The Determinants of Adopting International Voluntary Certification Schemes for Farmed Fish and Shrimp in China and Thailand (Rethink Priorities)

This shallow literature review addresses the determinants considered by exporting farmers in China and Thailand when adopting international voluntary certification schemes for farmed fish and shrimp.

Voluntary certification schemes (VCS) specify production standards as well as auditing processes that verify that those standards have been achieved. They allow suppliers to credibly communicate product qualities.

Importance: International VCSs are one of the few governance tools in aquaculture currently in use that demand improvements in the welfare accommodations of farmed fish and shrimp production practices. Knowing to what degree farmers register with certification schemes and what influences their decisions may inform future uses of this animal welfare advocacy strategy.

Certification rates: VCSs with international scope have seen limited uptake in Chinese and Thai fish and shrimp aquaculture. In 2015, less than 6% of global production that complied with major international or Chinese VCSs came from China or Thailand. This is surprising given the volume of Chinese and Thai exports and the proportion of standard-compliant production coming from developing countries.

Incentives and costs: The biggest incentive to get certified under international VCSs is access to wealthy markets, typically in Europe and North America. The biggest costs come from auditing and conducting more costly production practices. Small-scale farmers who are poorly connected to global value chains typically face higher barriers to certification, greater relative costs, and lesser benefits than large-scale farmers. Table 1 summarizes incentives, costs, and structural barriers.

Explaining low certification rates: For large-scale farmers, national certification schemes may offer cheaper ways to gain the same benefits that international VCSs offer. For small-scale farmers, poor business and technical infrastructure make certification less feasible, and the costs appear to far outweigh the benefits.

If international VCSs should expand: An increase in the popularity, scope, and number of international VCSs may lead to the following changes, compared to a world without such expansion in international VCSs. According to my own uncertain intuitions about the market forces involved, I expect:

1. a greater number and proportion of higher-welfare fish to be farmed
2. the average exporting farm raising certified fish to grow in size
3. practices between larger and smaller farm operators to polarize
4. an increased risk of entrenching low-welfare production practices in China and Thailand
5. a smaller volume of fish and shrimp produced globally.

Implications for advocates: I am generally pessimistic about approaches to improving Chinese and Thai fish and shrimp farming practices using international VCSs. Instead, I suggest animal advocates consider strategies to more strongly incentivize higher standards for the world’s lowest-welfare fish and shrimp farming practices. I also suggest raising welfare standards in major national VCSs. I do not have great confidence in my suggestions.

Future research: For greater insight on the international impacts of VCSs, a good foundation would involve gathering better disaggregated data on certification rates among different species, farm sizes, geographical regions, and export orientations. Research that would be more directly useful for animal advocates might involve investigating what changes to existing certification schemes are most promising, how effective different strategies for improving certification uptake might be, and to what extent grants can help lower barriers to certification. I list many research ideas in this report.

Caveats: Evidence tends to be weak, outdated, or scarce. I also expect the findings of this report to be more pessimistic than modern data might suggest. This is because most empirical evidence is from the mid-2010s, and the state of certification seems to be improving over time. I also anticipate that my inclusion of non welfare-centered certifications may lead to some findings that do not generalize well into welfare-focused certifications.