Collaboration to address a wicked problem - The case of certified palm oil Emma Lindahl Joakim Widén Master’s thesis · 30 hec · Advanced level Environmental Economics and Management - Master’s Programme Degree thesis No 909 · ISSN 1401-4084 Uppsala 2015 iiii Collaboration to address a wicked problem - The case of certified palm oil Emma Lindahl Joakim Widén Supervisor: Cecilia Mark-Herbert, Swedish University of Agricultural Sciences, Department of Economics Examiner: Karin Hakelius, Swedish University of Agricultural Sciences, Department of Economics Credits: 30 hec Level: A2E Course title: Degree Project in Business Administration Course code: EX0782 Programme/Education: Environmental Economics and Management, Master’s Programme Faculty: Faculty of Natural Resources and Agricultural Sciences Place of publication: Uppsala Year of publication: 2015 Cover picture: Ryan Woo, Center for International Forestry Research (CIFOR). Name of Series: Degree project/SLU, Department of Economics No: 909 ISSN 1401-4084 Online publication: http://stud.epsilon.slu.se Key words: Collaboration, corporate social responsibility, dialogue, industrial collaboration, multi-stakeholder collaboration, palm oil, wicked problem iiii Acknowledgements We would like to express our great gratitude to all the people who made this thesis possible. Special thanks to our supervisor Cecilia Mark-Herbert for her optimistic spirit and motivational energy. She has been an inspiration throughout the whole master program at SLU and we have learned a lot from her. We would also like to extend our gratitude to all informants for taking their time participating. Their interest and dedication to this subject have inspired us and have given this thesis greater value. Finally, we want to thank your friends and family for their encouragement and advices. iii Abstract Corporations meet complex challenges as they operate on a global market. Global multi- dimensional problems are referred to wicked problems and which cannot be solved only managed. In this case, of certified palm oil, palm oil production can be seen as a wicked problem due to deforestation of rainforest, land grabbing and social conflicts. There are also conflicts regarding the value and interest of palm oil. This thesis investigates the Swedish transformation for certified palm oil and how actors in the Swedish food market address this transformation to have certified palm oil in their production. The aim of this thesis is to explain enabling factors to address the governance gap of ethical sourcing in the food industry. A qualitative case study is conducted on important actors that are involved in this transformation. Interviews from each organization were analyzed in comparison with existing literature in the area of corporate social responsibility and collaboration theory. Corporations have great impact on the natural environment, a matter of responsibility has shed light on a gap in governance. Corporations have to regulate their own business but smaller national food producers and retailers are not capable to address ethical sourcing of palm oil by themselves. Collaborative initiatives within the industry and even outside the industry involving external stakeholders i.e. Non-Governmental Organizations (NGO) has brought new hopes on resolutions for palm oil production. Findings in this thesis are that collaboration within the industry is of high importance to the transformation of the industry. However industrial collaboration is not a solution, only a part of a resolution. External influence and a from other stakeholders such as NGOs and trade associations are needed when trying to resolve wicked problems. These kinds of collaboration take place in multi-stakeholder networks or initiatives are to prefer to fully understand and be a part of a resolution to wicked problems. Contrary to existing literature it is found that collaborative forms occur in different settings, industrial collaboration or with external stakeholders such as multi-stakeholder collaboration. Often these settings take place in a dialogue between all actors. Finding in this thesis is that both industrial collaboration and multi-stakeholder collaboration if of high importance to address governance gap in ethical sourcing. iv Sammanfattning Företag som verkar på en global marknad möter komplexa utmaningar och problem. Dessa komplexa flerdimensionella problem definieras som ‘wicked problems’. Fattigdom, terrorism och miljöförstöring är exempel på wicked problems. Denna uppsats undersöker ett speciellt wicked problem; palmoljeproduktionen, ett allvarligt problem på grund av regnskogsskövling, olaglig beslagtagning av mark och svåra sociala konflikter. Företag har en stor inverkan på miljön som de verkar i vilket medför en diskussion om vem som bär ansvar för företagens agerande. Här belyses ofta en lucka i lagstiftningen när det gäller företagens miljöpåverkan. Företag måste idag reglera sin egen verksamhet inom sociala och miljömässiga aspekter gällande palmolja. Dock har inte mindre livsmedelsproducenter och återförsäljare resurser nog att genomföra detta. Samarbetsinitiativ inom branschen och även utanför branschen som involverar externa intressenter, det vill säga icke vinstdrivande organisationer, har medfört nya förhoppningar om dellösningar för den komplexa produktionen av palmolja. Uppsatsen belyser en fallstudie om hur betydande aktörer på den svenska livsmedelsmarknaden arbetar för en omvandling till certifierad palmolja i sin produktion. Syftet med uppsatsen är att förklara möjliggörandefaktorer för arbete med ursprungskontroll gällande socialt ansvarstagande inom livsmedelsindustrin. En kvalitativ fallstudie med intervjuer är genomförd med aktörer på den svenska livsmedelsmarknaden. Intervjuerna analyserades i relation med befintlig litteratur kring socialt ansvarstagande och företagssamarbeten. Slutsatserna av denna uppsats är att samarbete mellan olika livsmedelsföretag är av stor vikt för att förändra marknaden. Dock är företagssamarbeten inte den enda lösningen. Samarbete med andra aktörer utanför livsmedelsbranschen är avgörande. Dessa aktörer kan vara icke vinstdrivande eller ideella organisationer. Samarbeten mellan dessa parter kan benämnas som ett flerpartssamarbete och viktiga för att slutligen kunna nå en lösning på komplexa problem. Befintlig litteratur inom samarbeten mellan företag och andra organisationer skiljer inte på dessa typer av samarbetsformer. Dock visar fallstudien om certifierad palmolja att samarbeten skiljer sig åt. Samarbeten kan ske inom branschen, men också med externa aktörer utanför branschen. Båda dessa typer av samarbeten är av betydelse när det gäller att arbeta med socialt ansvarstagande på en global marknad. Ofta är dessa samarbeten utformade som en dialog mellan inblandade aktörer. Företagssamarbeten och flerpartsamarbete är av stor vikt för den svenska marknaden gällande reglering och ursprungskontroll av produkter. v Abbreviations CSR Corporate Social Responsibility CSV Create Shared Values CSPO Certified Sustainable Palm Oil LI The Swedish Food Federation MNC Multinational Corporation MSC Multi-Stakeholder Collaboration MSD Multi-Stakeholder Dialogue MSI Multi-Stakeholder Initiative MSN Multi-Stakeholder Network NGO Non-Governmental Organization NPO Non-Profit Organization RSPO Roundtable of Sustainable Palm Oil SNF Swedish Society for Nature Conservation TBL Triple Bottom Line vi Table of Contents 1 INTRODUCTION ................................................................................................................. 1 1.1 PROBLEM BACKGROUND .................................................................................................... 2 1.2 PROBLEM ........................................................................................................................... 3 1.3 AIM .................................................................................................................................... 4 1.4 DELIMITATIONS .................................................................................................................. 4 1.5 OUTLINE ............................................................................................................................ 5 2 LITERATURE REVIEW AND THEORETICAL FRAMEWORK ................................ 6 2.1 A WICKED PROBLEM ........................................................................................................... 6 2.2 THE CONCEPT OF CORPORATE SOCIAL RESPONSIBILITY ..................................................... 8 2.3 STAKEHOLDER THEORY .................................................................................................... 11 2.4 MULTI-STAKEHOLDER ASSOCIATION ................................................................................ 13 2.4.1 Industrial collaboration ............................................................................................ 14 2.4.2 Multi- stakeholder network ....................................................................................... 15 2.4.3 Multi-stakeholder dialogue ....................................................................................... 16 2.5 GOVERNANCE AND LEGITIMACY ...................................................................................... 17 2.6 CHALLENGES AND CRITIQUE OF MULTI-STAKEHOLDERS COLLABORATION ...................... 18 2.7 IN SHORT TERMS - A CONCEPTUAL FRAMEWORK .............................................................. 18 3 METHOD ............................................................................................................................