This presentation explores the externally-led vertical differentiation of third-party certification standards using the case of the Marine Stewardship Council (MSC). We analyse this process in two dimensions. First, ‘MSC-plus’ fisheries employ strategies to capture further market value from fishing practices that go beyond their initial conditions for certification and seeking additional recognition for these activities from international NGOs. Second, ‘MSC-minus’ fisheries, not yet able to meet the requirements of MSC standards, are being enrolled in NGO and private sector sponsored Fisheries Improvement Projects (FIPs), providing an alternative route to global markets. In both cases the credibility and authority of the MSC is challenged by new coalitions of market actors opening up new options for capturing market value and/or improving the conditions of international market access. Using a global value chain (GVC) framework, the results offer new insights on how such standards not only influence trade and markets, but are also starting to change their internal structure and governance in response to threats to their credibility by actors and modes of coordination in global value chains. Based on: http://dx.doi.org/10.1016/j.marpol.2012.05.011

1. Vertically differentiating environmental
standards
The case of the Marine Stewardship Council
Simon Bush and Peter Oosterveer

2. Standard differentiation
Ongoing research based on:
Bush, S. R., Toonen, H., Oosterveer, P., & Mol, A. P.
(2013). The ‘devils triangle’of MSC certification:
Balancing credibility, accessibility and continuous
improvement. Marine Policy, 37, 288-293.
http://dx.doi.org/10.1016/j.marpol.2012.05.011

3. Standard differentiation
 Horizontal differentiation
‘Race to the bottom’ vs.‘ratcheting-up’
 ‘Internal’ vertical differentiation
Technical focus on tiers and certification ‘pull’
 External vertical differentiation?
● How does this occur?
● What implications does this phenomenon hold for
the credibility of environmental standards?

4. The rise of the MSC
 Status grown with rise in
consumer awareness and NGO
pressure on retailers
 Enormous (recent) growth
● 179 fisheries certified
● 12% of global stocks, up
from 1% in 2001
● 10,000 products in 70
countries
 Now seen as the ‘gold standard’
in fisheries certification

5. Demonstrating improvement
Cambridge et al 2011
 35% already comply with
standards
 65% of fisheries (i.e. with
greatest room for
improvement) don’t make
it to full assessment
 Only 7% of MSC certified
fisheries from developing
countries

6. Externally-led vertical differentiation
Fisheries
Improvement
Projects
MSC‐minus MSC‐plus
+
International
Bush et al 2013; Toonen and Mol 2013

7. Credibility
Accessibility Continual
improvement
MSC‐minus MSC‐plus
MSC
Untenable?
‘Devils
triangle’
Potential internal response
60
40
80
100
110?
Internal
tiered
approach

8. Looking beyond the triangle
How did this challenge to the MSC came about
and what implications does it have for the wider
credibility of sustainability standards?

9. Looking beyond the triangle
 Global value chain analysis
● Standards as a horizontal form of coordination
where practices are realigned to mirror or
materialise norms
● Focus on why certain qualities emerge, how they
gain traction, how they influence vertical
coordination, and ultimately firm upgrading
● But is the same in reverse?
How does vertical coordination and strategic
behaviour of firms influence definition of value
claims around quality standards?

10. Coordination and upgrading in GVCs
 Cases reflect structural limitations of standards in regulating
value chains – price premiums (MSC+) and access (MSC-)
 Changing power and modes of coordination in the chain:
● Shift from niche to mainstream markets change interests of
retailers (require volume)
● Horizontal links to NGOs become strategic for upgrading
● ‘Passive standard takers’ to active standard makers
 Networks being built that circumvent limitations being
posed by the standard – MSC is being challenged by
networks it created

11. Conclusions (so far)
 MSC success to date illustrates possible reconciliation of civic
and market conventions and maintaining credibility/authority
in GVCs
 But reconciliation is dynamic and on-going; defined by the
vertical and horizontal coordination in value chains and
strategic behaviour of firms
 An internal technical focus on tiers and thresholds are an
internal strategy but won’t address long term challenges to
MSC credibility