Advanced Management Control and Sustainable Development Food Value Chain: FAO-Developing Sustainable Food Value Chains: guiding principles Lecture 5: Concept and Framework NOTA: per sostituire un'immagine selezionarla ed eliminarla, quindi usare l'icona Inserisci immagine per sostituirla con l'immagine desiderata. Prof. Angelo Riccaboni University of Siena Department of Business and Law angelo.riccaboni@unisi.it

Agenda Definition of Sustainable Food Value Chain Value Creation in Value Chains Related Concepts related to Value Chain The Sustainable Food Value Chain Framework Sustainability of the Value Chain

Definition of Sustainable Food Value Chain “the full range of farms and firms and their successive coordinated value- adding activities that produce particular raw agricultural materials and transform them into particular food products that are sold to final consumers and disposed of after use, in a manner that is profitable throughout, has broad-based benefits for society and does not permanently deplete natural resources.”

Value Creation in Value Chain Value in a Value Chain is captured in 5 ways: Salaries for employees Net profits for asset owners Tax revenues Consumer surplus Externalities negative effects – cost to society positive effects - value to society

Value Creation in Value Chain Objectives of Value Chain are: Efficiently capture value in end markets Generate profits Create mutually acceptable outcomes for all farmers and firms Eliminate inefficiencies Core aspects of competitiveness in the Value Chains: Adoption of greener operations Social and environmental operations can create value and are source of competitiveness

Related Concepts related to Value Chain Filierè Supply chain Sub-sector Global commodity chain Porter’s VC Net-chain Inclusive business model Food system Land-scape system

The Sustainable Food Value Chain Framework The core functions of the Value Chian: Production Aggregation Processing Distribution The Governance of Value Chain- is the nature of the linkages between actors in particular stages (horizontal linkages) and within the overall chain (vertical linkages)

The Sustainable Food Value Chain Framework The Value Chain actors are supported by following business development support providers: Provide seeds at the production level, or packaging materials at processing level; Providers of physical inputs Provide services such as field spaying, storage, transport, laboratory testing, management training, market research and processing; Providers of non-financial services Play a crucial role in the sustainable growth of the company, due to proving working capital and investment capital Providers of financial services

The Sustainable Food Value Chain Framework Societal elements Informal sociocultural elements Formal institutional elements Organizational elements Infrastructural elements Environmental elements Soils Air Water Biodiversity Value Chain actors and support providers operate in a enabling environment with particular societal and environmental elements.

Sustainability of the Value Chain Economic dimension Social dimension Environmental dimension VC is sustainable if the required activities are commercially viable (profitable for commercial services) and fiscally viable (for public services) VC is sustainable, when sustainability refers to socially and culturally acceptable outcomes in terms of distribution of benefits and costs associated with increased value creation VC is sustainable, when sustainability is determined largely by the ability of VC actors to show little or no negative impact on the natural environment from their value adding activities.