Stewards Case Study

Working Outside of Government Regulation to Protect Human Health and the Environment

Introduction

The rare earth elements have become crucial to technologies that define our contemporary world. While consumers most commonly encounter the rare earths in electronic devices such as smartphones, manufacturers also use rare earth metals for military applications, pollution control, and specialized medical applications. The rare earths are an essential part of technologies that reduce climate change, such as offshore wind turbines and electric vehicles.

The locations where rare earth elements are produced changed repeatedly throughout the 1900s and early 2000s. This variation suggests that production is not determined primarily by the geographic location of rare earth ores. Instead, the location of mines and separation plants is driven by a combination of market prices, government policies, and the actions of producers and manufacturers. As a result where and how rare earth elements are produced could change in the future.

The production and international trade in many kinds of consumer goods have grown massively since World War II ended in 1945. This growth has improved the standard of living for many people around the world. But it has also led to pollution, the destruction of natural areas, the exploitation of workers, and dangerous working conditions for many people, especially those in poorer countries.

Environmental and social activists have tried various strategies to lessen these negative impacts. One strategy consists of pressuring political leaders to pass local and national laws to protect the safety of workers and reduce harm to the environment. However, multinational companies can often move production to other countries with lower labor costs, fewer protections for workers, and weaker environmental regulation, where governments may have little concern for the welfare of particular groups of their citizens.

When passing protective laws is not an option, harnessing the economic power of consumers can be an alternate approach. Environmental and social activists have tried to reshape consumer buying habits to pressure producers and manufacturers to make goods in ways that are less environmentally harmful and better for workers. Scholars call this “political consumption,” or using decisions to buy or avoid products to express political and ethical positions and advocate for change.

Political Consumption

Consumers are ethically implicated in how products are made because they provide the money that keeps production going while also benefiting from the products they buy. But individual consumers do not always understand the connection between consumption and politics. Activist groups advocating for change have often played a powerful role in showing consumers how their purchases affect the world.

During the second half of the 1900s many groups found ways to use political consumption to support social and political change. During the late 1960s the United Farm Workers, led by Cesar Chavez and Dolores Huerta, used a consumer boycott of California grapes to secure better pay and safer working conditions for the largely Hispanic and Filipino workers who picked fruit. In the later 1970s activists organized a boycott of the multinational food manufacturer Nestlé to protest its aggressive marketing of baby formula sales to mothers in impoverished countries. According to activists some mothers, not understanding that overdilution was an issue, mixed in extra water to make enough formula for two children instead of one, leading to infant deaths through malnutrition. During the 1980s South African human rights activists and their international allies called on the world to boycott and divest from (stop investing in) companies that did business with the government of South Africa, which enforced the racist “apartheid” laws that oppressed its black citizens.

Environmental activists adopted similar tactics to address environmental problems around the world. One example is the creation of the “Dolphin Safe” label and new regulations for tuna products. Beginning in the 1950s fish harvesters off the coasts of Central and South America followed pods of dolphins to find commercially valuable tuna. Millions of dolphins drowned in tuna nets. During the 1980s environmental activist groups, including the Earth Island Institute, began publicizing this practice, using videos of dolphins struggling against nets to galvanize public opinion in the United States. International agreements about fishing gave the U.S. Department of Commerce a degree of regulatory authority over tuna caught for sale in the United States. Consumer boycotts led well-known commercial brands to work with activists and the U.S. Department of Commerce to develop a solution. Fish harvesters were required to use nets that had “escape hatches” for dolphins. By 1990 consumers could look for a new label to know the tuna fish in a particular can was caught in “Dolphin Safe” ways.

Climate-change activists returned to the tactic of financial divestment during the latter half of the 2010s. Organizations such as 350.org argued that it was immoral to support companies that were destabilizing the climate. They initially sought to persuade religious organizations and universities to sell off (divest) their stock-market shares in all fossil fuel–based companies. By 2019 fossil-fuel divestment had spread, and more than $11 trillion globally was being managed by organizations committed to divesting from fossil fuels, including many public pension programs and philanthropic foundations.

Activists also applied the tools of political consumption to mineral products. During the late 1990s the sale of diamonds mined in parts of central and southern Africa funded civil wars and insurgencies that killed millions of people. Human rights groups such as Global Witness described these gems as “blood diamonds” and educated western consumers about their purchase, explaining how buying an engagement ring could contribute to deaths on the other side of the planet. Concern about blood diamonds and similar “conflict minerals” helped develop alternative sources in countries such as Canada. The bad publicity and threat to sales also compelled De Beers, the dominant firm in diamond production at the time, to change its purchasing practices. The Kimberly Process Certification Scheme, which came into effect in 2003 with the assistance of the United Nations, established a process to track the sale of rough diamonds, with governments certifying that sales would not support a rebellion.

As these examples show, political consumption can be targeted toward individual companies, particular commodities, entire industries, or products identified with a particular nation. It can be used to pressure specific corporations or entire industries to change their practices.

Commodity Certification Systems

Another strategy used by activists is to create systems for certifying that a product has been made in ethically or environmentally responsible ways. To get certification, producers agree to follow a set of standards in making their products. Consumers look for special labels on products and choose to buy (and often pay more for) products that have been certified to meet ethical or sustainable production standards. Among the most familiar of these certifications for American consumers is the “fair trade” certification for coffee and chocolate.

We can learn more about the promise and problems of product certifications for environmental sustainability by looking closely at the history of the Forest Stewardship Council, a certification program for wood and paper products.

In 1993 the World Wildlife Fund (WWF) recognized that international agreements and national-level policies were not doing enough to protect the world’s tropical forests, including the plants, animals, and people who lived in them. The WWF convened a council of “stakeholders”—including companies that made products from wood, advocates for environmental conservation, and representatives of indigenous peoples affected by forestry—to establish standards for sustainable practices for harvesting wood and producing paper products. The new Forest Stewardship Council (FSC) adopted a set of 10 principles (see below) backed up by a set of technical standards that described in detail how forest products could be extracted in sustainable and socially fair ways. Certified products would assure consumers that their wood products have been tracked throughout the production process and are guaranteed to come from responsibly managed forests and monitored by independent auditors.

The program has produced notable successes. The FSC logo—a green checkmark and a tree—has become a widespread icon on such consumer-facing products as toilet tissue, printer paper, and cardboard packaging. Tropical forest timber certified by the FSC sells for 15% to 25% higher prices at wholesale auctions. By 2017 about 489 million acres of forests across 84 countries were being managed according to FSC standards.

The program also has significant problems. While the system was designed specifically to protect tropical forests, only about 16% of the forest area managed according to FSC standards is in the tropics, while 83% is in Europe and North America. Ecologically valuable forests are sometimes clear-cut by companies that hold FSC certifications, and the FSC has been slow to cut ties with companies caught selling illegally harvested wood. Greenpeace, one of the world’s most prominent environmental advocacy organizations, was a founding member of the FSC. It withdrew in March 2018 after repeatedly reporting on various ways that certification has not adequately protected forests and ensured that human rights were respected.

Conclusion

Internationally traded commodities pose special challenges for people trying to improve the environmental and social impacts of production. Local and national laws have often not been adequate to protect workers and the environment. Activist groups have developed market-oriented solutions that use the power of consumers to support more ethical production processes. One example of political consumption is the sustainability certification system. Unlike government regulations, certification systems do not have the force of law. They depend on the willingness of producers and manufacturers to participate. They are products of negotiation and agreement, with each side having its own reasons to agree to participate. While not perfect solutions, these systems offer a way forward when agreements between national governments are unlikely to improve conditions on the ground.