An Overview of Sector Governance

Looking beyond the value chain to build high performing and resilient agriculture sectors

Building high performing and resilient sectors requires looking beyond the value chain and improving the governance of a sector

Why does sector governance matter?

Agriculture and agricultural supply chainsare still central to addressing ruralpoverty. Worldwide, more than 850million people live on less than $1 perday. These poor households areconcentrated in rural areas, and most ofthem depend on agriculture for asubstantial part of their income. Strongsector governance can provide theconditions and incentives for small-scalefarmers to produce with more benefit andless risk, contributing to poverty reductionand environmental protection. It can alsohelp to provide a more stable sector thatis more competitive and attractive fortrader and agri-businesses supply chaininvestment.

The last two decades have seen an increasing emphasis on company and supply chain drivenapproaches to promote sustainable production and trade of agricultural commodities such as cocoa,coffee, cotton and staple crops. Some of these initiatives have achieved remarkable success, withbenefits to both farmers and commercial partners. While they have resulted in ‘islands of success’,many others struggle with the systemic issues including price volatility, unaffordable—and thereforemissing—services for farmers, and a lack of transparency. Increasingly, supply chain actors realize thatto reach sustainability at scale, value chains need to be part of high performing and resilient sectors. Toaddress the roots of poor performance, scaling up supply chain interventions alone is not sufficient.These challenges often require a coordinated approach that is valuable for the sector as a whole andalso boosts the success of individual supply chain projects.This paper will share our findings on how improved sector governance can drive sector transformationleading to stronger sector performance with benefits for traders, processors, exporters and whichsupports more sustainable livelihoods for farmers sector-wide. In this paper, we focus on smallholderdominated agricultural sectors, in which a sector refers to single commodity at national level. However,the authors believe that the principles of sector governance presented in this paper can also be appliedat different intervention levels (e.g. a sub-national jurisdiction or landscape), multi-commodity contextsas well as agricultural sector governance in general.

This Overview of Sector Governance pulls from a larger report by the same authors which develops ananalytical framework and analysed 13 case studies in different commodity-country contexts to obtain abetter understanding of specific sector governance instruments and to support the development of amethodology to facilitate sector diagnostics from a governance and performance perspective. SeeResources on page 10 for more information.

Defining sector governance

Sector governance is the coordinated management of a sector as a whole which can include acollection of rules, stakeholder involvement and processes to manage for common/shared interests.Sector governance is broader than government, covering non-state individuals and institutions,including the private sector. It has three main functions:

Sector coordination: Alignment of keystakeholders around a shared vision andstrategy, monitoring of progress, andpromotion of learningRevenue generation and re-investment:Sector-led generation of revenues and re-investment in service delivery, the productionbase, market management and sectorcoordinationMarket management and regulation:Systems and rules governing trade, price,quality, demand and supply, traceability,sustainability, producer organization andservice provision

Improving sector governance, in coordination with private sector and civil society investments, cancontribute to the transformation of the:Producer base: consisting of viable and sustainable production systems and the organization ofproducers around service delivery, market access and agency at sector levelService sector: consisting of professional and inclusive service delivery models (e.g. research,extension, input provision and finance)Market: consisting of mutually beneficial trading relationships, fair pricing, incentives for quality andsustainability, traceability

Sector transformation

Sector performance

• Competitiveness• Inclusiveness• Innovation&adaptation• Resilience

• Resistancetorentseeking• Profitability• Transparency• Sustainability

Sectorgovernance,alongwitheffortsofotheractors,drivessectortransformation,leadingtoimprovedsectorperformanceintermsof:

Why now?

The undermining effect of price volatility in the vanilla sectorVanilla is an agroforestry crop well suited to small scale family farms in topical zones. Vanilla buyingcompanies have steadily invested in programs with farmers to improve vanilla production and addresschallenges such as food insecurity (now reaching 20% of farmers). However, the sustainability ofsupply and livelihoods is challenged by extreme volatility, which is amplified by concentration ina single origin, vulnerability to cyclones, delays in supply and demand response, and lack of marketinformation. When prices are high, quality suffers as trade in immature vanilla becomecommonplace. High prices and low quality reduce demand even as growersexpand production. During resulting low price periods, farmers often face economic challengesand underinvest in production, leading to the next boom and bust cycle.

Agri-business, NGOs and donors have largelyfocused interventions on the value chain insupport of legal and standards compliance,sustainability, productivity, and quality. Theseinitiatives often produce positive results, butdo not bring the systemic changes that arerequired to tackle issues that can make orbreak sector performance, such as pricevolatility, natural resource depletion or long-term security of supply. Sector governancehelps to drive a sector that can positivelyimpact farmers and agri-business, as well asboost the success of individual supply chainprojects aimed at improving sustainability,productivity and farmer livelihoods.

1998 2000 2002 2004 2006 2008 2010 2012 2014 2016

MadagascarVanillaBoom&BustCycle

Theft,earlypicking,lowquality,plantingofnewvanilla

Poverty,lowfarmerinvestmentinvanilla

Decreaseinproduction

• Pricevolatility(boom&bust)

• Productionvolatility

• Poorqualitymanagement

• Weakorganizationofsmall-scaleproducers

• Poorserviceprovision

• Informaltrade• Elitecaptureand

rent-seeking

• Badqualityreputation• Reducedsecurityofsupply• Negativeenvironmental

andsocialimpact• Reducedincentivesfor

supplychainandfarmerinvestmentinproduction

• Temporary“pilotproject”lifespananddonorreliance

• Temporarylifespanofeffectivesupplychainmodels

• Lackofrevenuecollectionfrominformaltrading

• Continuedreputationalriskforbrands

CommonSectorWeakness

NegativeImpacts

Sustainable Vanilla Initiative (SVI) – anew industryinitiative thatcomplementsvaluechainprogramsbyaddressingsector governance•SectorCoordination: SVI isworkingtostrengthenlocalforums that can anchorcrosssectordialogueandsolutions•Sector Professionalization: SVI is supportingprivateandpublic sector regulationtohelp“professionalize”the industry toprotect quality andpromote transparency, including:enforcementofcampaign(harvest)dates,childlaborcode,qualitystandards,systemsof registration.•Sector Stability: SVI isworkingtosupport growthofproductionin multipleorigins, greatertransparency of market information, and otherstrategiesto reducevolatility

Sector governance, along with efforts of other actors, drivessector transformation, leading to improved sector performance

Interviews and analysis across multiple tropical commodities pointed to diverse characteristics of a highperforming and resilient sector that is likely to be more beneficial to both smallholders farmers andagri-business.

Ahighperformingandresilientsectoris:• competitive: hasagoodreputationandperformancein

worldmarket(priceandquality)• resilient:reducestheriskandabsorptionofshocks

relatedtopricevolatilityandclimatevariability• profitable:allowsproducers,workersandsupplychain

actorstocaptureafairshareofendvalueenablingre-investmentsinthesectorandfarm

• innovativeandadaptive:isflexibletorespondtomarkettrends,addsvalueanddevelopsdifferentiatedproductsbaseduponoriginandqualityattributes

• sustainable:protectstheenvironment,respectslabourrightsandbuildshumanandenvironmentalcapital

• inclusive:providesopportunitiestothemostvulnerabletoparticipateinthemarketwithaccesstoservices

• resistanttorentseekingandelitecapture:protectsagainstinequitablesharingofresourcesandprofitsdownthevaluechain

• transparent:operateswithinlegalframeworkswithtransparentortraceablesupplychains

Well-organized and coordinatedsector governance that generatesrevenues and manages thefoundations of the market – incombination with the investmentsand behaviors of actorsthroughout the supply chain – canlead to a better organized andeffective service sector,production base and market(sector transformation). These, inturn, contribute to an increasedlikelihood of a high performingsector that is competitive,profitable and sustainable (sectorperformance).

What does a high performing and resilient sector look like?

Revenue generation & re-investmentSectors that are able to generatetheir own revenues can re-investthat money in service delivery,the production base, marketmanagement and sectorcoordination.

Key Tools:• Revenuegeneration:levies,taxes,subsidiesandtrustfunds

• Re-Investment:investmentsandsubsidiesinresearch,extension,inputdistribution,qualitymanagement,pricemanagementandstabilization,socialandenvironmentalprograms,marketpromotionandthefunctioningofthecoordinationbodiesthemselves

Shared vision, coordination &monitoringWhen key stakeholders arealigned around a shared visionand coordinated in their activities,they are better able to worktogether to increase the impact oftheir work. Using monitoring toolsto measure progress and promotelearning the sector can prioritizeand change strategy based onwhat is needed.

KeyTools:• Sectorplatformsandcoordinationbodies

• Sectorstrategies• Producerandsectorlevelmonitoringandevaluation(M&E)systems)

Organization of the service sector

Investments in the service sectorhelp to build professional serviceprovision with viable and inclusivedelivery models that can cater toproducers’ and supply chainactors’ needs, such as technicalassistance, inputs, and finance.

DrivessectortransformationOrganizationoftheproduction

baseA coordinated sector can promoteviable production systems andorganize producers aroundservice delivery, market access,and agency at the sector level.

Organizationofthemarket

Market management helps toestablish mutually beneficial tradingrelationships, fair pricing standards,managing quality, promotingsustainability and traceability of rawmaterials.

Sectorgovernance+actionsofotheractorsMarket management & regulationSectors that have mechanisms todetermine the basic rules on trade,prices, quality, traceability andsustainability are better able controlthe market in a way that is mutuallybeneficial to buyers and farmers bypromoting quality, reputation andsector growth.

Key Tools:• Commodityexchanges,pricesetting,stabilizationfunds,bufferstocks

• Qualitystandards,controlmechanisms

• Licensemechanisms,traderegistries

• Sustainabilitystandards,spatialplanning,moratoria

• Cooperativeregulation,contractfarmingprotocols

Increasedsectorperformanceshouldnotonlygeneratefundsforinvestmentinthesector,butalsoimprovetheclimateforinvestmentbysupplychainactors,includingproducersthemselves.

Competitiveness Profitability Resilience Innovation & adaptationInclusiveness Sustainability Resistancetorent-seekingTransparency

Leadingtohighsectorperformance

How does sector governance contribute to sector performance?

Taking a closer look: sector coordination

SustainablePalmOilinHonduras(PASH)PASHisasectorplatformmadeupofpalmoilcompanies,cooperatives,governmentrepresentativesandinternationalNGOsformallyestablishedin2013withtheobjectivetopromotebettermanagementandtostrengthenrelationshipsthroughoutthesupplychain.

ThecollaborationinthePASHconsortiuminspiredpalmoilcompaniestoset-upanindustryassociation(AIPAH).AIPAH’smainactivityistonegotiatecontractswithendbuyersforthecollectivemembership.

PASHsuccessfullyimprovedcollaborationandbuilttrustbetweenthecorporategroupandtheproducergroupinthesectorbyfocusingon“sharedinterest”.Theidentificationofsharedinterestamongtheseactors,andengagementwiththepublicsector,has ledtoself-monitoringwithintheindustryandanarticulationoftheneedtodeveloppolicyaroundresponsibleexpansionofoilpalmandrelatedenvironmentalimpacts.

KeytoSuccess:Patienceandgoodfacilitationskillsarenecessarytobuildtheinitialtrustlevelbetweenstakeholders.Collaborativefieldprojectsresultinginconcreteresultsenabledlearningacrossstakeholders.

Challenges:Themodeldoesnotincludeamechanismforrevenuegenerationwhichwillincreasethechallengetoreachoutandprovideservicestounorganizedfarmers,unlessadonorstepsin.

SectorPlatformsSector platforms are generallyvoluntary and focused on alignment,learning, or the coordination ofdevelopment efforts

We’veseenthatthestrongsectorsalwayshavesomegroupthatbringstogetherstakeholderstosetrulesinthesector.Thesebodiesdevelopavisionforthesectorandastrategytoachievesharedsectorgoalsandcan:• Developasector-widevisionandimprovementstrategy• Identifyneeds,raiseandaligninvestmentforsectorimprovement

Advocateandinformpolicy• Setsectorrulesthatleveltheplayingfieldforproducers• Monitorsprogresstowardssectortransformation,disseminatethe

lessonslearned,andchangestrategyaccordingly.

SectorCoordinationBodiesSector coordination bodiesare state-sanctioned with aformal mandate tocoordinate sectors andpossibly manage markets.

Thisisgenerallydonethroughasectorplatformorcoordinationbody.

Vietnam Coffee Coordination Board (VCCB),Cocoa Sustainability Partnership (CSB) inIndonesia, National Platform for ResponsibleProduction and Trade of Pineapple in CostaRica, Sustainable Palm Oil in Honduras (PASH)

The Inter-branch CottonAssociation of Burkina Faso (AICB),Coffee Institute of Costa Rica(ICAFE)

Factors to considerThe ideal make-up of sector governance institutions will be determinedby the context of the country and its producers.Voluntary vs. mandatory: The drawback of many voluntary sectorplatforms is that they generally do not have the mandate or capabilitiesto raise revenues for re-investments in the service sector, producer baseor to manage markets. Coordination bodies with a governmentmandate usually have a more formal mandate to manage sectors, whichmakes revenue collection, sector-wide re-investments and marketmanagement easier. However, mandatory coordination bodies are, bytheir nature, more political and complex.Government involvement: A strong government role can facilitate theintroduction of more extensive and far-reaching reforms. But, this canalso be done with a strong management system apart from thegovernment. In a weak institutional environment, sector governance isoften more effective when placed at arm’s length from the government,providing more opportunities for inclusive and transparent processes.Even then, however, some government mandate and buy-in isnecessary.Representation and governance: Sector platforms should aim for abalanced representation, which needs to be complemented by aneffective governance structure, strong leadership and facilitation skills,and effective goal setting and learning capabilities.Financial sustainability: Donor funds may be critical in the early phaseof the establishment of sector platforms, but self-financing is a keychallenge for durability.

Revenue generation and re-investment

KenyaTeaDevelopmentAgency(KTDALtd)TheKenyaTeaDevelopmentAgencyLimited(KTDALtd)wasincorporatedinJune2000asaprivatecompanyhavingevolvedduringliberalizationfromagovernmentauthority.EquityandsharesofKTDAareownedandpurchasedbysmallholdersofteaandthegovernanceandmanagementofKTDA-ownedteafactoriesarecarriedoutbyofficialselectedbysmallholders.AlevyisappliedbyKTDAatthepointofprocessing,whichfundsitsextensionservices,inputsandcreditforproducers. KTDAhavefocusedonextensionservicesthatemphasizehighqualitypluckingandprocessingtechniquesandhavesucceededinaccessingpremiumquality exportmarkets.Asidefromitscorebusinessrelatedtotea,KDTAhasalsosoughttoinnovatetoensuresustainabilityinenergyprovisionneededtorunitsfactories,viainvestmentsinhydropoweranditsownfuelwoodtreenurseries.Ithasalsoestablishedsubsidiariesthatprovideadditionalservicestoitsfarmershareholders,suchinsuranceandmicrofinance.KeystoSuccess:Themodelhasaneffectiveinfrastructureforcollectionoffundsandforreinvestmentofthosefundsbackintothesupplybasewithoutburdeningpublicresources.Challenges: TherehasbeensomedissatisfactiononthepartofthefarmersofKTDAservices(inputs,collection,processing,transparencyofpricesetting,andmarketing).

Revenue collection is generally done through export taxes or leviesand therefore is more easily achieved with export commodities thancrops destined for the domestic market. However, there is a lot ofvariation in the weight of the revenue collection and the extent towhich it is reinvested in the sector or the governance structure itself.The ability to collect revenues to survive market booms and bustswithout needing recapitalization and to invest in the root causes ofunsustainability at farm, landscape and sector level is key to sectorperformance.

Typical sector investments include: research, extension, inputdistribution, quality management, price management, pricestabilization, social and environmental programs, market promotionand the functioning of the sector platforms or coordination bodiesthemselves.

We found that more resilient sectors are those that able tocontinually invest in their production and quality. This requires theability to generate revenue on a consistent basis at the sector level(removing dependency on donors or lead firms) and the capacityand desire to re-invest those funds in the sector in a way thatfurthers progress toward the sector vision.

Factors to considerRe-Investment: Coordinated reinvestment in research and servicedelivery can have widespread impact on yield and quality. However,for re-investment to lead to a more sustainable production system,significant investment is often needed, particularly where there is aneed to rejuvenate tree crops—an expensive activity that does notbear fruit for several years depending on the crop.

Inclusivity: Sector-wide access to services, rather than access beinglimited islands of technical support paid for by lead firms or donors, iscritical to the inclusive development of smallholder agriculture.

Many sector-wide investments are insufficient to reach all producerswith high quality services. In this case, sector governance institutionscan help to create the alignment and tools necessary for other actorsto co-invest in service provision, for example, by mandatingcompanies to provide inputs and technical assistance to all theirsmallholder suppliers.

Accountability: Sectors that are able to ensure transparent andaccountable management and decision-making around revenuecollection and re-investment are better able to avoid rent-seeking andelite capture.

Market Management and regulation

ColombianCoffeeGrowersFederation(FNC)FNCisastate-sanctioned,farmergovernednationalfederationcreatedtoraisethesector'seconomicandsocialperformance.TheFNC’spurchaseguaranteeisacriticalcomponentofitsmodel.Growershavetheoptiontosellasmuchoftheiroutputastheychooseatanestablished(anddailycommunicated)minimumfairpricebasedoninternationalprices.Thepurchaseguaranteeensuresafairerdistributionofpowerbetweenbuyersandsellersbyprovidingapointofleverageinpricenegotiations.TheFNCarguesthatthisensuresfarmerscanreceivethehighestpriceandthelargestshareofvalue.Moreover,theFNCoffersfarmerstwocontractformsthatcanprotectthemfrompricevolatility(orspeculateonhigherprices).Keystosuccess:The FNC’sproducer-centeredapproachhasbeencentraltothedesignandimplementationofitsmodelandhelpstoensureitsrelevanceforfarmers.Itsdemocraticstructureallowsforhighlevelsofaccountabilitytofarmersandlimitsrent-seeking.Challenges:Thepurchaseguaranteeisasignificantdrainonresourcesavailablefordirectreinvestmentandisbecomingadrainonpublicresources.Ifitcannotadapt,themodelislikelynotsustainable.

Competitive and resilient sectors are frequently enabled by goodcrop quality management, low price volatility and well-organizedproduction bases. A body that is able to govern the sector in thismanner, and promote the market in line with the sector vision, canincrease value of the product to both the farmer and buyer.

Sector governance bodies have a variety of tools they are able touse to manage and promote the market:Sector governance bodies use tools at the sector level that can leadto better sector performance in line with the sector vision (e.g.,promote more stable pricing, protect quality and reputation,increase returns to farmers and promote market growth). Some ofthese may be supported by the funds raised and reinvested by thesector governance institution.

Price: commodity exchanges, price setting, stabilization funds, bufferstocksQuality: standards, control mechanismsSupply management: production / import quota, farmer exitincentivesSupply Chain Transparency: license mechanisms, trade registriesPromotion: branding and marketing of national sectorSustainability: social and environmental regulation, standards,spatial planning, moratoriaOrganization: cooperative regulation, contract farming protocols

Factors to Consider Acloserlookatpricingmechanisms:Manytropicalcommoditysectors,includingcoffee,cocoa,rubber,vanilla,etc.,strugglewithpricevolatility,oftenexperiencingextendedperiodswithpricesbelowsustainablelevelsforfarmers.Pricestabilizationmechanismscanhelptoreducepricevolatility,increasevaluecapturebytheproducer,andimprovesupplychaintransparency.However,thesestrategiesneedtobewellthoughtoutasmismanagedtoolscanhavenegativeimpactsonthesector.

Politicization:Animportantconditionforsuccessisthatpricesettingandstabilizationschemessetpricesandcontributionsonanon-politicalbasis.Pricesettingisverysensitiveasdifferentstakeholderswillhaveconflictinginterests.Thisrequiresagoodgovernancemodelandcleardecision-makingproceduresbasedonaprice-settingformula.

Pricefluctuation:Thestabilityofpricemechanismsmaybethreatenedbylong-termdeclinesinmarketprices.Pricesettingmechanismscannotbesetinisolationofsupplyanddemand,asintentionalpricemanagementcanriskpromotinganincreaseofproductionbeyondthemarketdemandleadingtoadestabilizationofthemarket.

ICAFE– Sectorcoordinationatarm’slengthfromthegovernmentAcasestudyinsectorgovernance

Many sector platforms or coordination bodiesutilize some, but not all of the sector governancemain functions (sector coordination, revenuegeneration and re-investment and marketmanagement). ICAFE, the sector coordinationbody for coffee in Costa Rica, is an example of amature sector body that implements acomprehensive set of instruments that promotehigh sector and producer performance.

Sector CoordinationICAFE’s management is at arm’s length from the government and its effective governance structure hasincreased trust levels between stakeholders. ICAFE’s vision and strategy has a strong emphasis oninclusiveness. The majority of the board are representatives of producers.

Market Management and regulationAn important component is ICAFE’s price policies. Farmers receive (at least) a minimum farmgate pricebased upon the New York exchange prices and are paid an annual weighted average of this price. Thishas resulted in more stable farmgate prices and guarantees farmers receive 80% of the export price.Margins are also set for washing stations and exporters. The price structure includes a fee for astabilization fund which compensates farmers when prices drop below cost of production by morethan 2.5%. The price policies also allow the collection of a levy (1.2%) which is used by ICAFE for itsrunning costs as well as investments in research, quality management, and market promotion.ICAFE implements rigorous national quality standards and control mechanisms. It has also limitedchoice of varieties to 100% Arabica. This high quality, in combination with active marketing by ICAFE ofthe Costa Rica brand, means its coffee receives one of the highest premiums on the world market.Despite these premiums, the Costa Rica coffee sector is struggling to remain competitive due to higherlabour costs and alternative livelihood options.The price and quality policies are supported by a license system and trade registry which includes allfarmers, value chain actors and trade transactions. ICAFE closely monitors the transactions. Thetransparency of this system also facilitates credit provision by commercial banks and washing stations.

Revenue generation and re-investmentThe collected levy enables investment in research and input programs targeting control of pests anddiseases and the renovation of plantations. It also functions as a central coordination point for donorfunding, for example for mitigation of climate change. ICAFE’s role in organizing technical assistance islimited, which is mainly done by the government, supply chain actors and other donors.

Factors for Success• The combination of price setting, stabilization, supply chain transparency and rigorous qualitymanagement result in high yields, high quality and premium prices on the world market.• ICAFE’s management at arm’s length from the government makes it less vulnerable to the effects ofpolitical regime changes. In combination with the absence of donor dependency, because of its revenuecollection model, makes it a very sustainable model.• Some identified critical success factors of this model are a result of an enormous political capital anda strong commitment by the board in promoting and protecting the interests of farmers. Trust levelsbetween stakeholders are high because of a lengthy historical relationship between participants andthe governance boards of the ICAFE, which have a democratic and representative structure.

The ICAFE was established in 1933 as regulator andsupervisor of the coffee sector in Costa Rica. It is astate-sanctioned, non-governmental organizationwith significant producer representation.

It is often the combination of sector governance and transformation instruments that lead to a highperforming and resilient sector. Individual instruments are often not enough. Without knowledge ofthe sector’s needs, buy-in from sector stakeholders, and/or the resources or knowledge to implementsector governance, many actors are trying to transform the sector or their supply chain throughtraditional development projects. These types of projects (business development services, farmerorganization and cooperatives training, sustainability standards, contract farming, etc.) are difficult toscale to the sector level without strong sector governance in place.

The Current State of Sector Governance

There has been a recentfocus on bettercollaboration, coordinationand monitoring withinsectors. However, revenuegeneration and re-investment and marketmanagement are largelyignored or not tackled forfear of disrupting themarket or unwillingness onthe part of key stakeholders.

Whatcanyoudotosupportsectorgovernanceinyourfield?ApplyingasectorgovernancelenstoyourworkThink about the challenges that you face every day. Many common field-level challenges could bepartially addressed by improvement at the sector level. To better understand the change neededand the levers to pull, it’s time to work with others to formulate a sector transformation strategythat would catalyze solutions to seemingly intractable problems:• Highvolatility• Endemicqualityproblemsthatthreatenthecountryreputation• Manyunorganizedsmallholdersandloosetradingrelationships• Lackofinclusiveextensionservices• Commoditymarketwhereitisdifficulttocreatedistinctivevalueaddthroughsupplychains

Whocanparticipateinsectorgovernance?• Sectorplatforms– multi-stakeholderplatformswhichcongregatearoundoneormore

commoditiesandpursuesectortransformationbyimprovedcoordination,sector-wideinvestmentsandpolicydevelopment.

• Producercountrygovernments/coordinationbodieswithapublicmandatetocoordinatesectors– improvingtheeffectivenessoftheirstrategiesinbuildingperformantsectors.

• Donors&developmentorganisations– interestedtosupportthesystemicchangesthatarerequiredtotransformsectors.

Where to start?Introducing a more coordinated sector governance approach isnot something to be tackled overnight. It requires a committedprocess in which engaging key stakeholders is of crucialimportance.

Take action

• Organize relevant stakeholders for consultation, alignment,strategy development and co-investment

• Conduct a sector diagnostic to identify needs andopportunities for improved sector governance and sectorperformance:

• A sector diagnostic tool can be used to: 1) assess thecurrent level of sector performance and identify itsmain strengths and weaknesses, 2) inform strategiesto enhance the effectiveness of sector governance,and 3) assess progress in improving sectorperformance by conducting a baseline andsubsequent repeated measurements. For moreinformation contact Jan Willem Molenaar (see below)

Goodsectorgovernanceprovidesabetterfoundationfromwhichallactorscanhavemoresuccessfulvaluechaininitiatives,andcanalsodrivesustainabilityoutcomes

directlyforbothproducersandbuyers.

Learn more• Learn from other the experience from other countries and sectors

• Read the full paper, including case studies, that informed this Overview: Reaching beyondthe value chain: How sector governance can improve the performance of agriculturalcommodity sectors

• Reach out to those working in sector governance to talk about your specific sector• Contact the authors of this paper for more information:

• Jan Willem Molenaar, Aidenvironment: molenaar@aidenvironment.org• Don Seville, Sustainable Food Lab: dseville@sustainablefood.org• Bill Vorley, IIED: bill.vorley@iied.org

• Develop a shared vision and a strategy based upon these insights distinguishing short andlonger-term priorities

• Start implementing the strategy with a focus on maintaining alignment and measuring progress,and use this as a basis for further improvement of the strategy.

• Monitor the effectiveness of strategies on sector governance and performance for furtherimprovement

The ownership of such process can be institutionalized in a voluntary sector platform or a moreformal governance body. Depending on institutional strength, these bodies could be managedwithin or at arm’s length of the government.