Since sustainable development was highlighted in 1987 as an important issue by the then World Commission on Environment and Development, many countries and firms have pursued excellence in sustainable practices related to the environment, human resource management and quality management. To some extent, the agricultural sector has led this shift.
However, discussions of sustainable agricultural supply chains count for only one-tenth of the total literature on sustainable supply chains. Much research has focused on separate sustainable practices (rather than taking a holistic view), and this has potentially under-estimated the effect of such practices on national supply chain operations. While sustainable agricultural supply chains are important to a country's economic development, concerns about food safety have become a major issue for supply chains following food recalls around the world. Moreover, a relative lack of attention to farmers as the first stage of the agri-food chain has inhibited the application of sustainable supply chain management in Indonesia's agricultural sector.
This thesis examines the role of sustainable supply chain management in Indonesia's cocoa industry. It argues that Indonesia's agricultural supply chains are linked to its economic development, and that this link is as strong as that in any other country. Indonesia's cocoa supply chain serves as an example for understanding how sustainable practices can be implemented in the agricultural supply chain as a whole: cocoa is an essential agricultural commodity in many countries, and it plays an important role in the international food market. The cocoa industry itself employs millions of farmers worldwide, contributes significantly to eradicating poverty in many countries, and provides employment downstream and upstream. In Indonesia, it has faced several impediments to the introduction of sustainable practices, such as the low incomes of farmers, the use of child labour, and the use of conventional transport vehicles for commercial purposes.
The results of the research suggest that implementing various sustainable practices in each stage of the supply chain determines the performance of the supply chain as a whole. That is, implementing a sustainable practice in one link of the supply chain will affect not only the immediate parts of the chain but also its final stages. The results also suggest that contingencies such as mutual trust, long-term relationships and the degree of information sharing will determine how successfully sustainable practices can be adopted and, hence, their effect on supply chain performance.
© 2013 Normansyah Syahruddin