Escaping the “Teenage” Years: The Politics of Rigor and the Evolution of Private Environmental Standards

Offsetting, Insetting, or Both? Current Trends in Sustainable Palm Oil Certification

“…Responses to this item provide a valuable and broadly representative insiders' perspective on the sustainable palm oil supply chain, but they are not easily used. We start with data first reported by Gallemore et al [25], who used a custom-coded R script to download and extract this item from the ACOP reports for 2012 through 2015. We augment their data by adding the 2016 ACOP reports more recently posted to the RSPO website [41], resulting in a total of 4,200 reports.…”

“…Because these responses are entered as free text, it is necessary to qualitatively code them in order to use them for analysis. For consistency with previous data, we use the coding scheme reported in the methods appendix of Gallemore et al [25], applying the scheme to the 2016 reports. Abbreviated definitions of the codes are found in Table 1.…”

“…Abbreviated definitions of the codes are found in Table 1. Fuller definitions and coding examples are found in Gallemore et al [25].…”

“…If firms' primary motivation to adopt private standards is escaping a market for lemons, then they are likely to prefer insetting to offsetting. If the standard is not sufficiently credible, furthermore, larger firms could opt for their own insetting approaches, as Nestlé's statement hints [24,25].…”

“…Insetting separates off a section of the market with more responsible production practices. In principle either approach could be adopted nearly universally, if adherence became obligatory to achieve sales [25]. To the degree that insetting imposes transaction costs related to traceability, however, it may undermine the standard's scalability [26], and in the absence of regulation a two-tiered market could form [10].…”