Value chain governance Progress report 2008-2009

This document reports on the first year of the DPRN process entitled ‘Value chains, social inclusion and local economic development’, as organised by the Institute of Social Studies (ISS/EUR), Wageningen University (WUR), Woord & Daad, HIVOS, ICCO, Concept Fruits BV and the Ministry of Agriculture, Nature and Food Quality (LNV). International trade is increasingly undertaken through organised global value chains in which quality competition plays a central role. Quality competition is achieved by means of increasingly complex standards and the introduction of new technologies at the level of individual links in the chain, as well as at the level of their interaction (transaction and logistics) and therefore for the chain as a whole. These requirements and their associated costs make networked markets an increasingly predominant form of exchange. Chain governance consequently denotes the manner in which the various actors in the chain, namely firms, governments and NGOs, are coordinated. It shapes how standards are defined, implemented and enforced. This proposal concerns the degree of inclusion of governance mechanisms within a value chain configuration.