Democratizing ESG helps smallholders join supply chains

The context of the green transition and global greenhouse gas emission reduction commitments are imposing strict requirements on Viet Nam's agricultural sector. Major export markets are continuously establishing technical barriers related to environmental, social and governance (ESG) standards.

In this supply chain, smallholder farmers are the direct link executing the farming process, yet they are the most vulnerable group due to limitations in financial resources, land funds and the capacity to access technology.

Discussing this issue, Mr. Pham Hoai Trung - ESG expert/lead greenhouse gas verifier and assessor, Chairman of the Member Council of Azitech Technology Co., Ltd. and Green Go Sustainable Development Practice Consulting Company, stated that a sustainable agricultural model must essentially be understood as "green with evidence, low-emission with measurement, and sustainable with responsibility". The green transition should not become an administrative burden or a technical barrier that eliminates small-scale producers from the market.

Turning academic standards into practical actions

The concept of sustainable development in agriculture needs to be concretized through practical actions in the field rather than remaining an academic slogan. The essence of this model is a tight combination of three layers: green agriculture, low-emission agriculture, and the practice of governance standards.

For smallholders, the "environmental" standard involves minimizing chemical fertilizers, using biological pesticides, conserving irrigation water, and properly processing agricultural by-products according to technical procedures. The "social" element is closely tied to ensuring occupational safety for producers, avoiding child labor, and maintaining stable livelihoods. Meanwhile, the core "governance" factor is transparency through the maintenance of digital farming logs and participation in cooperative groups to obtain legal entity status.

Globally, translating academic standards into practical actions for small-scale farmers has been effectively implemented in many countries. Typically in Indonesia, the National Sustainable Coffee Forum has simplified international standard sets into vivid visual farming guidelines.

Instead of forcing farmers to operate complex auditing systems, they organize farming groups to self-assess and cross-monitor each other on reducing chemical fertilizer use and protecting water sources. This lean governance model has helped over 18,000 smallholders in the Sumatra region achieve green certification, allowing their products to be purchased by major corporations at prices higher than the market rate.

To realize the emission reduction roadmap, management agencies and producers need to clearly identify major emission points but must initiate actions from the easiest and least costly tasks.

According to Mr. Pham Hoai Trung, when developing a low-emission agricultural roadmap, it should not be framed as an either/or choice between addressing the largest emission points or starting with the easiest tasks. A more practical approach is to combine both to achieve early results while building trust among farmers.

In rice cultivation, methane emissions from flooded fields account for a large proportion of the sector's total emissions, yet immediately applying complex measurement technologies is unfeasible for fragmented smallholders. Instead, applying alternate wetting and drying irrigation techniques, reducing the volume of sown seeds, and ending the post-harvest burning of straw are solutions that bring dual benefits. These measures both help reduce greenhouse gas emissions into the environment and save on input material costs for farmers.

Solving the digital technology puzzle for farmers

Currently, the biggest obstacle for smallholders when approaching sustainable development standards is the investment cost for data systems, inventory software, and international certifications. To resolve this bottleneck, Mr. Pham Hoai Trung proposes that the financial mechanism of the agricultural supply chain must be based on the principle of sharing costs according to actual benefits.

Lessons from the pineapple supply chain in Costa Rica, implemented by the National Chamber of Pineapple Producers and Exporters, show that when the European market tightened traceability regulations, major export enterprises proactively invested in the entire technological infrastructure, providing mobile apps and dispatching engineers directly to the fields to support farmers.

In this model, the enterprises bear the costs of software and independent auditing. In return, smallholders contribute through discipline, strictly adhering to clean farming practices, avoiding chemical overuse, and providing accurate production information to ensure data authenticity.

Furthermore, state management agencies play a constructive role by building foundational technical infrastructure, such as issuing planting area codes, standardizing local agricultural data, and recognizing standards.

Industry associations also need to develop minimalist sets of criteria, tailored to the specific production characteristics of each locality, to prevent situations in which farmers must meet too many overlapping requirements from different buyers. Concurrently, technology development units are responsible for designing simple, easy-to-operate digital management tools tailored to the technical proficiency of direct workers, aimed at preventing administrative information overload.

Mr. Pham Hoai Trung emphasized that sustainable standards only succeed when they help farmers sell better, reduce costs and participate more deeply in the value chain.

Over the coming decade, global consumer trends will redefine the value of agricultural products based on the ability to transparently trace the entire production journey. A smart agricultural product in the future will not only be evaluated by yield, quality, or cost but must also prove its environmental and social metrics through a reliable digital data profile.

Only when information regarding water usage, greenhouse gas emission levels, and occupational safety conditions is independently verified can Vietnamese agricultural products access green financial sources and affirm their competitive position internationally. Democratizing sustainable standards is precisely the strategic solution to protect the livelihoods of millions of smallholders and propel the agricultural economy towards a substantive transition.