the Jebel Ali Free Zone in Dubai with no tax regulations, no strict labor laws nor import/export duties, making it the perfect infrastructural hub to blend and pack tea according to corporate logic. Likely as an outcome of this, the Dubai Tea Trading Centre has since its establishment in 2005 risen to re-export 60% of the world’s tea production. These volumes are predominantly traded on virtual platforms.
In contrast, the Mombasa Tea Auction holds two weekly auctions under the auspices of the East African Tea Trade Association (EATTA), which conforms to national regulations (Tea Act of Kenya & Tea Board of Kenya). Recently, this auction site voted “against the mouse and for the hammer,” maintaining the tradition of the Dutch auction style vs. virtual trading. The ethnography for this research line will move between these two sites, following tea blenders who purchase in Mombasa vs. Dubai and investigating tea expertise and technologies as it pertains to the valuation of certified tea.

Research line C

builds on these ethnographies of production and exchange to try and understand the relationship between corporations and standards/certification regimes. There is a tension between these groups of actors whereby standards organizations such as the Rainforest Alliance and Fairtrade International need to appear independent in order for their certifications to remain credible while at the same time remaining sensitive to the financial obligations of for-profit corporations in order to promote “buy-in.”
This research line will draw on interviews with people working in these organizations and participant observation at sites where they interact, including industry conferences and trade fairs. These are the sites where sustainability is negotiated as both a concept and as a set of practices. With that in mind, interview questions will focus on, among other things, the extent to which specific agricultural and trading practices are integrated into broader definitions of sustainability and their manifestation in different certification regimes, the challenges of maintaining a critical distance between certifiers and corporations, and the way standards govern markets and, crucially, vice versa.

The grant

SUSTEIN is made possible by the Sapere Aude Starting Grant (meaning “dare to know”), awarded by the Danish Council for Independent Research (DFF). The Sapere Aude program “is aimed at younger, very talented researchers, who at the time of the application deadline and within the last eight years have obtained their PhD”. The Sapere Aude program targets “top researchers who intend to gather a group of researchers, in order to carry out a research project at a high, international level.”

Reference

Besky, S. (2008) ‘Can a plantation be fair? Paradoxes and possibilities in Fair Trade Darjeeling tea certification’. Anthropology of Work, XXIX: 1, pp. 1-9.

Hannah Elliott is a post-doc in the Department of Management, Society, and Communication at Copenhagen Business School, having recently finished her PhD at the University of Copenhagen. She is responsible for research line A.

Martin Skrydstrup is an associate professor in the Department of Management, Society, and Communication at Copenhagen Business School and is the principal investigator of SUSTEIN. He is also responsible for research line B.

Matthew Archer is an assistant professor in the Department of Management, Society, and Communication at Copenhagen Business School and is responsible for research line C. He recently completed his PhD in environmental studies at Yale University and is interested in corporate sustainability and sustainable finance.

Closing remarks

In a year we hope to update BOS readers about how far we are with answering our research questions. In the meantime, we invite you to swing by our offices at Dalgas Have for a cup of tea.
The SUSTEIN project runs from 1 July 2018 to 30 June 2020.
For further information about the project, please contact the principal investigator, Martin Skrydstrup, at msk.msc@cbs.dk.

By Oliver Laasch.

An ApPeaRange!

Business models are logics of value proposition (Pr), creation (Cr), exchange (Ex) and capture (Ca). When closely looking at sustainability business models, it becomes clear that these ‘value functions’ are not only shaped by a commercial logic, but also by one of sustainability. Many of sustainability business models include further logics of social welfare (e.g. social enterprises), and government (e.g. private-public partnerships) (Laasch, 2018b). If a homogeneous commercial business model was an orange, these business models are more like a heterogeneous mixture between an apple, a pear and that orange, an ApPeaRange! Their value logics are not homogeneously commercial, but heterogeneous mixtures.

Strange Fruit Everywhere

Heterogeneous value logics like the one of sustainability business models are widespread. Imagine you peel an orange and find an apple inside:

Over half of the FTSE100 corporations have integrated a responsibility logic into their business model descriptions (Laasch & Pinkse, 2018). Many large businesses, such as LEGO, as well as SMEs are family-run, integrating their commercial logic with a family logic (Laasch & Conaway, 2015). We may also think of the Chinese semi-conductor producer Goodark blending commercial logic with a spiritual logic of Confucianism; the German car supplier Allsafe with its humanistic logic of freedom and responsibility; or the Brownie bakery Greyston with its commercial value logic firmly wrapped around a social welfare logic (Laasch et al., 2018). Once opening our eyes to the variety of ‘values’, of normative orientations and purposes businesses are oriented towards (Randles & Laasch, 2016), the perceived number of companies adhering to a purely commercial value logic shrinks considerably. While the purely commercial business model might not be entirely dead, it sure shouldn’t be considered the norm. And then there are entirely non-commercial organizations with value logics.

Comparing APPLE and Oranges: Yes!

Isn’t comparing a commercial organization, for instance, Apple and noncommercial organizations, let’s say a church, like comparing Apple and oranges? Yes, cheap pun intended:

“…a commercial business like Apple. With a customer value proposition (Pr) of high quality and high-end design, it depends on highest-standard production processes (Cr) and on the ability to maintain high margins (Ca).”
Laasch, 2018b: 165.

It appears we have found a purely commercial value logic, one that deserves the name BUSINESS model. Can we analyze a non-business organization, for instance a church, the same way?

“…shaped by an institutional logic of religion. It may pursue a value proposition of spiritual salvation (Pr), by helping believers to live according to religious values through the provision of religious services from marriages and funerals to humanitarian aid (Cr), and exchange value in a global network of churches (Ex).”
Laasch, 2018b: 165.

It appears non-business organizations, while not having a BUSINESS model per se, do have an organizational value model of value proposition, creation, exchange and capture. Freeing the organizational value logic from its commercial business origins enables us to take a fresh look at any kind of organization: Churches, universities, NGOs, governments, your favorite sports club, you name it! Organizational value logics lend themselves to study, design, and improve all kinds of organizations.

How to Farm Strange Fruits?

It has been argued that one of the main challenges of our times is to create companies and other organizations shaped by alternative logics, be it the one of sustainability, or of social welfare. We have seen that many organizations already have heterogeneous value logics. How to change the ones that don’t? Three interrelated manifestations of organizational value logics together form an organizational value model:

Cognition: An organizational value logic manifests in organizational members’ cognitive structures, their mental models and related decision making.
Activities: Value logics manifest in the logic of action of the activity systems through which an organization’s value model is enacted.
Artefacts: Value logics materialize in physical form, as texts, or images, such as a business model description in the annual report, factory layouts, or products.

Changing an organization’s value logic can start in any of its manifestations. For instance, as a corporate responsibility strategy circulated through a multinational retailer, the document’s responsibility logic was translated into peoples’ mental models, new activities and structures (Laasch, 2016, 2018a). In the companies Goodark, Allsafe, and Greyston mentioned above, new practices centered on a humanistic value logic (Laasch et al., 2018; Laasch, Dierksmeier, & Pirson, 2015) changed the networks of practices’ enacting their business models (Boons, Laasch, & Dierksmeier, 2018; Laasch et al., 2015). The emerging field of business model sociology provides further insight into such change processes (Laasch, 2018c).

Oliver Laasch is an Assistant Professor of Strategy at the University of Nottingham Ningbo China, founder of the Centre for Responsible Management Education and a visiting professor at the University of Tübingen’s Global Ethic Institute. Currently, he is a part of Copenhagen Business School’s Governing Responsible Business (GRB) World Class Research Environment Fellowship program.

References and Materials

If you enjoy strange fruits, have a look at the ‘apples and oranges’ audioslides with a more ‘academic’ presentation.

Boons, F., Laasch, O., & Dierksmeier, C. 2018. Assembling organizational practices: The evolving humanistic business model of Allsafe, 6th Asian SME Conference. Tokyo.
Laasch, O. 2016. Business model change through embedding corporate responsibility-sustainability? Logics, devices, actor networks. University of Manchester, Manchester.
Laasch, O. 2018a. An actor-network perspective on business models: How ‘Being Responsible’ led to incremental, but pervasive change. Long Range Planning, [DOI 10.16/j.lrp.2018.04.002].
Laasch, O. 2018b. Beyond the purely commercial business model: Organizational value logics and the heterogeneity of sustainability business models. Long Range Planning, 51(1): 158-183.
Laasch, O. 2018c. Business model sociology: Exploring alternative lenses (not only) for the study of alternative business models. CRME Working Papers, 4(4).
Laasch, O., & Conaway, R. 2015. Principles of responsible management: Glocal sustainability, responsibility, ethics. Mason: Cengage.
Laasch, O., Dierksmeier, C., Livne-Tarandach, R., Pirson, M., Fu, P., & Qu, Q. 2018. Humanistic management performativity ‘in the wild’: The role of performative bundles of practices, 32nd Annual Australian & New Zealand Academy of Management (ANZAM) Conference. Auckland.
Laasch, O., Dierksmeier, C., & Pirson, M. 2015. Reality proves possibility: Developing humanistic business models from paradigmatic practice. Paper presented at the Academy of Management Annual Convention, Vancouver.
Laasch, O., & Pinkse, J. 2018. How the leopards got their spots: A typology of corporate responsibility business models, 3rd Annual Conference on New Business Models. Sofia.
Randles, S., & Laasch, O. 2016. Theorising the normative business model (NBM). Organization & Environment, 29(1): 53-73.

Month: September 2018

Sustainability’s Infrastructure