Motivations and Barriers of Using Emerging Technology in Eco-label Certification

for Sustainability

From the certification companies’ perspective

Emilio AsensiRenars Kaulins

Main field of study – Leadership and OrganisationDegree of Master of Arts (60 credits) with a Major in Leadership and OrganisationMaster Thesis with a focus on Leadership and Organisation for Sustainability(OL646E), 15 creditsSummer 2019Supervisor: Ju Liu

Title: Motivations and Barriers of using emerging technology in eco-label certification for sustainability, from the certification companies’ perspective

Authors: Emilio Asensi, Renars Kaulins

Main field of study: Leadership and Organisation

Type of degree: Degree of Master of Arts (60 credits) with a Major in Leadership and Organisation

Subject: Master Thesis with a focus on Leadership and Organisation for Sustainability (OL646E), 15 credits

Period: Summer 2019

Supervisor: Ju Liu

AbstractThe demand for organic sustainable products has been growing exponentially in the past years, pressuring the industry to showcase the sustainable origin and conditions of their products to their consumers. Companies use certifications and eco-labels to show the sustainability behind their products, but the standards behind these certifications can be hard to understand as certification companies are struggling to communicate them to the end consumers. Emerging technologies such as QR codes, IoT and blockchain provide new options for increasing traceability and transparency in the certification industry, but these technologies are not widely adopted.

This thesis investigates the current practices in certification companies by performing semi-structured interviews with different actors in the certification industry, to understand what are the motivations and barriers that companies see in the adoption of new technologies for transparency and traceability. Once motivations and barriers have been identified, the authors frame them into a motivational model and propose organisational strategies for these companies in order to overcome the barriers and produce change towards technology adoption, traceability and transparency improvement and sustainability advocacy.

Industry practitioners can use these technologies to increase the trust in their brands and to ensure the sustainability of their supply chains. Further, new emerging technologies can be seen as a tool to assess the companies’ strategic and tactical decisions to comply with their CSR policy, decisions that can eventually lead to an organisational change providing companies with a more sustainable perspective of their operations.

Keywords: Certification, eco-label, technology, QR codes, IoT, blockchain, sustainability, transparency, traceability, barriers, motivations, organisational strategy, organizational change.

Table of Contents

1. Introduction ..............................................................................................11.1. Background in sustainability..........................................................................1

1.2. Transparency in supply chains.......................................................................2

1.3. New technologies for transparency ...............................................................3

1.3.1. An integrative technology portfolio ............................................................4QR Codes..............................................................................................................4Smart IoT devices.................................................................................................5AI and Machine Learning .....................................................................................5Blockchain ............................................................................................................6

1.4. Certification industry .....................................................................................8Standards .............................................................................................................9Accreditation ........................................................................................................9Certification .......................................................................................................10Labels & Eco-labels ............................................................................................10

1.5. Research problem ........................................................................................11

1.6. Purpose and aim of the research .................................................................12

2. Theoretical Background and Analytical framework ...............................132.1. Organisational Strategy and Change...........................................................13

2.2. Motivation on the adoption of new technologies .........................................14

2.3. Unified Theory of Acceptance and Use of Technology ................................16

2.4. Analytical Framework ..................................................................................17

3. Research design......................................................................................183.1. Research Strategy and Approach ................................................................18

3.2. Research Method .........................................................................................18

3.2.1. Case selection ...........................................................................................18

3.2.2. Data collection ..........................................................................................19

3.2.3. Data analysis.............................................................................................21

3.3. Limitations ...................................................................................................22

4. Empirical Finding ...................................................................................234.1. Current Status of the Certification Industry................................................23

Eco-label standards ............................................................................................23Assurance methods ............................................................................................25Transparency......................................................................................................27Technology .........................................................................................................28Culture ...............................................................................................................30Partnership and collaboration............................................................................31

4.2. Motivations ..................................................................................................32Motivation 1: Consumer demand .......................................................................32Motivation 2: Thinking ahead ............................................................................33Motivation 3: Usefulness ....................................................................................35

4.3. Barriers ........................................................................................................37Barrier 1: Lack of consumer demand and pressure ...........................................37Barrier 2: Lack of financial resources ...............................................................39Barrier 3: Legislation .........................................................................................41Barrier 4: Miscommunication.............................................................................42Barrier 5: Knowledge or Interest in emerging technologies..............................43Barrier 6: Fear ...................................................................................................44Barrier 7: Complexity .........................................................................................45

5. Research Analysis ...................................................................................47

6. Conclusions.............................................................................................52Limitations and recommendations .....................................................................54

References .......................................................................................................i

Appendices....................................................................................................vii

List of Tables

Table 1: Overview of the interviewees .....................................................................19Table 2: Mapping organisational strategies with motivations and barriers for technology adoption .................................................................................................52

List of Figures

Figure 1: Triple Bottom Line model (Elkington, 1994) ..............................................2Figure 2: A body figure conforming an integration model of new technology for transparency...............................................................................................................4Figure 3: An example of blockchain usage in certification processes........................7Figure 4: Basic structure of the organic certification system (Schulze, Jahn & Spiller, 2007) ..............................................................................................................8Figure 5: UTAUT model (Viswanath et al., 2003).....................................................17

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1. IntroductionThis chapter presents a brief introduction of the background for the thesis topic. It starts with a background in sustainability and why it is important to address, then introduces the concept of transparency in supply chains and its relation to sustainability, while giving an entry point to new emerging technologies that can provide transparency and traceability. A deeper explanation of these technologies is presented due to their relevance to the research. Then, a closer look at the certification industry is taken to provide an understanding of various actors and their function involved in the certification scheme and how does that affect the end consumer. The chapter ends with a presentation of the identified research problem followed by the purpose and aim of the research.

1.1. Background in sustainabilityWorld population is reaching new highs and is projected to reach 8.6 billion in 2030, 9.8 billion in 2050 (United Nations, 2017). Growing population and the globalized economy are driving the need for raw materials and challenging industries to meet the demand. Additionally, advancements in communications networks have been important factors in driving market saturation and creating even greater competition. Thus, putting pressure on various actors involved in the supply chain systems by often creating conditions that favour the least environmentally and socially beneficial practices (Jovane, Seliger & Stock, 2017).

At the twenty-first session of the Conference of the Parties (COP 21) held in 2015, nation leaders from all UN member states gathered and reached a landmark agreement to combat climate change and signed Paris Agreement (UNFCCC, 2018). Further United Nations (UN) established 17 Sustainable Development Goals (SDGs) with an agenda to be reached by 2030. Among these goals, SDG 12 “Ensure sustainable consumption and production patterns” has created pressure for governments to introduce more stricter laws across industries and addressing the need to “achieve the sustainable management and efficient use of natural resources” and developing legal frameworks to “encourage companies, especially large and transnational companies, to adopt sustainable practices and integrate sustainability information into their reporting cycle” (Sustainabledevelopment.un.org, 2016). All this requires various industries to adopt new behaviours and processes throughout their entire supply chain. Actors in all stages need to adopt a strategic perspective for their sustainable challenges (Porter & Kramer, 2006).

For companies in general, sustainable development requirements translate into economic, social and environmental sustainability (Pereira de Carvalho & Barbieri, 2012). This refers to a framework that was introduced already back in 1994 by John Elkington named the 'triple bottom line' (TBL), where it was suggested for companies to focus on social and environmental concerns as just as they do on profits – ‘people, planet and profit’ (Elkington, 2001). Putting all these aspects into perspective, companies are pressured to look at their entire supply chain in order to become more sustainable while maintaining their competitiveness.

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Figure 1: Triple Bottom Line model (Elkington, 1994)

Awareness of pressing issues of environmental and social challenges amongst consumers has risen over the last decade, which has resulted in a growing demand for products that are produced in a more sustainable manner (Cherian & Jacob, 2012; Cervellon & Carey, 2011). Additionally, Christopher (2012) suggests that apart from the quality of the products, customers are also becoming more demanding in terms of the speed, flexibility, and predictability of delivery service. This puts even greater pressure on companies and their supply chains to satisfy customers while delivering on the promise of being environmentally and socially responsible enterprise.

1.2. Transparency in supply chainsIn regions such as Europe and North America, the demand for agricultural and other commodities is growing. However, the supply cannot be met by local producers, thus the demands are increasingly being met by global supply chains (Yu, Feng, & Hubacek, 2013). While the global economy and advancements in the network offer opportunities to extend the sourcing and manufacturing around the world, at the same time supply chains have never been as complex as they are today (Mangan & Lalwani, 2016). These operations can lead to opaque conditions and difficulties to navigate in the global supply chain systems. As a result, creating vulnerability for companies to oversee 'behind the scenes' of their suppliers or manufacturers. However, by increasing transparency, these risks and uncertainties can be reduced (Carter & Rogers, 2008).

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Taking into considering the fact that the supply chain process involves the product from the initial processing of raw materials to delivery to the end-user, having more transparency is a crucial step toward the development of sustainability (Ashby et al., 2012). Further as Carter and Rogers (2008) suggest transparency improves communication among different actors, thus strengthening trust and collaboration. This is especially important when evaluating whether the ingredients and working conditions of the supplier meet the requirements.

Additionally, transparency addresses the distribution of responsibility (Gardner et al., 2019). With no doubt producers carry a big responsibility in driving more sustainable businesses, so as consumers hold the power to impact supply chains, which further translates into what is produced and how it is being produced (Grunter, 2011; Shaw, Newholm and Dickinson, 2006). However, as Gardner et al. (2019) explains that “there is growing recognition of the need for actors involved in every step of global supply chain, and not only producers and consumers, to share the responsibility of placing production systems on a more sustainable footing'' (p. 164). Taking the cosmetics industry as an example, for a cosmetics brand to formulate a skincare product can often involve more than 200 ingredients. This can result in very complex supply chains and difficulties to track the origin of the components. Therefore, by increasing transparency in the entire supply chain can incentivize to keep every actor accountable, including actors such as traders, processors, retailers, and investors that make up global supply chains.

Supply chain information has traditionally been distributed through reporting and disclosure instruments by private and civil society actors, such as company sustainability reports and certification schemes and labels (Egels-Zandén et al., 2015). These instruments often relying on third-party certification bodies to assure the credibility and validity of the information. However, there are delimitations to the traditional forms of assurance in terms of efficiency and reliability. With the rapid advances in technology, there are new technologies such as Blockchain, Internet of Things (IoT) and Artificial Intelligence (AI) which are offering to improve the current processes and bring new forms of trust and transparency. Referred technologies have a great potential to improve transparency and traceability which in result will drive overall sustainable development.

1.3. New technologies for transparencyWe live in a historical period without precedents. In the last 30 years, the internet has reached almost all corners of the world connecting us more than ever and giving access to information which used to be very difficult to obtain if not impossible. Reliable information is a key component to generate trust when we speak about sustainability. Even more, when the intention is to prove to the consumers, certification organizations or anyone interested, a break from traditional unsustainable practices and a change in a company strategy towards sustainability. A way to ensure transparency, traceability, and reliability of that information is by making use of some innovative technologies already available in the market. The technologies described below are in an early stage of implementation and therefore

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not widely adopted, but present huge potential to improve the quality of the data, the access to information and to drive change in the industry towards more sustainable practices, in particular in their supply chains.

1.3.1. An integrative technology portfolio

Emerging technologies and innovations present many benefits for transparency by themselves, but the true potential arises in the combination of them. A good representation of this combined effort is an integrative portfolio of technologies mimicking a human body, where:

QR codes represent the shape of the body; the image that allows the communication between the external physical and the internal digital worlds.

IoT devices represent the senses of the body; the eyes that watch the reality and the hands that interact with its environment.

Blockchain represents the heart; the embedded trust and credibility it provides to any interaction, the will to communicate transparent information.

AI and Machine Learning represent the brain; the computing power and algorithms making the best decisions based on predefined requirements, considering those requirements of transparency and sustainability.

Figure 2: A body figure conforming an integration model of new technology for transparency

QR Codes

A QR Code is a matrix code with a symbolic representation that can be easily read by a scanner, camera or any other optical reading device. It contains information in both vertical and horizontal directions, while a traditional barcode has only one

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direction of data (Rouillard, 2008). People can read QR Codes by using the software integrated into their phones, which interprets the image and shows the information on the screen. Depending on the information contained in the QR Code, the phone may open a website, a predefined phone number may be dialled, an email may be sent, or a specific application may be launched.

Because the simplicity and fast action of QR Code processing, the barcode system allows products to be tracked efficiently, accurately and faster than manual data entry systems (Liu, Yang & Liu, 2008). QR codes are starting to be used more and more in companies for story-telling, linking the finalized product to the farmer or worker in undeveloped countries which sourced the raw materials, explaining the specific amount and characteristics of ingredients in a formulation, and even to show the full transparency policy of an organisation.

Smart IoT devices

A smart device is a machine or piece of electronics which can collect and transmit information to a third party physically located somewhere else by using embedded remote connectivity. When using the Internet to make this connection, is called to be part of the Internet of Things (IoT). This interconnectivity gives access to the information collected by smart devices to any interested person or organization, like consumers or certification organizations addressing sustainable practices.

Recent IoT technologies are enabling products to create value even after they have left the supply chain to deliver information such as location, condition or availability (Raynor & Cotteleer, 2015). The generated data can help companies improve productivity, but also better communicate their processes with their end-users. The organic industry, as an example, needs to know the conditions of a plant in order to verify its status, if pesticides have been used, the quality of the soil and where has it been cultivated, if in a traditional farm, a greenhouse or a piece of land taken from a forest. Smart devices can monitor and communicate the required information almost in real-time and to a virtually unlimited number of stakeholders, increasing the quality and reliability of the information. More access to information involves more trust if the right conditions are met. Smart devices, if used appropriately, have the potential to also monitor the working conditions of farmers or other workers and improve them by sharing their story (Mohanraj, Ashokumar & Naren, 2016). IoT devices can register if workers have been working too many hours consecutively, if it was too hot or too cold for their health or if a truck driver had enough hours of rest during a journey.

This information does not come without a level of scepticism and a feeling of lack of freedom, but the intention is to use it to improve working conditions, as similar technologies if not the same are already in use to improve companies’ benefits (Asplund & Nadjm-Tehrani, 2016). The problem with these practices is not the technology, but the people who make bad use of it in their own interest.

AI and Machine Learning

Artificial Intelligence (AI) has made great progress in the last years simulating human behaviour. Those advancements are powered based on symbolic representation: the idea that perception and cognitive

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processes can be modelled and simulated using enough data. AI systems aim to embed the knowledge and reactions of a human in a digital form, representing its behaviour symbolically in the form of production rules, frames or semantic networks (Monostori, 2003).

Machine learning, as an extension of the AI potential, develops programs and algorithms to detect patterns in data. Such algorithms are used in many services as recommendation systems, personalized Internet advertising or natural language processing (Monteleoni, Schmidt & McQuade, 2013), but it also has benefits for decision-making processes and sustainability, learning what are the best decisions and implementing them.

BlockchainBlockchain is an innovation in the information and communication technologies (ICT) as a tool which sets protocols and rules to ensure transparent, traceable and reliable information. The idea of a blockchain is a chain of blocks where each block includes the information of the previous blocks in the chain, new or updated relevant information and a security code called hash, working as a database. A block may contain the date when the information was written, the location of a package and the name of the person writing the information. That block is then distributed to a network of interested stakeholders. When a second block is created to update the location of the package, it does not only include the new information but also a code generated by an algorithm using the information of the first block, so if someone tries to modify the information of the first block to change where the package was in its origin, the second block will raise an alarm as the code would now be different, alerting the members of the network (Arefayne, Ellul, & Azzopardi, 2018). This system allows to create trust on the reliability of the data and requires the approval of the majority of stakeholders to modify a block, an almost impossible task in public blockchains. The following features make blockchain to stand out among other innovations (Pratap, 2018-1):

Decentralized: All members of the chain have a copy of it, and none can modify the chain without the agreement of the others. This allows transparency, security and power distribution among the stakeholders.

Peer-to-Peer Network: The interaction between two members can be done without the requirement of any third party. Blockchain uses P2P protocol, which uses approval through machine consensus.

Immutable: Data written in a block cannot be changed. The only way to modify a block is to get approval by every member of the chain, while it is easier and historically more traceable to create a new block showing the modifications. This is due to each block containing the hash of the previous block, as changing a block hash with new information would create a disagreement with the next block.

Tamper-Proof: The previously mentioned disagreement makes easy and fast to detect an unwanted alternation in the chain and to prevent it to happen.

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Private blockchains also exist and have different particularities, but we will not cover them in the thesis as their aim is to keep the data robust, but not necessarily transparent.Transparency and visibility in supply chains are becoming more and more important for consumers, as they aim to choose products that are produced sustainably and ethically (Maayan, 2019). But to assure the validity of the information is not always an easy task, and that is where technology like Blockchain can be a potential solution.

“Blockchain is designed to eliminate centralized transaction ledger's and use a distributed model instead, where everyone has access to all of the data while the system being extremely resistant to tampering. Using Blockchain, every participant of the supply chain can access one linked encrypted and validated information, providing everyone involved with high efficiencies and guaranteed data integrity” (IBM, 2019).

Figure 3: An example of blockchain usage in certification processes

Supply chains have a lot of challenges that can be addressed with blockchain, as their complexity leads to wrong information, challenging tracking and bad transparency. The biggest benefits of blockchain in supply chains are (Pratap, 2018-2):

Traceability: Supply chains are complex, companies can source their raw materials from many locations, produce the product in different facilities and distribute them from a completely separated place. Due to this, it is very complicated, even for large organizations to keep track of each and every registry, leading to missing packages, lack of information and bad logistics management. Using blockchain, and combining it with smart devices or smart labels, allows to easily access the product information and ensure the reliability of the data, like the location, and to prevent theft.

Trust: Trust is an important factor in all supply chains, which traditionally is gained through experience and many interactions between the partners. However, this is time and money consuming and does not create trust further than the involved partners, it does not reach per se the end consumers or regulatory authorities. A block of information in the blockchain is immutable and tamper-proof, creating trust.

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Transparency: As a decentralized chain where every stakeholder has an identical copy, it becomes easier to share information, ensure its validity and prevent misunderstandings.

Cost Reduction: According to a survey of supply chain workers conducted by the American Productivity and Quality Center (APQC) and the Digital Supply Chain Institute (DSCI), more than one-third of people cited reduction of costs as the topmost benefit of the application of Blockchain in supply chain management (DSCI, 2018). Due to the traceability of the products, costs are reduced in logistics and missing packages, while the P2P communication allows the elimination of middlemen and intermediaries, which as well reduces the risk of frauds and thieves.

The value of adopting blockchain technology reflects on the capability to decentralize the data, having one copy of the chain per member, while maintaining the data integrity. The strong values of traceability, transparency and immutability make blockchain technology with huge potential to create trust all along with the globe, from end consumers to suppliers, producers and governments.

Despite the explained benefits, Blockchain is still in a very early stage and cannot avoid presenting flaws and weaknesses related to its maturity as the lack of standards and integration with legacy systems. Also, technological challenges when addressing access, ownership, scalability or security (Niranjanamurthy & Nithya & Jagannatha, 2018). Some of those weaknesses will be improved over time, and some others can be improved with standardization, a very useful practice related to the certification industry.

1.4. Certification industryConsumption of goods and services have been growing and the supply chains have become more complex, while as described in section 1.1 demand has grown not only in terms of the quality but also in terms of more sustainable consumption. Research made by Young, Hwang, McDonald & Oates (2009) shows that green consumer behaviour is highly influenced by the labels on the product, such as Fair Trade, Ecocert and similar. However, having an overview and clear understanding of various labels can be overwhelming and hold little meaning or value for consumers. This can be creating vulnerability amongst customers to be exposed to greenwashing practices by companies to maximise their financial profits. While we as consumers have our expectations from the companies to deliver more sustainable products, for companies, this translates into having transparency and trust in their supply chains. From having a clear overview of where the raw materials are sourced, conditions of the employees involved in the supply chain, the conditions and the quality of the operational processes involved in the manufacturing and finally to how the product reaches the end consumer (ChainPoint, 2016). This requires a common language, a consensus from all parties involved in the operations on the expected quality of the product and the requirements involved in the entire supply chain (Matus, 2010).

Supply chain information has traditionally been disseminated through diverse forms of reporting and disclosure instruments by private and civil society actors, such as certification schemes and labels (Egels-Zandén et al., 2015). As illustrated in Figure 3, certification schemes are complex and involve multiple actors and various procedures.

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Figure 4: Basic structure of the organic certification system (Schulze, Jahn & Spiller, 2007)

Standards

One of the main objectives of standardization is usually that everybody adheres to the same standards, i.e. the same procedures or product specifications. As defined by the International Organisation for Standardization (ISO) standard is a “documents that provide requirements, specifications, guidelines or characteristics that can be used consistently to ensure that materials, products, processes, and services are fit for their purpose” ("International Organization for Standardization", n.d.-b). As mentioned in the definition standards can be used as “guideline” to develop product and process standards.

The Food and Agriculture Organization explains that “setting international standards has proven to be very difficult due to the variety of circumstances that exist around the world. This is especially true for agricultural practices, which have to respond to differences in climate, soils, and ecosystems, and are an integral part of cultural diversity” ("The Food and Agriculture Organization", n.d.). Taking into consideration the complexity involved in finding common practices around the world international environmental and social standards are more often applied as general standards or guidelines to develop a framework that can be applied in the local context and furthermore specified by local standard-setting or certification bodies (ibid).

The use of standards can be both voluntary and mandatory. Mandatory standards usually refer to national or even international standards that are implemented through policies by governmental bodies. As described by the ISO: “under the World

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Trade Organization (WTO) rules, governments are required to base their national regulations on standards produced by organizations like ISO and IEC, as much as possible” ("International Organization for Standardization", n.d.-b).

However, there can also be voluntary regulation. According to Vogel (2008) “this method of regulation, which has also been referred to as “civil regulation,” tends to deal with social and environmental impacts” (as cited in Matus, 2010, p. 86). It is closely related to the rise in corporate social responsibility (CSR) (Auld, Bernstein & Cashore, 2008). Additionally, advancement in technology has been one of the driving forces of keeping companies more accountable and demanding higher standards. Today consumers are more empowered to react very fast and move the information across the globe, therefore, punishing brands that have failed to reach their expectations (Matus, 2010). Further Matus (2010) suggest that standards have to be notable, credible and flexible. The standards must have notable enough impact, credible in regard to how believable it can be observed, measured and reported upon and finally flexible enough to that new knowledge or goal can be incorporated (ibid). Sustainability, for example, is an ongoing process of development and therefore require adjustments along the way to meet the current challenges and utilize available solutions.

Accreditation

According to The Food and Agriculture Organization (FAO) accreditation is defined as “the formal recognition by an independent body, generally known as an accreditation body, that a certification body operates according to international standards” ("The Food and Agriculture Organization", n.d.). This means that if the certification body wants to implement a new standard in their certification program, they first need to be evaluated and accredited by an authoritative body. The accreditation process will then ensure that the certification body has the capacity to carry out certification programmes and whether the specific standard used by the certification body is in line with the generic standard and whether they are satisfied with the method of verification.

Certification

Certification can be seen as a form of communication along the supply chain, through developed standards that have been inspected and verified by a third party without a direct interest in the economic relationship between the supplier and buyer to assure the credibility of the data (The Food and Agriculture Organization, n.d.). Matus (2010) defines certification as “the process, often performed by a third party, of verifying that a product, process or service adheres to a given set of standards and/or criteria.” As suggested by the International Standard Organisation (n.d.-b) certification can be seen as “a useful tool to add credibility, by demonstrating that your product or service meets the expectations of your customers”. Further adding that depending on the industry in some cases certification is a legal or contractual requirement (ibid).

The organization performing the certification is called a certification body (CB) or certifier (ibid). As the Food and Agriculture Organization (n.d.) explains “the certification body might do the actual inspection or contract the inspection out to an inspector or inspection body”. Further adding that “the certification decision, i.e. the

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granting of the written assurance or "certificate", is based on the inspection report, possibly complemented by other information sources” (ibid).

The certification process is not just a one-time interaction between auditor and auditee, rather as suggested by Matus (2010) a continuous relationship. Further adding that certification process can also introduce sanctions and penalties such as denying the right to use the label of the certification, thus keeping companies more accountable and stress the importance of complying.

Labels & Eco-labels

While the certificate can be seen as a tool to communicate between seller and buyer, the label, on the other hand, is a tool to communicate efforts and quality of the product to the end consumer. From a consumer perspective as Matus (2010) describes “labels have become increasingly common in relation to information regarding nutrition, safety, and most recently, the environmental impact of a range of products” (p. 79). Thus, labels play an important role in driving consumer purchasing behaviour, not only in terms of quality but also in terms of driving more environmentally beneficial decisions (Testa, Iraldo, Vaccari & Ferrari, 2013; Van Loo, Caputo, Nayga & Verbeke, 2014).

As described by the FAO “a certification label is a label or symbol indicating that compliance with standards has been verified” ("The Food and Agriculture Organization", n.d.). Further adding that “use of the label is usually controlled by the standard-setting body. Where certification bodies certify against their own specific standards, the label can be owned by the certification body” (ibid). Perhaps more known examples come from the food and beverage sector such as FairTrade, Marine Stewardship Council (MSC), Coffee and Farmer Equity (C.A.F.E.) and others.

Today there are more than 460 ecolabels in 199 countries, and 25 industry sectors ("Ecolabel Index | Who's deciding what's green?", 2019). These statistics are two folded. On one hand, the growing number of ecolabels show consumers interest in making more conscious decisions. On the other hand, the rising number of eco-labels can also indicate the oversaturation in the certification industry and raise concerns about whether these labels hold value and are not just there for financial benefits. Therefore, for labels to effectively communicate these standards and reach the end consumers, they must be meaningful. As suggested by the FAO “consumers who base market decisions on the presence of a label need to be able to access information about the underlying certification and standards” ("The Food and Agriculture Organization", n.d.). In other words - the label should be transparent and trustworthy. End consumers should have a good understanding of what the label stands for and is not just an empty attempt to use greenwashing tools to increase the value of the product.

More recently, many other forms of transparency instruments have appeared, including online databases, scorecards, self-disclosure information systems, traceability platforms, independent local monitoring initiatives, and various forms of footprint calculators (Grimard et al., 2017). All those tools open new possibilities to use technology in eco-label certification for sustainability and improve transparency practices.

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1.5. Research problemCertification companies in the sustainability sector carry great responsibility in driving sustainability, end consumers rely at first instance and often only on eco-labels for their ethical decisions when selecting one product or another, but not only consumers, several actors in products supply chains depend on transparency and reliability of their data to assure and communicate the quality, social, environmental or ethical integrity of a product. Further, certification companies have not been extensively researched in the literature, a comparative study performed by Heras, Casadesús and Dick (2002) found that most articles covering certifications and their business value were either anecdotal, case study based, or report only descriptive statistics, and so their industry practices are not fully understood by the end consumer, leading to misconceptions and lack of information.

Emerging technologies such as Blockchain and IoT are available today bringing properties of transparency, traceability and reliability of data. Their implementation in the certification sector would greatly benefit certification providers by improving transparency and traceability in the supply chains, which would in result benefit the end consumer but, despite the potential of the technology, companies in the certification industry are reluctant to change and adopt the technology.

To introduce new technology in a long-time established company is often faced with resistance which may come from different sources. Even if in the long term it does make sense for the company to implement such technology due to the many benefits provided. Companies failing to adopt new technology may find themselves falling behind the market, affecting their operations, impact and profit, thus the barriers to adopting such technologies must be overcome. Without these new technologies providing transparency and traceability in the sustainability sector, the end consumer can be overwhelmed by the different eco-labels in the market, creating vulnerability to be exposed to greenwashing practices by companies to maximise their financial profits and losing value towards the companies that do have sustainability in their daily practices.

To summarize, emerging technologies such as IoT and blockchain provide new opportunities to increase traceability and transparency in the certification industry, however, these technologies are not widely adopted across the industry thus raising the question of what the barriers of are adopting the new technologies.

1.6. Purpose and aim of the researchThe purpose of this research is to explore what is preventing certification companies in the sustainability sector to adopt new technologies that increase the quality, transparency and traceability of data when addressing a supply chain, like QR codes, IoT or Blockchain and to promote its use. This research aims to provide knowledge on motivations and barriers faced by certification companies and organisational strategies that can be applied in order to facilitate technology adoption.

In the form of the research question, this thesis aims to answer the following:

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Main RQ: How can certification companies overcome their barriers to new technologies, and allow them to improve quality, transparency and traceability in their certification practices?

To answer the main research question, the research needs first to investigate the current practices in the certification industry, what are their motivations to adopt new technologies to improve transparency and traceability and what barriers they face for its adoption. With this aim, three preliminary research questions are formulated:

RQ1: What is the current status of transparency and traceability methods in certification processes?RQ2: What motivates certification companies to adopt new technologies?RQ3: What prevents certification companies to adopt new technologies?

2. Theoretical Background and Analytical framework

This chapter presents existing theories and models developed by researchers in the field of organisational change and motivational studies. These theories form the basis for answering the research question, with motivational models illuminating the aspects of technology adoption in sustainable certifications and organisational strategies proposing methods to produce a change. The chapter ends with a unified model of motivational theories to visualise how factors influence technology adoption.

2.1. Organisational Strategy and ChangeMost research on organisations agrees on the fact that change is unavoidable (Tolbert & Hall, 2009). Child and Kieser (1981) mention that “Organizations are constantly changing. Movements in external conditions such as competition, innovation, public demand, and governmental policy require that new strategies, methods of working, and outputs be devised for an organization merely to continue at its present level of operations. Internal factors also promote change in those

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managers and other members of an organization may seek not just its maintenance but also its growth, in order to secure improved benefits and satisfaction for themselves” (p. 28). Companies need to change in order to adapt to new practices which were not considered in the early stages of the company strategies. Those changes can be motivated by many reasons, including a new technology in the market filling a need, or improving an already established method. It is very important to keep in mind that organisational change does not happen in a single day, it is a process.

Organisational change can be episodic or continuous, depending on the time frame of the change (Weick & Quinn, 1999). Episodic changes are produced in a single moment of time when a change needs to be implemented in order to move away from a stable situation towards another, these changes tend to be infrequent, discontinuous and intentional. From the other side, continuous changes are ongoing evolving changes that tend to group together to produce a bigger change and often related to small improvements in organisational processes (ibis). An example of episodic change would be the transition from the use of technology in an organisation towards adopting a different one, while a continuous change would be the continuous improvement of a technology already in use by the organisation by including small periodic updates.

Any change in an organisation starts with its strategy. Strategies affecting user behaviour are often linked with psychology and then creating methods to produce change by influencing managers, decision-makers and relevant stakeholders. These psychological strategies to produce change within an organisation have been listed by Furnham and Gunter (1994) and are classified into seven categories (Furnham & Gunter, 1994 in Furnham, 1997):

The fellowship strategy: This strategy relies on improving interpersonal relations and long discussions to produce a change in consensus. A ‘friendly’ approach is taken when addressing others and everyone is treated equally, no matter the level of hierarchy in the organisation. It is, however, difficult to produce change with this strategy as it avoids conflict, which can lead to miss critical issues and waste time.

The political strategy: This strategy relies on the power of individuals, managers, leaders, and decision-makers to produce a change by influencing their behaviour individually. It is a shady strategy as it attempts to fulfil individual agendas to reach the goal, which may be contrary to the values of the organisation. At the same time, it produces a weak change, due to shifts in management positions and not involvement of the rest of the organisation.

The economic strategy: This strategy believes that money is the best persuader and that a change in someone's salary or incentives will change the behaviour to reflect the values of the new culture to be adopted. However, this strategy ignores the emotional perspective and all values beyond the economic bottom-line and should not be applied if the organisational culture has any other values than money.

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The academic strategy: This strategy believes that information, or rather enough information and facts, can change the opinion of people. It uses studies, reports and any findings that can trigger a reaction and produce change. This strategy may take a long time to collect and analyze the data, having the risk of becoming irrelevant or outdated.

The engineering strategy: This strategy assumes that if the way of doing things change, then people will change as well. It focuses on what, how and why, but uses to fail on the communication aspect. It is a limited strategy as, frequently, only a few people understand the change, can create unhappiness and may fail to commit most of the people.

The military strategy: The strategy relies on brute force. The focus is on fighting the current situation to change it by any means, where a strict plan has to be followed and there is no room to relax. This strategy is normally faced with the same force in the opposite direction, and the result is an ever-escalating conflict. It can only work during a crisis.

The confrontational strategy: This strategy assumes that if you fuel people’s anger, they will rise to change the situation. It is a complicated strategy as it should not end in violence and encourage people to face problems they may not want to, creating a backlash. It tends to focus too much on problems and less on solutions.

The way of working with these strategies is not to use one or the other, but to combine them depending on the situation and match the best methods according to the step in the change process (Furnham & Gunter, 1994 in Furnham, 1997).

2.2. Motivation on the adoption of new technologiesThe motivation to adopt new technology is a topic studied in many types of research (Taherdoost, 2018). In order to understand these motivations, academics have developed several frameworks and models that deal with the user acceptance of new technologies and its factors:

Theory of Reasoned Action (TRA): Although this theory was developed as a general behaviour theory, it is considered one of the first to frame the motivation to adopt new technologies. The theory considers the user pre-existing attitude towards the technology and the user subjective norms to analyse the user willingness by understanding the initial motivations to adopt the technology (Fishbein & Ajzen, 1975). This theory considers that the user is already motivated to adopt the technology (or, as a behaviour theory, to perform an action) and so presents many limitations on its use.

Theory of Planned Behavior (TPB): This theory is developed as an extension of TRA, by adding perceived behavioural control in addition to pre-existing attitude and subjective norms to shape the user behaviour (Ajzen, 1985). Perceived behavioural control considers the availability and perceived the need of resources, opportunities and skills to adopt a technology, which enhances the

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model beyond the individual intention, but relies on those resources, opportunities and skills in order to be relevant.

Technology Acceptance Model (TAM): This model is developed from TRA and takes into consideration the user acceptance based on how the technology is designed to fulfil two factors: perceived usefulness and perceived ease of use (Davis, 1986). Those factors are considered to be directly linked to the user attitude towards using the technology and so affecting the behavioural response towards actually using the technology but, as it does not take into account external factors like social influence, it has limitations to be applied in a large scale, and it mostly used within a company or organisation, losing relevance at a large scale (Taherdoost, 2018).

Social Cognitive Theory (SCT): This theory considers a triangle model of three groups of factors: personal factors (cognitive, affective and biological), behavioural factors and environmental factors (physical and social) that interact and are continuously influenced between them (Bandura, 1986). The theory assumes three behaviour patterns for user acceptance of new technology stated as outcome expectations, emotional reaction, and self-efficacy (Momani & Jamous, 2017). The theory limitation lies in the fact that it is not fully understanding which of the factors is more influential than the other.

Model of PC Utilization (MPCU): This model is developed from TRA but removes the pre-existing attitude towards technology, while adding habits, and facilitating conditions to user feelings, social norms and expected consequences as the factors affecting user behaviour (Thomson, Higgins & Howell, 1991). This model intends to analyse the current use of technology-based on habits of use but requires the right personal profile for the technology, the “job fit” (Momani & Jamous, 2017).

Motivational Model (MM): This model is developed from the Self-Determination Theory (SDT), which states that “self-determination is a human quality that involves the experience of choice, having choices and making choices” (Deci & Ryan, 1985). MM contains two groups of factors to explain user behaviour: extrinsic motivation factors, and intrinsic motivation factors (Davis, Bagozzi & Warshaw, 1992). The extrinsic factors are represented by SDT self-determination as external, introjected, identified and integrated form of regulation, while the intrinsic factors refer to intrinsic regulations (Momani & Jamous, 2017). In other words, external motivations are related to how useful is the technology while internal motivations are to how enjoyable is its use. This model is useful for learning and motivational studies, but it is too broad to be considered effective in technology acceptance studies (Parijat & Baggan, 2014).

Diffusion of Innovation theory (IDT): This theory takes into consideration that some people adopt new products or behaviours sooner than others. The theory identifies five different adopter groups based on how early or how quickly users adopt an innovation: innovators, early adaptors, early majority, late majority and laggards (Rogers, 2003). The theory explains that each adopter group needs to be treated differently using distinct communication channels and messages in order to adopt the technology.

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The listed motivational models and theories have been widely researched in the literature, improved over time and faced against many user cases (Taherdoost, 2018), however all of them present flaws and limitations. In order to overcome their limitations, Viswanath et al. (2003) studied the issues in the existing technology adoption motivation models from various dimensions combined the previous theories and models to create a unified theory to profit the benefits while removing the flaws, called Unified Theory of Acceptance and Use of Technology (UTAUT).

2.3. Unified Theory of Acceptance and Use of TechnologyThe integrated model created by Viswanath et al. (2003) considers effort expectancy, performance expectancy, social influence and facilitating conditions as factors affecting user behaviour, while including four variables to tailor up the specific case, being these: gender, experience, age and voluntariness of use (Taherdoost, 2018). These four groups of factors or constructs considered in UTAUT to explain user behaviour are explained as following (Sullivan, 2012):

Performance expectancy: How much a user expects the technology to improve its quality of life, work performance or status. This construct takes perceived usefulness from TAM (and TAM2, C-TAM-TPB), extrinsic motivation from MM, job-fit from MPCU, relative advantage from IDT and outcome expectations from SCT (Viswanath et al., 2003). Those factors have many similarities being easy to group them in the same construct. Gender and age play a moderating role in performance expectancy, although studies have shown that gender is influenced by psychological factors and society and its bias can change over time (Kirchmeyer, 2002).

Effort expectancy: How much a user expects the technology to be user-friendly, easy to use. This construct takes perceived ease of use from TAM (and TAM2), complexity from MPCU and ease of use from IDT (Viswanath et al., 2003). Effort expectancy is a relevant construct for both mandatory and voluntary schemes, and especially significant just after the technology is discovered or the user has been trained on it. According to Morris and Venkatesh (2000), gender, age and experience play important roles in effort expectancy.

Social influence: How much a user expects the technology to be influenced by people in the user environment, and their social acceptance. This construct is present in technology acceptance models as subjective or social norms, like TRA, TPB, TAM, MPCU and IDT, plus expansions of those models like TAM2, DTPB or C-TAM-TPB (Viswanath et al., 2003). Social influence affects user behaviour with three factors: compliance, internalization and identification (Venkatesh & Davis, 2000). Compliance, or voluntariness, in social influence, is found to affect user behaviour when technology adoption is perceived to be enforced by rules, as the user may be unwilling to comply with a mandate that feels like an order without previous consultation (Hartwick & Barki, 1994). Internalization is found to affect user behaviour in the sense that, once the

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user believes in the importance of technology, it takes motivation as its own (Kelman 1958, Warshaw 1980). Finally, identification refers to the idea that technology adoption will improve the user image among the social group (Moore and Benbasat, 1991). However, these factors should only be taken into account at an early stage of technology adoption, as experience provides a more suitable influence over time. Age and gender have to be considered for social influence as well, while voluntariness is key for social influence as being related to internalization and identification, the motivation to adopt the technology is not much affected by social influence if the voluntariness to use is high.

Facilitating conditions: How much a user believes to have the right conditions to adopt the technology, in knowledge, organisational structure, infrastructure and resources. This construct is present in TPB as perceived behavioural control, in MPCU as facilitating conditions and in IDT as compatibility (Venkatesh et al., 2003). All these factors are intended to remove barriers for technology acceptance and incorporate items to facilitate technology adoption but do not directly affect the user motivation, only the technology use.

Performance expectancy, effort expectancy, social influence and facilitating conditions are considered as independent factors that affect the dependent variables of behaviour intention and use behaviour, while gender, experience, age and voluntariness of use affect indirectly the dependent variables via the main factors. The user behaviour intention is considered as an entry point to technology acceptance (Venkatesh et al., 2003).

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Figure 5: UTAUT model (Viswanath et al., 2003)

Despite its completed integrated model, UTAUT still presents some limitations when addressing different contexts. Gahtani, Hubona and Wang (2007; in Liu, 2013) tried to implement the model in Saudi Arabia and found out that cultural differences made it very difficult to follow the same patterns described in UTAUT theory, creating a resistance to the new technology. Also, Maldonado et al. (2010; in Liu, 2013) had to modify the model for their research in Peru and include different levels of social-economic status based on three regions, as the influence of factors were very different. These limitations of UTAUT need to be considered when working outside western countries, and cultural factors should be considered in further iterations of the motivational model.

2.4. Analytical FrameworkThe described theories form the analytical framework of the research. Through UTAUT motivational model and its factors, the researchers identify what moves companies to adopt a technology, as well as finding what they may have missing in their organisation to trigger a behavioural intention, mostly in decision-makers, for the user acceptance of the technology. Once the factors are identified and related with certification companies’ motivations and barriers, organisational strategies are suggested in order to overcome the barriers and produce a change towards technology adoption for transparency, increasing the visibility of their eco-labels as well and their traceability to ethical sourcing and sustainable practices. The strategies are finally mapped with motivations and barriers to identify the most fitting strategies and recommend future research in that direction.

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3. Research designThe following chapter describes the practical approach taken towards the data collected for the purposes of further analysis in this paper. The selection of research design and process for data collection is discussed to reveal the motivations for the methodological choices made in relation to the stated research questions. Justification for the design of the interview guide as the instrument for collecting data is given as well as the limitations of the method.

3.1. Research Strategy and ApproachThe study has been designed to take an inductive approach where hypotheses and conclusions are based on the observed behaviours and collected data. This approach aims to generate meanings from the data set collected to identify patterns and relationships to build a theory or make conclusions (Saunders, Lewis & Thornhill, 2012). The inductive approach does not prevent the researcher from using existing theory to formulate the research question to be explored.

3.2. Research MethodThe research is conducted through qualitative research methods with the exploratory purpose to better understand the state of the certification industry in the context of sustainable development and the underlying challenges. According to Brown (2006), Silverman (2011), Hart (2018), 6 and Bellamy (2012) a qualitative method is a good method when researchers need to investigate in-depth and get a deeper understanding of a topic. An explorative purpose is an approach where the researcher can satisfy her or his curiosity, provide a better understanding, or for general interest (6 & Bellamy, 2012; Hart, 2018). A naturalist perspective has been chosen to capture authentic experience and insights of the subject's experiences within the industry such as values, beliefs and behaviour (Silverman, 2015).

This study uses primary and secondary data to collect relevant information and answer the research questions. Primary data is collected directly by researchers with interviews while secondary data is inspected conducting content analysis (Silverman, 2015). The gathered data will be separated into themes and codes. Additionally, precisely establishing categories and categorizing information to identify relations and patterns further. A good researcher knows how to use both primary and secondary sources in their writing and to integrate them in a cohesive fashion (Driscoll & Brizee, 2019).

3.2.1. Case selection

Certification industry is a complex system, that involves various actors and stakeholders in the processes. In order to investigate what are the motivations and barriers that certification companies see in the adoption of new technologies, 11 samples from different organizations were selected to perform qualitative research. Flick (2007) suggests that “taking sampling in qualitative research seriously is a way of managing diversity so that the variation and variety in the phenomenon under

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study can be captured in the empirical material as far as possible” (p. 83). Since the study is investigating the certification industry as a whole, the first criteria for selecting samples were to represent various actors involved in the certification industry from around the world. Further, as suggested by Patton (2002) qualitative study aims at the maximal variation in the samples. Flick (2007) explains that this approach is looking to integrate only a few cases, but those that are as different as possible, to disclose the range of variation and differentiation in the field. Therefore, the second criteria for selecting samples interview representatives of various actors such as standard-setting bodies, certification bodies, third party assurance companies and sustainable brands. Lastly, Flick (2007) suggests looking for people with a long experience with the issue and those who are really in a position to apply the professional practice we are interested in. Therefore, third criteria for sample selection aim at decision-makers, executives and managers.

3.2.2. Data collectionAs part of the qualitative research, semi-structured interviews were chosen as the primary research method. The research conducts semi-structured interviews with selected participants from certification companies while parallel interviews are done in addition to the main interviews with participants from sustainable brands and transparency advocates to get a deeper understanding of the current needs in transparency and traceability. Conducted conversationally with one respondent at a time, semi-structured interviews are conducted employing a blend of closed- and open-ended questions, often accompanied by follow-up why or how questions (Adams, 2015). In this manner, the interviewee has a focus on the relevance of the research, at the same time with the possibility to expand on the subject when necessary (Gray, 2014).

Semi-structured interviews are highly valued in social research as can be adapted to almost any research question or hypothesis formulated while involving the interviewee into the topic of the research. Both practical and theory-driven questions can be formulated in a semi-structured interview, increasing the quality of the collected data grounded in the experience of the participant (Galletta, 2013). The process of the interview, when to ask the right questions and which questions to skip, requires time, trial and error as each interview address a different person, but all questions need to be connected to the purpose of the research while getting deeper into the topic.

The interviews aim to explore the predisposition of certification companies to adopt new emerging technologies, what challenges they faced in previous implementations and their opinion on the blockchain, IoT and QR codes, technologies that have demonstrated to improve transparency and traceability in supply chains, a core function of sustainable certifications. The interviews are performed with organisational members listed in Table 1.

Table 1: Overview of the interviewees

Specific expertise

Interview

type

Media type

Duration Position Location

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Certification bodies (CB)

A1 An international accredited registrar

Online Audio 60 mins Digital transformation manager

Norway

A2 Certification body for ecological products

Online Audio 45 mins General Manager Germany

Sustainable brands

B1 Organic cosmetics brand

Online Audio 30 mins CEO & Co-founder Lithuania

Standard-setting organization (SSO)

C1 Sustainability CB/SSO

Online Audio 45 mins Manager Germany

C2 Natural and ecological cosmetics CB/SSO

Online Audio 65 mins Manager Belgium

C3 Organic food CB/SSO

Online Audio-visual 60 mins Executive Director USA

C4 Sustainability & Environmental Certification Program

Online Audio 60 mins Operations & Finance Manager

Australia

C5 Carbon footprint off-setting CB/SSO

Online Audio 45 mins Managing Director UK

C6 Food & Beverage CB/SSO

Online Audio-visual 45 mins Data Program Manager USA

C7 Organic food CB/SSO

Online Audio 45 mins General Manager UK

Transparency Advocates

T1 Fashion Transparency advocates

Online Audio 30 mins

Policy and Research Coordinator

UK

T2 Open source map and database organisation

Online Audio 35 mins Project Director USA

Governmental Agency

G1 Department of Agriculture

Online Audio 45 mins Agricultural Marketing Specialist

USA

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In order to deliver both the reliability and validity of the research, an interview guide was created to deliver a consistent interview process. McNamara (2009), suggests eight principles for effective interview preparation: (1) choose a setting with little distraction; (2) explain the purpose of the interview; (3) address terms of confidentiality; (4) explain the format of the interview; (5) indicate how long the interview usually takes; (6) tell them how to get in touch with you later if they want to; (7) ask them if they have any questions before you both get started with the interview; and (8) do not count on your memory to recall their answers. These steps were applied before every interview to assure the quality and the experience of the interview for both hosts and participants.

Further, the process of semi-structured interviews was accommodated to cover a wide range of topics, thus the construction of the interview was adjusted based on the interviewee context. However, all interviews were hosted by both authors and followed the same structure: an opening segment, a middle segment and a concluding segment, as suggested by Galletta (2013, pp. 46-50). An opening segment was intended to form a level of comfort, establish basic information and create space for participants to narrate their experiences. This segment is focused on listening carefully to the unfolding story. The middle segment was divided into three sections: Status quo of the industry, Supply chain and Transparency, Technology & change. As the research intended to identify the motivations and barriers of adoption of new technology amongst certification companies, it was important to understand the relation of actors involved in the ecosystem to sustainability and collect the insights on the status quo of the industry. Further, both practical and theory-driven questions were used to address the challenges and opportunities of Supply chain and Transparency, Technology & change. The middle segment continued with in-depth questions to attend the nuances in the narrative thus far, while at the same time keeping space for more specific questions that relate to the research question. This part of the interview was designed to be more substantial in order to ask follow-up questions based on the ongoing discussion and then ensuring comprehensive interview data. Lastly, the concluding segment provided an opportunity for the interviewee to revisit topics that were not discussed previously, critically reflect on the subject and give further suggestions and ask the participant for additional thoughts and how they see the future of sustainability and technology.

All the interviews were conducted using online communication tools. This approach was taken since the research was looking to have a global scope and conduct a broad range of interviews with managers, decision-makers and leaders regardless of the location. Communications technology, such as Skype and Zoom, offered to have an audio-visual experience that simulated in-person environment (Hanna, 2012).

Finally, after the interview, the two interviewers gather notes documented during the interview, debrief by reflecting on the interview, exchange with impressions and suggestions for future perspectives. And prepare the audio recording together with notes for the content analysis process.

3.2.3. Data analysisThe purpose of exploratory research is to identify patterns and so conducting thematic content analysis is considered one of the best data analysis methods for this

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purpose (Krippendorff, 2013). The data collected in the interviews are analysed by a thematic content analysis and coded according to evidence of constructs (Edmondson & McManus, 2007). Thematic content analysis is one of the most common methods used in qualitative research as it aims to find common patterns across a data set. It usually follows the steps of getting familiar with the data, coding the whole text, searching for themes with broader patterns of meaning, reviewing themes to make sure they fit the data, defining and naming themes and creating a coherent narrative that includes quotes from the interviewees (Braun & Clarke, 2006).

Due to the topic of the research and the developed interview guide, a first coding of the data was performed to identify the relevant information in each part of the interview and collected into three main themes: Current status of the industry in terms of practices, transparency and technology; motivations to be sustainable, to be transparent and to adopt new emerging technologies that facilitate the previous concepts; and barriers and challenges for the technology adaptation, as well as lack of motivation. These three themes fit the preliminary research questions and aim of the research and so were considered a good starting point for the content analysis. The second coding of data was then performed to identify different disciplines within the current status of the industry and how it is affected, to identify and separate the different motivations and alike for the barriers.

3.3. Limitations

The research design, however, has some limitations on the method. Semi-structured interviews are biased by the human factor on both interviewer and interviewee, their personal opinion on the topic, the mood on the day or perception on the other person, making the collected data subjective to be compromised and less reliable than quantitative data. The interview guide is a suitable method to mitigate this factor and therefore has been used on the research, but its efficiency is limited and replication of the research with other actors and higher sample rate is encouraged.

A predefined limitation in time frame and length of the thesis do create a limitation on the validity of the research as well, due to the short time to perform interviews leading to a small number of interviews. Interviewees were selected according to their discipline and expertise to mitigate this factor and it is even arguable that the sample rate is a limitation, as the study is performed with a qualitative approach instead of quantitative, and therefore validating the analysis, but it should still be considered as a possible limitation on the research. In addition, the interviews were performed with managers and decision-makers, whose availability is often limited.

To use semi-structured interviews as the main data collection method also creates a limitation on the quality of the research, as it would have been possible to get deeper into the topic by using a case study or a literature review. However, the broad and different perspective of different players in the industry gives a different and also very valuable data that should not be depreciated, as well as a good understanding of the current status. A combination of those different methods would have produced research with both deep and broad understanding of the research topic, but the time and length of the thesis do create the main limitation on the research.

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The research aimed to cover a global perspective, but only western countries companies were interviewed, as all interviews were carried out in English to avoid a language barrier. However, this creates a geographical and cultural limitation on the research, which limits the validity of the research to only western countries, as does not cover a global perspective.

Further, the research has only taken into consideration the perspective of the certification companies and is lacking expertise and knowledge from blockchain and IoT technology companies to get a broader perspective on the development of the technology.

4. Empirical FindingsThis chapter presents and analyses the findings from the research data to understand the current status of certification companies when addressing sustainable challenges, the motivations they have to adopt new technology and the barriers they encounter in technology adoption. Interviewees will be identified by the codes in Table 1 to make reading the analysis easier and making the expertise area of the interviewee easily recognisable. The research analysis is divided into sections based on the thematic areas of Status, Motivations and Barriers.

4.1. Current Status of the Certification Industry To understand the current status of certification companies when addressing sustainable challenges and in their daily operations is an important first step for the research and therefore is divided into: how eco-label standards are created and what criteria is followed by standardization organizations, what are the current methods

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and practices of certification bodies, what is the current status of transparency and technology in certification companies, to give a ground breaking start to research, and exploring the culture and collaboration strategies in the sector.

Eco-label standards

We explored the current status of eco-label certifications by interviewing several players in the certification industry. All interviews started asking questions about the interviewee and the interviewee role in relation to sustainability and in relation to the company, where we got feedback of the person and how the organisation approached sustainability and eco-labels as a standard-setting organisation, certification body, transparency advocate, governmental body or sustainable brand. Standard-setting organisations, like the ones creating standards in sustainability and eco-labels to show their compliance, are more aware of how this process started:

“Oil companies, property managers and construction companies started to recognize the impact that they have or were having on the environment and decided to introduce voluntary schemes. And actually, most of our certifications are business to business in the commercial built environment industry.” (Respondent C4, 2019)

In the period before sustainable certifications were implemented, companies noticed the harm being done and noticed that there were no regulations to address these issues, and so they introduced voluntary schemes. Eco-labels and their certification standards have been filling the gap of slow-moving governmental authorities, raising the bar even in the cosmetics industry, as an example. This industry is a hard one for eco-labels, B1 mentions that there are about 10 cancerogenic ingredients still allowed in the traditional cosmetics industry, while in the natural cosmetics industry all this is very strictly regulated. All the cosmetic products sold in the European Union market have to first comply with the EU regulation cosmetic products that state the requirements on safety, but eco-label standards aim to be on top of those regulations. Standard-setting organisations work hard to keep high sustainability levels in their eco-label standards:

“Our Scientific Committee is the body responsible for developing the standards. Any scientific topic that we wish to include in the standards goes through them, first of all, the requirements for ingredients and formulations and also now we would like to expand our criteria towards other sustainable topics, like the packaging.” (Respondent C2, 2019)

Even though the complications of certifications in the cosmetics industry, eco-labels like the one provided by C2 manage to keep a high level of sustainable requirements, as in their standards raw organic materials have to come from certified organic farming, like palm oil that has to be certified sustainably sourced, and that is something that certification bodies can easily check.Through the interviews, we saw how eco-labels are moving forward and incorporating more and more sustainable requirements into their standards. Those standard-setting organisations responsible for eco-labels want to enrich their impact reporting as much as they can, because that strengthens the value proposition of

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their certification while having conversations with the members of their eco-label networks to include more sustainable topics in the standards, like social criteria:

“Our eco-label covers environmental, social and health criteria, because we see saving people and planet as equally important in sustainability.” (Respondent C4, 2019)

Even if standard-setting organisations make their own standards for eco-labels, ISO standards are still taken into so much consideration, while sometimes criticized. Interviews with certification bodies dealing with certifying companies and ensuring that the standards are followed showed that these bodies are very much aware of ISO strengths and faults. Certification bodies stated that sustainable-oriented standards like ISO 9000 or ISO 14000 do not have enough requirements to assess how sustainable a company is, and do not have enough commitment with sustainability, arguing that they work more like a ticket to trade, a way to ensure that a business partners work under some conditions but not necessarily as a way to ensure sustainable practices in a company:

“The standard does not define claims for the final product, it only defines how to calculate the natural part of an ingredient. But of course, it risks that there are producers that will say, we call our product natural because it contains only natural ingredients as defined by this ISO standard. And this can be very misleading.” (Respondent A2, 2019)

Despite this, the act to perform certification processes is also ruled by an ISO standard, which is the ISO 1765 for certification of products. This ISO standard does not allow a certification body to be involved in any development or production or consulting of the products they are certifying, a good practice to ensure an objective certification. The understanding of the sector is that law will eventually catch up. In the food industry, food companies are required to provide country of origin through the supply chain to the ultimate retail store that is displaying these products for sale to the final consumer, and it is already a retail labelling law in the USA. Some eco-labels also got governmental support and can have certain monetary incentives if every supply chain element is certified. The certification process to get an eco-label in a product may seem difficult at first glance, but companies are aware of this fear and want to conciliate the minds of the worried:

“You can always contact our certifiers, the information is released on the website, that is the same when companies approach us, we always tell them to choose the certifier of their choice, they can always call a few of them and inquire about the prices and their availability.” (Respondent C2, 2019)

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Assurance methods

In order to understand how new technologies can improve the transparency of an eco-label down to the sourcing of the raw materials, it is mandatory to have a good overview of how assurance methods work. The framework of this research is based on the importance of eco-labels and certifications to ensure sustainability along the supply chain of certain products, mostly organic and natural. Brands commercializing the final product to the end consumer literally rely on certifications to prove that the ingredients they buy come from sustainable sources. Here, we need to highlight the importance of documentation, as it is the current status of how all this information is distributed, but still not happening at every level:

“When it comes to papers, you go to big companies (suppliers) who can provide you with these papers, they already have a big screening. Small ones, they don't even understand what you're asking. So, in those big ones, normally the ingredients will be already certified organic. So, if they are certified organic, then they have already been checked, including organic oils, and essential oils, as opposed to conventional. And it's like much less paperwork.” (Respondent B1, 2019)

Even if local farmers may have ingredients equally or more sustainably sourced than big companies, to have the right “papers” for a certification is a big problem as, in order to supply from those small companies, the brands would need to do a lot of the required paperwork which takes time and effort, while big companies would already have a structure in place to provide the documentation. Certification indeed requires a lot of paperwork, and to provide it can be difficult and time-consuming. In the meat industry, C3 asks farmers to send them a herd health plan and herd management plan, but they cannot tell the farmers how to do the paperwork as it can be seen as a conflict of interest, which is forbidden by law. Third parties, like independent certification bodies, are of great help for the farmers, once the documents reach the eco-label standard-setting organisation, they send a reviewer that works with the farmers to ensure all documentation is in order.

These organizations responsible to create the standards for eco-labels are aware of the complications certifications bodies can encounter and try to frame the requirements based on that, most of the interviewees in standard-setting organisations reported a feedback loop with the certification bodies to ensure that standards requirements are easy to follow and verify. Collaborations between standards organizations, which normally own the eco-label, and the certification bodies are very important for good traceability and helps on certifying more and more elements of the supply chain, a complex task since supply chains get more and more complex every day. Even if most eco-labels are managed and administered by the organism who create them, there are some that are administered by a third party, providing some benefits:

“Some eco-labels are managed and administered by a third party, I will argue strongly in favour of the idea that those are stronger, and they do a lot more for the people because they aren't owned by the corporation that is marketing them.” (Respondent C6, 2019)

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In the end, most of the certification companies interviewed agreed that the process of certification could be resumed in checking the documentation and performing an audit, and companies can be quite prepared if the standards are transparent and publicly available. These tasks in the process of certification are done by the certification bodies: information transfer, transparency, and traceability are the major objectives of a certification body, also to be independent and to provide trust. The certification body cannot become better or more trustworthy than the employees themselves, the training around personnel is very important as well as ensuring that the employees have not just the right skills, but also the right attitude:

“The conduct of our employees is super important, the training that goes behind when you become an inspector or an auditor, and the values that you have when you put on your helmet, jacket and go on sites.” (Respondent A1, 2019) “We have implemented an integrity program which includes assessments not only of our system users who are certified but also certification bodies who certify our system users. So, we also monitor the auditors and that is also where we find a high mistake potential.” (Respondent C1, 2019)

Audits are the main assurance method in certifiers nowadays, to go to companies’ facilities and check that they comply with the eco-label requirements. For example, G1 sample certain products over the course of the year by asking the retail stores for their records from their immediate previous supplier and who conveyed to them with a country of origin was. Then auditors select products from those samples, fruits, vegetables, fish and shellfish, to get it as many different supply companies to audit back to the supply chain and ensure the companies are complying with the law and convey information about their supply chain.Most of the companies believe it is a simple and trustful process, certification bodies can be in a lot of trouble if they are found to be entering false data in their reports, up to going out of business:

“We have veterinarians who can do farm inspections as well. They have to complete an application with us and it's a very simple process, we have found that people who are veterinarians do not want to put their names on any fraudulent documents because they'll lose their license.” (Respondent C3, 2019)

Third-party companies are usually preferred to do the inspections, due to flexibility, avoidance of interest conflicts and requirements of certain retailers. Those certification bodies create trust and initial contact with the companies, so there can be a good communication flow to achieve the eco-label certification and, in the process, to improve the sustainability conditions of the company:

“The good thing about being able to rely on third-party audits is that, even if that is one moment in time, that mechanism still goes a long way toward establishing a trust that you can leverage throughout the rest of your interactions with all the people that you're working with. The audit is there to establish trust as a groundwork for the rest of what we're doing.” (Respondent C6, 2019)

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The audit process can slightly vary between the different certification bodies, some may have an automated procedure system to minimize mistakes [C1] while others may use more traditional pen and notebook as assessment and evaluating is generally seen as an easy task, while the problem goes more in the direction of what is the definition of sustainable raw materials and where are the boundaries. C6 even send enumerators out into the field to learn a little bit more about the impact that they are having, which is very useful to the organization as that information sets the size and longevity in terms of the geography of their programs.However, audits have a very big problem when talking about scale. In fashion, for example, there are many surveys and audits needed, and most of them are redundant due to products manufactured in the same factories:

“...the number of surveys and audits that facilities have to do is ridiculous. Like, there's a lot that they have to do an annual basis, dozens and dozens of surveys and audits.” (Respondent T2, 2019)

A way to simplify audits in those cases would be to combine different surveys and audits in one [T2] where technology and transparency plays a key role to access this kind of information, but also A2 approach to help companies in order to have all the required recipes, raw materials information and quality assessment plan done ahead before the audit.

Transparency

The current status of transparency in the certification process does not start at the consumer level, but at the communication between the companies aiming to get an eco-label and the certification bodies. This interaction needs to be transparent, otherwise, the certification bodies would not be able to do their assessment work properly, although companies can demand to keep the data between them and the certification bodies as confidential to protect their processes and intellectual property so none else has access to it:

“The certification process is transparent in itself, needs to be transparent otherwise certification makes no sense, that's the only objective of certification to have a transparent process, otherwise the certificates you issue are not worth anything.” (Respondent A2, 2019)

However, it is indeed at the consumer level where transparency has the biggest impact, mostly raising awareness on the sustainable practices and sourcing of a product. There are many ingredients and materials that are sourced from undeveloped countries involving poor working conditions and even child labour. This situation could highly improve if that information was transparent, as the consumer would probably make a better decision and not support products involving environmental or human harm:

“We know what the critical components are. For instance, there is a situation with mica, because some of that is sourced from countries which involve child labour, and it is known for being a problematic ingredient. So, we get from our suppliers the statement that is sourced ethically.” (Respondent B1, 2019)

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There is a lot of need to look at transparency both top-down and bottom-up and teach the suppliers about transparency and why it is important, as well as teaching consumers about why the brands should have transparency [T1]. Luckily, more and more brands are being aware of the need to show their values, to be transparent about them, and certification is a good way to prove it:

“As eco-certified, we need to have transparency in every single ingredient, like 200 - 300, we need to show all the information about every ingredient.” (Respondent B1, 2019)

Despite the previous mention, some companies are still very reluctant to be transparent, for fear, lack of knowledge or any other reason, but they are missing the very important point to show their sustainable values and practices, up to the point to cause distrust from the consumer, like not even disclosing information about child labour, while they may actually have sustainability in their core values. It is literally how consumers trust a product or its eco-label when they're buying:

“...we had a number of clients complaining why they did so poorly (in sustainability reporting) and saying, “We're sustainable”, and things like that, but if they're not disclosing that information, then how can we truly hold them accountable?” (Respondent T1, 2019)

Standardization organisations use to publish the summary audit report and the certificate on their website. For example, C1 does not only publish the valid certificates but also the expired ones, audits are on an annual basis, so a certificate is only valid for one year, after when companies have to recertify. Companies can create their own certificate and stamp an unapproved eco-label, but when standardization organisations publish a list of those companies, they become more transparent.

There is, after all, a clear link between transparency and standardization. When all stakeholders in a supply chain keep their records in the same format and use the same protocols and communication links, a product is way easily tracked than if everyone was using its own different format, which highly increases the traceability of the product and creates transparency all along the supply chain. Also, to have a common standard facilitates the understanding of the processes, otherwise you may be losing critical information along the chain:

“The requirement in the EU is that you have to know only one tier, while you might have four or five tiers, and then you don't know anything about them and that's where you might have child labour, that's where you might have modern slavery or bribery.” (Respondent A1, 2019)

To have transparent information among a sector and across different supply chains allows open data to flow free and be available to everyone through open databases, where brands can highly benefit planning better their market strategies. T2 has investigated this topic and explained how companies may think about doing a new program in a certain region and then see where they overlap with other brands and retailers in the same facility. Also, in case of an emergency in a facility brands can potentially go online, look up that facility and check the current conditions of the

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facility, if there is child labour or there is a worker strike and what other brands and retailers overlap the same facility. As brands and retailers, they could potentially talk to the factory owners and help negotiate the struggling.

“One of the amazing things with transparency is the number of benefits that can arise from paying your workers a decent wage and gender equality, which often only happened to you today being recognized through transparency.” (Respondent A1, 2019)

Technology

Data collection is obviously very useful to manage supply chains, companies collect all the relevant information from different stakeholders to construct data sets about relationships between those organizations, according to specific identifiers of the product that's being traded, or any other topic companies consider useful. This information can be used to optimize a process, to show compliance of certain laws, rules and standards and even to detect problems in an early stage. However, data collection is still performed manually in many companies, often by using Excel spreadsheet as a workbook where the information is gathered, reviewed and communicated, but losing all the potential data has in our modern world for transparency and optimization. Manual data collection is also very time consuming and vulnerable to human error, becoming an impossible task to have a good data analysis when addressing a large data set. An easy and common technological upgrade of those workbooks is “to bring them online”, to place them in a server where all interested parties can access the information, share the findings and collaborate in expanding the database.

“We are actually in the process of making our external, a platform where all our certifiers could be sharing information on different products so that the product documentation is easily accessible to the others.” (Respondent C2, 2019)

“We are changing our total data collection system to a database, where all the formulas and information on raw material which are handed over to us have been handed over with Excel sheets and paper in the past. Clients can connect to this database and also to us. We had the same information before, but now we can handle it much easier.” (Respondent A2, 2019)

Online databases are a great tool for transparency but do not tackle the topics of sustainability, ethical sourcing and trust. For these, we can look at new emerging technologies, like smart sensors and blockchain, while we can look at advanced algorithms and artificial intelligence to compute the findings, look for patterns and obtain valuable reports from the data analysis.

“We use remote sensing technology to discover the land-use change of farms from the last 20 years up to now. For example, we can track if the rain forest was deforested or if there are any crops which growing patterns have changed.” (Respondent C1, 2019)

Transparency databases like the one provided by T2 use algorithms to check and match data against an existing list. This algorithm studies the statistical significance

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of the data and looks for errors, allowing to not have duplicate entries in the database, same entries with minor differences or grammatical errors and adding new data when relevant. These types of algorithms are very useful and needed as one of the current problems with manual entries and traditional databases are just wrong data, a stakeholder that wrote an entry in capital letters, another with only the first letter as a capital, etc. creating problems to retrieve and analyse this data. Companies are starting to realize the benefits of good data, including the cost associated with errors, and then looking at new technologies to improve data collection, data access and data analysis:

“Business, in general, is really driven now by whatever you can learn from data, and the people that are the best at getting data out of the world and using it to generate insight are the ones who are going to succeed.” (Respondent C6, 2019)

A technology that links all this data processing and certifications is Blockchain. After all, certifications and eco-labels are a way to create trust to the consumer, but then this trust needs to go all the way to the sourcing of the raw material with many stakeholders along the supply chain, where blockchain ensures that the data introduced by the stakeholders is reliable and has not been modified to fit the requirements or the demand.

“We started on a blockchain project because we believe in the technology as it bridges the trust gap between businesses, we have the ability and capability and, as a third party, we can also bridge the trust gap between the business and the end consumer.” (Respondent A1, 2019)

There is also a trust gap between a physical product and digital information that can be addressed when certification bodies work together with technological companies and use a tool like a blockchain, so they can verify that the information introduced is valid. There start to be many technological companies that implement blockchain and write a QR code on a product to show the story of a product but if none of it is verified, blockchain does not solve the “garbage in, garbage out” problem, a way to call the mentioned errors in data entries in data management. There is where third-party certification bodies can verify the information and be trusted due to being neutral. As C6 mentions:

“There's this mantra of garbage in, garbage out with data analysis. But with blockchain, it's really more accurately garbage in and garbage forever. If the information is not useful, blockchain is not going anywhere.” (Respondent C6, 2019)

This statement confirms the need to involve certification bodies when adopting blockchain in supply chains, to the information can be checked, updated and verified by a neutral third party, retrieving the exact moment when the information has been wrongly added and avoiding future errors. Interviewees agree that there is going to be a lot of really innovative activities among start-up organizations in blockchain, where companies are trying to use new technologies to tackle this problem within a fairly short time frame. However, if these companies merge or are bought by a big corporation which decides to adopt a private blockchain, that would prevent

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transparency to happen and would be against the ethics of blockchain, a valid fear as it is already happening in banking and not being a totally distributed ledger per se.

Culture

We have been seeing an emerging trend in sustainability during the past years, people are more aware of the environmental and social problems existing in our society and how we interact among us and with the planet. This tendency shows a slow but steady shift in our culture from being egocentric individuals to becoming more an eco-centric community and when society starts to change its mindset, so do the companies operating in it. Here we can differentiate companies where founders, management and employees are highly committed to sustainability and have it as one of their core values, and companies that are trying to adapt to “the new trend” and often failing. We have focused our research in the first group as the potential users of technology in eco-certification while suggesting a big organisational change in the second group in order to be successful in implementing sustainable practices. It has become very common in sustainability to have passionate values-driven people, which is a cultural phenomenon, as when people become passionate about something, they keep going and work hard to achieve the goal.

“We have seen a lot of increase in consumer awareness about environmental sustainability.” (Respondent C4, 2019)

“We as a company have a strong social responsibility value, a natural and organic brand that has a complex set of values in every part of the company.” (Respondent B1, 2019)

Culture is a very important topic when talking about sustainability, where awareness is a critical factor. A society that has been working to embed social and environmental concerns in daily practices, promoting fair trade and organic products, is a society more open to trust certifications with sustainable intentions and to use any tool available to access the information it believes important.

“We've done a lot of work in the past on consumer activation, we have a campaign team that focuses on how we can get sustainable practices involved in various different kinds of the convening of people, all that happened to get awareness out there.” (Respondent C6, 2019)

But the cultural change we are experiencing is not only a matter of awareness and campaigns, although highly motivated by them. Change is something intrinsic to humanity and happens all the time due to many factors like the normal evolution of an industry or, in the worst case, a crisis. There is a clear example of a crisis when we talk about ocean plastic waste, which has triggered the development of many regulations and alternatives to packaging, which was not a concern a few years ago. In the case of fashion and transparency we can find both examples mentioned above, T2 mentions that industry has evolved up to a point where the value is not that much in the design due to sharing ideas and products being developed in the same factory so the products are not different enough to be considered intellectual property,

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which facilitated the industry to be more transparent. Unfortunately, a crisis had to also happen to boost cultural change:

“When the Rana Plaza factory collapse, it became apparent that none of the brands whose clothing was being made in that facility knew that their clothing was being made in that facility. Those brands were tied to the death of over 1000 people, and they didn't even know that they were paying that facility. That was a huge push towards transparency where activist organizations said enough, there can't be people dying tied to the manufacturer of our clothing, or to any brand name.” (Respondent T2, 2019)

Although we have been talking in this section about the current cultural change towards sustainability, there is still a long way to go. Some people would not adopt sustainability practices unless there is an incentive for them, but then, a way around it is that sustainability becomes the norm, that we as a society embrace it and make it part of our culture:

“Why should you have a Chief Sustainability Officer in your company? Sustainability is no longer something that only belongs to one area of the company or belongs under the responsibility of one person. Sustainability should be everywhere, in everything that we do.” (Respondent A2, 2019)

Partnership and collaboration

At this point, it has been argued that transparency is a wonderful practice when different players in a market want to collaborate and that technology facilitates it to happen by sharing a common database while common standards allow better communication and understanding. In sustainability and eco-labels, certifications and governments should work together [C4] as laws need to catch up in sustainable practices to have a future. The requirements certification organisations ask companies to get their eco-label is a great entry point for governments as those organisations have already developed and tested standards that companies can follow, facilitating the implementation of sustainable laws and avoiding potential backslash. Despite these claims, some governments are actually aware of the situation and open to collaboration, as law-making processes are long, and they may even lack the resources:

“We are filing Freedom of Information requests with the government to find out where people are sourcing, and what are they putting on their labels to find out if they're legit or not. And we're actually getting a lot of good response from the government, for us helping them because they don't have the resources to do that.” (Respondent C3, 2019)

“...there were findings of e-coli contamination and the government advised consumers to stop eating lettuce because they identified where the e-coli contamination was coming from. So, to avoid having regulations rolled down on the industry, the manufacturing association worked with the producers to come up with a way to label every lettuce package with the name of the farm and the date of harvesting so they could track down possible contaminated products. That was an example of the industry reacting to clear health concern in collaboration with the government.” (Respondent G1, 2019)

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Partnerships and collaborations make a lot of sense also among the industry, where there are already some initiatives happening where organizations are coming together and trying to share data concerning the way they perform the certifications, so they can benefit from the collaboration with better practices and less cost, like the social and labour convergence project:

“In the social labour convergence project, companies are trying to reduce the number of audits that happen by creating one common audit from across the industry, and thereby having the members of the social labour brands and retailers in one audit, rather than each having their own audit be done.” (Respondent T2, 2019)

As mentioned, companies can have great benefits through collaborations and partnerships sharing information in a common database and using common standards but, in order to do that, they first need to agree on a common database and common standards, which is not an easy task. Companies may be willing to collaborate as they realize the benefits but maybe not so eager to change their procedures, standards, and data format, as it would involve a change in the organisation and people tend to resistance to change. Here is where a change strategy needs to be applied the barriers need to be overcome, and the same applies to the technology used to share the data.

“When it comes to feeding data into a system, you still have to get people to be willing to buy into the use of that system. So, for us it's going to be really hard to be one of the early players to roll out blockchain for our certification, because we have a lot of relationships, which is really good, but we have to get all of those people to use the same tools and formats, which would be really hard.” (Respondent C6, 2019)

4.2. MotivationsWhen addressing the motivations companies may have to adopt a new technology in eco-label certifications for sustainability, it is also an important part to analyse the motivation to be more sustainable, as eco-label certifications are a method to show the sustainable values of a company, while new technologies are the tools used to achieve it in the most transparent and efficient way possible. Motivations to be more sustainable, more transparent and to prove their claims force companies to use new emerging technologies to give that information to the end consumer and to create a relationship of trust with them. Brands rely on eco-labels to show this information and pass this need to change and upscale the technological tools to certification companies, to provide more and better information.

The following categories highlight the identified motivations followed by certification companies to adopt new emerging technologies, the reasons behind those motivations and the potential benefits they see on its adoption.

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Motivation 1: Consumer demand

The first motivation we analyse after having performed the interviews is consumer demand, as it has been clearly seen as a trend companies want to follow and fulfil. Companies want to sell their products and services and then this motivation is a powerful one, the relation between companies values and profit needs to be balanced in order to keep a company in business, as Caroll (1991) states, the first rule in Corporate Social Responsibility is to be economically stable, a company cannot do any good if it runs out of business.

In companies, the opportunity is to make a change into answer requests from the consumers and society. The industry has to take their share of responsibility for the problems caused in the environment [C2] and, if they want to stay in the game, with this rate of conscious consumerism, more and more consumers are really paying attention not only about the benefits that the product gives them directly, but also more bigger picture how these products affect the environment, then these companies need to adapt, because if not, at one point, they will not be competitive anymore.

“We are looking at packaging to move away from plastics as much as possible because the trend is now that people hate plastics, even if that particular kind of plastic does not give the reason.” (Respondent B1, 2019)

Linked to this change is consumed demand is a change in culture, a lot of research at the moment is coming out saying that sustainability is becoming one of the key things that consumers are looking for [T2], also to know more about the product consumers are buying, as stated in a survey where more than 71% of respondents mentioned that they expected more information and only 41% actually felt that the information provided on the product was sufficient [A1]. These changes are often linked to new generations, especially the millennial generation, or also, as Georg Kell coined it - the generation S. The generation Sustainability have a lot of interest in what is behind the product and care more about the bigger picture on products that are buying:

“I don't care if it is brand A or brand B, I buy the shoes that fit me, not just my personality, but also my identity. So, I want to know what is behind, I want to make sure that the product that I buy doesn't just have a label, I want to be ensured that it doesn't contain child labour.” (Respondent A1, 2019)

Driving toward greater transparency are in the most demand in brands who are selling and marketing a product to consumers, while the trend is shifting from corporate transparency to product transparency, due to the consumer demand. This is, however, not a new trend as, to know the organic conditions and origin of products, already started some years ago in the food industry:

“The natural cosmetics and natural textile market are following the organic food sector like it was two years ago. So, there are the same discussions, there

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are the same developments, how these products get into supermarkets. And so, it looks, it's the same development as with food.” (Respondent A2, 2019)

Things that help are, unfortunately, crisis. The crisis raises a lot of attention in the media and so people become aware of the really bad conditions of industry, triggering an immediate response and creating a huge “consumer demand” to stop that way of doing. It happened with the horsemeat scandal, that changed consumer perception, the recent coverage of plastic in the ocean, and will happen in industrial farming if media puts its attention there. Without media attention to call it a crisis, the response is very slow, as consumers lack the awareness, and that is one if the current intentions with changing terms like global warming or climate change, to the climate crisis. Awareness in consumers has a lot of power to trigger a response and demand, after all, people want to buy their products knowing they do not contribute to creating harm.

“We are seeing a renewed interest in making products carbon neutral” (Respondent C5, 2019)

By providing consumers with the information that they need in order to make better decisions being transparent about the content of the product, that is the way companies can create the change that consumers need in order to reward the companies that do good. With the information being transparent and trustful, the choice is, after all, at the end consumer.

Motivation 2: Thinking ahead

Thinking ahead has been identified as another motivation certification company consider adopting emerging technology. These companies know that legislation will eventually take over their standards but, in the meantime, they use new technological tools to give a relative advantage to brands so these can show their values to the end consumer as easy and transparent as possible.

When addressing the future outlook, a common view among the respondents was conveyed. Respondents representing various actors indicate that legislation is one of the main motivators driving to change. For standard-setting institutions and certifiers, legislation is crucial since it ultimately shapes the direction and enforces change once being approved. As an example, the European Parliament recently introduced a law banning single-use plastic items such as plates, cutlery, and cups by the year 2021 (Chatain, 2019):

“I think by 2021, all single-use packaging in the European Union will need to be recyclable if I'm correct. So sooner or later once we change the standard, this kind of new regulations will catch us. The industry as a whole will need to adapt processes.” (Respondent C2, 2019)

There are businesses that understand the importance of adopting a sustainable approach and voluntary implement them in day-to-day operations. These companies can be considered proactive and very often they want to communicate their practices through certification and labelling (Silvius & Schipper, 2015). At the same time, there are businesses that operate in a reactive manner and despite the market, dynamics will not change their operations in exception to legal obligation.

“I think awareness but also legislation is ultimately going to be the thing that drives some of those brands that lag behind.” (Correspondent T1, 2019)

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Therefore, while some volunteer standards prohibit the use of single-use plastic already today, not everyone is contributing. Mandatory standards, on the other hand, enforces region as a whole to adopt the changes across various industries. Further, another example of how legislation can incentivize change was provided during the interview by C1:

“The biofuels market is big in the European Union. There are also a lot of monetary incentives to prove that you will comply with the Renewable Energy Directive into the Fuel Quality Directive.” (Respondent C1, 2019)

Hence, the legislation can incentivize the change in various ways and ban is just one way to deal with the problem. By introducing a directive, for example, a specific industry can be nudged to achieve more sustainable practices through monetary incentives. In this manner, the industry is given the support to switch to an alternative means of operating without entirely sacrificing their financial performance.

In parallel with legislation, other factors that affect the certification industry are businesses and their end-consumers. As the consumers' awareness of environmental issues is growing, the changes in the market sentiment can also reflect in the economic activity of the individuals which in the result are affecting the businesses. As respondent B1 during the interview shared her experience on how it has influenced her decisions as an executive to steer the business. Additionally, C1 and A1 commented with supportive observations:

“Plastics will be prohibited in a lot of products and synthetic components too ... We as a brand can see the trend and therefore certifying more and more products.” (Respondent B1, 2019)

“Actually, a big topic that came up during the two years was the topic of the circular economy, so recycling, reuse also bioplastic. Plastics are also a big topic.” (Respondent C1, 2019)

“The companies that will survive are the companies that understand that they do play an important role in society and that they have no business in a society that fades.” (Respondent A1, 2019)

Taking into consideration the dynamics of transitioning to more sustainable business practices, businesses who are the frontrunners in driving the change are in fact challenging certification industry to adopt new innovations. As respondent C6 explained, businesses who understand the importance of the technology driving the change are exploring new ways how innovations such as IoT and Blockchain, for example, could be utilized to improve their current practices and push the boundaries even further. And often these innovations require different actors to collaborate.

“Some larger companies want to know in a lot of details how they're doing, those were the ones that were having a lot of innovative conversations right now to figure out exactly what we could do better. And some companies go above and beyond and really do a lot themselves to move on this front.” (Respondent C6, 2019)

As respondent C6 further explained for these businesses to even further improve their sustainability practices would require working closely with certification bodies [C6] since their standards and certification processes are closely connected to supply chain operations of those businesses. In result creating pressure on certification providers to join the process of innovation. On the other hand, it can be the

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certification body, who is carrying the initiative to more sustainable business practices by introducing technological innovation to its current certification process and who is creating value to its end consumers. As respondent C7 explained:

“So, we were really thinking, how can we set ourselves apart and not only say that our products are traceable because everybody says the product is traceable. But actually, can we prove it? Which of course not everybody that says it is traceable can actually easily prove it. And we wanted to be able to prove it in a very easy and convenient way for consumers.” (Respondent C7, 2019)

In summary, interviewed respondents expressed their strong belief in how legislation plays an important role in shaping the certification industry from the perspectives of different actors. Additionally, sharing the insights about the future outlook on the supporting factors driving these changes in the context of the certification industry as a whole.

Motivation 3: Usefulness

Usefulness is possibly the most logical and intuitive motivation that certification companies follow to adopt emerging technology. The understanding of the benefits technology can bring to the business directly translates into satisfied clients and economic profit, overcoming several barriers if the right conditions are met. New emerging technologies that provide transparency and traceability are indeed very useful in an oversaturated market with hundreds of eco-labels, were showing the sustainable practices behind an eco-label is of great help for better decision making.

Correspondingly to the previous section, the majority of the interviewed respondent shared another similar opinion in regard to the adoption of new technologies. Respondents described the characteristics of the third factor behind motivation being the usefulness of technology and transparency. Actors from different industries viewed the usefulness of the technology to be one of the main driving factors in the adoption of new technologies not only in the context of certification industry but also in their respective areas of expertise. Respondents viewed the technology to be the driver to improve the traditional certification industry systems - making them more efficient, agile and trustworthy. Additionally, bringing the innovation that would improve the transparency not only in the certification industry but also in other industries as a whole in result benefiting various actors and ultimately being the driver to sustainable development. As respondent C3 during the interview painted an overall picture:

“I think that there is a general feeling that technology, digitized approaches to maintaining, collecting and managing data all seem to be generally beneficial. So, in other words, it's cheaper and easier to collect vast volumes and to interrogate those vast volumes of data, that's a pretty seated across the marketplace. And everybody knows that that's happening.” (Respondent C3, 2019)

Thus, technology already today is seen as a significant improvement in how we use it in day-to-day operations such as data collection and processing. Additionally, respondent G1 further expressed his point of view on how the private sector can benefit from the new technologies in terms of overall improvement of various processes and quality:

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“So, it seems like it could be useful if the industry (private sector) adopted it. So that there could be some kind of information that was conveyed along with the product through the use of blockchain technology, that would be an industry effort to improve overall performance. An industry like fish and shellfish, the seafood industry might find that particularly useful not only for the country of origin but for a whole host of transparency and accountability measures. Sustainability and performance, environmental performance, product identification, performance. and the whole industry could benefit from that. Got to be both international effort as well as an industry.” (Respondent G1, 2019)

Further, as respondent G1 mentioned this has to be a collaborative effort. In order to achieve truly credible and impactful results technology cannot do it alone. It requires collaboration between various actors both in the public and private sectors. While having information is helpful and can provide more transparency over the supply chains, at the same time it is at the most important to have credible and valuable information that can be trusted. Certification bodies play an important role in bringing credibility in the supply chains and essentially the end consumers. As respondents A2 and C2 explained, technology would improve the processing time and bring more efficiency and trust in the supply chain, to begin with:

“We certify about seven and a half to 8000 products. And in these products are, let's say 10000 to 15000 raw materials. So, if you don't have an electronic data processing, you get lost somewhere.” (Respondent A2, 2019)

“We would like to make it really a shared place for all the certifiers to share their documentation also to speed up the process, for them and also for the manufacturer. So, once they share their documents, they don't have to do it again. And the ones that want to make cosmetics, they can find the list of products that are certified in the database and they don't need to search further.” (Respondent C2, 2019)

Further, by improving the internal processes of certification bodies can then improve the transparency amongst various supply chains. This is especially important for companies that are prioritizing sustainable business practices and want to measure and control their true impact:

“It's really a mechanism [transparency] to help all of those who are trying to measure impact and collaborate on improved impact across the sector to be able to do that more easily ... there's a lot of great manufacturers out there who are doing really good work. And it's for them, they want to have a credit profile that they can claim.” (Respondent T2, 2019)

While the certification industry is undoubtedly important in driving more sustainable development, on the other side of the spectrum certification industry has developed oversaturation of eco-labels (See section X). This has created confusion amongst consumers to have a critical perspective on the given label. The problem with some of the eco-labels, for example, can be that while visually they look very similar and represent certain values and standards, these values and standards can be very

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different depending on the label in result misleading the consumer. This is where the technology can help bring credibility and transparency of the product to their end consumer. As described by respondents C2 and C3:

“I think we confuse the consumers with all the labels. I think the QR code would help a lot with that.” (Respondent C3, 2019)

“We are advocating to have this data online so that the consumer can scan the QR code on the product and then access this information.” (Respondent C2, 2019)

In summary, there is a positive outlook on the role of technology in the near future. Through the lens of various actors, the interviewed respondents confirmed the potential use-cases that these technologies can introduce. Providing value not only for the certification industry but industries in general. Incentivizing businesses to bring more transparency and change to their day-to-day actions.

“I think it will be good to have some changes. And I think we all are looking for ways to improve the fashion industry. And if this is truly going to be one of those ways [blockchain], then we want to be ahead of that. And we really want to pioneer it.” (Respondent T1, 2019)

4.3. BarriersThroughout the conducted interviews, respondents expressed a positive outlook on the adoption of the new technologies and see great potential in improving current systems and processes. However, they have also underlined many critical barriers that are currently strongly influencing the development of this space. The following analysis takes a deeper look at the barriers facing the adoption of the new technologies in the context of the certification industry.

Barrier 1: Lack of consumer demand and pressure

One of the most common themes that appeared through the conducted interviews was closely related to the forces of supply and demand. In other words, the current market is lacking pressure on the businesses and this is closely related to the lack of education among the consumers. Therefore, this first theme will explore the lack of consumer demand and pressure, and what role education plays in stimulating the market.

Some of the interviewed respondents shared their experience of the current status on the adoption of new technologies in the private sector. These responses, unfortunately, painted a grim picture. One hand small-medium size enterprises (SME) firmly rely on the market pressures and due to the financial limitations cannot afford to invest money in R&D. Hence, creating the conditions in which businesses choose to operate in a reactive manner. On the other hand, there are businesses which are pushing the envelope in terms of innovation and sustainability. These businesses are interested in communicating their sustainable practices with their end consumers by being transparent about their supply chain. However, lack of

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interest in the subject or being unaware of the communication tools provided customers are making the invested time and effort of the business redundant. As a result, losing potential sales and brand awareness creation:

“Blockchain? Our customers still don't understand it and don't require it. When there is no pressure from end clients, then the producers don't put the pressure on the suppliers of raw materials and then they are not willing to provide it.” (Respondent B1, 2019)

“Most of the companies I've heard so long so far, who entered these systems with QR codes and printing systems, most of them were not successful. I mean, most of them said that finally, the consumer does not honour or respect this information, right? They’re even not interested.” (Respondent A2, 2019)

With this in mind, the conducted interviews linked this phenomenon to the lack of education amongst consumers. Technology in these specific cases serves as a communication tool to bring the full transparency of their product and showcase their sustainable business practices in return hoping that customers based on the information choose to consume their product. However, the problem lays in the fact that if consumers are not aware of the environmental and social problems, these customers may be less likely to consume concisely, in result creating conditions where decision making is based more on the price and less on the description of the product. This then lowers the chances of using the innovative communication tools offered by the brand to get to know in-depth details about the quality and the processes of the entire supply chain:

“I think the affordability issue is driving (unsustainable business models) because you got cheap food in the USA, which is an illusion. Inexpensive food is paying for somewhere down the line.” (Respondent C3, 2019)

“We do have to move to a more transparent and sustainable industry. And hopefully, by educating the consumers and the consumers pressurizing the brands, we can really achieve that.” (Respondent T1, 2019)

“Education. People follow all the trends coming from Western countries, and they come here, eventually, just a matter of time. Younger people there, they're really concerned about these things, more than older ones. But even here more people are talking about how dangerous synthetic ingredients and the impact on the environment are.” (Respondent B1, 2019)

Therefore, education must be considered a crucial factor in creating market forces that prioritize conscious business models. The more people are aware of the environmental and social problems, the higher the chances they will change their purchasing behaviour and in result forcing companies to rethink their day-to-day operations and adjust to the new standards. This is the power the consumers hold, and businesses are aware of that. As interview respondents further elaborated:

“I think industry always take consumer demand into account even before, even in sustainability, because it's a matter of selling, if it doesn't work with the consumers, it will not be implemented.” (Respondent C2, 2019)

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“I think consumers have a big role to play in that. Because if they stop buying their products, because if the consumers don't know where their clothes are coming from, then I think that will have a profound impact on the way people start to disclose information.” (Respondent T1, 2019)

Lastly, some of the interviewed respondents further commented that they believe that not only consumers are in power to drive the change, but also carry the responsibility to do so. Ultimately how people choose to spend their money reflects on what they believe in and want to support. While education is a crucial factor, this goes beyond education. Being informed and aware of the problems is just the first step. The next step is action. As respondents C3 and T1 explain:

“The consumers are going to have to start it. We keep talking about bottom-up, because we're going to have to say we're tired of this, and we're going to have to make them aware of it.” (Respondent C3, 2019)

“I hate to say that it is the responsibility of consumers. But I think ultimately, they're the people that are buying the clothing. And there is money, there is power in their money. And they could choose, every time they buy a piece of clothing, they could essentially be put on the vote for who they want to support and what world do they believe in. And I think people are slowly realizing that. And ultimately, the brands that don't keep up in terms of sustainability and transparency, I think will be the ones that fall, ultimately.” (Respondent T1, 2019)

Barrier 2: Lack of financial resources

Similarly, to lack of consumer demand and pressure, interviewed respondents underlined financial factor as one of the biggest barriers to adoption of new technologies. Therefore, the following section will unfold perspectives of different actors to better understand how money influences innovation in the context of the certification industry.

Money has always been a sensitive topic in regard to sustainable development. While money can be seen as the obvious solutions to resolving the most pressing issues of today, the paradox of money is that it can also be the factor limiting the advancements in this space. This comes as no surprise since financial performance traditionally has been the main driving force behind the decision making, especially in the private sector. By definition a business is any activity performed in order to make a profit, therefore healthy financial performance is fundamental to the viability of a business. Thus, the performance of the business is closely linked to the end consumer and therefore to the lack of consumer demand and pressure. From the consumers perspective, the economic situation of the individual can affect their decision making, especially when it comes to conscious consumption:

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“The economic situation among consumers is important. People do not think about ecology until they are not worrying about basic material needs.” (Respondent B1, 2019)

Further, financial performance can affect the levels of innovation in the business. Section 4.2, Motivations, concluded that usefulness of the technology among the respondents was seen as an important motivator to adopt the technology. On the contrary, this technology is still in early stages of adoption and the markets have not matured yet, in result demanding businesses to have a long-term perspective in terms of financial expectations. Despite the acknowledgement of the overall benefits the technology offers, some businesses are not capable to afford long term financial investments:

“We've discussed QR codes, however, none of our producers, to my knowledge, have it. We've looked at it. But it's not something that we're ready to do at this time. Just because of the cost.” (Respondent C3, 2019)

When it comes to innovation short term cost-benefit analysis in terms of how much it costs to implement the new technology versus the benefits of having the technology can be the defining factor in decision making. Hence, financial limitations can lead companies to a reactive state, in result sacrificing the innovation. In contrast, good healthy financial performance can also cause poor decision making in order to benefit in the short term. Some of the labels have their own interest to get as many products with their labels. For these labels value proposition advocate low standards, therefore making it simpler for producers to acquire. Therefore, the introduction of described technology would contradict their business model since the whole premise of the technology is to improve the standard bringing more transparency and accountability to brand and its entire supply chain. As respondent A2 shared his insights:

“So, at the end of the day, maybe some of these labels are more interested to get market share, rather than then actually upholding a very high level of the standard, especially when you get competing standards.” (Respondent A2, 2019)

Similarly, the big companies who have the financial power to introduce more sustainable practices and have the resources to innovate are often the ones to resist. The reasoning behind might be the requirement for the shift to long term commitment, in result affecting short term financial gains. Thus, creating undesirable conditions for the shareholders who are expecting to profit from their investment:

“Big retailers could pressurize all their suppliers to become fantastically sustainable. But, they don't, and one of the reasons why they don't is because there are still financial people who run the show. At the end of the day, it comes down to the cost and the price.” (Respondent A1, 2019)

Although there are companies that position themselves as the frontrunners and challenge the status quo. Recently, Starbucks announced that they will provide consumers with more information on its coffee products by using a blockchain

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system that will track beans from farm to cup that will track coffee shipments from across the world, bringing digital real-time traceability to its supply chains. As previously mentioned, the problem with the adoption of the new technology is affordability. As respondent C3 and C7 further explained:

“If you can make the technology of what you described, affordable. What this big company did, it's great. You know, they can hide that cost. Now, if you put that cost back on the producer, let's just say radio tags and QR codes, as long as you can make sustainability affordable to the producer and the consumer will pay for it.” (Respondent C3, 2019)

“Butchers are worried about extra work because the margins in the supply chain are very, very small. So, any extra admin work involved can make it unprofitable and viable. It's extra work for them which unless there's a premium for it and consumers really demand it.” (Respondent C7, 2019)

As previously described in Chapter 1, new technology can bring the tools to accelerate transparency in the supply chain, however, it relies on the original source of information. Therefore, for this technology to work, the information must be disclosed by all the parties involved in the supply chain. Thus, the financial interest of the business can affect the availability of that information. One hand you can have a company that simply refuses to share the information because it consists of sensitive data which can affect the competitive advantage of the company. As respondent C2 explained this can create situations where:

“Sometimes certifiers don't want to share their evaluations because of course they invested money already and someone else can benefit from that.” (Respondent C2, 2019)

On the other hand, you can have an organic cosmetics brand for example, who wants to be transparent about their supply chain but is limited to the certified suppliers who have the right documentation for the necessary ingredients.

“From five possible suppliers for these ingredients, only one would be willing to give us the needed information and naturally they are much more expensive. That reflects in the end price, which makes it difficult to sell them.” (Respondent B1, 2019)

And lastly, while the new technology is very promising the benefits of those have an uneven application across the market. Many of the producers around the world are based in underdeveloped countries where economic conditions in the region are making it close to impossible to the adoption of these technologies even if they want to. As respondent C3 explained:

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“We have many of our projects in the least developed economies. And in those instances, labour is much cheaper than technology. And in some instances, there is no Wi-Fi, there is no internet connectivity for remote location project. So, for them, it's not that they don't like the technology, they don't have access to it, either energy to power it, or internet coverage to access it. They would like to, but they cannot because they don't have the capital, they don't have the capacity to install and use, in other words, people are not educated in tech, digitized tech, and also labour is a lot cheaper and in fact. In other words, they'd rather have people do that than machines.” (Respondent C3, 2019)

The marketplace is always competitive and for the smaller actors in the supply chain, this can create rigid conditions where the smallest change in the price can affect their financial performance. There are many good initiatives, but they also have to make money and sometimes these initiatives can fail because they are not viable commercially.

Barrier 3: Legislation

In 2015, nation leaders from all UN member states gathered and reached a landmark agreement to combat climate change and signed Paris Agreement (UNFCCC, 2018). Further United Nations (UN) established 17 Sustainable Development Goals (SDGs) with an agenda to be reached by 2030. However, these goals have no legal bound over countries, instead, its emphasis on consensus-building allows for voluntary and nationally determined targets. Therefore, in recent years there has been a lot of discussion on how to create a national and regional level regulatory framework to combat climate goals.

The role of legislation has also been discussed in the framework of this research and has been met with both positive and negative reaction. Certification industry is highly dependent on legislation, policy and regulation. And all of these are subject to change based on the region, country or even city adding layers of complexity making the certification industry more complex and robust. As respondent C1, explained:

“And the issue here is also that the EU or maybe different regions have different standards or different regulations on how the land can be changed or converted to agricultural land.” (Respondent C1, 2019)

On one hand, the regulatory framework is a very effective way to drive change, since companies operating in the respective area are obliged to comply with them. On the other hand, the application of new legislation can be very complex and time-consuming due to the bureaucratic processes and political dynamics. These conditions can contribute to the creation of barriers when addressing the adoption of new technology.

“The market and the technological innovations happen, changes happen faster than governments can react to, in regard to regulations and requirements.” (Respondent G1)

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Further, the lack of common standards can also contribute to barrier creation in innovation. Blockchain, for example, offers trust, but cannot assure the validity and credibility of the information, therefore, it is crucial to have standardised data collection and storage processes. As respondent T2 suggested:

“When we think about trying to provide information to consumers or down the supply chain or using technologies like blockchain, none of that is possible until we all come to a common data set, an open standard for name and address.” (Respondent T2, 2019)

The challenge today is that mandatory certification systems are not strict enough in terms of standards addressing sustainability. Therefore, there is relatively little incentive for companies to commit to these issues. This subject has gained a lot of attention in recent years and has been criticised by various stakeholders such as NGOs, activist groups and even some companies. As respondent A1 commented during the interview:

“The challenges of why this transformation into a more sustainable business or smarter business doesn’t go faster, is that the standards are not requiring enough.” (Respondent A1)

Further, the majority of the sustainability-related certifications today are voluntary based and reporting processes heavily rely on participants personal interest and trust. While businesses are interested to communicate their sustainable business practices through labels, certifiers hold very little or no legal power to demand a certain level of standards and the outcome is purely in the interest of the company. As respondent C6 explained:

“Even if we have specific guidelines for how we want our business partners to report their transactional data to us outside of audits, it's really difficult to get them to act according to expectations, and that's often because there's little incentive for them to do so, for them certifications are sort of a bonus in their product.” (Respondent C6, 2019)

Many believe that the introduction of sustainability specific regulatory framework is paramount to combating social and environmental challenges. Additionally, the fear lies in the fact that voluntary initiative might not be effective enough to reach the goals in time putting people and the planet under serious risk. And while technology is a promising tool to advance sustainable development, it will not do it alone. Sustainable development is, after all, a collaborative effort and requires the support of various aspects and legal framework, being one of its pillars.

“So, there has to be a shift in terms of how we make products and our business model. And I think blockchain can be a part of that. But blockchain can't change the business model necessarily. And it can't change, how much workers get paid.” (Respondent T2, 2019)

Barrier 4: Miscommunication

Communication is essential for sustainable development as it entails the power to create awareness about the social and environmental problems and educate on

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solutions on how to address these problems in result contributing to behaviour change for good. However, in order to establish effective communication, it has to be simple enough, direct and precise. Additionally, considering the gender, cultural and media variations in terms of communication.

During the conducted interviews participants underlined miscommunication as a factor affecting innovation in the certification industry. The main reasons being the complexity of the industry, lack understanding of the standards and labels amongst consumers. In recent years, healthy and mindful lifestyle has been gaining momentum and driving demand for more natural and organic products, reflecting the demand amongst the standard-setting and certifying bodies. Today there are more than 450 different ecolabels worldwide, making it harder to navigate in the natural market. Many of the labels state the same, “natural” or “organic” qualities but they comply with different standards. Consumers often buy products that claim to be natural, but this may be totally different from another product that states the same thing, and most of the consumers are not aware of that. That is a big challenge in which standard owners need to inform much better and much more transparent to customers and the market itself about the quality issues of their standards. However, for many of these label owners staying opaque is more beneficial in result having little or no need to adopt the new technologies:

“The main problem is the different requirements in different standards and communicating these differences to consumers. For consumers, it's very difficult to find their way into understanding certifications.” (Respondent C2, 2019)

“We have so many certificates and labels around but they're not enough. There is inflation in ecological labels if you ask me, and not possible for the end consumer to understand or know what is behind it.” (Respondent A1, 2019)

On one side is the consumer who wants to know more and want to make sure that the company that has produced this product is living up to its promises with regards to health or social issues. And on the other side is the businesses who are struggling to actually communicate with the end consumers, because a lot of companies are actually doing good things, but they cannot necessarily communicate it. Respondents C3 and T2 further explained:

“The consumer can't read through the industry jargon. The production standards, consumers don't really understand production standards.” (Respondent C3, 2019)

It can be extremely confusing for a consumer to find the information on the packaging useful enough to understand the differences between differences labels to make a decision. And that is especially true when people are at a grocery store and looking at a wall full of bags, and just picking the one that is the most inviting to them just based on what the packaging looks like. People's decision making there is really brief and sort of trivial. As respondent C6 explained:

“An interesting challenge that is when you get to the point of marketing to a consumer, is that there's sort of this equivalency that people think of between

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the fair trade certified or organic, or Rainforest Alliance, or retailers like Wholefoods.” (Respondent C6, 2019)

The adoption of emerging technology has the potential to solve these problems and offer both producers and consumers with more effective communication. But for the people involved in the supply chain it is crucial to understand why they should use this technology and how can they benefit from that. As a consequence of miscommunication can be a barrier to adoption of the new technology. As respondent C3 explained:

“If we could explain it to the farmers, so that they understood it, and what the reasons were for it because right now they're being told very little, they don't really have a good grasp on it (IoT, Blockchain). And even the people that do have a good grasp on it are so insulated from these farmers, and they're trying to figure out why they need to do that. So, it needs to either have somebody explain it to them and say, here's what we can go with. And this is why it's a benefit to you, without it being forced on them by a retailer.” (Respondent C3, 2019)

Barrier 5: Knowledge or Interest in emerging technologies

During the conducted interviews interest in emerging technologies was seen as one of the motivational factors in adopting new technology. On the contrary, knowledge about the emerging technologies was less frequently mentioned, yet lack of knowledge about the emerging technology was identified as an obstacle to the adoption of new technology. It is closely related to the previous barrier of miscommunication.

While there is a big interest in the technology and companies are looking to find ways to utilize the benefit of it, there is lack of knowledge amongst them in terms of how to actually implement the new technology. Thus, requiring external resources to achieve. As respondents T1 and C7 explained:

“Yes, something we are considering. And it's really something we need advice on. None of us is supply chain technologists, we don't understand the technology may be as in-depth as a lot of people developing it. So, we really hope to kind of get some advice from some outside people on that.” (Respondent T1, 2019)

“I am aware of the concepts of things like blockchain, but I don't see that yet. It's kind of not easily accessible for us to really make use of. I think it's a little bit further away.” (Respondent C7, 2019)

Lack of knowledge as a problem was explored during the interview with C7, where he explained that this is one of the factors affecting innovation in this space. As being an advocate of transparency in the meat industry, he mentioned that the lack of knowledge amongst the farmers and smaller actors involved in the supply chain are affecting the more rapid development, therefore, to tackle this problem they have developed a curated knowledge-sharing platform.

“There is a huge amount of work into managing the knowledge sharing staff

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and farmers. So, we have an online forum, very busy on a daily basis.” (Respondent C7, 2019)

Bringing knowledge to the bottom line of the supply chain is one of the approaches, on the contrary top-down could potentially be the other way to go. Often people in the position of decision making are the ones who can lack knowledge in certain topics in result preventing the company to innovate. As one of the respondents shares his insights:

“Just to give you an example - the CEO of Organic Valley, which is a multi-billion-dollar company just recently retired. He didn't have a smartphone. He had a flip phone. He ran a billion-dollar company.” (Respondent C3, 2019)

While there is no evidence to weather Organic Valley's CEO's personal preference to technology affected the level to which the company has innovated in the past, knowledge sharing amongst the top and the bottom line of the company can reduce the barriers to innovation.

Barrier 6: Fear

Growing concerns over social and environmental challenges, emerging technologies and changing customer behaviour are forcing both public and private sector to undertake organizational changes. Organizational change is a process that often can bring fear and uncertainty further fuelling resistance to change. During the conducted interviews respondents shared their insights that suggest that there are elements of fear creating barriers to innovation in the context of the certification industry. The element of fear is not seen in standard-setting and certifying bodies per se, but rather the actors involved in the value chain. One of the main value propositions of the proposed technology is to bring transparency in the entire supply chain. While transparency is at the utmost importance in building trust amongst the suppliers and producers and ultimately end consumers, for many actors in the value chain might not be so happy about it. The reasons can stretch from the protection of intellectual property, keeping a competitive advantage and in some cases fear of discovery of environmentally unfriendly production practices, bad working condition and even child labour.

“Sometimes manufacturers are not willing to share all their documentation with everybody because they have patent-protected processes.” (Respondent T2, 2019)

“For a long time, the supply chain of a brand or retailer was perceived as a competitive advantage. In the luxury sector, there's concern about counterfeiting, and there's concern about a thief if they disclose their supply chain. There is slave labour making luxury products, there are migrant labourers who don't have any rights making luxury products. There are factories that are not like nice little artists and workshops in the Italian countryside, making luxury products, there are sweatshops, and it's a dirty secret that the luxury industry doesn't want you to know because they make you pay such an exorbitant price for their products.” (Respondent T2, 2019)

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Further, this results in some of the actors involved in the value chain are trying to prevent the disclosure of the information about the location of their facilities, by inputting the wrong data sets [T2]. And further as respondent shared his insights:

“A raw material producer does not like to give some of the information to his customers, but he is open to give it to us. There is a slight problem in the kind of certification because not the whole Chain of Custody is certified.” (Respondent A2, 2019)

This is creating a challenge for some companies to take a step forward in terms of transparency, because prior they have not been strategic about their business operations and in some cases are not fully aware of their supply chains. Therefore, they do not feel confident that the name and address that they have listed or that they have in their database are accurate or they never visited the facilities and have the information from third parties. Thus, creating resistance from top management:

“Another problem is that the company has not decided strategically, that they would like to share data. So, they don't have permission from up above, that they may have data that they want to share, but they want to make sure that the data is accurate first.” (Respondent T2, 2019)

Barrier 7: Complexity

Many industries today are dependent on global supply chains. Fashion and cosmetic industry, for example, is highly segmented and involves numerous material suppliers and producers. Therefore, making it more difficult to trace the impact of a product as a result. And one of the reasons why it is difficult to trace is tied to high levels of complexity involved in the value chain. Often businesses do not even have a full overview of their supply chain, where they get their products from, where they source it. They might be aware of tier 1 suppliers, but not tier 2 or tier 3 suppliers, thus relying on standard-setting and certifying bodies. But according to conducted interviews that is also a big challenge for the certification industry:

“I think a big part or big challenge for certification schemes is always the issue of traceability of supply chains because supply chains become more complex with worldwide business and globalization. And for us, it's especially knowing that auditors to do their job in an appropriate and right way is crucial.” (Respondent C1, 2019)

Certifiers closely rely on third-party assurance providers. They are the once to assure the credibility and validity of the information. However, even though they can be considered as the gatekeepers of the information, for them collecting and assuring the level of transparency of the supply chain might be challenging. Ultimately in the whole certification system, there is a high dependency on the original source of information. Actors involved in the value chain must make sure that the internal processes become more transparent. In many instances, it can be as basic as the right address of the office and production facility of the supplier.

“There is no real certification system yet and no verification system for the whole chain of custody. And there is the matrix for quality control, where we

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really need to rely on the information we get from the processors.” (Respondent A2, 2019)

“Even the names and addresses of facilities. So, there's different names and addresses for the same facilities contained in various databases controlled by a variety of industry actors... I don't see communication as a major problem, I think the major problem is implementation. We can say yes, we are sustainable, but then how we can prove that is the main question. When we develop the standards, we need to make sustainability very easy to check, that is the problem. These types of changes don't happen overnight ... We still are not sure for social sustainability, how to check that there's no child labour and so on. At the moment we're brainstorming and trying to figure out how to do it.” (Respondent C2, 2019)

Further, the complexities involved in the global supply chains are making it harder to trace necessary information due to the legislation in different countries. In the cosmetics industry, for example, some of the products consist of more than 200 ingredients and acquiring the necessary information to prove the origins of these materials is close to impossible. Respondent G1 tried to picture the level of complexity to simply identify the origin of the country for the specific garment:

“If a bale of cotton is grown in the state of Alabama in the United States, the final product from that farm is cotton. Cotton is exported to China and converted into a roll of cotton fabric. The product now is cotton fabric, which is different from a bale. So, the cotton fabric is now a product of China because that is where product, cotton fabric was manufactured and created. You cannot go back and turn it back into Alabama's cotton. That cotton fabric is exported to Mexico, where it is manufactured into articles of clothing. And the clothing is a product of Mexico because it's now a new and different product, it's been transformed. It has a different name or character and uses than the role of fabric.” (Respondent G1, 2019)

In summary, there are various factors affecting the transition process thus also the adoption of the technology. The technology is creating opportunities to change the behaviour and current processes and making transparency more possible by offering the right tools to benefit from it. However, while technology is a promising tool to advance sustainable development, it will not do it alone. Validity and credibility of the information are paramount to truly transparent supply chains and currently, there are complexities on various levels, across industries that are creating barriers to truly utilize the benefits of Blockchain and IoT technology. As respondent T2 commented:

“Blockchain hype is wasting everyone's time to walk around and talk about it without having a real conversation about the complexities of supply chain data (clean your kitchen first).” (Respondent T2, 2019)

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5. Research AnalysisThis chapter presents the research analysis in relation to motivational and organisational theories. The collected data from status, motivations and barriers are faced against existing theories to make a connection between the factors affecting decision-making to adopt technology for transparency and user behaviour intention. The discussion unfolds the findings for the preliminary research questions and relates them to potential organisational strategies to produce change.

The information analysed in the previous chapter from the interviews gave very valuable insights of the status and expectations the certification industry has in relation to technology for sustainability, with a focus on improving the transparency of the whole chain up to the end consumer. The research method used of semi-structured interviews directly answers RQ1 formulated on this thesis, is it “What is the current status of transparency and traceability methods in certification processes?”, where we have seen several members of the certification industry at different stages of technology adoption. These companies also had different levels of transparency, but they really understood the benefits of being transparent and most of them were even aiming to improve their transparency. All companies agreed on the fact that certification had no sense if the communication between the company aiming for an eco-label certification and the certification body was not transparent, the same between the certification body and the standardization organisation. Traceability, is from the other hand, very much linked to their technology adoption stage, having low traceability in companies with “pen & paper” data collection and improving it with digital databases up to artificial intelligence algorithms that prevent human errors and blockchain to create trust along the traceability chain. This technology adoption is at the moment related to the complexity of the supply chain as most companies found fairly simple to certify a single producer, being the certification process resumed as documentation check and audit, and then, as more documentation needs to be checked and managed, the more complex the certification becomes, and more useful is to upscale their technological tools.

The analysis of the interviews also gave valuable insights to answer RQ2: “What motivates certification companies to adopt new technologies?”, where the researchers identified three main motivations that can be related to the principles of the Unified Theory of Acceptance and Use of Technology (Viswanath et al., 2003), being these three motivations: consumer demand, thinking ahead and usefulness.

The consumer demand for companies to be more sustainable, more transparent and to prove their claims motivate companies to use new emerging technologies to give that information to the end consumer and so create a relation of trust with them. Brands rely on eco-labels to show this information and so pass this need to change

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and upscale the technological tools to certification companies to give more and better information where an Academic Strategy for organisational change can be applied (Furnham, 1997) due to information being the main reason for the change, while being able to argue that companies will need to train themselves and their partners in order relationship to make use of the new emerging technologies that can provide the required information. Consumer demand has triggered brands to request this extra information to their eco-labels, but has been the motivation of usefulness which makes certification companies to adopt emerging technologies based on perceived usefulness, a factor on the performance expectancy group of UTAUT, and in order to improve the information flow, also a facilitating condition factor within UTAUT. Transparency always raises awareness on the end consumer and then it is also easy to relate consumer demand with Social Influence, also taken into consideration at UTAUT, validating the relation between consumer demand with the motivational model. Consumer demand is without a doubt a powerful motivation to produce a change, as in situations like the Rana Plaza incident (Siddiqui & Uddin, 2016) that triggered a Military Strategy in companies to react fast and without considering secondary factors. In a lower scale, consumer demand is also a good reason to apply an Economic Strategy due to Social Influence, otherwise, companies may lose their clients. The adoption of new emerging technologies due to consumer demand is in the case of sustainability often linked to new generations which have lot of interest in what is behind an eco-label (Hill & Lee, 2012) , to be sure that a product is organic, ethical sourced and does not contain child labour, helping the consumers to make better decisions, linking it as well to the usefulness motivation and the factor of relative advantage in performance expectancy within UTAUT. To have enough information to make better decisions is very important in the current market oversaturated with products, but also over-saturated with eco-labels.

When looking at the motivation of thinking ahead, there is a willingness in standardization organisations to create standards and practices that fill the sustainable gap of slow-moving governmental authorities. These companies foresee that laws and directrices will eventually catch up with their standards but they aim to already provide eco-labels to companies so these brands can show, promote and advertise their values. To be ahead is always seen as pioneering and a good sign for a company creating a relative advantage in comparison with other companies, a motivation is considered at the UTAUT model (Viswanath et al., 2003). Technologies like QR codes and other that improve traceability and transparency like IoT and Blockchain can provide the facilitating conditions to show these values that companies want to advertise, being it a good reason to motivate the technologies adoption. As governments known about their slow and complex bureaucracy, they use to collaborate with certification companies in order to “smooth the path”, decreasing the future effort expectancy and improving the technology ease to use, and even to test the market response to some standards. This collaboration can trigger an Economic Strategy (Furnham, 1997) within companies if those governments provide grants and monetary incentives, which is usually the case as this collaboration between certification companies and governments is very beneficial for both sides, creating a synergy where even a Fellowship Strategy can be applied, as any member would hesitate to break such a deal. The thinking ahead motivation does not only provide a relative advantage but also facilitate the technology adoption for when authorities start requesting more traceability and transparency in products, as it already happened in the food sector (European

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Commission, 2011). Governments even if slow can trigger a Political Strategy due to their position, as there will always be companies reacting to change instead of being proactive, which would lose the benefits of thinking ahead and would need to overcome their barriers to comply with the law with expected higher cost and effort. Collaboration between different organisms is very important when dealing with new emerging technologies, as technology companies would understand faster the importance and benefits of these technologies and would push the rest of the industry, in this case, the certification industry, to adopt new innovations and to explore how these can be used to improve their daily practices, due to the technology performance expectancy, as in the UTAUT motivational model.

Finally, it has been extensively argued that new emerging technologies like IoT and Blockchain are a great tool to provide transparency and traceability to eco-labels, making them very useful and so a great motivation for certification companies to adopt these technologies. As mentioned and linked to consumer demand, brands want to show their values through eco-labels, which will gain more credibility the more transparent and traceable they are, being digitalization a facilitating condition, like in UTAUT model (Viswanath et al., 2003), to provide as much information about a product as possible and without having an extensive booklet or text-filled package. Technology is not only useful to show this information but also to provide it, like with IoT devices that can collect the higher amount and more accurate data while transferring it safely in a Blockchain network without human mistakes or tampering. After all, supply chains get more and more complex every day and with manual entries that become a huge, repetitive and time-consuming task. As certification bodies mentioned during the interview, their main methods to assure companies that want to get an eco-label are documentation checks and audits, to verify that they comply with the eco-label certification standards. Documentation can then be checked easier and faster when using digitized tools where even algorithms can detect human error and perform a cleaner categorization, motivating the perceived usefulness of the technology, as well as online databases that define the sustainability of certain ingredients helping the certification bodies to perform their checks and audits. The traceability and transparency of a product can be vastly improved when the stakeholders of a supply chain agree on a format, protocol and communication channel to share data, which also becomes simpler with digitalization. The performance expectancy factor of UTAUT is clearly seen when data collection is improved with technology, optimizing the process and even detecting problems at an early stage, motivating the adoption of the technology. Handling the information becomes much easier reducing the effort expectancy as those big amounts of data are very sensitive to mistakes in manual entries that usually costs time and money to fix, and so giving weight to apply an Economic Strategy (Furnham, 1997) to change as a cost prevention measure. Many businesses are driven now by what they can learn from data, which also encourage an Academic Strategy to adopt the technology if the right conditions are met, as having more information is seen as useful for companies to optimize their operations and comply with their clients' demands.

It is also very important to understand the psychology behind the resistance to change and what are the barriers, and to utilize this knowledge to improve how to adopt new technologies, as it gives far way more benefits than ignoring the resistance and focus only on the motivations (Sheth, 1981, in Ram, 1987).

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Throughout the conducted interviews, respondents expressed a positive outlook on the adoption of the new technologies and see great potential in improving current systems and processes. However, they have also underlined many critical barriers to answer RQ3: “What prevents certification companies to adopt new technologies?”. Innovations always impose a change: on the consumer, on the market or in an established strategy, and resistance to change is a normal human response (Ram, 1987). Researchers have identified seven barriers that can be related to the principles of the Unified Theory of Acceptance and Use of Technology (Viswanath et al., 2003), being these seven barriers: lack of consumer demand and pressure, lack of financial resources, legislation, miscommunication, lack of knowledge or interest in emerging innovations, fear and complexity.

While consumer demand has been identified as one of the main motivators for the certification industry to adopt new technologies, lack of consumer demand, on the other hand, is creating barriers. More importantly, “Innovation Resistance is not the obverse of Innovation Adoption. Adoption begins only after the initial resistance offered by the consumers is overcome” (Ram, 1987). The research revealed that referred technology is still in the early stages and markets are not mature enough to see the benefits, thus resulting in lack of demand from the end-consumers. Lack of knowledge among consumers can be seen as one of the factors reflecting poor demand. On one hand, the reasons for that could be seen as a lack of knowledge regarding the technology and understanding of what the underlying benefits of it are. On the other hand, it could be seen as a lack of awareness regarding environmental and social problems, since these customers may be less likely to consume concisely (Respondent B1, 2019). As a result, creating conditions where decision making is not based on the 'full story of the product' but more on the bases of the price. Thus, as a result, lowering the chances of the need for innovative tools of communication that Blockchain and IoT technology can provide. As UTAUT model suggests that social influence is one of the driving factors of technology adoption since the technology is influenced by people in the user environment, and their social acceptance (Viswanath et al., 2003). And perceived usefulness of the technology is directly linked to the user attitude towards using the technology and so affecting the behavioural response towards actually using the technology (Davis, 1986). While identified factors can be seen as barriers to adoption of new technology, for organizations in general adoption to new technologies can require the adoption of new practices. Furnham (1997) suggests that Academic strategy believes that information, or rather enough information and facts, can change the opinion of people. Thus, for organizations, the strategy can be seen as a driver to overcome the barrier of lack of knowledge.

Similarly, to lack of consumer demand, interviewed respondents underlined financial factor as one of the biggest barriers to adoption of new technologies. This phenomenon is closely linked to a lack of consumer demand since it can be affecting organizations financial performance, which often is the main driving force behind the decision making. Thus, financial status can affect the levels of innovation in the business. Despite the acknowledgement of the overall benefits the technology offers, some businesses may not be capable to afford the initial investments. UTAUT model suggests that having the right conditions such in knowledge, organisational structure, infrastructure and resources are crucial to the adoption of technology

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(Viswanath et al., 2003). When it comes to innovation short term cost-benefit analysis in terms of how much it costs to implement the new technology versus the benefits of having the technology can be the defining factor in decision making. Hence, financial limitations can lead organizations to reactive state, in result sacrificing the technology adoption. This can be linked to the UTAUT model that suggests that performance expectancy or level of expectancy of the technology to improve work performance is determining the adoption of technology (Viswanath et al., 2003). Adoption of new technology can be a financially challenging process, especially since the technology is not vastly available, however by educating and training employees of the organization can reduce the costs by avoiding high expenses on external contractors. Thus, Academic Strategy can be applied in order to overcome these barriers. Further, partnerships and collaborations with actors involved in the value chain can be established to reduce the costs. Thus, the Fellowship Strategy can be applied to improve interpersonal relations to produce a change in consensus (Furnham, 1997).

Certification industry is highly dependent on legislation, policy and regulation. On one hand, the regulatory framework is a very effective way to drive change. On the other hand, the application of new legislation can be very complex and time-consuming due to the bureaucratic processes and political dynamics. Thus, the research legislation was identified as a contributor to the creation of barriers when addressing the adoption of new technology. Further, the lack of common standards can also contribute to barrier creation in innovation. Blockchain technology, for example, offers trust but in order to be effective needs to be supported by industry standards, as it is crucial to have standardised data collection and storage processes to use a common set of values that everyone in a supply chain can understand. This outlines that lack of legislative infrastructure which based on UTAUT models facilitating conditions create a barrier to adopting the technology (Venkatesh et al., 2003). Furnham (1997) suggests that political strategy relies on the power of individuals, managers, leaders, and decision-makers to produce a change by influencing their behaviour individually. While legislation can be holding back the development in the certification industry, decision-makers and leaders have the power to advocate the change and take a proactive position, not only to innovate, but also improve the current systems.

The research identified miscommunication as another factor affecting technology adoption in the certification industry. The new technology can provide many benefits, however, in order for the technology to work, information about the product must be collected from all the actors involved in the supply chain. Therefore it is crucial for the people involved in the supply chain to understand why they should use this particular technology and how can they benefit from that instead of only being an additional cost as it is especially important when addressing the bottom-line of the supply chain where margins are very tight. This is also closely linked to a lack of knowledge about the emerging technology barrier. On one hand, lack of knowledge can be seen as a barrier created amongst the bottom line of the supply chain, on the other hand, people in the position of decision making can be the ones lacking knowledge in certain topics in result preventing the organizations to innovate. However, communication is crucial as one of the most basic tools for supporting organizational change (Kotter & Schlesinger, 1979). Thus, poor communication can create conditions where social influence is creating a barrier for adoption of the

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technology, as the people in the user environment do not have the knowledge needed (Viswanath et al, 2003). Therefore, education can facilitate the transition needed by bringing knowledge to individuals of various positions. Academic strategy can be used to overcome the barrier by informing the people and in this way nudge their decision-making process (Furnham, 1997).

For both public and private sector, technology adoption requires to undertake organizational changes. Organizational change is a process that can often bring fear and uncertainty fuelling resistance to change (Weeks, Roberts, Chonko & Jones, 2004). The research found that there are elements of fear creating barriers to the adoption of technology. One of the main value propositions of the proposed technology is to bring transparency in the entire supply chain. While transparency is at the utmost importance in building trust amongst the suppliers and producers and ultimately end consumers, for many actors in the value chain this can be creating challenges, for example, the protection of intellectual property and keeping competitive advantage by keeping the information about suppliers confidential. Thus, creating resistance from top management to take a step forward in terms of transparency. These conditions can create a lack of performance expectancy (Viswanath et al., 2003), since the managers and decision-makers may see the transition to threaten their current operations. Additionally, resistance in disclosure of information among companies about their suppliers is affecting facilitating conditions (ibid) for the adoption of technology, since the availability of credible and valid information is fundamental for Blockchain technology to fulfil its purpose. Fear of the unknown is a natural human behaviour, which decreases and disappears once the unknown becomes known, therefore an Academic Strategy (Furnham, 1997) is also very much applicable to this barrier, to make decision-makers aware of the benefits of the technology and even showing them cases where transparency has been applied without losing performance or clients. Certification companies in the sustainability sector exist to ensure sustainable practices and their clients should not be afraid to show how they operate, otherwise, all the process lose its purpose.

Further, supply chains today have become more complex due to worldwide business and globalization, thus making many industries today highly segmented and making it more difficult to trace the real impact of the product. Certification industry is highly dependent on the original source of information. Certifiers closely rely on third-party assurance providers. They are the once to assure the credibility and validity of the information. However, even for them collecting and assuring the level of transparency of the supply chain might be challenging as in some instance’s suppliers are failing to provide basic such as the right address of the office and production facility of the supplier. Facilitating conditions are introducing complexities to the adoption of the technology, as the industry might be lacking the infrastructure and the right knowledge to support the data inputs, which in the result are losing the purpose of the technology. Additionally, the performance expectancy is creating barriers since the complexities introduce factors that can affect the performance and use of the technology. From an organizational perspective, these barriers can be overcome by introducing Political strategy (Furnham, 1997). Leaders and decision-makers of the certification industry have the power to standardize the data collection processes and introduce mandatory requirements for participatory actors of the value chain. Important to remember that these changes are an ongoing process rather than an overnight success. And the same way as the certification

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industry needs to overcome organizational change, so as the actors involved in the value chain.

In summary, there are various factors affecting the transition process thus also the adoption of the technology. The technology is creating opportunities to change the behaviour and current processes and making transparency more possible by offering the right tools to benefit from it. However, while technology is a promising tool to advance sustainable development, it will not do it alone. Validity and credibility of the information are paramount to truly transparent supply chains and currently, there are complexities on various levels, across industries that are creating barriers that need to be overcome to truly utilize the benefits of Blockchain and IoT technology.

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6. ConclusionsThis chapter presents the conclusions of the research in the form of answering the main research question as well as some concluding remarks and a summary of the discussion. The chapter finishes describing the limitations found in the research while giving some recommendations for future research in order to enhance the built knowledge.

The purpose of this study was to investigate the current status of the certification industry and how can the industry adopt emerging technologies to drive future development of sustainability. To fulfil this purpose, the study performed semi-structured interviews with executives and managers from various organizations: such as certification bodies, standard-setting organisations, third-party assurance companies and sustainable brands. The study explored the western perspective on the status quo of the certification companies and covered seven countries from around the world. By conducting a qualitative study, the authors have gained extensive insights into the current status of the certification companies and identify motivations and barriers. These insights were used to frame a motivational model and propose organisational strategies for certification companies which resulted in answering the main research question:

How can certification companies overcome their barriers to new technologies, and allow them to improve quality, transparency and traceability in their certification practices?

The answer to the main research question is to have identified their motivations and barriers to adopt the technology and, mostly, to apply the right organisational strategy to overcome the fitting barrier. Which organisational strategies are good for each identified motivation and barrier are summarized in Table 2.

Table 2: Mapping organisational strategies with motivations and barriers for technology adoption

Organisational Strategies

Fellowship Political Economic Academic Engineering Military Confrontational

Consumer Demand

x x x

Thinking Aheadx x x

Usefulnessx x

Financial resources

x x

Legislationx

Miscommunication

x

Knowledge or Interest

x

Motivations and Barriers

Fearx

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Complexityx

Both Engineering and Confrontational Strategies were not found useful for the aim of the research. As we are dealing with motivations, barriers, and how to overcome them, the Engineering Strategy is not much applicable to the topic, due to seeking a change in the behaviour by changing the industry methods, while the research is taken from the other side, looking at adoption of technology triggered by a change in companies’ behaviour due to their motivations and barriers overcome. The Confrontational Strategy is from the other side not very appreciated by the researchers as aims for conflict and looks at problems instead of solutions, a wrong approach when dealing with new emerging technologies that actually require to focus on solutions, to collaborate and to have a good level of understanding within the company stakeholders. Following the Confrontational Strategy on levels of aggressive approach is the Military Strategy, which could only be used in case of a strong consumer demand. The consumer demand we face in QR codes, blockchain and IoT adoption, new emerging technologies for transparency, is related to the demand for more information about the sustainability of a product (sourcing, supply chain, production, packaging) and then it would be difficult to face such a situation where this strategy can be applied, however it can be triggered as a consequence of a bigger crisis with environmental or social impact.

The lack of financial resources was a barrier reported by most of the interviews and therefore an Economic Strategy was not very applicable as an inner method to trigger technology adoption within an organisation, but would be a good motivation if the initial investment was doable due to the expected benefits from adopting the technology, linked with the optimization of processes reducing their cost and creating a relative advantage which would reflect in more clients for the company. Economic incentives should then come from outside the organisation and there is where governments can collaborate by creating partnerships with certification companies and providing grants to facilitate the technology adoption. A Fellowship Strategy has been found to be one of the most applicable strategies for technology adoption, highlighting the importance of collaborations as in the previous example with governments, as to help each other can significantly reduce the cost due to the sharing of resources, being them money, people or knowledge. Collaborations with technology companies would be very beneficial to trigger a technology adoption, as those would have a better understanding of the technology and then having the right skills to help and share their knowledge with certification companies.

When addressing legislation, many believe that the introduction of sustainability specific regulatory framework is paramount to combating social and environmental challenges. The fear lies in the fact that voluntary initiatives might not be effective enough to reach the goals in time putting people and planet under serious risk and, while technology is a promising tool to advance sustainable development, it will not do it alone. Sustainable development needs to be a collaborative effort that requires the support of a legal framework by being one of its pillars. In the meantime, a Political Strategy has been found to be useful when applied by decision-makers in certification companies among their supply chain stakeholders, to create standardized tools and facilitate the technology adoption, which would reduce their

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increasing complexity and help to divulge a common understanding of processes and practices, as well as advocating the benefits of transparency.

Finally, the most applicable organisational strategy to overcome technology adoption barriers found in the research has been the Academic Strategy. By training their employees, certification companies can reduce the cost and uncertainties of hiring external contractors if pushed by external factors like consumer demand, while a good understanding of the technology would reduce if not eliminate the fear of disclosing confidential information. As the technologies described have many benefits for transparency and sustainability, to educate decision-makers and properly communicate what there is to gain would make them understand how useful the technology can be, like a decrease in complexity and cost, as well as satisfying their current and potential clients.

In summary, most certification companies are open to increase their transparency while having different levels of technology adoption, usually having similar motivations to adopt new emerging technologies and encountering similar barriers to produce a transition towards them. It has been found that a combination of organisational strategies can be used by certification companies to overcome those barriers and create a positive change, being Collaborations (Fellowship Strategy), Leadership (Political Strategy) and, most importantly, Education (Academic Strategy) the core pillars to create impact and move certification companies to adopt new emerging technologies to improve transparency for sustainability.

Limitations and recommendations

The conducted research has taken motivational models and organisational change as theoretical pillars to frame the findings and answer the main research question of “How can certification companies overcome their barriers to new technologies, and allow them to improve quality, transparency and traceability in their certification practices?”. In order to have a broad perspective, the motivational selected was UTAUT, a completed integrated model designed with several motivational theories widely researched in the literature. However, UTAUT has shown vulnerabilities when addressing different cultures other than western countries and so may not present valuable data when a global scale is considered (see Section 2.3). Future research addressed to other cultures is then recommended to expand the research and test different motivational models to build knowledge on the topic.

Furnham’s strategies to produce change were a good fitting when addressing decision-makers, and the research shows a potential to produce organisational change if the right strategy is implemented to overcome the barriers. As addressing decision-makers, the research would benefit from extended research from a leadership perspective, making it more robust with the organisational and leadership perspectives. In addition, the research has shown the great potential of the Academic strategy to produce change, and therefore the researchers highly recommend replicating the study taking organisational learning as a theoretical pillar to frame the research, due to its influence on organisational change and such findings on strategy.

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In summary, the researchers recommend expanding the built knowledge with future research taking approaches from different angles not covered in this thesis and to even replicate the study, as many perspectives were not covered due to time and length of the research. The research topic would highly benefit from further studies using a leadership perspective, cultural diversity and organisational learning.

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AppendicesAppendix 1 – Interview Guide

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Opening segment: Introductory and contextual questions

What are your responsibilities at the company and what are you currently working with?

What is your main area of interest in sustainability?

Middle segment: Questions on the expertise area and its relation to Supply Chain transparency

Status quo of the industry

1. What role the company has in relation to sustainability?2. Which main opportunities do you see for businesses to adopt sustainable/organic

certifications?3. Which main challenges do you see when businesses adopt sustainable

certifications?4. Do you ask companies to make changes in their business model to get the

certifications? If yes, do you recommend actions?

Supply Chain

5. Do you work with improving/measuring businesses supply chains?6. Where do you see the biggest impact of supply chains?7. What motivates companies to incorporate sustainability into their supply chain

strategy? 8. What are the main influences/challenges in making a supply chain more

sustainable?9. How do you see sustainability in supply chains being influenced by the different

actors in a supply chain?

Transparency, Technology & change

10.What are the biggest challenges related to transparency in the company?11.Why do they still exist?12.Which possible solutions do you see to these issues?13.How do you treat client’s confidentiality when addressing transparency?14.How do you assure the credibility of the information?15.What challenges do you see to be innovative in your organisation?16.What technology do you use in the company when addressing transparency and

traceability?17.What changes did you have to implement to shift to that technology?18.Are you considering Blockchain or other innovations as a next step to improve

transparency and traceability in your certification processes? 19.What challenges/barriers do you see for implementing it?20.How do you think your co-workers would react to a change in the organisation

processes?

Concluding segment: Follow-up questions and elaborations

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21.In your opinion, what can incentivize the industry to become more sustainable? 22.How do you envision the progress of sustainability in the future?23.Thanks for this interview. Are there any topics you’d like to comment on that

we’ve neglected to bring up, or would you like to expand upon anything you said earlier?

Appendix 2 – Participants Consent Form

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Appendix 3 – Interview Transcription

Sat, 05/18 06:59AM 50:08

SUMMARY KEYWORDS: carbon neutral, companies, certification, corporates, carbon, work, projects, protocol, business, people, technology, organization, sustainability, impact, clients, offsets, data, reduce, operations, carbon credits

SPEAKERS: Interviewee Nr. 10INTERVIEWEES: Emilio Asensi, Renars KaulinsFORMAT: Audio-visual online interview via ZOOM communications tool

Interviewee Nr. 10 0:08So how do we tackle this? Do you want to tell me a little bit about just a, you know a sentence or two about the two of you and what you're a little bit of background and context and then we can get into your questions?

Renars Kaulins 0:23 That sounds great.

Emilio Asensi 0:26 We are both studying at Malmo University. We are doing Master on leadership for sustainability. And then for or thesis we are researching innovation for certification mostly, we also have these different angles, what is happening on the market of the certification, and assurance companies mostly all related to sustainability.I have a background in engineering so that's why we are interested in looking at innovation or maybe even some resistance to innovation in that sense but related to sustainability. What are the methods that are using nowadays in order to assure and certificate, sustainable brands and sustainable practices? And what is the role of transparency and traceability in these processes? So, it's quite ambitious research.

Interviewee Nr. 10 1:28 Great.

Renars Kaulins 1:29 And just to add up, on everything as Emilio was saying, I'm coming from a communications perspective and at the same time I'm an advocate of technology and been following the development of IoT and blockchain for the past years. And we found this topic interesting to see what's happening with the different certification bodies around and how technology is potentially pushing this sustainable development and this point.

Interviewee Nr. 10 1:59 Good stuff.

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Renars Kaulins 2:56 We could just ask you, if you could start with giving your background, what is your responsibility at Natural Capital and what are you guys currently working with?

Interviewee Nr. 10 3:08

I'll try and give you a sort of a short summary of what I do and what the business does. So first of all, you probably looked at the website, but it was started in 1997 by two entrepreneurs, who are no longer with the business as it happens, but they set up the business and it was called Future Forest and they were planting trees in the UK.

And we developed a legal contract to take title over the carbon sequestered in the forest to stay grew, we've bundled up into package for a consumer facing offer for carbon neutral lives, weddings, holidays, etc. And back in 1997 the IPCC first reported come out, so climate change was sort of quite a big issue in a couple of companies, most exposed in the travel industry, the car or aviation. So, these two founders have focus on the small business that started to attract attention from the airlines and the automotive manufacturers. And in order to meet, to respond to that corporate really firmly on the idea of planting trees, a very compelling icon for action on climate change, and they wanted to be able to offer that to their customers. So, the founders raised some institutional investment funds. I join in 2005 when we were probably about 16.

As CEO, then both took that money and raised some more, an equal amount from Netherlands. And we then built out the business together. And we moved from b2c model to a b2b model. And we also moved beyond trees in the UK into all kinds of mitigation projects around the world, whether that be renewable energy, energy efficiency, fuel searching me then capture whatever.

When I arrived, there was no real transparency around the trends and the carbon neutrality claims that were being sold to our customers. So we began to develop carbon neutral protocol, from 2007, with the under the guidance of KPMG and then later on PwC, a group of advisors explained sort of what transparently carbon neutrality was, how you measure the footprint, how you might reduce internally, how you might finance mitigation outside of the boundaries of your business, and then make a claim. We also associated with that certification mark, which we awarded, and we still do, for companies that chose to follow all of the steps and the requirements in the protocol. We carried on as carbon neutral company, until actually 2007.

We acquired 2008, actually just after the financial crisis, we acquired a small company in the United States that have set themselves up to do pretty much what we were doing, and they were better funded than we were. And so, we kind of merged or acquired them and built out a US footprint. We also thought that a lot of this carbon offsetting cap and trade your market-based solutions to climate would get commoditised, because the United States was contemplating adding mission Trading Scheme. Later, the Wechsler market bill failed to happen in the US. And of course, we have the financial crisis from 2008 - 2012. So, we just continued as a carbon neutral company.

And we kind of managed to grow slowly but organically during that period. And what we found is that our clients that were purchasing credits from projects were less interested in the mitigation outputs and more interested in the biodiversity benefits of forests or the

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alternative sources of income are associated with some of our Clean Cookstoves projects and things like that. So, four years ago, we diversified geographically, from the UK into Europe, and then into the United States. That was quite successful. We wanted to sort of diversify a little bit into the field of market-based instruments. So, we rebranded as the Natural Capital Partners four years ago, to reflect the fact that we were then transacting renewable energy certificates, guarantees of origin, water benefit units, we've dabbled a bit in biodiversity offsets and various other things. So now, our company describes itself as a service provider to mainly multinational corporations that are trying to achieve sustainability goals around the world. Corporations that wish to use market-based instruments to gain access to solutions that they can't build themselves. So that's what we do. We are now 30 people, somewhat a virtual organization. Now across Europe and in the US, we have about 300 corporate clients at 80 - 20 rule 20% of those represent about 80% of our revenues.

And our largest clients include companies like Microsoft PwC, UPS, Marks and Spencers here. Nordea, hewlett packard. I'm just trying to think of some Scandinavian outputs, but our clients are, are operating in the voluntary space, not the compliance space. One of the things I should say is that I, we appointed my successor as CEO in 2007-2008, when we thought that we wanted to go international, we might have to change into a compliance company. But that hasn't happened. And my role now is, you know, I do a little bit of work in maintaining our key relationships with larger clients, I support team.

Institutional memory, I do a lot of the work on the credibility and the quality of the protocol and the work that we do. And I engage with the policy and regulatory frameworks at the UNICEF, Triple C, and various other levels to track and idly influence, the direction of policy, climate policy, and our diversity policy and all the other things we do in our favour. So, I'm managing director with focus on external affairs.

I've told you that I've actually worked in environmental sustainability all of my life. I started off in the mining industry in South Africa, which is where I was educated as a civil engineer. And I did a master's in environmental science, and then left South Africa in the mid 80s, came to the UK getting an MBA. And then went back into environmental consulting for a US company working with very high polluting big motors leading companies. And then my main area of interest in sustainability is the context in which successful businesses need to find resilient strategies. And so, I have constantly throughout my life work to the interface of business and sustainability.

Interviewee Nr. 10 13:18 I'm just sort of looking at the next set of questions that you've got the status quo in the industry, what role is natural Capital Partners in relation to sustainability? Hopefully, I've, I've actually explained that. So, we help these corporates access solutions outside of their boundaries, either through tradable instruments. We also work in the area of what I would call results-based finance. So, our clients, sometimes fund projects against particular KPIs that don't necessarily create tradable instruments, like carbon credits. Five funds just came back from Kenya, where tea client of ours called Taylor's tea or Yorkshire tea, pretty big here in the UK, they are supporting the rollout of afforestation projects in the tea sector around Mount Kenya. And for them it's the aggregated impact of that intervention that's more important than the instruments. So that's the role that Natural Capital Partners plays. Main opportunity opportunities for business adopters - they will gag

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certifications, which means I get this is why I need you to stop bringing in the aspects that you want me to specific the onset.

Emilio Asensi 14:57 We are saw in your website that you have these carbons neutral certification, so maybe you can you give us an outline of what do you do with the certification and how companies achieve that? And all the process that goes through?

Interviewee Nr. 10 15:18 So, I'm not going to talk you through that? Because you can certainly find them on that website. But what I can do is sort of say that I think I've already told you in our story that we developed that first in 2002. Before there were third party standards for the measurement of corporate footprints. The creation of emission reductions transacts with emission reduction. So now that is a protocol. And it literally was a sort of a 10-page Word document with a spreadsheet on how we accounted for carbon, sequestering forests, and so on. So now we're able to reference many other standards, third party standards, greenhouse gas protocol, vocera, gold standard, the CGM under the Kyoto Protocol.

But the main thing that I think you're interested in is the fact that up until 2006, that's all we sold - carbon neutral certifications, and obviously, the offsets. We never did the measurement of corporate footprints, because that's a conflict of interest if we measure everything offset, so we always outsource that to partners, independent partners. What we found is that as we started working with larger corporates, like Marks and Spencers, Microsoft, UPS, Deutsche Post, DHL - they felt that their brands were strong enough to carry the message, they didn't need a third-party certification mark. And what SKY broadcasting did, at one stage in their history, they were challenged by the Advertising Standards Authority, because a couple of people complained, NGOs complain to them to say that SKY claimed that they were carbon neutral, and they couldn't understand how a company could be carbon neutral. And so, they went through a range of hearings and, and basically SKY, pointed to the carbon neutral protocol and said, we're making a registered trademark claim against the provisions in this protocol, as we've always called it. And that's what we mean when we say carbon neutral, and the asca upheld sky with the position. And that those kinds of requirements on corporates around communicating environmental attributes, of course, not just here in the UK, in the US, the federal standards authority or something like that.

We've ensured that we've maintained the protocols so that people who use have a defendable, transparent way of explaining what it is that they're claiming. So now, one of the things I should say is that at this point in time, I would say that probably 40% of our clients that make claims of neutrality, your commitments to net zero quarter what you will, probably only 40% of them use our certification mark. And the tendency is - the bigger the company, the stronger their brand, the more they're able to support their claims without our certification, which makes sense to us.

Renars Kaulins 19:48 Actually, can I ask you, when you work with b2b and they acquire your certification? Do they also then later use that to communicate with their B2C?

Interviewee Nr. 10 20:15

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Yeah, that's a fair point. I mean, in the early days of our business, if can remember that far back - music CDs. We had a lot of musicians that used us to make either films, tours, or CDs, carbon neutral. So literally hundreds of millions of CDs that were carbon neutral back in the day with Coldplay, or the Pet Shop Boys and the Rolling Stones made the European tour carbon neutral, is the days when we were sort of using the celebrity action to sort of draw attention to this. And there are carbon neutral products around. There is wine, there are garments. Mostly our carbon neutral certifications are companies or corporations. We are seeing a renewed interest in making products carbon neutral.

We are getting a lot more data about supply chains. One of the biggest barriers to products being carbon neutral is the cost in conducting life cycle assessments. We think that cost is coming down, because there are now industry wide databases. And it's much easier to get a hold of that data. And, and we're seeing an uptick in that. But the vast majority of our certifications are for companies. So, as I've said, if you open up the carbon neutral protocol, you will see a couple of case studies in there that indicate how different companies use it as company's carbon neutral services, for example UPS, carbon neutral products.

So then moving along you've asked a very interesting question, do you ask companies to make changes in their business model to get your certification. I will point you to the carbon neutral protocol. To make changes, we asked them to meet the requirements of the protocol. And the requirements of the protocol require that they measure a footprint to certain standards, we advise that they set an internal reduction plan, we will require that they use offsets, we will only sell them offsets, carbon credits for offsets from certain projects that we believe are high quality. And then we also require that they use the certification mark in a particular way. So, we have guidance on how they can use that. So, for example if it's for a company, we need to make sure that the consumers won't be confused if it's carbon neutral company or is it a carbon neutral product. So, we have quite strong specifications around that. But we are not a campaigning organization, the carbon neutral protocol is a guide that has been developed by business. That's us. We happen to have an advisory board made up of NGOs, and academics and others. And it's for business. And so, we try and make our protocol as accessible as possible. But the value of the protocol to our clients comes from the fact that they are protected when they use it from criticism that you know, the greenwashing or that they're not being transparent about what they're doing. So those requirements in the protocol are very strong.

Renars Kaulins 24:33 So, I think when we first approached your company, we perhaps were not quite clear on what is your real impact. And because we were looking through different certification bodies, the assurance companies, organizations that create their own labels, and so on, so forth. It has been an interesting perspective to see what your company is doing. And now that I'm thinking about how does this apply to our case more? Maybe I'm more interested now to ask you, for example, like the technology part, do you see technology within your scope, advancing sustainable development at this point? Or you're more like dependent on what your partners are doing with technology?

Interviewee Nr. 10 25:30 Yeah, I think the short answer is, technologies are a major role in increasing transparency, and cost efficiency of those organizations that are pursuing or seeking to decarbonize

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their products and their operations. But we are an indirect beneficiary of that. You Renars, mentioned the use of satellites in your cover - the satellite imagery. We are at the moment where our clients finance through carbon through the purchase of carbon credits, forestry projects and sometimes those projects have to wait seven five or seven years before there's significant growth.

And that the carbon stocks and those trees have grown significant to make it work while having people on the ground go and verify that those trees are in the ground that they've sequestered their carbon. And they are the boundaries of that it hasn’t changed. Now increasingly, we're able for the standards that verify that carbon using remote sensing, to gather that information or sometimes day by day or even week by week basis. And that means that they can verify that the carbon has been sequestered, in other words reduced. And that trend, the cost of verification has come down, the frequency with which you can readjust and register these credits and transact them is increased. So, there are a lot of things there in that example, which helps us become more effective in what we do with kinds.

The second area that I've already mentioned, is that as we see a shift from carbon neutral operations to carbon neutral product, there is an enormous amount more data required to develop a footprint across the supply chain that is just for direct operations. And that data is now being collected. The progression of big data management approaches, Ai, for example, ways of examining large databases for anomalies, or consistencies, or averages, etc. - all helping bring down the cost of profiling the climate impacts of products. Head operations, but mostly products. And so, we actually getting on a beneficiary for two examples, technology plays a major role.

Emilio Asensi 29:09 Let me ask you, did you find any resistance to yet to adapt to new technology or to be innovative in your organization? Maybe not only internally, but also from your stakeholders outside?

If someone came up with an idea to use a new tool? And then what are the perspective of the people you would work with?

Interviewee Nr. 10 29:43 I think that there is a general feeling that technology, digitized approaches to maintaining, collecting and managing data are all seem to be generally beneficial. But the benefits of those had an uneven application across the market. So, for example a general very positive attitude toward the digitization of data. So, in other words, it's cheaper and easier to collect vast volumes and to interrogate those vast volumes of data, that's a pretty seated across the marketplace. And everybody knows that that's happening. And except that we've all got smartphones, and so on.

But what I was saying, then, is that it has an uneven impact on different actors in our marketplace. So, for example, here 15 years ago we would employ consultants to verify the carbon sequestered in a forest. And you know, that could be a $20,000 contract for a reasonably sized forest. Today we, the standards are now using satellite imagery to provide a substrate of data, which then gives very selectively ground truth, at a much lower cost. So that means that the verification bodies, verification companies like KPMG to DNV, those guys are being challenged to a bit of a disruption in their market. So that's

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one example of where I wouldn't call it resistance. But disruption it will always going to have its good and bad impact.

A secondary, which is slightly different to that is we have many of our projects in least developed economies. So, in Indonesia, Rwanda, Eritrea, Madagascar. And in those instances, labour is much cheaper than technology. And in some instances, there is no Wi Fi, there is no internet connectivity for remote location project. So, for them, it's not that they don't like the technology, they don't have access to it, they don't have access to things, either energy to power it, or internet coverage to access it. And also, they don't have the capital nor the inclination to adapt to that as speedily as we might think. They would like to, but they cannot because they don't have the capital, they don't have the capacity to install and use, in other words, people are not educated in tech, digitized tech, and also labour is a lot cheaper and in fact, employment is a bit of an issue. In other words, they'd rather have people do that than machines. So those are two examples of where I don't think people are against technology, but where they are barriers to its application.

Renars Kaulins 33:49 I'm actually thinking, I was just following the recent development of DNV and I saw that they're working on this digital carbon ecosystem. And they're planning to create a solution on how to put the big data on a platform, for example, if you as a consumer, you buy and drive an electric car, it would measure how much carbon footprint you have saved, and then you would be rewarded, you would receive your credits that you can later, for example, use to do a purchase somewhere else. And this can be also applied to companies where the data is being measured, and then you receive it in the form of a credit. And then of course, you can get a tax deduction, and then a different kind of incentives. This simply makes me ask if this is something that your organisation is looking into?

Interviewee Nr. 10 35:10 I think that's clear. You know, we have projects around the world that generate credits in very different ways. Some of them protecting forest from deforestation, some are about fuel efficiency, replacing high greenhouse gas and missing fuels. And when we purchase the credits, we get both the mitigation outcome and the story behind that.

So, for example, in America, we've had a project where these very large trucks that travel across America often leave the trucks running when they are sleeping at night. So, there you go. It's an intervention, which allows every truck to shut down and significantly reduces fuel use and having a sensor on every single truck to measure that reduction is a great thing. It's a fantastic thing. And it just means that as I made the point earlier, you can create an emission reduction at a cheaper cost, because the data is almost real time it's stream that can be processed according to a particular standard and then brought to market. So, in a sense, we are helped when those kinds of new applications of digital technology are applied. There's another example that I would give you. One of the classes of projects that our clients quite like is Clean Cookstoves. So, about a billion people around the world, cook with open fires where they chop down wood and create open fires in their dwellings. So, this would be in places like Rwanda, Kenya, Uganda. And not only are they destroying trees, in doing so, they create an enormous amount of air pollution within their dwellings, and a lot of greenhouse gas emissions from the burning of fuel. So, the Clean Cookstoves replace those open fires, and, you know, have much higher rates, effective rates of combustion, they reduce the air pollution completely within the dwellings, you know, a whole bunch of benefits. But one of the things that's quite difficult, when you're

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trying to verify whether the stoves have made a difference when actually reduced emissions. We don't know, if they're used all the time. So, what we've see now is the application of small RFID, or, sensors in the stoves, so that when the verifiers come along, they can download the sensor and say, yeah, this has been used every day for the last year.

And then obviously, as those communities get connected to the internet, you can actually upload that information on a real time basis and create carbon credits as a result of that. But not every community off grid community has access to that. We see opportunities for digitized information to really make our job, our access to credits, and more transparent and more effective.

Renars Kaulins 39:00 Yes, that's an interesting example. Actually, I didn't know about this before some really, interesting way to look at it. So as far as I can see there is a big demand at the moment from organizations to try to reduce their impact. And, and to me, it sounds like you are one of the most obvious choices or options on how to help them to doing so. This sounds like a very comprehensive operation. And I'm just curious to ask what the scale of your impact as an organization and I is believe you have a lot of partners around the world that are of course helping you in achieving this. But let's give it a more concrete example, you're working with a multinational and just to just to pick a company, for example, an H&M. The operations are massive, and therefore their footprint as well. What is the impact of your organization when it comes to these big organizations? How much of that impact that can actually reduce like?

Interviewee Nr. 10 40:31 I don't have the figures but if you go to Natural Capital, where can you look at our corporate responsibility report, I think we list how many companies we work with, and how many countries and how many tons of carbon dioxide we have, mitigated. We also talk about how many how much renewable energies we have helped our client’s access. So, you should find it quite easily in that link. So, you'll get a sense of it.

The short answer is we with h&m, for example, we've helped them over the years, support the hundred percent renewable energy goal with what we call Rex renewable energy, certificates and guarantees of origin. So that that would be included in it. The grand scheme of things - we work with 300 corporations, some of them 20% of which are very large. We don't work with the big images, we don't work with the big oil and gas companies, the steel manufacturers, the cement manufacturers. So, our impact in the grand scheme of climate mitigation is small. As we're saying, we're rounding in global ambitions. But we like to think that our impact with the carbon neutral protocol, and the solutions that we're giving, mainly to kind of leaders at this point, other than the bulk of all companies gives people a very simple, pragmatic, business focused entry point into taking responsibility for their emissions in a way that delivers value to them. Because when they communicate what they've done, going back to a question by using the certification mark, or making claims or making it part of this story, I mean, if you go to Microsoft's website, and you look at the search for the carbon fee you'll see that they built an entire program that is strongly embedded in a core business strategy on reducing their carbon impact. In that respect, I think you could measure our impact in terms of money that we've directed into the market of medication, which is in the sort of 10s of millions of dollars, you could measure in tons and kilowatt hours, megawatt hours of

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energy consumed. I'd like to say is that we can also then point to the fact that we are helping corporates take what can be very complicated and difficult first steps, in decarbonizing their product or their operation.

Renars Kaulins 43:40 Since there is so much of a need of actually reducing carbon emission and mitigating them, is there enough resources to actually pull these operations or as a demand is very high therefore high supply.

Interviewee Nr. 10 44:03 At the moment political will, is very low. As you probably noticed Akira protocol got kicked down the road by eight years until the Paris Agreement came in, as you probably know, the sound of subsequent are considered to be 30 to 40%, lower than what is needed to stabilize player climate at 2020 2 degrees. And even then, the commitments are not yet backed up by regulation of policy. The people that were the organizations that we work with tend to be climate leaders, people, organizations that are taking action, way ahead of business as usual. So, we work in a niche. And it means that for the most part, we believe that there are multiple, significant quantum of projects around the world that can generate, valuable mitigation outcomes that are not being funded, because it's a waste of money to them.

So, at this stage, I would say, that is real desire amongst our key partners, who are the project developers, we don't develop these projects. We be assigned contracts, what we call emission reduction, purchase agreements, or agreements for renewable energy certificates. We're not the boots on the ground, we help those projects generate carbon assets. In other words, the credits that can be used for carbon offsetting. But we don't actually make the projects happen. And you know, from our experience, right around the world, there are massive opportunities that are going on interest because of lack of finance or political will.

And then the other thing I would say, and this is sort of quite a dry thing is that if we run out of opportunities that we've solved the problem.

Renars Kaulins 45:59 Yes, right. That is the grand goal run out of business.

Emilio Asensi 46:15 I was actually curious about you were to say that you are working with these companies that want to be like the climate leaders in a sense, they want to be in the front, the front lines, but then it is quite a tricky position I will say. Because Microsoft, for example you can see that they have this good and bad perspective. But have you encountered them within these big companies, at some point that they are not really transparent in the sense that they have some resistance to keep their confidentiality in some respects?

Interviewee Nr. 10 46:54 When they aren't climate leaders, we probably not working with them? I think there are some companies that make claims that are not fully supported - greenwashing. There are some corporates who don't want to be leaders, you know, they saying - Look, we don't want to protect the pain and gain, the pain of taking action ahead of a mass commitment,

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because we can't solve this problem on our own, we got to wait for policy and regulation. So, there are a lot of reasons why the broad, massive companies will not act at this time. At a lot of that makes sense. And large part of our business is trying to make sure that corporates that are taking action, feel that they get rewarded for doing so by greater customer loyalty or recognition in civic society, that they better companies than others, that the risks of taking that action are low, in other words, that they won't be attacked by environmental NGOs, for example, that feel, that might say - Well, you know, that is meaningful. So, we have to make sure that the impact is understood and appreciated. But your question is quite pertinent. And I think across the corporate spectrum, there are companies at very different stages of this journey.

Interviewee Nr. 10 46:54 I just tried to sort of understand your question. I mean, I think there are some companies that make claims that are not fully supported - greenwashing. And I think there's a lot of that around, like, you know, largely, the certification market, we put out there is meant to try and prevent that are here to make sure that there are good ways of doing this. And maybe not so good ways. There are some corporates who don't want to be leaders, you know, they saying, look, we don't want to protect the pain and gain the pain of taking action ahead of, you know, a mass commitment, because we can't solve this problem on our own, we got to wait for policy and regulation. So, there are a lot of reasons why the broad, massive companies will not act at this time. At a lot of that makes sense. And, you know, large part of our business is trying to make sure that corporates that are taking action, feel that they get rewarded for doing so by greater customer loyalty or recognition in civic society, that they better companies than others, that the risks of taking that action are low, in other words, that they won't be attacked by environmental NGOs, for example, that feel, you know, that might say, Well, you know, that is meaningful. So, we have to make sure that the impact is understood and appreciated. But yeah, you know, your question is quite pertinent. And I think across the corporate spectrum, there are companies at very different stages of this journey.

Interviewee Nr. 10 48:54 Yes, so guys, I need to I need to get on. And I hope that's been helpful. I, I suspect that when, when I said yes, I might have mentioned that, you know, I'm always happy to support academic research I've read I read everything that we will do in in this so you know, that I've been involved in so you know, if you could send me a summary of your project or, you know, whatever is easy for you to do, when you're done hobby, very interesting to, you know, to read that.

It's the way in which I keep in touch with kind of latest thinking and research. So, I appreciate the work you're doing I hope to be able to see what you will come out and I'll find that interesting. And I wish you every success with you with your project.

Emilio Asensi 49:43 Thank you.

Renars Kaulins 49:47 Thank you so much for your time. It has been a pleasure talking to you and it's nice to hear a little bit more from your company's perspective and the operations. it will definitely help with our research. Hopefully we can share the results in the near future. Will keep you updated. And once again thank you for your time. Have a nice day!

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Interviewee Nr. 10 50:34 Thank you. Bye for now.