The theme of Traceability and Transparency is critical to achieving the aims of the FACT Dialogue. In part, this is because systems and technologies that enable traceability and transparency of commodities provide the basis for certification schemes and assurance of origin. They also support efforts by national governments to apply and enforce laws that underpin: sustainable production; work by companies to ensure sustainable sourcing of commodities; and efforts by stakeholders and civil society to enhance accountability. They can also help to underpin investor confidence.

Traceability and  transparency may have different meanings, depending on the circumstances. In this context, traceabilityrefers to the ability of an actor in the system to link a product with information about its history of locations, owners, and transformations between points in the supply chain, such as from production site to end user.

Transparency refers to how this information is made available. This will often refer directly to the traceability of commodities, but can include broader information such as sustainability policies and practices, commitments, land use information and monitoring. There can be different levels of transparency, from information sharing within an organization, to sharing with stakeholders, to sharing publicly.

Strong traceability and transparency can underpin objectives set by both the public and private sectors to follow supply chains and, in cases where forests are under threat, work to address forest loss. Traceability and transparency in supply chains for commodities is necessary to understand the impact of commodities on forests, and to support the design, implementation, monitoring of effective solutions to address forest loss. This can help make agricultural production and food systems more sustainable.

Work by the FACT Dialogue under this thematic area began by identifying measures and opportunities for greater collaboration, drawing on technological developments, digital innovation and institutional strengthening, to facilitate increased trade in sustainable agricultural commodities. This work also aims to enhance the protection and the sustainable management of forest and other critical ecosystems.

Informed by discussions held between countries participating in FACT, the UK and Ghana, as co-facilitators of this thematic working group, identified the following actions for further discussion, development, and implementation:

1. Assess existing traceability and transparency systems and identify the most significant data gaps that need to be addressed to enhance these systems in international forest and agricultural commodity supply chains.
2. Develop a set of guidelines, working with international organisations and building from existing initiatives, that will help to inform national government approaches to data sharing and data management on forest and agricultural production, and commodity supply chains. These guidelines should promote compliance with national laws and policies, and enable better monitoring and protection of forests and other critical ecosystems. They would recognise the importance of existing government and stakeholder commitments, costs, technology, interoperability, and accessibility while protecting vulnerable people. In recognition that countries face different challenges in developing their data systems, and to encourage continuous improvement, the guidelines could also recommend ways for governments to further raise ambition. They would also explore in due course how best to apply the guidelines within the international system.
3. Support countries and stakeholders to identify and access funding, technical assistance and capacity building to strengthen traceability and transparency systems and promote interoperability between systems.

FACT member countries are exploring and identifying gaps to support ongoing technological developments and improve systems around the world concerning traceability and transparency. Work coninues to identify where countries need guidance to enhance and improve traceability and transparency systems, especially related to new regulations concerning sustainability and trade.

To that end, a number of FACT member countries have been preparing for the changing regulatory landscape, which is bringing amended market requirements and regulations. This includes the European Union’s Deforestation Regulation (EUDR) and the UK’s Forest Risk Commodity (UKFRC) Regulations, for example. In response, national approaches to traceability systems for coffee and cocoa in Cote d’Ivoire and in Ghana, to cite two examples, highlight the progress being made by countries in the implementation of new systems and requirements.