**Part 4: Political and Societal Challenges**

### **Agricultural Policy for Biodiversity: Facilitators and Barriers for Transformation**

**Sebastian Lakner, Christian Schleyer, Jenny Schmidt and Yves Zinngrebe**

#### **1. Introduction**

The Common Agricultural Policy (CAP) is one of the largest agricultural policy systems worldwide (Pe'er et al. 2019), with a financial allocation of EUR 58.4 billion in 2019 (EC 2019) and a Producer Support Estimate of roughly EUR 90 billion, outpacing other major agricultural policies (e.g., in the USA (EUR 36 billion) or Japan (EUR 43 billion)) (OECD 2018) in absolute terms. The CAP objectives, first mentioned in the Treaty of Rome of 1957, focused on the increase in productivity, support of farm incomes, and market stability. However, with increasing awareness of environmental challenges and global commitments on biodiversity, climate change as well as desertification at the Earth Summit in Rio de Janeiro in 1992, environmental concerns have increasingly entered the CAP agenda. As the CAP has been reformed every five to seven years, it is reasonable to ask the extent to which reforms have resulted in a coherent policy producing effective and cost-effective outcomes.

This chapter looks at the advances towards this target using the frame of an idealized circular reform process (Figure 1), based on a policy action cycle (Parsons 1995; Zinngrebe 2016). By conducting a formalized evaluation prior to every CAP reform, it might be assumed that experience and a growing body of scientific and local knowledge lead to learning processes in the governance regime (Pahl-Wostl 2009).<sup>1</sup>

Sections 2–5 show and assess issues related to the dimensions of the policy cycle. One of the main questions of this chapter is to elaborate on the past and current status of the CAP and to indicate if the upcoming post-2020 CAP reform will be able to keep up with the challenges for the agricultural sector described in Section 2. In Section 3, we introduce the main CAP instruments supporting biodiversity objectives and give a brief overview on their performance in Section 4, focusing on the case of Germany.

<sup>1</sup> Note that there is already an established evaluation process for the Rural Development Programs (RDP) in Pillar II, put in place since their inception in the Agenda 2000. While having the potential to substantially inform CAP reform at least in this area, the evaluation process itself and the limited uptake of its results have been critically discussed (Dwyer et al. 2008; Poláková et al. 2011).

We focus on policies, instruments, and measures, which aim to halt the biodiversity decline. In Section 6, we draw some conclusions and provide an outlook.

**Figure 1.** Policy cycle of the EU Common Agricultural Policy. Source: own presentation.

#### **2. Agenda Setting: Formulation of the Policy Problem**

Agenda setting for reforming the CAP is determined by a range of aspects, including environmental challenges relevant for and/or caused by agriculture and the uptake of both scientific knowledge and stakeholder and other societal preferences. As a result, targets set by the reformed CAP reflect these insights and, in particular, take into account relevant Sustainable Development Goals (SDG).

#### *2.1. Environmental Challenges*

The agricultural sector in Europe is facing a number of environmental challenges, which are already influencing farming practices and agricultural policies; and which will continue to influence the sectoral development and the political transformation of agriculture over the years to come. Most relevant challenges include the decline in farm biodiversity, climate change, and ground and surface water pollution with nitrates and pesticides. This is even more important since agricultural areas account for over 43% of Europe's total area (Eurostat 2020), thus affecting the remaining semi-natural and natural habitats.

Farm biodiversity in Europe and worldwide has been declining for decades (IPBES 2018). This has been illustrated recently in a study on Western Germany (Hallmann et al. 2017). Another study showed that arthropod species richness

declined by 34% over the last ten years, and their biomass and numbers declined by 67% and 78%, respectively (Seibold et al. 2019). Furthermore, a report of the Intergovernmental Science-Policy Platform for Biodiversity and Ecosystem Services (IPBES) pointed to land-use change as the most important driver for the decline in terrestrial and freshwater biodiversity worldwide (Díaz et al. 2019). Reports by the German National Academy of Sciences Leopoldina (Leopoldina 2018) and the German Advisory Council on the Environment (SRU and WBBGR 2018) have pointed to the urgent need to react to the decline. On a global scale, Beckmann et al. (2019) have shown that farm intensification is one of the major drivers of biodiversity decline.

The challenges for agriculture posed by climate change are twofold:

First, farms have to adapt to a changing climate. In 2018, for example, a long period of dry weather led to substantial losses in harvests: the yield for wheat declined by 16%, and for rapeseed (25%) and potatoes (26%) the declines were even larger (own calculations). Thus, the issue of adaptation to climate change already plays a major role for farms.

Second, the agricultural sector is a significant contributor to greenhouse gas (GHG) emissions. In Germany, roughly 12% of GHG emissions originate from agriculture and land-use change (UBA 2019). Consequently, the Intergovernmental Panel on Climate Change (IPCC) has pointed out the crucial role of land-use policies (Shukla et al. 2019). Here, the potential of restoring former wet grassland and peatlands and less-intensive forms of land use has been emphasized as being able to substantially reduce GHG emissions from agriculture in Germany (WBAE and WBFP 2016). On a global level, drained peatland takes a share of 1% of agricultural land, changing from a C-sink into a substantial source of GHG (Leifeld and Menichetti 2018). Rewetting peatlands, which have a share of 7% of the agricultural land in Germany, might reduce agricultural GHG emission by 37%. Yet, the implementation of such GHG-reducing strategies may impose high on-farm costs which could, however, be covered by agricultural policies (GMC 2019).

#### *2.2. Scientific Input and Stakeholder Opinions Informing the Reform Process*

In comparison to previous CAP reforms, the post-2020 CAP reform process is perceived to be more inclusive with respect to incorporating inputs from the public and evaluating the current CAP (2014–2020), yet still lacking sufficient structure and transparency. Key issues relate to the sequential order of reform elements in the preparation of the CAP proposal, and an unclear or even biased process in taking and processing inputs.

An in-depth evaluation of the current CAP period—the so-called 'fitness check'—has only been conducted many months after the first post-2020 CAP proposal had been published (June 2018) and negotiated in the Council and the EU Parliament (Pe'er et al. 2019). In turn, the new budget in the Multiannual Financial Framework (MFF) 2021–2027 was proposed in May 2018, prior to the publication of the CAP proposal, and thus, as in previous reforms, predetermined the process in advance by fixing, for example, the financial distribution between both pillars and options for potential improvements.

The process of public engagement for reforming the CAP included a public consultation, workshops and a stakeholder conference, and an Impact Assessment (IA). The public consultation process started in early 2017 with a 12-week Online Consultation by the European Commission (EC) to obtain public opinion—in particular, from farmers, citizens, organizations, and other interested parties—on how to modernize and simplify the CAP (Pe'er et al. 2019, SM, p. 46). However, respondents (total: 322,916)<sup>2</sup> represented only a very small (less than 0.01%) and non-random subset of the EU's population (e.g., 45.6% from Germany vs. 6.7% from new Member States (MSs)) who actively chose to participate after being invited. About half of the respondents identified themselves as being associated with farming or forestry. For them, the most pressing challenge of the CAP was ensuring a 'fair standard of living for farmers' (32%). For all others respondents, 'pressures on the environment and on natural resources' were perceived as most important challenge (ECORYS 2017). However, there are methodological concerns (e.g., biased, closed-ended questions often left unanswered) and the raw results have not been made available.

In preparation for the reform, the European Commission (EC) organized a series of workshops as well as a Stakeholder Conference in July 2017. However, the workshops to inform the reform and to prepare the Impact Assessment were organized internally by the EC's Directorate-General for Agriculture and Rural Development (DG AGRI) and it is not clear how participants were selected. Key organizations, such as environmental NGOs and scientific organizations, were not invited to some of these workshops and the conference, while farmer organizations were over-represented. Furthermore, no minutes of the conference were made public.

<sup>2</sup> This number includes responses coming from large public campaigns. Only 63,027 responses came from individuals (ECORYS 2017).

As in previous CAP reforms, the EC conducted an Impact Assessment. However, the underlying processes were neither transparent nor inclusive. For example, relevant and important research work, such as the 'fitness check' outcomes of a comprehensive independent literature review (Pe'er et al. 2017b), were largely ignored and the results of the EU Joint Research Centre's (JRC) modelling that were used were not made public. Altogether, it is unclear how different sources of evidence, and types of contribution, were used to develop the proposed post-2020 CAP.

#### *2.3. Reforming CAP Targets vs. Maintaining 'Old' CAP Structure*

The original objectives of the CAP formulated in the Treaty of Rome 1957 and repeated in Article 39 of the Treaty of Lisbon 2009—increasing agricultural productivity, ensuring a fair standard of living for the agricultural community, stabilizing markets, assuring the availability of supplies, and ensuring that supplies reach consumers at reasonable prices—are largely insufficient and poorly reflect current European challenges with respect to climate change, nature conservation, and other sustainability issues (Pe'er et al. 2019). Others have already been fulfilled, such as ensuring food security at the European level. Thus, rather than stimulating higher agricultural productivity, the current challenge is to balance productivity with other objectives (Tangermann 2011). On the other hand, uneven distribution of Direct Payments (DPs) among farm size classes as well as among MSs suggests that the CAP instruments in general, and DPs in particular, have failed to reduce disparities and achieve a fair standard of living, and are inefficient in meeting farmers' needs (Deppermann et al. 2016). The chosen instruments do not sufficiently contribute to the targets. Conversely, environmental issues, rural vitality, and inequalities among EU regions are not listed in the original objectives.

During the reform process, sustainability narratives became more prominent; however, whenever it came to budget decisions, 'productivistic' and neo-liberal narratives were rather decisive (Erjavec and Erjavec 2015). The CAP reforms seem to follow a predetermined path, which conflicts with the majority of public inputs, compelling evidence, and published responses on the initial CAP proposal. For example, the 2017 Public Consultation indicates that both farmers and the public perceive the environment-related components of the Rural Development Programmes (RDPs) for public goods as the best instrument to address current challenges (Figure 2), whereas, in the proposed post-2020 CAP, most funding still goes to DPs.

Furthermore, the CAP has little focus on most of the 12 Sustainable Development Goals (SDGs)—ratified by the EC in 2015—relevant for agriculture, including SDG 2 Zero Hunger, SDG 15 Life on Land, SDG 6 Clean Water and Sanitation, SDG 8 Decent Work and Economic Growth, and SDG 10 Reduced Inequalities (Pe'er et al. 2017b, 2019; Scown et al. 2020). So far, the CAP only substantially contributes to SDG 2 Zero Hunger and SDG 1 No Poverty, in particular through both DPs and RDP payments (ibid.). Yet, both SDGs are not key (anymore) in a European context. Some positive local impacts of some of the environment-targeted CAP instruments such as Agri-Environmental and Climate Measures (AECMs) and Cross Compliance (CC) have been noted with respect to SDG 6 Clean Water and Sanitation and SD 15 Life on Land. However, their budget and extent are too limited to reverse overall trends of environmental degradation and biodiversity loss; and some CAP instruments, such as DPs may have even speeded up the biodiversity decline (Pe'er et al. 2017b). Other crucial agriculture-related SDGs, where various CAP instruments could play an important role, are not—or hardly—addressed, including SDG 12 Sustainable Consumption and Production and SDG 11 Sustainable Cities and Communities. At the same time, several objectives are conflicting with each other and therefore give no clear guidance on how to achieve more sustainable agriculture (Pe'er et al. 2019).

**Policy-area within the CAP**

**Figure 2.** Perceived priorities by farmers and citizens and actual Common Agricultural Policy (CAP) spending. Source: Pe'er et al. (2017b).

#### **3. Policy Output: CAP and Other Policies Relevant for Biodiversity**

Apart from instruments and measures directly related to the CAP, in particular Agri-Environmental Programs (AEPs) (today: AECM, CC, and Greening of DPs), there is a wide range of environmental policies which affect agricultural land use, farming systems, and biodiversity. These include the Birds Directive, the Habitat Directive (both building the Natura 2000-network), the Nitrates Directive, the Organic Production Regulation, and the Water Framework Directive (Table 1).


**Table 1.** A history of environmental policies relevant for agriculture in the EU.

Source: own presentation, based on Hill (2012, 190f.).

The evolution of AEPs within the CAP has its origins in the 1970s, with a substantial development after 1992 when the first AEPs were introduced. Reacting to a fundamental crisis during the 1980s and international pressures, the EU set-up a series of policy reforms, starting in 1992 with the so-called MacSharry Reform. In this and subsequent reform(s), environmental targets and measures were introduced to the CAP-framework. This includes the so-called 'accompanying measures' in 1992 with the EU Regulation 2078/1992 and 1257/1999 (Osterburg and Stratmann 2002), which were later on consolidated as AEPs in the Agenda 2000 Reform. After the Fischler Reform 2005, AEPs were financed through the European Agricultural Fund for Rural Development (EAFRD) (EU-Regulation 1698/2005).

The Agenda 2000 also introduced the two-pillar system: Pillar I includes DPs and market measures. DPs were then granted for production and are currently linked to the farmed area. Pillar II consists of the rural development policies including the AEPs, but also investment programs and rural development such as village renovation or the LEADER initiatives. Linking environmental standards to DPs via CC was introduced as principle with the Agenda 2000 and extended in the Fischler Reform 2005. As another step in this direction, compulsory Greening measures were introduced in the 2013 Reform now linking 30% of DPs to three sets of measures: crop diversification, maintenance of permanent pastures, and Ecological Focus Areas (EFAs). With the reform of 2013, the climate topic was added to the AEPs, now called Agri-Environmental and Climate Measures (AECMs).

Yet, although environmental sustainability narratives gained importance throughout the reform-path of the last 30 years, the designated financial funds remained small (Erjavec and Erjavec 2015). Though fluctuating significantly over the last twenty years, the share of AEPs within the CAP never exceeded 6% (Figure 3). In the current financial period (2014–2020), the AECM spending even slightly decreased by 8.6% compared to 2007–2013 (Pe'er et al. 2017b). Furthermore, 60% of the CAP-budget is still spent on the farm income target, yet failing to reduce disparities between and within MSs and thereby to achieve a fair standard of living (Pe'er et al. 2017b, 2019; Scown et al. 2020). Adding to this, AEPs still have the potential to be improved in terms of effectiveness and efficiency (Batáry et al. 2015).

During the 1990s, the expenditure on AECMs increased (Osterburg and Stratmann 2002), but it stagnated until 2008 due to the Eastern Enlargement of the EU and an increasingly broader scope of Pillar II. Figure 3 shows that the budget-share of AEPs has been varying between 2.3% and 6%, with the dips 2007 and 2015 being mainly due to the switch between program periods, i.e., fading out payments in the 'old' program and still only low expenditures in the 'new' scheme:

In the current CAP (2014–2020), there are three main instruments targeting environmental aspects of agricultural production, which are introduced and discussed in the following: Agri-Environmental and Climate Measures (AECMs), Cross Compliance (CC), and Greening of Direct Payments.

**Figure 3.** Amount and share of Agri-Environmental Programs in the EU 2000–2018. Source: own calculations; Data from German Federal Ministry of Food and Agriculture (BMEL 2000–2018); div. issues. Values are in Mio. EUR; Note the changing number of EU Members States 2000–2003 EU-15; 2004–2006 EU-25; 2007–2012 EU-27; 2013 ff. EU-28.

#### *3.1. Agri-Environmental and Climate Measures*

AECMs are the oldest and most developed environmental instrument within the CAP. Figure 4 displays the specific collaboration in financing and programming between the EU, the national government and, as an example, the federal states of Germany.

The AECMs are jointly financed by the EU and the MSs and formulated and implemented by the MSs or the regions/federal states as part of RDPs. The EU provides the general legal framework (EU regulation 1305/2013), and MSs design and implement the programs. In most cases, the MSs develop national RDPs and the respective AECMs; in some MSs, the regions (France, Spain, and Italy) or the federal states (Germany) are responsible for this. In Germany, the national government offers a co-funding tool (Joint Task for Improvement of Agricultural Structures and Coastal Protection—GAK), adding up to 60% of the costs of the AECMs. The system of co-funding is explained in Figure 4.


AECMs are voluntary measures (see Figure 5 for some examples), which remunerate the income forgone for environmental actions that go beyond the CC standard (Section 3.2) and the Greening requirements of Pillar II (Section 3.3). The main approach is to compensate farmers for services as either producing a positive environmental outcome or avoiding a negative externality.

There are different types of AECMs:


**Figure 5.** Examples of Agri-Environmental and Climate Measures. Source: own presentation.

The fact that MSs or even regional administrations program their own AECMs leads to a substantial heterogeneity with respect to the range and choice of measures

offered and the premium levels. This is due to (a) heterogeneous opportunity costs, (b) different budgetary capacities, (c) high administrative costs (e.g., designing schemes, monitoring, and sanctioning) for which MSs have diverging capacities (personnel, financial budget) to manage, (d) national and/or regional political priorities, and (e) the specific needs of the regional agro-ecosystem. Figure 6 shows the divergence in expenditure per hectare for AECMs across MSs.

**Figure 6.** Expenditure for Agri-Environmental and Climate Measures 2014–2020. Source: own calculations, based on EU factsheets Rural Development (EC 2016). Figures include support of organic farms and payments for Natura 2000 areas. Payments for Areas with Natural Constraints (ANC) are not included.

#### *3.2. Cross Compliance (CC)*

*Cross-Compliance (CC)*, introduced in 2000, links DPs of Pillar I with environmental objectives, regulations, and good practices for farming and animal husbandry, and food safety (BMEL 2015). The EU sets guidelines that are specified by the MSs (Juntti 2012). As DPs are usually too attractive to forgo, CC is seen as a "de-facto statutory law" (Nitsch and Osterburg 2004, p. 173). Farmers have to comply with Statutory Management Requirements (SMR), for example, avoiding agricultural practices polluting groundwater and to ensure Good Agricultural and Environmental Conditions (GAEC) of their farmed area, like preventing soil erosion and avoiding the deterioration of habitats (Juntti 2012). These standards and regulations were reinforced by CC through a standardized monitoring/control mechanism on 5%

of farms and the possibility to withhold payments if not adhered to; the amount withheld depending on the violation. This way, these standards become effective also in areas with very good *conditions* for agriculture where AEPs/AECMs are usually not applied.

The European Court of Auditors (ECA) 2008 criticized the implementation of CC as not sufficiently effective, as its objectives and the scope were not well defined, and therefore rules were not translated into controllable requirements at the farm level (ECA 2008). To help farmers comply with CC regulations, a Farm Advisory System within the MSs became mandatory in 2007 (Knuth et al. 2018).

As "[t]he use of interconnected resources results in unintended external effects" (Meyer et al. 2014, p. 187), ownership (as the right to use, manage, and gain income from) is linked to certain rights and duties that are subject to (state) authority (Meyer et al. 2014).

#### *3.3. Greening of Direct Payments*

The *Greening* of DPs was introduced in 2013 as a means to further deepen the CC standards (Meyer et al. 2014). It aims at 'enhancing the environmental performance' of agriculture by framing 30% of DPs as 'payments beneficial for climate and environment', granted only to farmers who comply with all three greening requirements (EC 2013, verbatim, recital 37).

Crop diversification requires, for farms with more than 30 ha of arable land, the cultivation of at least three different crops, of which the first crop shall not exceed 75%, and the first two crops not 95% of the arable land, respectively. For farms with 10–30 ha of arable land, a minimum of two crops is required, of which the first shall not exceed 75%. Farms with less than 10 ha of arable land, or with a high share of fodder crops on arable land, or a high share of grassland, are exempted (BMEL 2015, p. 37 ff.).

Maintenance of permanent grassland is aiming at protecting environmentally sensitive grassland (e.g., in Nature 2000 areas), which must not be converted to arable land. Conversion of permanent grassland to arable land shall not exceed 5% of the total permanent grassland in a region. Thus, conversion of permanent grassland (>5 years) has to be approved by local authorities (BMEL 2015, p. 42).

Farmers have to provide Ecological Focus Areas (EFA) on 5% of their arable land. They can choose between different EFA options, each related to weighting factors (WF) reflecting the respective ecological impacts. For example, a farmer can register 1.0 ha fallow land (WF = 1.0) equivalent to 3.3 ha of catch crops (WF = 0.3) or 0.5 ha of hedges as landscape elements (WF = 2.0) (BMEL 2015). MSs can pre-select

different EFA options, which are then nationally implemented. The choices within MSs are quite diverse; however, especially large MSs provide a broad set of EFA options, whereas small MSs are rather offering few EFA options (Table 2).


**Table 2.** Number of Ecological Focus Area (EFA)-options implemented in the different EU Member States 2015.

Source: own elaboration, based on data from EC (2015: 24) and Pe'er et al. (2017b).

The specific objective of the EFAs was outlined by the EC as to "safeguard and improve biodiversity on farms" (EC 2013, recital 44). While most EFA options are indeed listed as directly affecting biodiversity, the EC admits that catch crops and green cover only do this indirectly. However, any approaches testing the effectiveness of EFAs need to consider specifically their contribution to safeguarding and improving farm biodiversity. With respect to the effects of EFAs on a broader set of ecosystem services, however, some authors come to a more positive assessment (Hauck et al. 2014; Lakner 2018).

Organic farming systems are excluded from the obligation to comply with the Greening criteria (EC 2013). Greening is obligatory. However, in case of non-compliance, about 30% of the DPs can be cut. Consequently, empirical data for Germany in the year 2017, for example, shows that 284.678 farmers did apply for DPs, and only 132 farmers (0.6%) did not receive any Greening-payments, meaning that substantial sanctions lead to zero Greening-payments for these farms (BMEL 2017). Overall, it seems that Greening includes a rather low risk of receiving the maximum level of sanctions.

#### *3.4. Other Policies Protecting and Fostering Biodiversity*

Besides the CAP, there are policies from other policy fields also influencing land-use decisions and the maintenance and protection of biodiversity. Here, the so-called Natura 2000-strategy comprising of the Birds Directive (1979) and the Habitat Directive (1991) is the most important; however, pesticide regulations and Water Framework Directive (WFD) also haven influence on biodiversity (see Table 1).

The Birds Directive concentrates on the protection of a list of bird species of European importance. Most of these birds are migratory birds, and the Birds Directive attempts to protect their habitats for nesting and feeding. The Habitat Directive focuses on a number of specific habitats and plant and animal species of European importance, where the MSs have to maintain their 'favourable statuses'. Both Directives are the legal backbone of Natura 2000: a network of sites selected to ensure the long-term survival of Europe's most valuable and threatened species and habitats. Significant parts of this network are supported by AECMs.

There is also a link between the CAP and the EU Water Framework Directive. Introduced in the year 2000, the WFD requires MSs to achieve good qualitative and quantitative status for all water bodies. There is a high coherence in terms of objectives, and some CAP instruments can contribute to the implementation of the WFD: Cross Compliance, statutory management requirements, good agricultural and environmental conditions, and rural development measures. Another relevant water-related EU policy is the EU Nitrates Directive. As part of CC, it does effectively contribute to the reduction in nitrogen fertilizer use across most MSs, influencing not only land-use decisions but also livestock densities. Adding to this, the Regulation on Pesticide Use and the Regulation on Placing of Plant Protection Products on the Market still of 1991 and later years has an impact on the environment and specifically on biodiversity (EC 1991, 2005, 2009).

#### *3.5. Harmful Subsidies within the CAP*

Harmful subsidies are subsidies with side-effects on the environment (SCNAT 2020). Within the CAP, only some instruments, in particular coupled DPs, can be categorized as harmful subsidies (Schmid et al. 2007). These are sector-specific coupled payments that are decided upon by the MSs. They incentivize higher production through linking payments with, for example, a number of eligible livestock (Hristov et al. 2020), and they usually lead to a higher local farming intensity than would be the case without coupled DPs. This is because many of the supported production systems are relevant drivers of climate change (e.g., meat or milk production) or input-intensive production, such as protein crops, sugar beet, vegetable production, and horticulture.

Decoupled DPs cannot be regarded as harmful subsidies since they are not linked to production intensity (Schmid et al. 2007). An exception can be perhaps found in Bulgaria, where decoupled DPs are linked to the requirement to reduce landscape elements on supported grassland farms (Trapp and Lakner 2018).

Other CAP instruments, however, may have unintentional impacts. Examples include investment measures (Pillar II) but also sectoral supports such as olives, wine, cotton, and renewable energy as well as support for irrigation and Areas of Natural or other area-specific constraints.

#### **4. Policy Outcomes and Impacts: The Case of Germany**

In this section, we analyze the (cost-)effectiveness and impacts of both AECMs and Greening for Direct Payments using the case of Germany as an example for one of the major economies and agricultural sectors among the MSs and because of the availability of comprehensive and detailed data.

#### *4.1. Analysis of AECMs*

#### 4.1.1. The Effectiveness of AECMs

There is a broad literature on AECMs focusing on effectiveness towards the maintenance of biodiversity. Despite a large heterogeneity within the objectives, content of the measures, complexity, and payment level, AECMs often have a positive impact on biodiversity.


Generally, the literature distinguishes between broad entry programs and specific and more advanced programs, often labelled as 'light-green' and 'dark-green' AEPs. A study by the ECA (2011) has pointed out that, especially the specific, dark-green programs are 'effective' and contribute substantially to the conservation of species, whereas the unspecific light-green programs often contribute little to nothing towards

the outlined objectives. This finding is confirmed by many studies (e.g., Armsworth et al. 2012). Some studies indicate that the share of spending on effective programs is rather low (Freese 2012). Oppermann et al. (2012), for example, show that of 7.6% expenditures for AECMs, only 1.2% are effective (dark-green). The share of spending for effective AECMs on arable land is even lower, a mere 0.2%. On grassland, 11% of the grassland area is managed by effective AECMs; for arable land, the share is again lower with 0.3% (Oppermann et al. 2012).

#### 4.1.2. Cost-Effectiveness and Administrative Costs of AECMs

Conceptually, the payment level for AECMs is based on the average opportunity costs to the farmers within a region. This leads to a spatially uneven participation behavior since farmers on more favorable production locations have to face higher opportunity costs finally resulting in non-participation, whereas farmers in less productive locations face lower opportunity costs, such that participation is attractive. The spatially uneven distribution is depicted in Figure 7, in a map of the federal state of Bavaria in 2012.

There are also administrative costs involved. In the federal state of Baden-Wuerttemberg, for example, Pillar II (EAFRD) has administrative costs of 32% of the amount of the payments made, in contrast to Pillar I (EAGF) with administrative costs of only 7% (Landesrechnungshof Baden-Württemberg 2015). This is also true for AECMs, however, with substantial variation between different programs and between German federal states. Fährmann and Grajewski (2013) find between 7% and 18% average administrative overhead for AEPs in different federal states. The percentage is also depending on the intensity of regulation. Light-green AECMs are associated with low administrative costs (12%), whereas targeted, dark-green AECMs or conservation programs face high administrative costs (36%); organic farming has low administrative costs of 9% (Fährmann and Grajewski 2013).

The German Scientific Advisory Board on Agricultural Policy, Food and Consumer Health Protection argues that, to a certain extent, administrative costs are necessary means to achieve agri-environmental targets (WBAE 2019). Furthermore, Armsworth et al. (2012) show that higher administrative costs through dark-green AECMs are justified by a much greater increase in biodiversity.

Argargebiete: 1 Alpen, 2 Alpenvorland, 3 Voralpines Hügelland, 4 Tertiäres Hügelland (Süd), 5 Tertiäres Hügelland (Nord), 6 Gäugebiete, 7 Ostbayerisches Mittelgebirge I, 8 Ostbayerisches Mittelgebirge II, 9 Jura, 10 Nordbayerisches Hügelland und Keuper, 11 Fränkische Platten, 12 Spessart und Rhön

**Figure 7.** Regional participation in Agri-Environmental Programs (AEPs) and location quality in Bavaria 2012. Source: Wanner (2012).

#### *4.2. Analysis of Greening of Direct Payments*

The EC presented a cost estimation for proposed Greening measures within an ex-ante assessment of the CAP reform, assuming even stricter rules of application as formulated in the proposal of 2011 (EC 2011) (Figure 8).

According to this assessment, crop-diversification and maintenance of grassland were presumed to not cause additional costs on 92% and 84.5% of the farms in the EU-27, respectively. Even for EFAs, the assessment predicts no additional costs for 54% of the farms (see Figure 8). Only farms larger than 15 ha have to comply with EFAs, so exemptions reduce the impacts of EFAs. According to an ex-ante study by Pe'er et al. (2014) based on data from Eurostat, 88% of all farms and 48% of the farmed area in the EU were exempted from EFAs. The decision patterns of farmers

can be studied based on EU data; however, this is only for the year 2015. More detailed data are available for Germany 2015–2018 (Figure 9).

**Figure 8.** Share of farms with no additional costs due to Greening in the EU-27. Source: own presentation, data from the Ex-ante Impact Assessment (EC 2011, pp. 9, 12 and 17).

**Figure 9.** Chosen Ecological Focus Area (EFA) options by farmers in the EU 2015 and Germany 2015– 2018. Source: Alliance Environment (2019: p.33) and BMEL (2016–2019). Note: The shares refer to the EFA before Weighting Factors. **Figure 9.** Chosen Ecological Focus Area (EFA) options by farmers in the EU 2015 and Germany 2015–2018. Source: Alliance Environment (2019, p. 33) and BMEL (BMEL 2016–2019). Note: The shares refer to the EFA before Weighting Factors.

The actual decisions of farmers in 2018 in the EU on choosing EFA options show a strong emphasis on production-oriented options such as catch crops (50.9%) and nitrogen-fixing crops (24.1%) (Alliance

non-productive options, fallow land takes the largest share, with around 23.6% in the EU and 15.5% in Germany; in turn, buffer strips (1.5%/1.7%) and landscape features (1.7%/2.2%) have only a very low

To analyze the effectiveness of different EFA options, Pe'er et al. (2017b) interviewed 89 ecologists

share (Pe'er et al. 2017a).

(Figure 10).

14

**Figure 10.** Survey on effects of the different EFA options for biodiversity. Source: Pe'er et al. (2017b); Note: Evaluation from positive (+5) to negative (−5); No. of participants = 89 within EU and Switzerland.

A first group shows a positive median value. The arithmetic mean shows some degree of variation for buffer strips (2.5), fallow land (2.4), and landscape elements (1.7), which are all evaluated as effective. A second group of EFA options show a median value of zero; i.e., they are largely ineffective. Some options show a slight positive arithmetic mean, such as nitrogen-fixing crops (0.7) and catch crops (0.4), which still seem to have a positive effect on biodiversity, whereas agro-forestry (−0.1) and short rotation coppice (−0.4) are neutral to slightly negative. A third group (afforestation areas) has a negative median

The actual decisions of farmers in 2018 in the EU on choosing EFA options show a strong emphasis on production-oriented options such as catch crops (50.9%) and nitrogen-fixing crops (24.1%) (Alliance Environment 2019, p. 33). In Germany in the year 2019, two production-oriented options—with catch crops (73.9%) being the largest and nitrogen-fixing crops (6.5%) the third largest—also took a substantial share of EFAs with 81% of the net area (i.e., the area before applying weighting factors). Among the non-productive options, fallow land takes the largest share, with around 23.6% in the EU and 15.5% in Germany; in turn, buffer strips (1.5%/1.7%) and landscape features (1.7%/2.2%) have only a very low share (Pe'er et al. 2017a).

To analyze the effectiveness of different EFA options, Pe'er et al. (2017b) interviewed 89 ecologists (Figure 10).

**Figure 10.** Survey on effects of the different EFA options for biodiversity. Source: Pe'er et al. (2017b); Note: Evaluation from positive (+5) to negative (−5); No. of participants = 89 within EU and Switzerland.

A first group shows a positive median value. The arithmetic mean shows some degree of variation for buffer strips (2.5), fallow land (2.4), and landscape elements (1.7), which are all evaluated as effective. A second group of EFA options show a median value of zero; i.e., they are largely ineffective. Some options show a slight positive arithmetic mean, such as nitrogen-fixing crops (0.7) and catch crops (0.4), which still seem to have a positive effect on biodiversity, whereas agro-forestry (−0.1) and short rotation coppice (−0.4) are neutral to slightly negative. A third group (afforestation areas) has a negative median value and is evaluated as significantly negative, i.e., counterproductive (−1.4). The results of this survey have been largely confirmed by two recent field studies on Greening measures, both concluding that fallow land, buffer strips, and landscape elements are most effective to protect target species of farmland birds or insects (Dellwisch et al. 2019; Ekroos et al. 2019). The European Court of Auditors concludes that Greening "has led to very limited change in farming practices" (ECA 2017, p. 24).

#### **5. Problem Evaluation**

#### *5.1. Farmers' Decisions on Conservation Measures*

The management of agricultural landscapes has strong impacts on biodiversity conservation. There is a broad range of factors determining farmers' adoption of conservation measures (Figure 11; (Brown et al. 2019)), including structural, financial, ecological, political, and socio-demographic factors as well as farmers' values and attitudes and policy design features.

**Figure 11.** Factors determining farmers' adoption of conservation measures. Source: Brown et al. (2019).

As structural factors, particularly farm size, production system, and farm location have been shown as influential. Findings on the importance of farm size vary across geographies and production systems (Brown et al. 2019). A positive correlation of farm size with AEMs uptake has been observed (Zimmermann and Britz 2016) and explained with a better education of large farmers (Villanueva et al. 2015). In turn, a specialization in livestock and dairy has been reported as negatively influencing farmers' uptake of conservation measures in England (Hodge and Reader 2010), while favoring farmers' uptake in studies from Italy (Borsotto et al. 2008). Literature reports that as farmers specialize in a specific form of farm management, their willingness

to adopt AEMs depends on the extent to which conservation practices fit into their technological setting (Vuillot et al. 2016). Furthermore, the geographical location strongly influences farmers' willingness (Zinngrebe et al. 2017). Specifically, areas with high land values are less likely to show strong uptakes of conservation measures (Bartolini et al. 2012).

As a clear pattern in financial factors, higher payments drive farmers' decisions when choosing those EFA options which are least costly, less labor intensive, and leave the largest part of the Greening-payment as 'windfall gain', as shown for the case of cash crops (Lakner and Holst 2015). The positive impact of an economic benefit on farmers' adoption of AECMs was shown, for example, in Germany (Bock et al. 2013) and Italy (Borsotto et al. 2008). The real economic benefits, however, need to prevail when taking into account other costs related to the fear of sanctions, risks of income forgone, and market risks (Prager and Posthumus 2010). There is variation in the role of financial factors depending on the geographical location and the methodology applied (Brown et al. 2019).

As part of the policy design, administrative considerations and farm controls negatively affect farmers' willingness to participate in conservation measures. Furthermore, contract flexibility and taking participatory decisions with farmers increase farmers' willingness to participate (Geitzenauer et al. 2015). What is more, the availability and trust in extension services positively relates to the adoption of conservation measures (Brown et al. 2019).

Socio-demographic factors: while young farmers are more likely to take up conservation measures, the statistical effect of the age of farmers is highly dependent on the social-ecological context (Brown et al. 2019). Some studies find part-time farmers as more likely to engage in AEMs (Vesterager and Lindegaard 2012), while others report a stronger participation of full-time farmers (Matzdorf and Lorenz 2010). Moreover, a stronger focus on productivity is reported to correlate with less AEM uptake (Kvakkestad et al. 2015). Furthermore, the level of education and training might have a positive impact on the adoption.

Values and attitudes of farmers influence their disposition for conservation activities. Production-oriented farm management has a negative effect on farmers' uptake (Breustedt et al. 2013). At the same time, openness and an interest in environmental considerations increase the willingness to participate (Brown et al. 2019). For example, traditional customs, such as the implementation of landscape elements ('Knicks') since the 18th century in the German federal state Schleswig-Holstein, lead to a strong uptake of this measure. Social networks and trust further increase farmers' willingness to adopt measures.

Ecological factors play a role, particularly if a positive effect for landscape and wildlife is perceived (Brown et al. 2019). Visible ecological benefits, such as near water bodies or ecologically valuable areas seem to favor implementation (Grammatikopoulou et al. 2012). Particularly high shares of grassland and a heterogeneity of farm structures are reported to increase farmers' uptake (Matzdorf and Lorenz 2010).

As a last but relevant political factor, distrust in government or in environmental schemes negatively impacts the willingness of farmers to participate in conservation schemes (van Zanten et al. 2014). A misconception of farmers' motivations in political arenas is a potential leverage point for improving the CAP's design and induce more effective implementation (Brown et al. 2021).

#### *5.2. Facilitators and Barriers for a Transition towards Environmentally Friendly Farming*

There is clearly a need to improve and increase the uptake of AECMs. The CAP reforms to date have been quite unsuccessful. The established AECMs (together with CC) do not achieve sufficient impacts to halt the decline in biodiversity or to substantially contribute to climate change mitigation within the farming sector. In his seminal paper, Günther Schmitt (Schmitt 1984) has posed the question, 'why is the agricultural policy as it is and not as it should be?'. This question is still highly relevant for the CAP, especially in view of the agri-environmental targets. In this section, we suggest why there is such little progress within respect to the stated agri-environmental targets.

#### 5.2.1. Unclear and Conflicting Objectives

One main obstacle is the vague and contradicting objectives within the CAP. Throughout several reforms of the CAP, the EU added new objectives without adjusting or aligning them. The Treaty of Rome in 1957 defines the original CAP objectives, which were implemented throughout the 1960s by applying market regulations, such as intervention price system and external tariff protection to several sub-markets.

In the Treaty of Lisbon (2009), the EU has confirmed the classic CAP-objectives in Article 39, despite some of them being rather outdated. However, the post-2020 CAP proposal lists nine 'new objectives', of which three are environmental objectives, referring to the protection of biodiversity, climate action, and resource efficiency (EC 2018). While the objectives income (a), competitiveness (b), and market stabilization (c) can still be linked to the 1957 objectives, the environmental (d, e and f) and rural development objectives (g, h and i) cannot. These diverging

objective systems are introducing new conflicts between objectives, for example, between competitiveness and environment or between income and environment (Pe'er et al. 2019, SM).

#### 5.2.2. Flexibility Instead of Subsidiarity

The CAP is offering finances and measures for a highly diverse continent, including very different climate zones, heterogeneous production locations, diverse farm structures, and differently developed national economies and farming sectors.

Based on the economic theory of fiscal decentralization (Oates 1997), the EU pursues the subsidiarity principle meaning that policy making takes place at the lowest possible level that can produce effective outcomes. Central solutions seem reasonable if there are (a) economies of scale in the provision of public goods and (b) homogeneous environmental, social, and market conditions across MSs. In turn, decentral solutions enable national and sub-national governments to adjust policies to diverging social preferences and social-ecological contexts. Thus, the appropriate level of subsidiarity has to balance uniform regulation with flexibility to maximize synergies and to account for trade-offs.

In the CAP reform of 2015, the 'trilogue process' (i.e., the negotiation of EU Commission, Council, and the EU Parliament) and the introduced flexible elements have led to a process of watering down of the main reform elements. Here, MSs have often used the top-down flexibilities to implement the softest possible option for their national farming sectors. Since 2005, the EC has continuously increased the use of flexible elements in the CAP (Box 1).

**Box 1.** Genesis of 'flexible elements' with the CAP.

2005 Different decoupling models of direct payments, differently used within the EU (Fischler Reform 2005)

However, these flexibilities come with no clear guidelines in programming and no clear outcome indicators for measuring their impact. With respect to Greening, for example, flexibilities have increased the EFA elements, such that farmers had

<sup>2009</sup> Regionalization of direct payments, the option to maintain coupled payments within some specific agricultural sectors (Anania and Pupo D'Andrea 2015), (Health Check 2009)

<sup>2013</sup> Some flexible elements (Greening, coupled payments, flexible transfer between pillars and options for redistributive payments) (Ciolos Reform 2013)

<sup>2020</sup> Full flexibility and national implementation, containing 'strategy plans' with an agreement between EU and MSs on target-oriented implementation (CAP Reform 2021)

a large choice between elements; however, many options are hardly effective or even counterproductive. Thus, the flexibilities introduced with the Ciolos Reform have undermined and watered-down environmental measures and diluted their effectiveness, still, however, with substantial differences among regions and MSs.

#### 5.2.3. CAP Politics and the Influence of Lobbyism

In the 1960s, Mancur J.R. Olsen introduced the theory of collective action, showing the incentives towards political influence and lobbyism. To attract members, associations have to lobby for political rents for their members (Olsen 1965). The theory further developed by Gary Becker, however, had a more positive view: different stakeholders compete on the political market and create better information for political deciders (Becker 1983).

The CAP can be regarded as a classic example for lobby influences on a specific sectoral policy. From its beginning in the mid-1960s to the 1980s, especially the decisions on intervention prices were taken unanimously in non-public sessions by the council of agricultural ministers in Brussels, at that time far away from any public or media attention and without any minutes (Runge and von Witzke 1987). Here, price-decisions were made like at a 'restaurant table' using a 'menu' meeting the preferences/needs of concrete ministers and national agricultural sectors, whereas costs were ultimately borne jointly by the six MSs (Schmitt 1984).

The role of institutions and the design of decision-making processes can play a decisive role and exhibit a strong impact on today's CAP. As a consequence of the Treaty of Lisbon in 2009, the co-decision-making process was extended and the European Parliament (EP) increased its influence during the 2013 CAP reform process (Fertö and Kovacs 2015). But despite the extended influence of the EP, the farmer-supportive, conservative groups continue to dominate the Committee on Agriculture and Rural Development (COMAGRI) of the EP, resulting in a constrained disposition for reform, while, similarly, DG AGRI dominated the final CAP design despite a consultation with other Commissioners (Knops and Garrone 2015). These findings on the 2013 reform align with the 'old' hypothesis that small interest groups with homogeneous interests (here, farmers associations) dominate political processes compared to larger groups with heterogeneous interests (here, the general public, other sectors).

While new discourses of multi-functionality and sustainability entered the political arena, a 'productivist' narrative continues to dominate political discourse and the resulting policy design (Erjavec and Erjavec 2015). Despite multiple changes in the EU decision rules, with a shift in favor of the European Parliament, the new flexibility introduced by the CAP reform 2013 implies a return to the 'restaurant table game', where MSs can freely choose, for example, between different Greening options, redistribution models, or coupled payments, which can be granted to diverse farming sectors. In most cases, this flexibility is not leading to the provision of more public goods, but rather to more market distorting coupled payments or a watered-down Greening (Alons 2017). Implementation of the Ecological Focus Areas within the Greening obligations showed a strong underrepresentation of ecologically effective measures (Pe'er et al. 2017a; Zinngrebe et al. 2017; Brown et al. 2019).

#### 5.2.4. The Role of Administration for Policy Design

National and regional agricultural administrations play a key role in designing, programming, and controlling the implementation of AECMs. Whether or not an MS or region is offering ambitious or targeted AECMs depends on the available administrative and financial resources. AEPs necessitate between 10% and 35% administrative top-up costs. High administrative costs are a barrier for state administrations to implement complex and, in particular, targeted AECMs (WBAE 2019). This is particularly relevant in eastern MSs, where agricultural administrations are smaller and budget shares for AECMs are lower. In north-western EU MSs<sup>3</sup> , about 33.5% of the RDP spending for 2014–2020 is dedicated to AECMs, Organic Farming, and Natura 2000, whereas, in eastern and southern MSs, it is just 19.8%/18.4% (own calculations, based on (EC 2016)). From a farmer's perspective, high administrative burdens are a disincentive to use AECMs, too.

#### **6. Conclusions**

We showed that CAP reforms have repeatedly failed to draw on the accumulated knowledge on policy processes and implementation. Consequently, institutional learning along the initially described policy cycle for transformation is disrupted at several levels. Based on the reviewed literature, we conclude that the highly politicized and biased process of incorporating inputs from the public and from evaluation results of previous CAP reforms lacks sufficient structure, transparency, and inclusivity.

The key challenge that remains is how to transform a post-2020 CAP into an incentive framework supporting multifunctionality and the provision of societal

<sup>3</sup> Northwestern MSs: BE, DE, DK, IE, LU, NL, UK, AT, FI, SE; Southern MSs: FR, EL, IT, MT, PT, ES, CY; Eastern MSs: BG, CZ, EE, HR, LV, LT, HU, PL, RO, SK, SL.

services related to the sustainability of agricultural landscapes. In the remainder of this section, we briefly introduce the most recent CAP reform proposal and reflect on its opportunities, potentials, and shortcomings:

#### *6.1. The Post-2020 CAP Reform*

The post-2020 CAP reform has four main elements linked to environmental aspects:


Since MSs choose the set of criteria when implementing the new CAP, the actual impacts of 'Conditionality' are unclear.

The EC proposes 'Eco-Schemes' related to climate and the environment (Article 28), which are yearly AECMs within Pillar I. MSs have to offer these schemes; however, they are voluntary for farmers. The eco-schemes can be cost covering, yet premiums may also contain an income component, thus going beyond opportunity costs. MSs can decide on the funds they want to dedicate to this instrument; yet, a minimum share within Pillar I is discussed.


**Table 3.** Selected criteria of the good agricultural and environmental conditions.

Source: European Commission (EC 2018).

4. A Multiannual Financial Framework (MFF) of the EU 2021–2027 was proposed by the EC in May 2018. Since the United Kingdom, one of the net payers to the EU budget, left the EU in January 2020, the proposed MFF contains a cut for the agricultural budget. This MFF proposal was published before the draft of the post-2020 CAP reform, suggesting an asymmetric budget cut of 11% for Pillar I and 28% for Pillar II (Matthews 2018), thus, to some extent, predetermining the CAP reform.

#### *6.2. Potentials and Challenges of the Post-2020 CAP*

The new post-2020 CAP gives more responsibility to MSs by using a larger set of flexible elements. This has a number of advantages and drawbacks from an environmental perspective:


for ca. 38% of the CAP budget; funds are needed to finance agri-environmental policies within the CAP.

Thus, it is unclear whether EC and MSs were able to apply conclusive learning within the CAP-context. The post-2020 CAP reform has some interesting potentials; however, since there are no clear minimum requirements, implementation by the MSs might be unambitious. Here, much will depend on the final decisions of the Council and EU Parliament in 2020, the implementation in the MSs, and the reactions of farmers on the ground.

#### *6.3. Potential Instruments and Approaches for a Transformation*

There is a further range of instruments and approaches that could facilitate a transformation towards biodiversity-friendly EU agriculture as elements of future CAP reforms and beyond:


agri-environmental schemes (Schroeder et al. 2013) and/or the introduction of a points system to increase farmers' benefits proportionate to ambition and/or investments in the provision of a broader range of ecosystem services (Neumann et al. 2017). So far, however, result-oriented schemes have only been implemented in some MSs in an experimental way, yet with both positive ecosystem effects and positive perceptions from farmers' (Schroeder et al. 2013).

In general, the last two approaches (2 and 3) have been considered in the post-2020 CAP proposal: Articles 65 (AECMs) and 71 (Cooperation) allow for the support of collective schemes and result-based schemes, relating to the potential implementation of measures at a larger-scale level, i.e., by groups of farmers. However, Article 71 does not necessarily relate to environmental objectives and may even promote unsustainable farming practices (i.e., homogenization), and Article 65(7) is only voluntary for MSs to adopt. Furthermore, there are no instruments in Pillar I relating to larger-scale implementation, neither as CC mechanisms nor in eco-schemes (Article 28).

In order to address the above challenges and to make the CAP a coherent framework for the sustainable development of rural areas and for achieving the SDGs, in particular SDG 15 Life on Land, the respective political decision-making processes and institutional settings need to be adjusted (Pe'er et al. 2019). Without including other political and other stakeholders in negotiations on budget allocations and policy design, agricultural interest groups will continue to preserve current trajectories and undermine any initiative for sustainable transformation.

**Author Contributions:** conceptualization: S.L., C.S. and Y.Z.; writing: S.L., C.S., Y.Z. and J.S. All authors have read and agreed to the published version of the manuscript.

**Funding:** This research received no external funding.

**Conflicts of Interest:** The authors declare no conflict of interest.

#### **References**


© 2021 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (http://creativecommons.org/licenses/by/4.0/).

### **Strategic Engagement in Institutions of Organic Farming in Indonesia**

#### **Dimas D. Laksmana and Martina Padmanabhan**

#### **1. Introduction**

This paper analyzes the institutional aspects of organic farming (OF) in Indonesia, focusing on the dynamic interactions among stakeholders in OF social networks and their engagement with OF government initiatives by using the Net-Map method based on social network analysis (SNA). OF has been promoted by the state as a strategy towards nature conservation and environmental protection. Following the global consensus on the need to transform the current agricultural systems to achieve some Sustainable Development Goals (SDGs), in particular, SDG 15, OF is considered as a promising model of sustainable agriculture (Willett et al. 2019). Therefore, this paper specifically questions how 'sustainable' Indonesian OF is from an institutional perspective. Analysis on sustainability and sustainable development, which are considered as two distinct concepts, should address the specificity of these concepts which are connected to the actors who define them and the subject of the enquiry (Nightingale et al. 2019a). Therefore, following this approach, we analytically show the diversity of views on OF not in order to resolve these differences, but rather to bring these differences to the foreground and to illustrate the various ways people act upon these tensions. We also focus on the ways in which different notions of sustainable agriculture are negotiated through different strategies employed by OF actors. Specifically, we examine how, and to what extent, the development of OF has been supported and/or undermined by the social networks of civil society, government, and the private sector.

Previous studies on SNA and environmental farming practices among cocoa and coffee farmers in Indonesia point out the lack of multi-scale analysis that links local and global social networks (Matous 2015). However, as argued by Neilson and Shonk (2014), a 'value chain approach' to draw linkages between small-holder farmers with global players tends to miss the complexity of micro-level interactions between different stakeholders. With a different take, our paper illustrates the importance of combining analysis on the governance and policies of OF at the national level with the social networks of stakeholders at the local level in understanding the implementation of OF. Therefore, this paper addresses the limited study on OF

policies and dynamics between actors in Indonesia (David and Ardiansyah 2016). In addition, the use of Net-Map provides a greater involvement of study participants to interpret the networks they constructed, a feature which reveals insights on their positionality with respect to other actors in the networks. Three research questions were formulated to address the points above:


The paper presents the results of a participatory workshop in Yogyakarta, Indonesia, in 2017 where OF practitioners used Net-Map (Schiffer 2007) to construct the social networks of OF in Indonesia<sup>1</sup> . This research was undertaken as part of the transdisciplinary research project 'IndORGANIC', which explores the environmental, economic, and social potential of OF in Indonesia (IndORGANIC n.d.).

This paper is structured as follows. First, we describe the historical development of conventional farming and OF in Indonesia, with particular emphasis on the interactions between government and civil society. This section identifies the principal OF actors and provides an overview of relevant policies that frame sustainability issues in farming. Second, we review the literature on the application of institutional analysis and SNA for the study of OF in various contexts. Third, we describe how the Net-Map method was used in a participatory workshop to elicit the views of OF practitioners on the current state of OF in Indonesia. Fourth, we analyze the SNA data in the social networks produced by participants in the workshop, and the content of audio recordings made during the workshop. Our interpretation of the data leads us to elaborate different notions of 'sustainability' in OF and to propose three different categories of OF actors, grouped according to their degree of engagement with the government. In the final section, we identify a possible space for negotiation within OF institutions where government and different actors could collaborate in formulating a more coherent policy for OF development. For future research, we identify a need for further investigation on the potential links between OF development and decentralization.

<sup>1</sup> Please see the Appendix A for social networks created in the workshop, Figures A1 and A2.

#### **2. Study Area**

This section specifies historical development of conventional farming and OF in Indonesia, specifically in Java. In addition, it links the government's paradigms and the governance structure in agriculture, which provide insights on the characteristics of the interactions between the government and broader civil society.

#### *2.1. The Historical Development of Conventional Farming in Indonesia*

The productivist paradigm, farmers' dependency on the government, and the top-down transfer of knowledge and agricultural inputs are aspects of governance that still persist in the current government's approach to OF. Following the foundation of independent Indonesia in 1945, the government prioritized the increase of agricultural production and food price stability—of rice in particular—in order to achieve national food security (Arifin 2008). These goals were achieved through agriculture policies inspired by a productivist paradigm, whose key components were the intensification and industrialization of agriculture (ibid.). Implementation of these policies involved the creation of top-down bureaucratic institutions that controlled the distribution of agricultural production, managed input subsidies, and claimed to have a monopoly of knowledge on agriculture (Winarto 1995; Sawit and Manwan 1991). In 1960s, as part of the green revolution, the government promoted the use of petroleum-based agricultural inputs and high-yield rice varieties (HYV) in Indonesia. The implementation of these policies in Indonesia is examined in numerous studies, including many that criticize their (intended and unintended) consequences (Fox 1991, 1993; Oka 1997, 2003; Winarto 2004; Winarto 2011; Sawit and Manwan 1991). While the intensification of agriculture enabled the goal of national food self-sufficiency to be achieved in the mid-1980s (Fox 1991 cited in Fox 1993), this success was short lived, undermined by massive outbreaks of the rice pest brown plant-hopper (BPH), which attacked paddy fields throughout the country (Winarto 2011; Fox 1993). Among contributing factors to this agricultural disaster were the bureaucratic inefficiency and centralist control that characterized government during the Soeharto era. All criticism of the government was suppressed, thus, stripping initiative and decision-making power from lower level government officials and civil society (Thorburn 2015). The change of the country's political system from autocracy to democracy during the Reform era in 1998 introduced decentralization, including in agriculture. This important feature of the country's agricultural policy is further elaborated in Section 6. However, overall, the introduction of modern agricultural management during the green revolution period forced farmers to be institutionally, technically, and financially dependent on the government (Winarto 2004, pp. 365–66). This historical background and institutional context influence the characteristics of the networks of OF actors in contemporary Indonesia, as described in Section 7.

#### *2.2. Civil Society and OF*

OF in Indonesia, particularly in Java, emerged as a social movement initiated and spread by non-governmental actors. The Bina Sarana Bakti<sup>2</sup> (BSB) foundation was established in 1983 in West Java to provide an alternative option for farmers locked into a centralized agricultural system that perpetuated their financial and institutional dependency on the state and continuous environmental degradation (David and Ardiansyah 2016). This organization is recognized as being the first to offer training in OF for farmers in Indonesia (Jahroh 2010). Another milestone in the OF movement occurred in 1990, when the Ganjuran Declaration, issued at the conclusion of an international seminar held in Central Java on soil degradation caused by agricultural intensification, called for sustainable agricultural development based on the principles of ecological, economic, cultural, and social sustainability (Utomo 2005). In subsequent years, the World Food Day Secretariat for Farmers and Fishermen (SPTN-HPS)<sup>3</sup> , which was founded during the same seminar, continued to promote these principles and spread knowledge of sustainable agriculture.

More recently, numerous organizations and initiatives promoting OF at different scales have emerged in Indonesia. In Central Java, communities of organic market provide space for the exchange of knowledge and transactions of healthy and artisanal food, where 'self-certification' of the organic produce is accepted by customers based on trust (Widiyanto 2019). These are community-based grassroots movements initiated by individuals with common aspirations and interests. At a national level, the Indonesia Organic Alliance (AOI)<sup>4</sup> is a long-established organization that has functioned since 2002 as an umbrella organization, connecting different actors involved in OF, and publishing statistics on OF in Indonesia (AOI 2018; AOI n.d.). OF is also supported by international development agencies, such as the international NGO, Rikolto Indonesia, which promotes sustainable agriculture in Indonesia by providing institutional and technical support to farmers (Rikolto n.d.).

<sup>2</sup> Yayasan Bina Sarana Bakti.

<sup>3</sup> Sekretariat Petani dan Nelayan Hari Pangan Sedunia.

<sup>4</sup> Aliansi Organis Indonesia.

#### *2.3. The Indonesian Government and OF*

Government's approach to the development of OF is characterized by productivist and market-oriented agendas, which are exemplified by the following programs and policies. The first government initiative to support the expansion of OF was the "Go Organic" program, launched in 2002, which aimed to transform Indonesia into one of the main producers and exporters of organic food products in the world by 2010 (Ditjen BPPHP 2001). This was supported by the creation of a national standard for OF, based on third-party certification, within the Indonesian National Standard (SNI) certification system (SNI No. 01-6729-2002) (BSN 2002). This SNI and subsequent updated versions of the standard provide guidelines for the regulatory agency OKPO (Competent Authority for Organic Food) and extension workers led by the Ministry of Agriculture (MoA) (BSN 2002; Ministry of Agriculture 2003). The main responsibilities of OKPO are to formulate regulatory policies for the monitoring and development of organic food systems, oversee the establishment of organic food certification bodies, and verify the competence of certification bodies and other entities that perform similar functions (Ministry of Agriculture 2003). All the above standards and regulations cover not only agricultural production but also the activities of other private sector organizations involved in the OF sector, such as certification bodies, suppliers, and retailers (BSN 2002, 2016). While the goal of the "Go Organic" program was not achieved, given that the proportion of organic land is less than 1% of the total agricultural land in 2015 (AOI 2018)<sup>5</sup> , the regulatory and institutional structure it gave rise to remains in place. In 2016, the government of President Jokowi launched the "1000 Organic Villages" program with the aim of creating 1000 organic-certified villages throughout the country (Plantation General Directorate of the Ministry of Agriculture 2016). This program was part of the strategy to achieve food sovereignty within the government's wider development agenda (KPPN/BPPN 2014). Despite the government's acknowledgement of the importance of local knowledge and resources, this program still emphasizes the transfer of knowledge, agricultural inputs, and financial support from the MoA to organic farmers (Plantation General Directorate of the Ministry of Agriculture 2016). The top-down structure of the program is apparent from Figure 1.

<sup>5</sup> According to these statistics, organic land includes agricultural land of four different groups: the members of AOI who practice OF without having organic certificate, organic-certified farmers, organic farmers who are in the process of being certified, and organic farmers who are certified by PAMOR which is the Participatory Guarantee System (PGS) in Indonesia.

**Figure 1.** Governance of organic farming (OF) in food crops production in Indonesia (Laksmana and Padmanabhan 2019 based on BSN 2016; Ministry of Agriculture 2003).

#### **3. Theoretical Framework**

#### *3.1. Institutional Theory*

In this paper, an institution is understood as sets of prescriptions, such as rules and norms, which shape structured and repetitive human interactions. While social interactions are regulated by these rules, the participants and non-participants of these interactions have the possibility to change them (Ostrom 2005, p. 3). Rules in this context are understood in regulatory terms, as something created by an authority (not necessarily conflated with government) that permit or prohibit certain actions (Black 1962, p. 115 cited in Ostrom 2005, p. 17). Conducting institutional analysis is challenging because of the diversity of situations in which preferences are expressed and choices are made, as well as the implicit nature of many of the rules governing their outcomes (Ostrom 2005, pp. 4–5). It is important to select an appropriate level of analysis that gives sufficient information on the specific situation of interest, but at the same time, provides information on outcomes that is generalizable across a range of cases (Ostrom 2005, pp. 5–6). To address these challenges, we follow the theoretical framework by Michelsen et al. (2001) which identifies three levels of

the institutional environment that constrain decision-making by organic farmers: macro (rules governing civil society, market, and the state), meso (rules governing farming community, agricultural policy, and food market), and micro (rules governing interaction among actors) level. We analyze Indonesian OF institutions at the microand meso-level, with a particular focus on the interactions among actors (individuals and organizations) and the governance of OF. Organizations are associations of individuals who share and participate in the same meaning systems or similar symbolic processes and are subject to common regulatory processes (Scott 1994 cited in Lynggaard 2001). We apply SNA for micro-level analysis to explore the emic perspectives of actors, specifically their perceptions of OF, expectations, and positionality in the networks. Meso-level analysis was conducted by reviewing the literature on the institutions of OF and publications of the relevant governmental agencies. By synthesizing these two levels of analysis, we demonstrate that OF institutions in Indonesia are influenced by the characteristics of the social networks of OF actors that are embedded within the governance of OF. In addition, from the current OF institutions, we draw upon different notions of 'sustainability' enacted by the involved actors. The following sections present the results of the meso-level analysis.

#### *3.2. The Institutions of OF*

Numerous studies on OF analyze institutions as determining factors in the development of OF, which is measured variously in terms of the number of organic farmers and farms, market size, consumer demand, and the existence of regulations governing OF (Michelsen 2001b; Lynggaard 2001; Bellon and de Abreu 2006; Sanders 2006; Slavova et al. 2017). Studies characterize OF as fundamentally distinct from conventional farming in terms of values and relations among actors (Michelsen 2001a, 2001b). It is suggested that these distinctions arise as a consequence of the origins of OF, particularly in Europe, in social movements that were critical of the environmental and social impacts of conventional farming (Conford 2001; Tomlinson 2008). Historically, the sustainability of OF is variously rooted in environmental protection, health and food safety, and equity issues related to control over means of production in agriculture (Tovey 1997; Tomlinson 2008; Lockie et al. 2006). Tensions arise when the self-regulatory aspect of OF is undermined by the creation of organic standards, thus, diminishing the importance of individual actors in the OF movement and strengthening the position of government agencies (Michelsen 2001a). Michelsen et al. (2001) propose three types of institutional relationships that may exist between OF and the institutions that govern conventional agriculture: pure cooperation, pure competition, and creative conflict. OF institutions in different countries vary, reflecting

their specific national contexts. The OF principles coined by the International Federation of Organic Agriculture Movements (IFOAM) are commonly referred to compare the principles of the global OF movement with national-level organic regulations (Michelsen 2001b; Sanders 2006). However, countries that develop their organic sectors for the export market face the challenge of harmonizing organic regulations with international standards (Mutersbaugh 2004). Harmonization not only poses challenges for the traders and activists involved in the OF movement, but it can also have wider transformational effects, by redefining the meanings of "things", "people", and "social relations" that make up property regimes (Verdery and Humphrey 2004 cited in Aistara 2018, p. 138).

#### *3.3. The Institutionalization Process in OF*

The literature on the institutionalization of OF addresses the challenges involved in developing a regulatory framework for OF that is compatible with international standards. Institutionalization is considered in this study as a process in which OF is transformed from a social movement that positions itself as distinct from conventional farming into a branch of agriculture that is embedded in conventional farming. This happens, for instance, through alignment with institutional support structures that enable conventional farming to persist or the codification of organic principles into sets of legally recognized standards and definitions (Buck et al. 1997; Tomlinson 2008). Early studies of the institutionalization of OF were mainly concerned with the reconceptualization of OF within the framework of state agricultural policy (Lockie et al. 2006; Tovey 1997), while later studies focus more on the codification of the principles of the OF movement into national or supranational organic standards and how this process has affected the goals of the OF movement (Michelsen 2001a; Lynggaard 2001). The institutionalization process entails a process of institutional change within OF that can be manifested by the formulation and adherence to new sets of rules and regulations (Lynggaard 2001). In addition, the emergence of new organizations or mergers of existing organizations can be treated as an approximation to institutional change (ibid.). For example, Kaltoft (1999) argues that the creation of national certification and financial subsidies in Denmark led to the dilution of value-laden principles that had underpinned the development of OF as a social movement, and their reduction in OF to a set of technical and quantitative definitions and rules. However, Edwards (2013) argues that the formulation of national standards for OF is part of an institutionalization process that does not necessarily undermine the values of OF as a social movement in Indonesia. Within the OF movement, actors have devised different strategies for adapting to regulatory change without

abandoning the values that underpin OF as a social movement (ibid.). Therefore, the introduction of OF regulations does not predetermine subsequent trajectories in the institutionalization of OF. However, regulations do have consequences, as discussed in Sections 6 and 7.

#### *3.4. Institutional Analysis and SNA*

SNA is an analysis based on the dyadic relationships between actors in a network. Numerous studies in OF apply SNA in order to examine the network characteristics associated with phenomena such as the commercialization of OF, the participation of individuals in policy-making, adoption of organic practices, the process of knowledge and information production and circulation among OF actors, and OF policy development (Thiers 2002; Mutersbaugh 2004; Bellon and de Abreu 2006; Tomlinson 2010; Wollni and Andersson 2014; Poerting 2015; Slavova et al. 2017). In our research, we used Data Muse to calculate the values for two indices, degree of centrality and betweenness centrality, in order to analyze the relationships and different kinds of flow among the network of OF actors. The actors with high degree of centrality have more links with other actors in the network, while actors with high values of betweenness centrality facilitate flows in the network (Krebs 2004). From these two indices, we can derive a general understanding on structural determinants of influence, the roles of actors, and how the positions of actors in the network relate to their influence (Schiffer and Hauck 2010).

In the abovementioned studies, SNA is usually based on information obtained in semi-structured interviews and surveys where interviewees describe their interactions with other individuals, while the interpretation of the networks is predominantly conducted by analysts. By contrast, in our study, Net-Map was employed to visualize the networks of OF actors and, as further explained in Section 5, this approach enabled us to explore the actors' emic perceptions of the networks that structure their interactions and their own positionalities within these networks. In Section 7, we highlight the influence of the historical coevolution of civil society and government in the area of conventional farming on current OF institutions. Our analysis identifies and characterizes the links among OF actors and shows how these are related to their past positionalities, particularly in relation to the government, and their visions of the sustainability and future development of OF.

#### **4. Research Methodology and Limitations**

This section describes the study participants, Net-Map method, and our reflection on the research methodology's limitation. We implemented Net-Map

in a participatory workshop held in Yogyakarta in 2017. Out of the 46 people we invited, 28 participated in the workshop. They were mainly from West and Central Java, which are both the primary agricultural production areas in Indonesia and areas which have played an essential role in the historical development of OF, as mentioned in Section 3. The participants came from diverse backgrounds (Table 1). They were identified based on academic papers and grey literature on Indonesian OF and an explorative study conducted in the two study areas before the workshop. Besides, they were selected based on their various forms of involvement in OF. For example, we invited extension workers and staff of the department of agriculture as they monitor and implement OF programs. We also invited NGOs and activists who conduct OF training, thus, are involved in spreading OF knowledge and values. To understand the trade and marketing aspect of OF, we invited organic traders. These categories are based on self-identification.


Net-Map is an interview-based mapping tool for visualizing networks that can help people understand, discuss, and improve situations in which different actors can influence outcomes (Schiffer 2007). This method is based on SNA and was developed to address some of the shortcomings of SNA data collection, particularly the interviewees' lack of learning opportunities (Schiffer and Hauck 2010). The Net-Map method encourages participants in the process to discuss and interpret the networks among themselves (ibid.). This method is suitable for application in a variety of intercultural settings and different purposes because of the use of low-tech and low-cost materials and the discussion on the properties of the networks in concrete terms (Birner et al. 2010; Schiffer and Hauck 2010; Campbell et al. 2013; Schöley and Padmanabhan 2016). However, the limitations of the method are the numbers of links can become unmanageably large when working with a large or not very well-defined group of actors and the influence of more powerful actors is a potential source of bias as actors perceived as non-influential might be excluded from expressing their views (Schiffer and Hauck 2010). To overcome the power dynamics among workshop participants, we assigned two facilitators, who can interfere when some participants dominated the discussion, for each group.

The procedure of the workshop is as follows. First, two facilitators familiar with the method divided the participants into two equally sized groups. Each group worked on a large table around which they moved freely. Second, we asked participants, "Who are the important players that can influence organic farming?". We asked the participants to list influential actors and assign them, based on their interpretation, to one of four categories of actors: Non-Governmental Organization (NGO), private sector, government, and community. The names of actors were written on colored cards and placed on the tables. The colors of the cards indicate different categories. Third, we explained to the participants how to describe the links and the direction of the links between actors. We specified four types of links: information or knowledge, marketing channel, agricultural inputs (fertilizer, pesticide, and financial support), and seeds or animals. Participants drew arrows that indicated the links and direction of the links using markers of different colors to connect pairs of actors. Fourth, participants built 'influence towers' by placing plastic cups on the card representing each actor. The height of the tower corresponds to the actor's degree of influence in the networks. Due to time constraints and mental fatigue among the participants, we did not implement the last step of the Net-Map method, which deals with strategizing. In the strategizing step, interviewees are asked to provide actors' perceived goals, which can assist them in deciding on potential collaborations or conflicts that might arise from interacting with particular actors. Finally, Net-Map visualizations of Figures 2–4 were created using Data Muse, open-source software for network visualization and network data analysis<sup>6</sup> . We inputted data for network visualization based on the photographs of the two networks produced at the workshop. The degree of centrality is calculated by Data Muse according to the number of links of an actor divided by the number of links of an actor with the greatest number of links in the network (Freeman 1978). The maximum value is 1, which indicates the greatest number of links an actor has, and the minimum value is 0, which stipulates no link an actor has in a network. Betweenness centrality is calculated according to the sum of the fraction of all-pairs' shortest paths that pass through a node. The betweenness centrality of a node v, for example, follows this formula:

$$\mathbf{C}\_{B}(\mathbf{v}) = \sum\_{\mathbf{s}, \mathbf{t} \in \mathcal{V}} \frac{\sigma(\mathbf{s}, \mathbf{t} | \mathbf{v})}{\sigma(\mathbf{s}, \mathbf{t})}$$

<sup>6</sup> https://www.datamuse.io/network/login.php#.

where V is the set of nodes, σ (s,t) is the number of shortest (s,t)-paths, and σ (s,t|v) is the number of those paths passing through node v (Brandes 2008). The maximum value is 1, and the minimum value is 0. An actor with the highest degree of betweenness is on the closest links between other actors, so that the actor can control flows in a network. The visualized social networks were supplemented with qualitative analysis of audio recording of the group discussions and information obtained from organizations' websites, booklets, publications, and policy documents.

The Net-Map method assisted us discover nuanced interpretations of the social networks constructed by the workshop participants, which would otherwise not be revealed by the survey method. For instance, the local organic market community is connected to other actors mostly through knowledge/information transfer, since the term market is not limited to a place for selling organic products but also for exchange of ideas, as one participant explained (Section 5). Despite this advantage, there were some problems and limitations in implementating the research method, out of which are related to the points elaborated by Schiffer and Hauck (2010). First, the way the workshop was organized was a potential source of bias in the results. We selected and invited the workshop participants based on our judgment of their knowledge of OF and influence in OF. This selection may have favored certain forms of knowledge or opinions and excluded others. Moreover, the two groups were also formed based on self-selection by participants. To the extent that group formation was based on familiarity among the participants, this could have influenced the discussions' dynamic. In any case, it should be borne in mind that the workshop results provide a snapshot of interactions among a selected group of actors at a particular point in time. As elaborated in Section 6, OF situation in Indonesia is not static, and both actors and the institutional framework are changing and evolving.

Some possibly more fundamental limitations of the method were identified by the participants, who did not merely follow the Net-Map instructions but actively engaged in critical discussions and meaning-making as we proceeded. In particular, crucial discussions took place on the notion of "influence", which was considered ambiguous by the participants. They queried whether it was possible to assign values to the actors' influence based on their actions in the network and pointed out that "influence" was a shorthand term for a set of sometimes incomparable characteristics. For example, how could one compare the influence of organic farmers with that of the MoA? Besides, they maintained that a distinction should be made between "positive" and "negative" influence; however, an actor's judgment in this regard would depend on their positionality concerning the presence of other actors in the network. In other words, both the quantity and the quality of influence reflect the normative stances

of actors. For instance, extension workers are influential as they provide technical knowledge and information on the government's programs for farmers. However, they may not be equally influential (quantity of influence) across different actors in the network. Moreover, different actors have different opinions about the standard and usefulness (quality of influence) of the advice they provide. This interpretation implies that, from individual actors' perspective, working closely with "influential" actors does not always help them achieve their goals. As mentioned by Schiffer and Hauck (2010), this issue arose from working with a not so well-defined group of participants, where each individual can have conflicting goals.

However, these critical discussions among participants illustrate one of the strengths of Net-Map. They show the advantages of encouraging participants' active engagement in critically reflecting on and analyzing their positionality concerning other stakeholders in the networks, instead of leaving this analysis to the researchers alone.

#### **5. Results—OF Actors and Links**

Based on the two social networks produced during the workshop, we propose three categories of OF actors based on their different degree of engagement with the government, their positionalities in the network, and the interactions among them. We call these disengaged, partially engaged, and fully engaged groups.

#### *5.1. The Disengaged Group*

The disengaged group is characterized by the rejection of interaction with the government. This group is dominated by activists who were inspired by the early pioneers in Indonesian OF. For members of this group, the introduction of organic certification as specified by SNI 01-6729-2002 in 2002 was a decisive moment that altered the aims and the actions of OF as a social movement. In the discussions at the workshop, they expressed the view that the prohibitive cost of organic certificates perpetuates the injustice that prevails in conventional agriculture. This view is aligned with another study that argues for the democratization of third-party certification (Konefal and Hatanaka 2011). As mentioned in Section 1, OF was promoted by BSB and SPTN-HPS as a means of achieving both greater independence of farmers and environmental sustainability in farming. More recently, the introduction of OF certification, envisaged as a way to protect consumers, has raised awareness within the OF movement of the need to take consumers into account, a viewpoint supported

by Joko<sup>7</sup> , an organic activist, in the discussions at the workshop. However, one initial aim of the OF movement, that to a certain extent is still pursued by activists today, was to create a community. Community in this sense can be understood as a group of people with shared causes or interests, where the roles of those who identify with this group can be quite flexible and interchangeable. The actors in the disengaged group, including Joko, are (also) concerned that the development OF that seems to be following the blueprint of conventional farming towards greater engagement with agri-business:

So I think it is important to be aware of the State's interpretation of OF, when we talk about Go Organic 2010 program. In the end the aim [of the government] is to develop organic fertilizer industry. (Interview, 9 December 2017)

According to this group, at first, the OF movement was primarily supported by NGOs, whereas it is now mainly driven by market demand. Actors in this group have to adjust to this recent development. They have to either submit to the demands of the market, setting their sights on organic certification and carving out a niche in the market, or to create an alternative system that focuses on the creation of community. This group is exemplified by the local organic market communities (komunitas pasar organik lokal), which are connected to private sector organizations (traders and distributors of organic products), NGOs, and other communities in the network. The term 'local organic market community' reflects the dual purpose of these organizations. As Joko, who was one of the initiators of the local organic market community in Central Java, explains:

Actually this [local organic market community] can be considered as a community. It's called a market because it's a place where they [people] meet. I try to define them [local organic market community] so that there is an encounter [where people meet to exchange ideas]. (Interview, 9 December 2017)

Figure 2 shows the network connections of the organic market community in Central Java. This actor not only offers a physical space where transactions can take place, for example, as a place where non-corporate farmers (petani non-korporasi) can sell their produce, but also serves as a networking platform for other actors

<sup>7</sup> All names in this paper are pseudonyms.

with shared concerns about OF (Figure 2). For instance, this actor shares knowledge on nutrition and healthy lifestyle to local consumers, transmits knowledge about agricultural technology to private sector actors, and participates in OF-related research with NGO actors.

**Figure 2.** The network of the local organic market community in Central Java. The size of the sphere corresponds to the height of the influence tower (see the text for further explanation). Source: original data by authors.

As shown in Figure 2, this actor has no links with government actors, but numerous links to NGO actors as well as with private sector organizations (degree of centrality score 0.55). In most cases, the links consist of exchanges of information. Apart from providing a market for goods produced by non-corporate farmers, there are no physical exchanges (e.g., of seeds or other inputs) in this network. Another notable feature of the network is the low degree of betweenness centrality (with a score of 0.01); thus, this actor does not facilitate the flow of information between other, otherwise unconnected actors. According to the workshop participants, in

this particular network, local consumers have the most influence and non-corporate farmers together with the local organic market community have the least.

#### *5.2. The Partially Engaged Group*

The actors who belong to this group are characterized by their strategic adaptation to the government regulations, while retaining certain aspects of OF as a social movement, especially regarding the issue of farmers' independence from the current system of conventional agriculture. They interact with government actors, for example, by accepting government support, as long as this helps them to advance their goals. However, participants at the workshop commented that they are wary of accepting financial support, as this tends to provoke conflict, whereas technological support can be useful. One member of this group, SPTN-HPS, one of the early pioneers of OF in Java (see Section 3), has the degree of centrality score 1.0, with links to all four categories of actors (Figure 3). The majority of links are for knowledge and information transfer, but SPTN-HPS is also connected to other actors through the exchange of agricultural and/or financial inputs and seeds. In these relationships, SPTN-HPS tends to be the provider of information and knowledge to other actors, including other NGOs working on OF-related issues, retailers, village officials, and communities. In addition, SPTN-HPS distributes or sells seeds and animals to both community-based seed banks and distributors of organic products. SPTN-HPS also works directly with village officials to promote the benefits and importance of OF for village development. It, thus, collaborates with government at the level of the administrative units that have direct interactions with farmers as farmlands are predominantly located in rural Indonesia. As a result of decentralization, village governors control significant resources (the so-called village funds) and can influence the direction of agricultural development of the areas they represent. Among the NGOs and communities in Central Java with links to SPTN-HPS are the Young Farmers School (Sekti Muda) and Mursyidul Hadi Islamic boarding school. These two platforms are used by some farmer activists, for example, those who are part of the Indonesian Peasant Union (SPI), to promote OF as part of a strategy to develop young activists and as the starting point for building a grassroots agrarian movement. Totok, who is a former extension worker and is a representative of SPI in Central Java, further explains:

The Village government is more important [than provincial government], especially after the Village Law was passed, they can use village funds to empower [the villagers]. I have observed several places where OF was developed together with the village governments, because they can take

decisions on their own. In this situation the position of village government is more important than the district government. (Interview, 9 December 2017)

The above statement is illustrated in Figure 3 by the fact that participants in the workshop considered that the village governor had the highest degree of influence in this network. SPTN-HPS has the highest degree of betweenness centrality (score 0.36) in the network, which indicates its important role in the network as a facilitator of information flows between actors that otherwise would not be connected. Due to their influence and centrality in the network, partially engaged actors have the opportunity to disseminate the holistic principles of the OF movement while simultaneously promoting alternative OF systems that are distinct from the government's approach to

OF. Therefore, they are able to operate on two fronts, cooperating with government to promote OF and simultaneously creating an alternative system where they disagree with the government's actions. In this sense, they can influence the government's approach by exchanging information with government actors who share their interest in promoting OF.

#### *5.3. The Fully Engaged Group*

In this group, OF actors are characterized by their adaption to the current OF regulations. They generally have links with government agencies, other communities, and actors in the private sector, but no links with NGO actors. They adhere to the status quo and, to the extent that they are successful, provide a justification for the government approach to OF that focuses on building consumer–producer relationships. The creation of a legal framework for OF, with definitions and standards, has allowed actors who do not necessarily identify themselves as belonging to the organic movement to partake in the OF system. In this context, the OF system can be understood as a mechanism for the trade of organic products as premium agricultural products, which protects both consumers and producers from misinformation or fraud through third-party certification as set out in SNI 2016 (BSN 2016). One example of an actor in this group is the farmers' association Gapoktan (Gabungan Kelompok Tani). This is a federation of farmer groups in hamlets that operates at the village level (see Figure 1). In Indonesian agriculture, farmer groups are an official channel for the distribution and dissemination of agricultural subsidies and technical support. Therefore, only farmers who join farmer groups can access government support, though exceptions might exist.

Gapoktan maintains connections with government agencies and other government-sponsored groups with connections to agriculture. Government officials, for instance, public sector employees, often source organic products from farmers, either through formal channels as part of a policy or informally through personal contacts. In Figure 4, these links are observed in the form of inflows of knowledge and information from government actors, such as the regency-level department of agriculture and MoA extension workers. In addition, Gapoktan has a trading relation with the regency-level department of trade, which acts as a trading channel between farmers and customers. Totok, a former extension worker, explains how this works:

So usually farmer groups [in hamlets] focus more on the technical aspect on the field. Meanwhile, Gapoktan focuses more on administrative issues, for example in connecting them [farmers in farmer groups] with the

Categories Links Government Community NGO Private sector Information Knowledge Marketing Channel Input Seed Animals Farmer group of water users (P3A) Farmer Credit Union Village governor Regency-level department of agriculture Extension worker Seed conserver group Farmers' association (Gapoktan Bumi Lestari Department of industry, trade and cooperative (Disperindagkop) Religious institution Regency-level department of trade 

government which is one administrative level above [hamlet]. (Interview, 9 December 2017)

**Figure 4.** The network of the association of farmers group (Gapoktan). The size of the sphere corresponds to the height of influence tower. Source: original data by authors.

In the network, Gapoktan is connected to other government-sponsored groups, such as Bumi Lestari which is a women's farmer group (KWT) and a farmers' group of water users (P3A) that is responsible for the construction of irrigation channels and drains in and around agricultural fields. These links take the form of exchange of information about government programs and/or distribution of agricultural inputs and financial support. Gapoktan has the second highest score for the degree of centrality (0.89) and a relatively equal number of outflow and inflow links, reflecting its influence in the OF network. It was perceived as influential in the network by the participants, though with a lower degree of influence than village

governor. This is probably an indication of Gapoktan's dependence on support from government agencies, as mentioned above. However, Gapoktan's relatively low value of betweenness centrality (0.14) indicates that it does not play an important role as a bridge between actors which otherwise are not connected.

#### **6. Discussion—OF Institutions in Indonesia and Future Implications**

In this section, we argue that understanding the emergence of OF institutions, through an analysis of the characteristics of the social networks of OF actors and their relations with the historical development of conventional agriculture, can assist in understanding how the future development and sustainability of OF are perceived and constructed by the related actors. Understanding the interplay between OF as a state policy and as a social movement is crucial for projecting the future trajectory of OF (Michelsen 2001a; Lynggaard 2001).

As mentioned above, since the early 2000s, the MoA has introduced a number of regulations and programs that define, standardize, and set the agenda for Indonesian OF. The Indonesian Standard SNI 6729:2016 on organic farming systems states that one of the aims of OF is to create agriculture that is socially, ecologically, economically, and ethically sustainable (BSN 2016). In addition, organic farming is framed as a strategy for environmental conservation. This approach by the MoA seems to adhere to the OF principles set out by IFOAM and, in Indonesia, the Ganjuran Declaration. Simultaneously, the aim of this national standard to protect consumers and producers of organic products from misinformation (BSN 2016), in a sense, defines OF as a market relationship, distinguishing the different roles of consumers, producers and distributors. This market-based approach has transformed Indonesian OF, which is rooted in the social movements that operated at the grassroots level and emphasized community building. Moreover, closer scrutiny of this policy document reveals that the majority of the information it contains is related to technical aspects in OF, such as the requirement for barriers around organic farms, lists of permitted and prohibited inputs, the conversion period from conventional to organic farming, and other technical measures (BSN 2002; BSN 2016). Therefore, the state has been developing OF following the narrative of sustainable development as ecological modernization, where the invention of environmentally benign technology in OF goes hand-in-hand with economic growth (Nightingale et al. 2019b). Despite the state's recognition of the importance of social, economic, and ethical aspects in OF, they receive much less attention.

Furthermore, the focus on national programs to promote OF recalls the productivist, top-down approach of policies for conventional agriculture, which leads

to farmers' dependence on the state. For instance, the targets of the "1000 Organic Village" program are to be achieved through the top-down distribution of agricultural inputs, knowledge transfer, and financial and institutional support for organic certification (Plantation General Directorate of the Ministry of Agriculture 2016). This program views OF as part of the national food sovereignty agenda that leads to food security, an overarching strategic aim of agricultural policy in Indonesia (Neilson and Wright 2017; Schreer and Padmanabhan 2019). On the one hand, the state's orientation in developing OF is technically measurable, for example, through the number of certified organic farms, size of market share, and consumption and production of organic products. In principal, these indicators can be used to assess the sustainability of OF. On the other hand, the diversity of strategies, values, and goals upheld by various OF actors question the extent in which the state's approach contributes to the future sustainability of OF. Moreover, OF is still embedded within the governance of conventional farming (see Figure 1), whereby government agencies take dual roles in developing both organic and conventional farming. Contrary to the European case, where the EU as a supranational entity pushed for the formulation of national OF policies (Slavova et al. 2017), in Indonesia, OF policies emerged from the dominant role played by a national government that views conventional farming and OF as two systems that are not necessarily contradictory, but should be able to exist in parallel and operate side by side.

The need to respond to these inconsistencies in government policy has led to the emergence of three categories of actors within OF social networks. The disengaged group is characterized by its association with the organic movement and its critical attitude towards the government; members of this group have no links with any government actors, as shown in the example of the local organic market community. In particular, they criticize the dilution of OF principles through the focus on standardization and technical definitions, the realignment of OF from community building towards market relationships, and justice issues related to the industrialization of OF, for example, through mechanization and the focus on input substitution (Goodman et al. 1987). They believe that in all these respects, the government's approach to OF perpetuates the existing shortcomings of conventional agriculture. These limitations restrict farmers' initiatives when selecting which farming practices to adopt. They increase the dependency of organic farmers on the state and on policies adapted to the needs of industrialized agriculture—despite the fact that almost two-thirds of farmers in Indonesia are smallholders (Aji et al. 2019; BPS 2018). Therefore, actors in this group consider sustainability in OF should constitute a justice dimension where means of production are not controlled by those

who are not directly involved in farming, but rather more independence among farmers in deciding how and what to grow and where to sell. However, actors in the disengaged group do not express their criticisms by advocating for policy changes — as does the Soil Association in the UK, for example (Conford 2001). Instead, they adapt to the policy environment by engaging with retailers directly, while maintaining connections with the NGOs that pioneered OF in Indonesia as a way of upholding the foundational principles of the organic movement. The actors in this group operate in a close-knit network characterized by a large number of links with other actors and low values of betweenness centrality. It should be noted that, in the context of national regulations, which were created to facilitate the trade of organic products, these alternative community-based organic markets are, in principal, illegal (Aistara 2015). While at present, this remains largely a technicality, this legal issue might become a serious problem in the near future if the government increases the monitoring of trade in organic products, or if the definition of 'organic' is made even stricter.

The second group that we identify is the partially engaged group, which is connected both to the OF movement and the conventional agricultural sector, and strategically adapts to the ongoing changes in state policies by maintaining links with government actors. One example is SPTN-HPS, which is one of the organic pioneers in Central Java and was originally supported by the Catholic Church. In the social network, they still maintain this connection with religious institutions, with whom, they exchange information on the philosophy and technical aspects of OF. They also play a supporting role in government-sponsored OF projects, for instance, by offering advice and training to farmers and village governors. The role of SPTN-HPS in promoting OF in government projects might reflect its credibility among government actors, derived from its status as a pioneer of the organic movement. In the network, SPTN-HPS is a central actor given by its high degree of centrality and its links with all four categories of actors. Nevertheless, after their funding from Catholic social and development organizations ended in 2009, SPTN-HPS has been struggling to adapt to changes in OF, as the priorities of organic farmers have shifted, to a certain extent at least, from building a social movement to obtaining certification and markets for their products (Tamtomo forthcoming). The challenge that SPTN-HPS has been facing, could be argued, is connected to the radical aspect of the OF movement that insists on the independence of OF practice from the state and market (Tovey 1997).

One issue on which SPTN-HPS and other members of the partially engaged group, for instance, Sekti Muda and Mursyidul Hadi Islamic boarding school, takes a firm stance is food sovereignty, particularly seed sovereignty, which is defined as

farmers' rights to access, reproduce, and save seeds (Kloppenburg 2010). There is insufficient clarity in OF regulations on the issue of what constitutes organic seeds (BSN 2016), while Law No.12/1992, the Plant Cultivation System in Indonesia, makes it illegal for farmers to use non-state-registered seeds (President of the Republic of Indonesia 1992). Thus, organic farmers are liable to be prosecuted for attempting to become more independent by storing and using their own seeds, even though, simultaneously, the state encourages the use of local resources in OF (BSN 2016). Similar to the actors in the disengaged group, the justice aspect in OF is paramount for the sustainability of OF according to them. To address this problem, actors who belong to the partially engaged group consider OF as an entry point for engaging in the critical discussion of the current agricultural system with the young people. They also attempt to take advantage of current decentralized governance structures, using village funds as a resource for developing OF from the bottom-up in a way that engages with the aspirations of farmers.

Decentralization was a significant milestone in the governance of agriculture following the fall of President Suharto in 1998, as mentioned in Section 2. The shift in political power and control over budgets allowed government officials to pursue regional interests (Nordholt 2012; Mietzner 2013; Nasution 2016). In a conversation with Eka Herdiana, a government official at the department of agriculture of Tasikmalaya regency, on December 8 2017, he stated that the regency of Tasikmalaya in West Java decided to emphasize the production of organic rice and this is reflected in the provincial government's budget and active support provided for marketing. In addition, the enactment of Village Law (No 6/2014) gave villages a voice in how village funds were used, and thereby increasing their participation in influencing agricultural development at the village level (Vel and Bedner 2015). Therefore, village-level governance could be a platform where farmers, local grassroots OF movements, and the government meet. Nevertheless, a large proportion of the village development budget originates and requires approval from the central government, and this limits the autonomy that villages have for bottom-up agricultural development (Green 2005). In addition, continuation in village development priorities could also be an issue, as village head is a political position, so that the agenda between village head candidates might differ. Despite competition between government officials at different administrative levels for the exploitation of natural resources and the cases of funds mismanagement in the decentralization process in Indonesia (Tsing 2003; Fox et al. 2005), according to the actors in the partially engaged group, village governments remain important potential cooperation partners, since agricultural areas are mostly located in rural areas. Therefore, on the one hand, the current technocratic and market-driven government policy restricts local OF initiatives; on the other hand, the decision-making process in decentralization offers OF actors the opportunity to influence policy-making and its implementation at local level.

As described above, the disengaged and partially engaged groups adopt different strategies to reconcile the convictions of OF pioneers with government policies and, it could be argued, to overcome the negative stigma previously attached to OF movements (Lähdesmäki et al. 2019). By contrast, there are some actors who make use of the legal framework for OF (i.e., third-party certification and OF standards) as an entry point into the organic market, but do not consider themselves to be part of the organic movement. These actors belong to what we identify as the fully engaged group. In principal, their notion of sustainability is similar to the national government, where OF provides better economic opportunity for farmers in the future. Within the group, the farmers' association Gapoktan is influential in terms of the number of network links to other actors, with whom it exchanges information, agricultural inputs, and seeds. However, similar to the local organic market community, Gapoktan exhibits a low degree of betweenness centrality, which suggests limitations to its influence in the network. Unlike many members of the partially engaged group and all members of the disengaged group, members of the fully engaged group do not consider OF as being opposed to conventional farming, and thereby maintain their dependence on government support for both the production and marketing of organic food products.

#### **7. Policy Implications**

We agree that sustainability as a concept loses its analytical rigor when it is used uncritically. The explicit accounts on actors who define it and its definition are prerequisites to address the sustainability of OF. Institutional analysis at the meso level that focuses on the governance of OF highlights the contradiction between centralized governance structures in the agricultural sector and the government's stance that OF should prioritize the use of locally available resources and knowledge. This characteristic can compromise the potential of OF to address the shortcomings in the current agricultural sector, as described above. Institutional analysis at the micro level that focuses on the social networks of organic actors elaborates the multiplicity of perceptions, positionalities, and rationales enacted by different actors. In the context of the pervasive influence of the Indonesian state in regulating OF, our analysis showcases the different strategies based on different degrees and types of interactions between non- and governmental actors. According to this two-level analysis, different

notions of sustainability of OF are enacted by different actors. Particular narratives refer to either the justice aspect in sustainability related to the access and control over OF practices promoted by OF activists or on the ecological modernization promoted by the state. Given the influence of non-governmental actors in the networks, the social justice narrative cannot simply be subsumed under the market creation and technological fix narratives. Therefore, the institutionalization of OF in Indonesia, which is illustrated by the creation of OF policies and standards as we argued above, does not completely push the practices and views of OF as social movement to the margin as also pointed out by Edwards (2013). Our findings support the argument that to make progress in SDGs, the implementation and formulation of policies in sustainable agriculture depend on "societal debates and social movements that apply pressure to governments and institutions" (Eyhorn et al. 2019, p. 254).

Despite the existing tensions, we argue there are spaces for negotiation between the civil society and government, which could potentially lead to the formulation of more coherent OF policies that can accommodate the diversity of goals and strategies among OF actors. One option would be to explore the alternative decision-making mechanisms available in the context of decentralization. The aim should be, for each type of decision, to identify the appropriate decision-making administrative level, so that decisions take account of the interests and perspectives of individual actors and help them achieve their goals. Secondly, as farmlands are predominantly located in rural Indonesia, cooperation and coordination between the MoA and the Ministry of Village could help facilitate OF development in a way that captures the aspirations of farmers. Further study of the relation between village governance and OF institutions could contribute to the future development of OF in a form that is not only more inclusive and locally-driven, but also in alignment with current government OF policy, wider sustainable development goals, and the commitment to decentralization.

**Funding:** This research was funded by the German Federal Ministry for Research and Education (BMBF), grant number 031B0233, Research for Sustainable Development, funding line "Bioeconomy as societal transformation".

**Acknowledgments:** Language editing by Andrew Halliday is highly appreciated. We thank participants at the 1st IndORGANIC Workshop 'The State of Organic Farming on Java' Yogyakarta, 8–9 December 2017. Special thanks to Kristian Tamtomo from the University of Atma Jaya for jointly facilitating the Net-Map exercise. We also thank two anonymous reviewers for their constructive feedback and suggestions for improving the overall arguments and structure of the paper.

**Conflicts of Interest:** The authors declare no conflict of interest. The founding sponsors had no role in the design of the study; in the collection, analyses, or interpretation of data; in the writing of the manuscript, and in the decision to publish the results.

#### **Appendix A**

**Figure A1.** The social network that was drawn by participants of group 1 in the workshop.

**Figure A2.** The social network that was drawn by participants of group 2 in the workshop.

#### **References**


Ditjen BPPHP. 2001. 4 tahun Go Organic 2010.


© 2021 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (http://creativecommons.org/licenses/by/4.0/).

### **Biotechnology, Bioeconomy, and Sustainable Life on Land**

**Justus Wesseler and David Zilberman**

#### **1. Introduction**

Sustainable Life on Land depends on what people want. Some people have a preference for food products labelled as "organic", while others pay more attention to food attributes (e.g., freshness, country of origin, regionality). Yet for others, food itself is less important than the social aspects of food consumption. Moreover, the cares and concerns that people have are not limited to food. They also care about their family and friends, their work, their social life, and their leisure activities, among many other aspects of life. Their wants and choices are shaped by cultural factors, income, and available time, as well as by the places in which they are raised and choose to live. Their preferences are also influenced by local, regional, national, and international policies, over which they are also willing and able to exercise a certain level of influence (Banerjee and Duflo 2019). All of these factors have an impact on the allocation of aggregate-level natural resources—including land—over time and space. These allocations are not static, and they are likely to change in response to changes in relative prices resulting from new information, as is the case with technological changes generating new information induced by knowledge and ideas generated at home and abroad. The reallocation of natural resources over time and space can be understood as a stochastic process with variations around a trend, with new information inducing changes in both trends and the variations surrounding them. The net present value of this process expresses the value of natural resources by assigning a state-dependent and time-dependent price measured by the owner's opportunity costs for each resource (Zilberman et al. 2018). This can also be calculated at an aggregate level for a sector. An increase in net present value is generally understood to improve sustainability (Arrow et al. 2012) and hence, contribute to the sustainable use of terrestrial ecosystems (SDG 15), but also to SDG 2 (End hunger, achieve food security and improved nutrition and promote sustainable agriculture). El-Chichakli et al. (2016) have pointed out the importance of innovation in the bioeconomy for reaching SDG 15 and in particular, from advancements in plant breeding. The approach also indicates that a positive contribution will not necessarily always be the case. As opportunity costs need to be considered, tradeoffs—but also

synergies—with other SDGs are possible. Ronzon and Sanjuán (2020) assessed the EU Bioeconomy Strategy and already identified a number of potential links with 53 targets distributed over 12 of the 17 SDGs. A positive synergy has been identified with respect to SDG 7, SDG 11, and SDG 15, while a negative one has with SDG 2, SDG 8, and SDG 12.

The generation of new ideas can have an important effect on the allocation of resources, and thus, on trends and variations around them. The importance of these effects has increased when responding to climate change (SDG 13), population growth (Jatana and Currie 2020), and the associated increase in the demand for food, all of which pose challenges to the sustainability of continuing "business as usual". It has been estimated that the agricultural sector alone contributes about 37% to current greenhouse gas emissions, and this contribution is expected to increase to between 47% and 60% by 2050 (SAPEA 2020). Based on projected population growth through to 2050, an increase of about 35% in agricultural production is expected to be needed in order to maintain current consumption levels. Some estimates are even higher (SAPEA 2020).

Achieving such an increase in productivity will pose a challenge in light of climate change and in reaching SDG 15. Cost-effective compliance with the objective of the Paris Agreement (a warming limit of 1.5 ◦C) will require large-scale land-based mitigation strategies involving bioenergy production and afforestation, which will result in higher food prices (VanMeijl et al. 2018). Compensating for the increase in food prices will require either further increases in productivity and/or a reduction in meat consumption (Doelman et al. 2019). The magnitude of the changes in agricultural productivity and meat consumption that will be required differs widely, depending on the model used and the assumptions made (Rosenzweig et al. 2014; VanMeijl et al. 2018).

In this contribution, we review and discuss recent technical changes in the field of biotechnology from an economic perspective and how they can help to cope with increasing food demand while also contributing to the sustainability of life on land. We pay particular attention to the ways in which these technical changes will be affected by policies at the national and international level.

In the next section, we provide a brief overview of recent historical developments in the political economy of biotechnology and discuss recent major developments and their implications for sustainable life on land. This is followed by Section 3, which focuses on the importance of supply-chain design, and then by Section 4, which addresses the policy dimension. We conclude (Section 5) by mentioning options for policy changes that could enhance the sustainability of life on land.

#### **2. Brief History of Modern Biotechnology, Including Recent Developments**

The field of modern biotechnology originated with the development of dDNA technology in the mid-1970s. Early applications were made in various fields, including the pharmaceutical and food-processing sectors. Applications with direct land-use implications began with the development of seeds for plants that can express toxins to protect themselves against pests, as well as for plants that were resistant to broadband herbicides. These traits have since been introduced into major crops, including corn, cotton, canola, soybeans, and sugar beet (ISAAA 2018). These crops are cultivated primarily in the United States and Canada, Brazil and Argentina, China, India, and a few other countries (Brookes and Barfoot 2020b). In recent years, insect-resistant eggplants have been introduced in Bangladesh. Another noteworthy application involves the cultivation of papayas that are resistant to ringspot virus in Hawaii. These crops are often summarized under the term "genetically modified organisms" (GMOs), a legal term used in the European Union (Eriksson et al. 2019).

Several meta-studies have pointed to an average increase in yield, a substantial reduction in the use of herbicides and pesticides, and a substantial reduction in greenhouse gas emissions (Brookes and Barfoot 2020a, 2020b; Klümper and Qaim 2014; Finger et al. 2011; Barrows et al. 2014a, 2014b). The increase in the productivity of land has reduced the pressure on land use. Other countries (e.g., Brazil, Argentina) have also experienced an increase in double-cropping (Zallesa et al. 2019; Trigo and Cap 2006). Brookes and Barfoot (2020a) report an aggregate reduction of 775.4 million kg in pesticide use and a reduction of 2.456 million tons CO<sup>2</sup> emissions over the period from 1996 to 2018, due to decreases in fuel consumption. These figures do not include reductions in greenhouse gas emissions resulting from changes in land use through the adoption of reduced-tillage systems, which can also be substantial. As reported by Smyth et al. (2011), emission savings from the adoption of reduced-tillage systems in Canada's production system for herbicide-resistant canola amounted to about 381,000 to 434,000 additional tons in 2006.

Recent progress in molecular biology has provided opportunities for increasing the scope of plant breeding. New plant-breeding technologies (NPBTs) reduce the time and costs required to develop new plants with traits that protect them against a number of abiotic and biotic stressors, including drought tolerance, pest and disease resistance, and increased efficiency in the use of plant nutrients (Nationale Akademie der Wissenschaften Leopoldina, Deutsche Forschungsgemeinschaft und Union der deutschen Akademien der Wissenschaften 2019). An overview of applications in plant breeding is provided in Table 1. Many more are under development. Such developments can be expected to generate further increases

in land productivity, to enhance preparations to counteract the adverse effects of climate change, and to reduce the quantity of pesticides and inorganic fertilizer applied. Taken together, these developments will increase the sustainability of agriculture production and land use by reducing emissions and the pressure on terrestrial ecosystems (Barrows et al. 2014a). Nevertheless, the judgment of the Court of Justice of the European Union (CJEU) in 2018 on the legal treatment of crops developed by using mutagenesis has been interpreted as subjecting crops developed by new plant breeding technologies to the specific EU regulations on GMOs (Purnhagen 2019). This implies that crops developed by those technologies have to follow a lengthy, costly, and unpredictable approval process (Purnhagen and Wesseler 2019; Smart et al. 2017).

New developments in modern biotechnology are not limited to plant production. They have implications for food consumption in general (Tilman and Clark 2014). Advances in biotechnology are being used to grow meat, not only by raising farm animals, but also by growing meat from stem cells in laboratories—a procedure known as "cultured meat" or "clean meat" (Dance 2017). The expectation is that fewer inputs will be needed to grow meat from cell cultures. This is a reasonable expectation, given that the energy needed to keep an animal alive (e.g., for growing a heart, liver, and other body parts) will not be needed, and less land will be required for producing the energy (e.g., in the form of feed and fodder). While the energy use per 1000 kg of cultured meat is comparable to that of beef, the land use and greenhouse gas emissions are more than 10 times less (Dance 2017). Several companies have invested in these technologies, and progress has been made, but it will be many years before the results will reach the market (Thorrez and Vandenburgh 2019). They are nevertheless quite promising from the perspective of both sustainable land use and animal welfare.


**Table 1.** Current and Potential Applications of new plant-breeding technologies (NPBTs) in Agriculture (Examples).

Source: adopted from Purnhagen and Wesseler (2020).

Similarly, a number of plant-based meat alternatives are under development, and some have already reached the market. This reduces the amount of land required for final consumer products by substituting plant-based consumer goods for animal-based products by a factor of four or more (STATISTA 2020a). As reported by Curtain and Grafenauer (2019), more than 4400 meat-substitute products were registered worldwide as of 2015, and the market is approaching a value of several billion dollars (King and Lawrence 2019). In addition to its potential to reduce greenhouse gas emissions relative to equivalent meat products (STATISTA 2020b), meat alternatives are expected to enhance human health by reducing the over-consumption of meat (Willett et al. 2019).

Another development involves the production of insect-based protein. This is accomplished either by raising insects directly for human consumption or by converting maggots into protein—either for human consumption or for use as a protein for animal feed (Pippinato et al. 2020). Insects have a much higher conversion rate. Some can be raised on food waste, thereby increasing the circularity of the food system. The production of protein from insects requires less land, as maggots can grow in chambers, requiring much less space per unit of protein. As reported by Akhtar and Isman (2018), compared to the amount of resources required to produce one kilogram of protein from mealworms, beef protein requires more than 100 times more land, more than 150 times more energy, and more than 110 times more water, in addition to producing at least 50 times more emissions of greenhouse gases. The major markets for insect-based protein production are in the Asia Pacific regions, with an expected value of USD 476.9 million for 2018, followed by Europe, with a market value of USD 216.5 million. The insect protein market in the United States is exhibiting the largest compound annual growth rate—about 28% for 2018–2023—followed closely by Europe, with an annual growth of 26% (STATISTA 2020c).

A fourth development that is increasing the sustainable intensity of agriculture per unit of land is the indoor production of vegetables through closed systems or indoor farming. These techniques also enhance the efficiency of water usage, in addition to requiring almost no pesticides and nearly eliminating nutrient emissions into the environment. Indoor vegetable farming increases yields by a factor of 10, relative to outdoor farming (STATISTA 2020b). The use of LED technology to resolve one of the greatest challenges associated with indoor farming is expected to increase both yield and the adoption of the technology (Tibbetts 2019). The worldwide market is expected to increase by a factor of four, from about USD 4.4 billion in 2019 to about USD 15.7 billion in 2025 (STATISTA 2020b).

In yet another development, aquaculture production is increasingly shifting to closed production systems, thereby reducing pressure on coastal regions (e.g., mangrove forests) (Romano and Sinha 2020). Closed and semi-closed aquaculture systems, including recirculating aquaculture systems (RAS), are often combined with closed vegetable-production systems in "aquaponic systems". Although the market is still developing, further growth is expected to be strong in response to the "lighting revolution". The forecasted worldwide market value for 2022 is about USD 870.6 million (STATISTA 2020c). Overall, aquaculture production is expected to exceed capture-fishery production in quantitative terms by 2024 (OECD/FAO 2020), also supported by the recent developments in genetically engineered salmon (Van Eenennaam et al. 2021).

The five developments discussed above are moving food production closer to urban and peri-urban areas, with greater density per unit of land and less release of pollutants into the environment, including the emission of greenhouse gases. Each of these developments has the potential to achieve sustainable increases in food productivity. An overview of expected market values is provided in Table 2.


**Table 2.** Forecasted market values of sustainable intensification of food production systems.

Source: <sup>1</sup> MarketsandMarkets (2019), <sup>2</sup> STATISTA (2020a, 2020b, 2020c, 2020d, 2020e).

New developments are also relevant to parts of the bioeconomy that are involved with activities other than processing biomass into food and feed (as discussed above). The bioeconomy is viewed as part of a strategy aimed at sustainable development in general and, in particular, decarbonization and the transition from an economy that relies on non-renewable resources to one that relies heavily on renewable resources (EC 2018). The broad adoption of modern biotechnological solutions combined with taking advantage of new information technologies and applying precision agricultural techniques is expected to increase the input use

efficiency of agriculture, in addition to enabling the farming of fine chemicals and biofuels (Zilberman 2014). Many countries have developed bioeconomic strategies involving such conversions, including the production of bioenergy (e.g., biofuels), the extraction of biopolymers for bio-based products (e.g., food wrappings), and the production of textiles and clothing, enzymes for detergents, and many more examples (Wesseler and von Braun 2017). The main expectation is that these developments will reduce the extraction of carbohydrates from fossil resources and contribute to the reduction of greenhouse gas emissions through product substitution. This strategy has received considerable attention in the European Union. Under the new green deal, the EU plans to mobilize investments amounting to about EUR one trillion to develop the EU bioeconomy (EC 2020). Several large biorefineries are under development for the production of bioenergy, bio-based chemicals, and enzymes. A report by Parisi (2018) lists 803 biorefineries, 507 of which produce bio-based chemicals, 363 produce liquid biofuels, and 141 bio-based composites and fibers (multi-product facilities are counted more than once). Germany has the highest number of small-scale biorefineries producing energy in the EU in the form of biogas. Further increases are expected for investments in biorefineries. The economic success of many biorefineries depends in large part on government support. The rise in biogas facilities in Germany was driven primarily by the fixed feed-in tariffs for transferring energy into the grid system, resulting in a substantial reduction in price uncertainty. The future development of smaller and larger scale biorefineries critically depends on government policies (Theuerl et al. 2019) and in particular, on access to advances in biotechnology (Purnhagen and Wesseler 2019).

The United States and Brazil have engaged in a massive effort to produce ethanol as a biofuel. These efforts include the production of ethanol from feed stocks (e.g., corn and sugar cane), as well as the production of second-generation biofuels from grasses (e.g., miscanthus and switchgrass), corn stover and bagasse, and various trees. The production of corn ethanol in the US originally caused a significant rise in food prices and required substantial subsidies. Learning by doing and economies of scale eventually reduced the costs of producing corn ethanol by 45% between 1983 and 2010, while the cost of producing sugar-cane ethanol declined by 75% between 1975 and 2010, thus making these biofuels much more competitive with fossil fuels. The fuel-blend restriction in the US limits the ethanol content of gasoline to 10%, while ethanol provides 30% of the fuel for gasoline cars in Brazil. Corn ethanol production has had less of an impact on land use than was feared. In particular, in 2014, the total crop acreage in the US was only 0.5% higher than it had been in 2008 (Khanna et al. 2021). Furthermore, the introduction of corn ethanol led to

a modest reduction in greenhouse gas emissions, as compared to the gasoline it replaced (5–15%), while sugarcane ethanol reduced greenhouse gas emissions by as much as 70% (Hochman and Zilberman 2018). Second-generation biofuels are not yet competitive, especially due to the reduction in oil prices since 2014 and the increased economic viability of electric cars that rely on solar energy. Nevertheless, second-generation biofuels continue to be developed, utilizing recent advancements in biotechnology to target air travel, in which battery use is unlikely to be feasible (Debnath et al. 2019). More could have been achieved, but the use of flex-fuel vehicles in the United States and elsewhere is limited by the E85 refueling infrastructure (Kuby 2019).

Investments in the bioeconomy have not been undisputed. There has been an intense debate about food versus fuel. The conversion of crops that could have been used for food into fuel has been seen as morally unacceptable, given the high level of poverty observed in many regions of the world. This is a somewhat narrow view of the causes of poverty. Although access to food is obviously important, reducing the debate to the provision of food ignores the importance of purchasing power (Sen 1982). It can be extremely misleading to limit the understanding of purchasing power or income to food alone, as it depends on a variety of factors (Schmitt 1989; Acemoglu and Robinson 2012).

#### **3. Developing Supply Chains**

Many new technological developments in the bioeconomy require substantial investments, combined with a high level of uncertainty. The supply chains for many products are not yet developed, thus increasing the risk of an individual investor. Public–private partnerships and contracting sales along the supply chain have become important tools for developing new markets. This includes new bio-based products that are associated with positive relative carbon emissions and other environmental benefits (Rahmann et al. 2020).

The introduction of production standards and vertically integrated supply chains has created new market opportunities (Beckmann 2000). Vertical integration has allowed many farmers in Africa, Asia, and Latin America to benefit from export opportunities to the European Union and the United States. In many cases, this involves the export of high-value products, including the sourcing of aquaculture products or vegetables (Reardon and Zilberman 2018).

The development of vertically integrated supply chains has been supported by consumer demand, stakeholder groups, and government policies. The certification of timber products by the Forest Stewardship Council (FSC) has become an important

tool for supporting sustainability (Degnet et al. 2020). The Rainforest Alliance and other groups support the production of soybeans without a direct link to the deforestation of the Amazonian rain forest. Other certification schemes support other forms of agriculture (including organic agriculture), with the aim of contributing to sustainable agriculture, resulting in an overall increase in vertical integration (Wesseler 2014). Although many of these initiatives are well-intentioned, their impact on sustainability has been questioned in some cases (Ghozzi et al. 2016).

#### **4. The Political Economy of Biotechnology**

Sustainable life on land depends largely on policies and institutions. Policies can directly increase or decrease the price of goods at home and abroad, thereby affecting the allocation of natural resources. In particular, the impact of environmental and food-safety policies on the allocation of natural resources and its related implications for sustainability have been discussed by academics at the level of policy (e.g., Eriksson et al. 2019; Paarlberg 2008).

Concerns about environmental health and food safety have led to the establishment of production standards including procedures, incentives, and regulations that constrain land use (Winston 2002). In general, these measures include a combination of ex ante regulations and ex post liability rules. Ex post liability is understood as liabilities faced by producers in case they do not comply with ex ante regulations. The dependent design of safety policies affects incentives for investment in new food-production technologies. The clarity, severity, and enforcement of safety policies vary across countries. In some countries, they provide clear investment guidance, and in others, they add a layer of uncertainty, possibly curtailing investments. In recent decades, safety policies have substantially increased in importance, becoming non-tariff barriers to trade (e.g., Felbermayr and Larch 2013).

As suggested by Arrow et al. (1996), cost–benefit analysis is crucial for guiding the establishment of safety guidelines. Such analyses require performing risk assessments to estimate the relationship between risks to humans, to the environment, and to human action under alternative regulations and conditions, in addition to evaluating the benefits that the regulations will have for various parties (Antle 1999). Safety regulations are based on tradeoffs. The introduction of transgenics in agriculture benefited the consumers and producers who adopted it. At the same time, it was costly to producers not adopting transgenics and to chemical manufacturers, due to reduced commodity prices. Overall, however, the introduction of transgenics increased social welfare, based on economic criteria (Hochman and Zilberman 2018). In addition to precise and efficient regulations, the implementation of effective safety

policies has required effective risk communication and management (Henson and Caswell 1999).

The use of cost–benefit analysis could potentially be constrained by the lack of data on the value of non-market benefits and the cost of regulation. An alternative approach involves the use of cost-effectiveness criteria to establish cost-minimization regulations, subject to an upper boundary of mortality risk (Lichtenberg and Zilberman 1988). The resulting regulations require evaluating statistical life gain (i.e., the value of statistical life; Aldy and Viscusi 2007). This evaluation can be compared to those implied in other regulations, thereby allowing assessment of the stringency of the risk constraint.

Herring and Paarlberg (2016) suggest that Latin American countries (e.g., Brazil, Argentina), which are large feedbox producers (like the US), have applied regulatory frameworks similar to those in the US, while African countries, which have strong ties to Europe, have adopted a strict regulatory environment for biotechnology, even though they also stand to reap significant benefits from such technology (Shao et al. 2020; Wesseler et al. 2017).

Decisions about food safety regulations are inherently political, and the welfare of different groups in society may have different weights, which may be affected by political realities (Swinnen and Vandemoortele 2009). In particular, the economic tradeoff between ex ante regulations and ex post liability (Beckmann et al. 2006, 2010) as well as the decision-making procedures (Smart et al. 2015) can have strong implications for the incentives to invest (Purnhagen and Wesseler 2019). This has been demonstrated by a number of studies that look into the approval process and related costs of biotechnologies in agriculture. Those studies show that the time lengths in approval can differ substantially between regions (Jin et al. 2019; Frederiks and Wesseler 2019; Smart et al. 2017; Smyth et al. 2017) and of course, in many cases, the approval process reaches infinity, i.e., similar to a ban.

In an analysis of the political economy of agricultural biotechnology, Graff et al. (2009) suggest that existing restrictions on the use of biotechnology in Europe reflect the political power of the coalition of a number of farm groups, environmental groups, and chemical manufacturers, as well as the unique political structure of the EU (Smart et al. 2015). The regulatory environment in the US is more receptive to biotechnology, given that many biotechnological innovations have originated in the US, with some traits having been beneficial to US farmers. Wesseler (2002), McCluskey and Swinnen (2004), and Castellari et al. (2018) further suggest that in both the US and the EU, opponents to GMOs have been able to utilize the media to affect consumer preferences, even though consumers stand to benefit from the

introduction of genetically modified varieties. Additionally, the semantics being used in the public debate as well as in books, including teaching material, has a further impact on shaping opinions (Aerni 2018). Tosun and Schaub (2017) show that in the EU, the opposition to GMOs includes more active groups and has a stronger network, while the same has also been observed for China (Jin et al. 2020).

While many safety policies are designed by national governments, several international agreements impose additional costs and uncertainty for investors. One example is the *Nagoya Protocol on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from their Utilization to the Convention on Biological Diversity*. Plant breeders and others have complained that the protocol increases the costs and related uncertainties associated with developing new plant varieties with desirable traits, including drought tolerance, pest and disease resistance, and the efficient use of nutrients and adds to the regulatory burden already caused by the *Cartagena Protocol on Biosafety to the Convention on Biological Diversity* (Deplazes-Zemp et al. 2018). While any international agreement will invoke complaints by some, agreements that increase the costs of investing in sustainable agricultural solutions are of particular concern. New technologies and the benefits associated with them must be weighed against their potential negative implications, particularly those that are irreversible. As stated in Principle 15 of the Rio Declaration on Environment and Development of 1992: "In order to protect the environment, the precautionary approach shall be widely applied by States according to their capabilities. Where there are threats of serious or irreversible damage, lack of full scientific certainty shall not be used as a reason for postponing cost-effective measures to prevent environmental degradation." (United Nations 1992, p. 3 )

The presence of irreversible damage does not imply that a technology should be prohibited. As demonstrated by various scholars (Arrow and Fisher 1974; Henry 1974), if an irreversible effect is present, one unit of irreversible costs requires more than one unit of reversible benefits to compensate (Wesseler and Zhao 2019). Unfortunately, many assessments fail to consider the tradeoffs between irreversible damage costs, which are often uncertain, and the benefits foregone by delaying or preventing the introduction of a new technology. Previous studies have indicated that a one-unit increase in investment costs requires more than one unit in benefits to compensate for related uncertainties. For example, as demonstrated by Purnhagen and Wesseler (2019), the marginal effect of an increase in approval costs can be substantial, possibly extending beyond a factor of 10. One prominent and widely discussed example is the regulation of new plant-breeding technologies in the European Union (e.g., Nationale Akademie der Wissenschaften Leopoldina, Deutsche

Forschungsgemeinschaft und Union der deutschen Akademien der Wissenschaften 2019), which has resulted in court cases in which judges have applied an absolute interpretation of the precautionary principle (Purnhagen and Wesseler 2020).

As mentioned previously, many new developments in biotechnology have the potential to provide substantial sustainability gains. Nevertheless, they have been rejected by important stakeholder groups, which also argue that these technologies should be prohibited from entering the market, based on the perspective of sustainability. Such arguments extend beyond the absolute application of the precautionary approach, as the debate concerns the types of agriculture and land use that should be preferable. The line is drawn largely between what is and is not considered organic agriculture. Definitions differ by country and interest group. Referring to the Austrian anthroposophist Rudolph Steiner, groups including farmers market their products under the Demeter® label. While what is and is not considered organic is a policy decision (Castellari et al. 2018), policy choices that favor one over the other are questionable from a sustainable development perspective. In many cases, large-scale applications of organic agriculture as defined by policy makers result in lower yields per unit of land and reduce the total quantity of food available. While one common argument holds that organic agriculture reduces the emissions associated with fertilizers and pesticides, the application of copper sulfate has sometimes resulted in environmental pollution, and the rejection of inorganic fertilizer has led to soil mining in some cases. In other cases, the principles of organic agriculture are likely to yield better results. Policy decisions in these matters can result in a substantial misallocation of resources, thereby endangering sustainable development (World Bank 2010).

#### **5. Conclusions**

Modern biotechnology offers a number of possibilities for addressing challenges to sustainable life on land (SDG 15), but there is also a strong link with achieving zero hunger (SDG 2) as achieving SDG 15 depends on the expected increase in population and the related increase in food demand. In this contribution, we have listed several of the possibilities. Many more exist, and some are better developed than others. The promotion of sustainable life on land and protecting terrestrial ecosystems is thus not mainly a technical problem; the major problem is both institutional and political. This has been stressed by several authors before as well (Wesseler and von Braun 2017; El-Chichakli et al. 2016; Zilberman et al. 2018). More specifically, institutional and political environments provide both incentives and disincentives for the private and public sector to invest in the development of solutions. When the obstacles

are lower, parties in the private and public sectors are more likely to invest in the development of solutions. Obstacles can be reduced by harmonizing the standards for safety assessments. Examples include the acceptance of animal-feeding trials and nutritional studies across jurisdictions, as well as agreement on the procedures for field trials and the exchange of field trial data for environmental safety assessments. The relevance of harmonization of standards and the related benefits for all has been demonstrated by the COVID-19 pandemic recently. Hence, the positive contribution of biotechnology and the bioeconomy in general will go beyond SDG 15. This has important implications for achieving zero hunger (SDG 2), but also for reducing poverty (SDG 1), promoting sustainable growth (SDG 8), ensuring sustainable consumption and production patterns (SDG 12), and relies on fostering innovation (SDG 9). The UN Sustainable Development Goals initiative provides an opportunity for implementing important policy changes for achieving "decent lives for all on a healthy planet".

**Author Contributions:** J.W. and D.Z. both equally contributed to conceptualization, investigation, writing—original draft preparation, writing—review and editing. Both authors have read and agreed to the published version of the manuscript.

**Conflicts of Interest:** The authors declare no conflict of interest.

#### **References**


Zilberman, David, Tim G. Holland, and Itai Trilnick. 2018. Agricultural GMOs—What we know and where scientists disagree. *Sustainability* 10: 1514. [CrossRef]

Zilberman, David. 2014. The political economy of innovation and technological change. *Environment and Development Economics* 19: 314–16. [CrossRef]

© 2021 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (http://creativecommons.org/licenses/by/4.0/).

### **Barriers to Zero Tropical Deforestation and 'Opening up' Sustainable and Just Transitions**

#### **Izabela Delabre and Callum Nolan**

#### **1. Introduction**

International efforts such as the UN Sustainable Development Goals (SDGs), the UN Forum on Forests (UNFF), and the UN Framework Convention on Climate Change (UNFCCC) have sought to engender sustainable use of forests—including tropical forests, the focus of this chapter—through reducing deforestation and encouraging reforestation and afforestation. Ambitiously, the SDGs state that by 2020, we need to "promote the implementation of sustainable management of all types of forests, halt deforestation, restore degraded forests and substantially increase afforestation and reforestation globally" (UN General Assembly 2015). At the same time, tropical forest governance is increasingly decentralised within government departments, taking on public, private and hybrid forms, and bringing diverse actors and alliances into forest politics that interact across scales and with differentiated effects (Arts 2014). Initiatives for governing tropical forests take multiple forms, including 'zero deforestation' supply chain initiatives, carbon foresy, Reducing Emissions from Deforestation and Forest Degradation (REDD+), legislative frameworks that intend to cut off markets for illegally harvested timber, and emerging landscape and jurisdictional approaches.

These global commitments demonstrate growing recognition of the urgent need to arrest tropical deforestation to avoid 'tipping points' (Walker et al. 2019; Amigo 2020). A tipping point refers to the stage at which forest degradation is such that rainforests can no longer be sustained and shift states to savannah, releasing vast amounts of forest stored carbon with devastating and irreversible repercussions for planetary health (Lovejoy and Nobre 2019; Pereira 2019). A recent study has suggested that such tipping points may be considerably closer than previously imagined, with as much as 40% of the Amazon now at a point at which it could exist as savannah as opposed to rainforest (Staal et al. 2020). However, despite the acknowledgement of the SDGs for 'transformative' change, current trends indicate that the SDG 2020 targets on forests and their sustainable management have not been met. The majority of 'zero deforestation' commitments, made by private companies as voluntary pledges

to eradicate deforestation throughout their supply chains (Lambin et al. 2018) also fall short of their 2020 targets (as highlighted in the 'Forest 500<sup>0</sup> report by Global Canopy that found not one of the 500 most influential forest-risk commodity companies and institutions were on course to do so (Rogerson 2019)). Similarly, the five-year progress review of the transnational multi-stakeholder 2014 New York Declaration on Forests (NYDF) shows large commitments but slow implementation, pointing to another missed target (NYDF Assessment Partners 2019).

Rather than meeting these targets, tropical deforestation continues at an alarming rate, with as much as 12 million hectares of tropical tree cover loss recorded in 2018 (World Resources Institute 2019). On a global scale, tropical forest destruction is driven by an ever-growing demand for commodities such as timber, soybean, oil palm and cattle meat, all associated with forest loss (Seymour and Harris 2019), and the expansion of extractive industries and infrastructure development (Sonter et al. 2017; Bebbington et al. 2018). Tropical deforestation is often facilitated by the violent appropriation of land and the expulsion of indigenous communities (Li 2018), a recent example being the surge of violence against indigenous communities in Brazil (Greenpeace 2020). Furthermore, tropical deforestation has a host of other negative impacts felt across scales. Locally, forest degradation and loss erode vital ecosystem services which provide livelihoods, medicines and food for indigenous communities (Tsing 2004; Li 2015), and globally the felling and burning of tropical forests is a major source of anthropogenic greenhouse gases, emitting more carbon dioxide equivalent than the entire European Union (World Resource Institute 2018). Beyond, and linked to, the commodity expansion driven stressors facing tropical forests, environmental changes such as global warming and biodiversity loss exacerbate degradation, with exactly how and to what extent still relatively poorly understood (Cusack et al. 2016). To that end, we argue that careful attention must be paid to the influences of power and politics in forest governance to imagine opportunities for sustainable and just transitions for forests and their use.

Drawing on insights from political ecology and sustainability transitions research, this chapter discusses the barriers to transitioning to zero deforestation. Exploring the possibilities for a sustainability transition for forests, we argue that careful attention must be paid to the influences of power and politics surrounding drivers of deforestation, forest governance and its outcomes, and the need to challenge orthodoxies around economic growth that currently underpin policy responses. It is increasingly clear that transformative reforms are required, departing from the extant governance milieu of neoliberal solutions. This process is profoundly complex due to the inevitable trade-offs and tensions between the ecological, economic and social

aims of transitions to zero deforestation, and the difficulty in challenging the existing power structures that underpin 'business as usual' in forest governance.

#### **2. Power and Politics in Sustainability Transitions**

Forest Transition Theory suggests that landscape change is shaped by three distinct processes that occur over time: (1) fragmentation, (2) deforestation and degradation, and then (3) restoration and reforestation; and these three processes correspond with economic development at regional or national scales (Mather 1992). It may be argued that Forest Transition Theory emphasises a natural, unilinear and homogeneous process of 'development' whereby developing countries follow the historical processes of developed countries (Klooster 2003), but the nature of a transition is shaped by situated historical contexts (Rudel et al. 2002). However, the theory remains one of the foundations of current thinking on forest landscape change (Garcia et al. 2020). Given the urgency of addressing the forest crisis, we agree with Garcia et al. (2020, p. 418), who state that "landscapes do not happen; we shape them", and emphasise the role of agency as a key factor and blind spot of current forest policy.

The changes required to halt global trends in deforestation are highly complex and necessitate long lasting reform across social, economic and political spheres. The field of 'sustainability transitions' has increasingly sought to support our understanding of "the complex and multi-dimensional shifts considered necessary to adapt societies and economies to sustainable modes of production and consumption" (Coenen et al. 2012, p. 968). Early literature on sustainability transitions has been critiqued for being overly technocratic and therefore failing to recognise the inherently political, and thus power laden, nature of meaningful change (Meadowcroft 2011; Stevis and Felli 2015). More recent research has recognised that politics and power fundamentally shape the process of sustainability transitions (O'Neill and Gibbs 2020). A multitude of different actors devise, enact, enforce, govern, communicate, shape and resist these processes—including states, international institutions, private actors, civil society and communities. Sustainability transitions are therefore not unilaterally implemented by any one party, but are the product of complex networks of actors, likely to have divergent understandings of what 'success' may look like, and of how it may be achieved (Köhler et al. 2019).

These networks of actors are characterised by an imbalance of power, meaning that powerful actors such as corporations, states and institutions have a disproportionately influential say in setting the transformation agenda (Avelino 2017). Often, elite actors are invested in maintaining the status quo (Routledge et al. 2018), hindering truly sustainable transitions and perpetuating the environmental injustices that blight those less powerful actors such as indigenous communities. Power then in transition studies can pertain to 'power struggles' between incumbent actors and those who are trying to challenge 'business as usual' (Köhler et al. 2019). The results of these struggles impact access to resources and the distribution of the burdens and benefits associated with sustainability transitions (Healy and Barry 2017).

The inherently power-laden nature of sustainability transitions has invited researchers to apply a critical lens to their analysis, asking important political economy questions on who is defining the terms of change, who wins, who loses, how and why (Smith and Stirling 2010; Newell and Mulvaney 2013). These questions expose the injustices that arise, or are reinforced, by transitions aiming to achieve sustainability—most commonly addressed in the literature on 'just transitions'—which have sought to foreground the concerns of marginalised and disproportionately affected actors in transitions (Ciplet and Harrison 2019). Lawhon and Murphy (2012) outline additional critical questions that might further elucidate the impacts of disparate power relations in sustainability transitions such as: At what scale are decisions made? Who is represented in transitions? Whose knowledge counts? What are the intended and actual social outcomes of transitions? Answering such questions enables a root cause analysis of the drivers of, and barriers to, sustainable and just transitions. Next, we unpack some of the barriers to transitioning to zero deforestation to date, considering these critical questions. We do not claim to capture all of the challenges encountered in transitioning to zero deforestation, nor are we dismissive of the efforts undertaken by policymakers, practitioners and researchers in seeking to raise ambition on forest governance. Rather, we attempt to highlight the complexity of the challenges of addressing tropical deforestation and open up discussion on possibilities for transitions.

#### **3. Barriers to Transitioning to Zero Deforestation**

#### *3.1. Problem Framing: Contested Definitions of "Forests" and "Deforestation"*

Often, forest governance mechanisms are based on technological and market-based solutions to the problem. A case in point is the UN REDD+, in which developing countries receive money from developed countries in order to protect forests. Private governance is also becoming increasingly common, in response to growing public awareness of the extent of private sector-driven deforestation. This has manifested through 'zero deforestation' commitments being made by private companies as voluntary pledges to eradicate deforestation throughout their supply chains, often through the use of certification programmes

(Lambin et al. 2018). Challenges in transitioning to zero deforestation may in part relate to significant differences in how different actors define 'zero' (versus 'net' zero), 'forests', and 'deforestation', as well as differences in implementation mechanisms, and success metrics (Garrett et al. 2019). Definitions of deforestation and zero deforestation used by the private sector, government, and non-governmental organisations, vary and lack clarity on whether they relate to zero 'gross' deforestation (reducing primary forest loss) or zero 'net' deforestation (involving new planting or reforestation to compensate for forest loss), whether tree plantations are included, or how past clearance is addressed (Brown and Zarin 2013; Lambin et al. 2018). Examining discourses of how 'forests' and 'deforestation' are defined highlights how different actors interact and potentially influence the deforestation problem and its possible solutions (Bäckstrand and Lövbrand 2006). How these definitions are then encoded into policies and standards fixes meaning in an inherently political process (Turnhout 2018), where power is exercised by actors to challenge or keep power, thus serving particular interests (Fischer and Hajdu 2017).

This diversity and ambiguity makes it difficult to evaluate progress towards 'zero deforestation', and actors can fill the statements with meaning to suit their particular interests (Beland Lindahl et al. 2016). Through the process of defining forests and deforestation, discourses may be 'closed down' to retain hegemony through the reinterpretation of a problem and how it should be solved, and thus which interests should be taken into account (Fischer and Hajdu 2017). For example, zero 'net' deforestation could be considered well-aligned with corporate interests, as 'business as usual' can continue through a spatial-temporal fix of tree planting, apparently reconciling economic growth and conservation (Harvey 2007). However, alienated communities bear the burden of this appropriation of nature (Fairhead et al. 2012), as their use of land and forests is restricted (e.g., Mahanty et al. 2012) and benefits are captured by the elites (e.g., in the case of REDD+, Sikor et al. 2010).

In attempting to operationalise 'zero deforestation', an important process is making forests or deforestation 'calculable' and 'legible'. In the process of operationalisation, forested and deforested areas are defined using standardised categories and metrics, so that categories are commensurable and their values comparable and exchangeable, including through markets (Turnhout 2018). This process of categorisation involves 'experts' who are tasked with undertaking valuations and assessments as part of land use zoning for agricultural expansion or calculating carbon units represented by forests which obscure their diverse values. This has been at the expense of local communities who frequently recognise the plural values of forests beyond zones labelled as 'High Conservation Value areas/forests' (HCVs) or areas of 'High Carbon Stock' (HCS) (Cheyns et al. 2020). These technocratic processes of zoning—which allow efficient auditing to take place against certification standards—may obscure the exercise of power by experts, who are influential in defining certain visions of forests and their management.

The definitional problems related to deforestation have persisted for decades, and it is clear that previous accounts of deforestation's impacts have important flaws (Forsyth 2004). According to Hamilton and Pearce (Hamilton and Pearce 1988, p. 75 c.f. Forsyth 2004), "The generic term "deforestation" is used so ambiguously that it is virtually meaningless as a description of land-use change . . . It is our contention that the use of the term "deforestation" must be discontinued, if scientists, forest land managers, government planners and environmentalists are to have meaningful dialogue on the various human activities that affect forests and the biophysical consequences of those actions". It is clear that definitions of forests and deforestation continue to be contested, with important implications for how the problem is constructed and its solutions. Although it is unlikely that the term "deforestation" will be discontinued, we argue that the complexity of the term must be recognised. More attention is needed to the nuanced drivers and effects of deforestation, which requires consideration of questions of multi-scalar political economic causes of forest loss, in order to develop appropriate and relevant policies. This may require, for example, contesting problematic assumptions and policy narratives about causes of deforestation which lead to ineffective solutions (Ravikumar et al. 2017).

#### *3.2. Governance across Scales: Translations and Enactments of Sustainable Forest Governance*

"Zero deforestation", as encoded into SDG 15, private sector statements, and the NYDF, is a bold statement made by actors at the global level to communicate ambition to protect forests. Although this may be considered "the goal" set by actors at the global level, constituting a process of managing sustainability and brand risks or even as a marketing tool, these ambitious statements reshape and influence relations within global value chains, through consolidations, exclusions, and changing practices. Global strategies are enacted differently and unevenly across geographies, through complex politics of translation as they are refracted and reproduced across local-global sites of negotiation (Merry 2006; Newell 2008). Asserting that deforestation is always problematic through claims of 'zero deforestation' and the targets contained in the SDGs may grant insufficient attention to the complexity of how deforestation is carried out, its variety of purposes and impacts (Forsyth 2004). Moreover, implementation of zero deforestation commitments is incredibly complex due to supply chain

structure (Lyons-White and Knight 2018). Issues of leakage when supply chains are 'cleaned up' (or 'deforestation-free' with non-compliant suppliers excluded) mean that deforestation is displaced rather than eliminated (Garrett et al. 2019), and do not address the root causes of deforestation and may be considered a process of 'rendering technical' a complex political economic problem based on inequitable control of forest and forestlands (Li 2011). Myers et al. (2018), based on 742 interviews (in conservation, payment for ecosystem services, and REDD+ projects in Indonesia, Mexico, Peru, Tanzania and Vietnam), found that proponents viewed problems through a 'technical' rather than 'political' lens, which came at the expense of political solutions such as the representation of local people's concerns and recognition of their rights.

Current global sustainable forest governance initiatives are underpinned by the notion of forests as a 'global common good', which may contrast with local understandings of forests and in turn create barriers to transitioning to zero deforestation (Basnett et al. 2019). 'Global' views of legality, such as those defined by the EU Forest Law Enforcement, Governance and Trade (FLEGT) Action Plan, for example, differ from local understandings of legality which are viewed by non-state actors as part of a colonial legacy and imposed upon them (Myers et al. 2020). Global narratives can, in turn, be stabilised within regional narratives, which may not always reflect local realities but still inform policies (Fairhead and Leach 1995).

Measuring, reporting and verification (MRV) systems used to support global forest governance initiatives, while making visible forest loss and regeneration, identify forests as 'pixels' or units of carbon, risks further decontextualising the historic processes of deforestation that were—and are—based on a colonial extractivist mindset that persists in national plans and forest policies (Gupta et al. 2012). Galudra and Sirait (2009) argue that scientific discourse was used by the Dutch colonial administration to justify control of 120 million hectares of land as forest reserves, legitimised by the view that customary systems of land tenure and use were 'inappropriate' and 'destructive'. This pattern of land control endures and remains in policy discourses that emphasise and protect private land rights (Mousseau 2019). Under this form of land control, subsistence and artisanal use of forest resources are often declared illegal, while access is enabled for large commercial timber companies or agribusiness (Munro and Hiemstra-Van der Horst 2011).

Through carbon offsetting, a unit of carbon is disembedded from a locality and its conflicts, and through a process of commodification can be bought and sold in global markets, without challenging current consumption patterns and by allowing economic

growth to continue as usual (Cavanagh and Benjaminsen 2014). Private certification has been promoted as an important private forest governance solution, but can reinforce new forms of injustices as it privileges those who can afford to dedicate time and resources to comply with complicated standards (Basnett et al. 2019). According to Sayer et al. (2019, p. 501): "Without an emphasis on integration, wide political and public engagement and greater responsiveness to local needs, SDG 15 risks perpetuating a sectoral, top-down approach". Inadequate consideration of local contexts gives rise to equity concerns and may thus preclude efforts to challenge root causes of unsustainability and deforestation.

Current sustainable forest governance initiatives go further than decontextualising forests and disembedding the local. Initiatives implicitly blame local actors as driving deforestation, while simultaneously focusing on them as the solution, as is seen in the case of REDD+ and corporate deforestation initiatives (Delabre et al. 2020). In the case of REDD+, Skutsch and Turnhout (2020) highlight how the 'communities' narrative may implicitly rest on explanations of the causes of deforestation that have since been discredited, but remains attractive as it focuses attention away from more politically sensitive approaches, e.g., targeting powerful industrial interests, and masking difficult trade-offs. However, such an approach delegates the burden of responsibility to potentially already marginalised communities (Goldman 2001), which may exacerbate existing inequalities and potentially impedes progress against other SDGs. Treating the problem of deforestation as driven by small farmers and actors distracts from attention to the wider political economy of forests and their governance (Ravikumar et al. 2017).

The notion of 'measurementality' places transparency alongside effectiveness and efficiency as neoliberal principles in environmental governance (Turnhout et al. 2012). Despite such emphasis on standardised and 'objective' science-based measurements, the two main global datasets on deforestation are conflicting. Global Forest Watch (hosted by the World Resources Institute) uses satellite images and on the ground observations to detect tree cover, and estimated global deforestation rates as 72.5 million acres in 2017, whereas the UN FAO Global Forest Resources Assessment, based on registered land use and disclosed by governments, estimates annual net loss, once forest regrowth is taken into account, at 8.2 million acres (Pearce 2018). Despite continuing high rates of deforestation in many locations, statistical uncertainties are often not acknowledged, and as a result, some estimates become seen as factual and unchallenged (Forsyth 2004). Furthermore, the use of 'big data' and technologies as industry norms for monitoring and managing deforestation in supply chains brings to the fore a number of challenging questions, some examples of which follow.

Firstly, to what extent are these new technologies for knowing forests legitimate, to whom are they considered legitimate and what are the implications if they fail to gain legitimacy amongst important stakeholders? Secondly, who gains and who loses from the use of these new technologies, what are the power structures and other factors that determine winners and losers, and how might these be dismantled in order to ensure technological advances do not reinforce systems that oppress or harm vulnerable groups? Finally, whose visions of sustainability may be promoted or obscured as measurement is undertaken based on abstracted data, and what are the implications of this?

#### *3.3. Directionality of the Transition: Who Is Represented?*

Diverse actors and alliances are involved in the enactment of public, private and hybrid forms of tropical forest governance at global, national and local scales. How these diverse actors perceive forests and their sustainable governance influences their strategies and actions. Different framings of the same problems are often the source of political struggles (Fischer 2003). Thus, who frames the problem of deforestation, and how, is a critical consideration in transitioning to sustainability.

Incumbent actors such as the state, private sector, and powerful NGOs play a disproportionately large role in the directionality of the transition to zero deforestation, and are able to shape particular processes while resisting others. Although on one hand, this multi-actor governance brings diverse perspectives and knowledge and opportunities for dissenting voices to be brought to the table, certain powerful actors may be dominant in setting and enacting (often neoliberal) solutions. If powerful interests and values are over-represented in visioning and framing targets and the means of implementation, this may preclude possibilities for just sustainability transitions, and exclude alternative pathways (Leach et al. 2007).

This can be demonstrated by the different networks and alliances of actors who affect, and are affected by, deforestation and forest governance, who have divergent understandings of what constitutes sustainable land use with important consequences for how tropical forests might be best conserved while obtaining food. These different ideas result in divergent understandings of what 'success' looks like (Köhler et al. 2019). For example, there are disagreements on whether sustainable agriculture should be based on a model of 'land sharing' or 'land sparing' for biodiversity (Phalan et al. 2011), or agroecology or industrial agriculture (McNeill 2019), all of which are context-dependent. This contested discourse reflects both technical issues (i.e., how to assess sustainable land use empirically, and how ecological limits are defined), and political issues (i.e., who benefits and who loses from

particular models). In policy fora, agribusiness concerns are frequently rationalised by a narrative of feeding a growing 'global' population based on a model of 'land sparing' that allows continued expansion of commodities, with HCS and HCV areas designated within plantation concessions. These zones are privately conserved by agribusiness, with further implications for their fate and the fate of communities dependent on the resources of these areas.

The SDGs make a normative statement about what a high-level sustainability transition seeks to achieve, but within this high-level agenda are embedded assumptions, politics and trade-offs. Spann (2017) argues that embedded in the SDGs is the notion of 'agriculture for development', premised on a (problematic) structural transformation whereby, over time, countries shift from being agriculturally based to eventually becoming urbanised. Rather than a natural evolution, this agriculture for development model is a political project that negatively affects smallholders and ecological relations (ibid.). Thus, Spann (2017) argues that the SDGs ensure the interests of agribusiness—with whom the SDGs were developed—at the expense of actual (or alternative visions of) sustainable development. This is relevant to transitioning to zero deforestation, given the substantial role of agricultural expansion in tropical forest loss. Thus, the SDGs prioritise a pathway for how land is used for food production, potentially obscuring alternatives that may be more sustainable. Further, this singular pathway neglects attention to governance structures that support continued deforestation, such as harmful incentives, consumption patterns and the fundamental imperative for economic growth, which can be prioritised by states through a process of SDG "cherry-picking" to align with a pre-existing development pathway (Forestier and Kim 2020; Horn and Grugel 2018).

#### **4. 'Opening up' Just Sustainability Transitions for Forests**

Key questions need to be asked that relate to epistemological diversity and justice to consider whose knowledge counts in decisions for sustainable development and where forests feature. We suggest that a just sustainability transition, i.e., one that seeks to address both the uneven distribution of burdens and benefits inherent in socio-ecological transitions for forests, and the power imbalances that perpetuate them, requires 'opening up' (Stirling 2008) multiple, alternative visions of sustainable development that do not have infinite economic growth at their core. 'Opening up' examines different framing conditions and assumptions, including marginalised perspectives and considering ignored uncertainties: instead of providing prescriptive recommendations, alternative questions and new options can be considered and governance processes can be better informed, more transparent and accountable

(ibid.). A focus on the conditions that create barriers to zero deforestation supports us in unearthing possibilities and spaces for transformation, where power may be redressed through more equitable solutions. A perspective of a just transition based on political ecology supports an understanding of who wins and loses from current governance arrangements and the assumptions that underpin them, and thus supports researchers in imagining what combinations of co-constructed actions are needed.

As part of the process of 'opening up' just sustainability transitions, local actors should be placed at centre stage in decision-making, early on in processes related to land use change, and forest management, rather than rigid tokenistic efforts for consultation following already agreed futures, as has been seen in cases of superficial indigenous 'participation' in Low Carbon Development Strategies in Guyana (Airey and Krause 2017), or in impact assessment processes as part of certification standards in Malaysia and Indonesia (Delabre and Okereke 2020). Decision-making processes therefore need to recognise and be sensitive to diverse forms of agency and resistance, especially of previously marginalised actors (De Vos and Delabre 2018).

Recent conceptualisations of integrated landscape-scale governance arrangements hold some promise in this regard, by emphasising engagement between multiple stakeholders and aiming to disentangle complexity of landscapes, facilitating consideration of different courses of action, and reconciling societal and environmental objectives at the landscape scale (Reed et al. 2020; Sayer et al. 2015). Yet, these landscape-scale approaches may also risk exacerbating existing inequalities encountered in other forest governance approaches in complex political economic contexts and across geographies. Reed et al. (2020) highlight the need for concerted transdisciplinary actions in applying and assessing the effectiveness of landscape approaches, being attentive to power asymmetries in sectorial engagements.

Recognising the root causes of forest loss requires acknowledgement of the unsustainability of land use decisions that prioritise GDP growth, embedded in SDG 8, at the expense of other SDGs—highlighted by Menton et al. (2020) as 'the elephant in the room'. Within a capitalist political economy, neoliberal conservation promises to reconcile unlimited economic growth and forest protection. Recognising this tension highlights the need to develop a more nuanced perspective on the complex drivers of deforestation and thus how problems are confronted. This critical approach requires challenging prevailing political discourses that promise 'win-win' solutions with limited scientific evidence (Reed et al. 2020), or simply blame local people for forest loss (Ravikumar et al. 2017). Redistributing the burden of responsibility for implementing zero deforestation will require targeting actors according to the direct

and indirect impacts that their actions have on deforestation and the broader political power they possess (Büscher and Fletcher 2020), pushing for greater accountability for the actions of incumbent actors including companies, states and finance to comply with the commitments they have made themselves.

Following Büscher and Fletcher (2020), we argue that a just sustainability transition for forests requires radical (from the 'roots') shifts in how forests are governed. The concept of 'convivial conservation' may therefore be a helpful imaginary to support human-nature interactions, including conceptualising the diverse and multiple values of forests as complex social-ecological systems (Büscher and Fletcher 2020) that cannot be isolated or disembedded from their social and historical contexts. Shifting away from a 'global transition' to 'zero deforestation', a more sustainable and equitable future may require multi-transition pathways that embrace diversity. Some of these processes of transition may have already started, but as we have discussed, many barriers remain. Despite some shifts in how forest governance is enacted, it is clear that more equitable multi-actor processes will require shifts in power and agency. For example, partnerships between corporations and civil society organisations could be based on stronger requirements for companies, in an action to redress power. Civil society organisations play a role in motivating institutional logics and formulating alternative logics. Rather than being deemed 'too radical' within 'pragmatic' discussions, those civil society organisations play a critical role in pushing the boundaries of the debate (Von Geibler 2013).

Difficult and messy trade-offs are inevitable in implementation of the SDGs, but it is imperative to revisit the problem of deforestation, and to critically analyse the assumptions underpinning current solutions. A coherent, transdisciplinary effort to do so can support in shaping global targets that are appropriate to local contexts, and will be the only way to make transitions both sustainable and 'just'.

**Author Contributions:** I.D. and C.N. contributed equally to the conception, drafting and revision of this chapter.

**Funding:** This research received no external funding.

**Acknowledgments:** The authors would like to thank editors and reviewers of the book volume *Transitioning to Sustainable Life on Land* as part of the *Transitioning to Sustainability* series.

**Conflicts of Interest:** The authors declare no conflict of interest.

#### **References**


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