Swiss Sustainable Coffee Platform. Coffee Switzerland, will you now become sustainable?

Without Switzerland, the coffee world would look different. Switzerland is not only the largest raw coffee trader but also exports a lot of roasted coffee. And now, a government co-funded platform aims to ensure that the coffee sector in Switzerland also becomes sustainable. We participated, got a taste of politics, and are asking ourselves: is this all just a paper tiger, or is something really happening now?

First off, we have also become a member of the SSCP - the Swiss Sustainable Coffee Platform. We will explain exactly why at the end of the article. Together with other companies like Nestlé, Olam, Volcafé, Illy, organizations like Rainforest Alliance, Max Havelaar, and universities, we are now part of this "illustrious" circle.

Here we discuss:

• Context: How did the Swiss Sustainable Coffee Platform come about?
• The SSCP - who, how, what
• Sustainability in the coffee industry, what exactly is it?
• Why should companies participate in the SSCP?
• Why are we involved?

It might seem like an exclusive version of a Rotary Club of Swiss coffee. Or, as Public Eye somewhat cynically puts it, the platform is merely a "legally non-binding talking shop." SRF also reports and notes that the federal government still does not regulate, but rather focuses on dialogue.

The platform charges a fee for all members. However, the idea that universities should pay for their critical-scientific contribution as platform members is met with resistance by some, including Dorothée Baumann-Pauly here.

The doubts, but above all the expectations, are high that Switzerland, as a coffee nation, will provide answers to the pressing questions in the coffee industry:

• how can Switzerland make the coffee industry more sustainable?
• how can the industry be compelled to take responsibility?
• and how does Switzerland, as a coffee nation, react to new international laws?

Federal Councillor Guy Parmelin at the launch of the platform on June 6, 2024, in Bern

Switzerland as a coffee nation? Oh yes.

For decades, 60-70% of all global raw coffee has been traded through companies headquartered in Switzerland. In terms of transit trade, contracts are made by these companies, but the raw coffee does not physically touch Switzerland. At the same time, Switzerland is the third-largest exporter of roasted coffee, primarily due to Nespresso capsules.

On the northern shore of Lake Geneva, in Zug, or in the Zurich area, several globally active trading companies are based in Switzerland. These include:

• Louis Dreyfus Commodities
• Starbucks Coffee Trading Company
• Blaser Trading
• Walter Matter SA
• Volcafé Ltd
• Ecom Agroindustrial Corp.
• Keurig Trading
• Sucafina SA
• UCC Coffee
• InterAmerican
• Efico
• BeGreen Trading SA
• and others

With its robust franc currency, low taxes, and neutral international position, Switzerland has earned the role of a safe haven for many transnational corporations.

But this neutrality must not turn into indifference. The EU has enacted over 50 new laws and directives as part of the Green Deal. One that will affect the entire coffee world is the EUDR, the law for deforestation-free supply chains (see footnote).

Other laws directly or indirectly affect Swiss coffee – but because Switzerland is not in the EU, there have been no legally binding regulations for Switzerland so far. However, because Switzerland is a mega-player, it must position itself and take a clear stance.

The platform was launched on June 6, 2024, and we were there.

Behind the scenes of politics and trade, even before the new EU laws or the Corporate Responsibility Initiative, discussions were held on how Switzerland, as a coffee mega-player, could position itself more sustainably. A SECO source says that the IG Kaffee Schweiz sought contact with SECO, thus initiating the discussion.

The increase in regulatory pressure, especially from the EU, then accelerated the founding of the SSCP and created widespread movement in the industry.

Context: How did the Swiss Sustainable Coffee Platform come about?

Behind the political and trade scenes, even before the new EU laws or the

• The SCTA, the Swiss Coffee Traders Association, represents the largest coffee trading houses in Switzerland. This means it is the organization that includes exactly those companies that trade the largest volumes of green coffee globally.
• The IG Kaffee Schweiz, in coordination with the SCTA, the Association for the Promotion of Coffee in Switzerland Procafé, and the Schweizer Röster Gilde, joined forces and advocated for the concerns of Swiss coffee throughout the process.
• In spring 2023, SECO and the aforementioned organizations invited to an initial workshop in Bern, attended by over 60 representatives from private industry, the NGO world, academia, and other institutions such as certifiers.
• The process was moderated from the outset by Focusright, a management consultancy for sustainability issues. With pragmatic and clear leadership, they guided the process up to its founding.

What was our role?

After the first workshop, we were asked if we would like to participate in the core group that would draft the Declaration of Intent. The platform attempts to involve various sectors within the industry, as well as companies of different sizes. Without the representation of diverse stakeholders in the platform, it would lose credibility. We said "yes," attended physical and online meetings, and gained insight into the dynamics of the triangle of politics, coffee, and sustainability.

Many of the stakeholders present at the first workshop have now also become members of the SSCP and have committed themselves to making Swiss coffee more sustainable.

But what exactly does that mean?

And what is everyone supposed to change for the better now?

The SSCP - who, how, what

The Form

The Swiss Sustainable Coffee Platform is a Multi-Stakeholder Initiative, or MSI for short. An MSI aims to bring together various stakeholder groups within an industry to seek, formulate, and shape common solutions to challenges concerning human rights and environmental responsibility along supply chains.

Companies, foundations, scientific institutions, lobbying groups, and NGOs thus meet on an equal footing in an environment that would be difficult to achieve in any other format.

These initiatives are voluntary, as is the SSCP. There is no obligation to participate. However, if an MSI manages to make its value proposition so attractive to participating stakeholders that it offers tangible added value, then some might experience a fear of missing out, leading new stakeholders to join.

When does it get concrete?

As of August 2024, 55 organizations, companies, and scientific institutions are involved. In late autumn, the roadmap will be discussed at the founding assembly, aiming to define concrete steps.

The Division of Roles

An MSI differentiates between the roles that stakeholders play within the platform. In the case of the Swiss Sustainable Coffee Platform, there are four different roles:

The Private Sector

Coffee companies, which can be roasters, traders, cafés, machine manufacturers, or packaging producers, bring concerns from their daily operations, co-finance projects, and would implement them in collaboration with non-governmental organizations.

The NGO

NGOs help identify risks and formulate solutions. NGOs often have a broad network in project countries and can draw conclusions from comparable projects.

Academia

Scientific institutions, or academia, compare proposed projects with the latest research findings and scientifically evaluate the MSI's work themselves.

SECO

The State Secretariat for Economic Affairs has a dual role: on the one hand, it is the interface between government policy and suggestions from the coffee industry; on the other hand, SECO co-finances approved projects within the framework of development cooperation. In the first four years, eight million CHF are to be invested, primarily in SECO's focus countries of Colombia, Peru, Indonesia, and Vietnam.

The Intention

Anyone working with coffee never deals solely with coffee. Coffee not only affects and connects different ways of life, ecological and economic systems, but can also create or close off access to markets.

Coffee is never neutral. It is a man-made product, even when traded as an interchangeable commodity in future contracts.

This complexity allows actors in the coffee supply chain to hide in this thicket of interconnections, or at least not have to clearly emerge. This is what makes the coffee industry so opaque.

When I asked one of the world's largest traders at a core group meeting:

"Why is coffee trading sometimes so incredibly opaque?" he said with surprise:

"Oh, does it seem that way?"

The SSCP not only unites actors but also consolidates interests and challenges. It's about fostering pre-competitive collaboration and promoting sustainable change for coffee producers.

Or as Krisztina Szalai, Secretary General of the SCTA, says:

"The Swiss coffee sector is strongly committed to sustainability, which is why we proudly support the launch of the Swiss Sustainable Coffee Platform (SSCP). The challenges faced by coffee producers and the entire industry require a concerted effort. The SSCP embodies this spirit of collaboration, bringing together a variety of stakeholders to drive positive change and create a more sustainable future for coffee producers, consumers, and the industry,"

Isn't all this too vague?

Yes, absolutely.

And that is partly intentional.

Because:

Currently, there is a Declaration of Intent as a common point of reference. I spent almost a year myself working in a core group to formulate this DOI.

It is just over two A4 pages long and addresses various issues that should all be tackled, without being very concrete. The reason lies in how MSIs work:

if the conditions are too clear from the outset, for example, a precise number of fair-trade coffee or an exact percentage of how much CO2 emissions on the coffee chain must be reduced, then signing parties become accountable.

The signing of the declaration of intent could then be used as evidence if company X did not meet the precisely stated goals. If the DOI were too concrete, it would deter many stakeholders from participating, according to this line of thinking.

It must hurt

So the SSCP's intent remains vague - until now. Because the real work of an MSI begins when all members come together and have to define common goals.

And that was, is, and will be no walk in the park.

During the development of the SSCP, meetings took place that, on the corporate side, probably incurred six-figure costs just for attendance. When 15 stakeholders from the largest coffee companies sit in a room in federal Bern and discuss, sometimes emotionally, for four hours what sustainability actually means, only to leave without a definition, it can be grueling.

Or, it is part of a lengthy process that hurts. And it has to. Because an MSI is as much coquetry as negotiation skill, as politics.

And again: if the players from the Swiss coffee landscape are now sitting at a table that did not exist before, if Save the Children and Nestlé, Helvetas and Olam, Volcafé, Delica and micro-roasters talk about the same topics, and eat pumpernickel with cucumber and cottage cheese, then that is already a huge step forward.

In other words: little is much, when there was nothing before.

Until now, the exchange among leading Swiss coffee players primarily took place at the SCTA's annual Coffee Diner, held alternately in Geneva or Basel. When the approximately 800 most important coffee traders in the world meet, the pace is set for how coffee trade should proceed.

An MSI creates the opportunity for an exchange on an equal footing with large and small actors, with NGOs and academia. Those present must take a stand and ultimately deliver. And above all, they, and thus we, must even define sustainability.

Sustainability in the coffee industry, what exactly is it?

At the first meeting in spring 2023, voices of the present stakeholders were collected as to what the concept of sustainability in coffee should encompass. The question was deliberately broadly formulated, and all stakeholders expressed their own orientation. Sustainability in coffee should, in this case, cover the following topics:

• Child labor
• Biodiversity
• Deforestation
• CO2 emissions
• Climate change
• Soil fertility
• Livelihoods of smallholder farmers
• Living income
• Regenerative agriculture
• Youth and gender aspects
• Agroforestry
• Labor migration
• Landscape approaches
• Cross-sector collaboration
• Harassment and gender-based violence
• Customer awareness
• and more

It should not be surprising that during the drafting of the declaration of intent, the discussion about the definition of sustainability was extensive and without a specific outcome. What exactly should be sustainable and how must be defined in further steps.

Too high a degree of precision in the wording of the Declaration of Intent is a pièce de résistance and could prevent other companies from joining the platform and also make some attendees unwilling to participate. Anyone who signs becomes accountable to the public - and so it is not surprising that we spent hours discussing individual formulations and even words.

And where are the producers?

A concern of all participants in the core groups was to include the voices of coffee producers. It is not enough to give producers a voice; they should be involved in decision-making.

This point was considered mandatory right from the first meeting of the Core Group. The governance group then proposed to form a Sounding Board of producers, whose members should rotate.

"We need a broad geographical range of producers,"

says Veronika Neumeier, who has led the SSCP as Coffee Lead since June.

This was about more than just representation duties. "Checks and balances" were necessary, meaning the careful review and control of the SSCP's actions by the Sounding Board.

However, the coffee industry is diverse. What and who exactly is a producer? Is it a person running a subsistence farm?

A seasonal worker?

A cooperative president?

A lobbyist?

And then there are over 60 coffee-producing countries. Does Brazil, as the world's largest producer, need to be represented? Or Guinea, as a coffee-producing country with a non-existent coffee lobby but high robusta production?

Here too, there is no final answer yet. Here too, the SSCP will have to start, engage in public discussion, and improve in the process. The intention is there, and that is a lot. Far too late, with all due respect, but at some point, one has to start.

Why should companies participate in the SSCP?

Firstly,

the political engagement with a topic that is often approached exclusively from an economic, sensory, or marketing perspective is beneficial for all coffee companies. It forces them to take a stand and see the bigger picture. For undecided coffee companies, the SSCP is like the Federal Council's red voting booklet, which helps one quickly get an overview of issues that concern us all.

Secondly,

the SSCP offers the opportunity to engage in fruitful dialogue, to reflect on criticism, questions, and ideas with other stakeholders whom one otherwise observes, considers, or criticizes from a distance. The opportunity for exchange is the starting signal for improving the coffee supply chain.

Thirdly,

membership in the SSCP provides access to a funding pool co-financed by SECO. This aims to create incentives for coffee companies to address the core problems in the coffee supply chain. And this is where the EU approach differs completely from the Swiss one: The EU sets rules, while Switzerland, as often, relies on an incentive system.

Why are we participating?

We are a company committed to the Economy for the Common Good. For us, the concerns of the SSCP are also corporate goals that have been enshrined in our statutes since our founding. Sustainable action is not a project; it is part of our DNA. In this respect, the SSCP changes nothing about our orientation.

Today, we are glad to see the SSCP: Finally, there is a format where exchange can take place with all who wish to, within a framework supported by SECO and thus carrying political weight.

But. We are in 2024.

Climate change is increasingly disadvantaging coffee cultivation, the vast majority of prices for producers are still too low, there is a lack of labor, etc. - the problems are well known. For a long time.

In this respect, the SSCP is the lowest common denominator that coffee Switzerland has now formed, and that too on a voluntary basis.

So now there is a glimmer of hope for coffee Switzerland to contribute to making coffee better for everyone, even if the chances are slim. But doing nothing is not an option. There will be a lot of work, primarily aimed at building consensus - because bridging the individual goals of companies will be arduous. It's politics.

For us, it was also a motivation to gain insights into how such mills grind and how some companies think. Especially because it is so foreign to us.

Only if we understand how political opinion-forming, agreement, and thinking in some companies come about, can we inspire, influence, and shift them. We have done this in the past, are doing it now, and will continue to help companies adjust their compass in the future.

As a smaller company with a practical view of the entire chain, we can also take precisely this position in the SSCP. We hope that more smaller companies will join the SSCP and demand flexibility in the thinking and actions of all members.

The SSCP must not be an association where one leans back and can now put another label sticker on the coffee package. It is a place where negotiations and actions must take place. But above all, all companies must continue to work on improving their coffee supply chains.

And now?

Rightly, some occasionally wished for more radicalism. Public Eye is right when they write that the "government leaves it at non-binding dialogue without accountability and with a highly uncertain outcome."

And here, improvements must be made. Exactly how, must be answered by those who are part of the MSI - the big, the small, the quiet, the loud. And SECO must demand the clarity that the Federal Council neglects: In the course of the EUDR, the Federal Council does not feel compelled to change existing law.

The SSCP is based on voluntariness - that is one of its greatest weaknesses, but also its strength. Those who must, always find other ways to do nothing. Those who are involved, perhaps act as should be done in climate protection: Doing nothing is not a solution either.

Or as Rainforest says in this cheeky video: Pessimism is out. We're all in.

Footnote on the EUDR:

It affects importers, exporters, or companies trading in the EU area. They must ensure that their respective supply chains are deforestation-free. They must prove this with GPS points or polygons (area representations) showing exactly where the coffee was produced. They must prove that coffee was not planted in areas where there was forest after the end of 2020. If forest was converted to agricultural land after the end of 2020, that is deforestation. Regardless of whether this was permitted in the producing country or not. The EU bases this on the FAO's definition of what constitutes forest. If coffee were imported from such an area, it would now be illegal. To the podcast with Janina Grabs.