In many ways, the financial viability of a smallholder farmer, a community forestry operation or the owner of a fishing boat faces some of the same constraints and considerations as the largest multinational company: they sometimes need access to credit for supplies or infrastructure; they value a diversified income stream; their assets are important to track and grow; and their successful operation depends on the full legal right to conduct business where they do. When these needs are not met, the financial health of their operation – and of any workers they employ – is jeopardized.
Supply chain tools that improve sustainability recognize the importance of these aspects of business management to their participants’ livelihoods and strive to put conditions in place that will help them meet the challenges. Many standards and standards-like tools provide training on business skills such as recordkeeping and planning. Being a participant in these programmes and supply chain interventions can improve access to credit. In the forestry sector, standards and certifications often provide training that focuses on value-added processing and developing markets for some of the forest’s ‘lesser known species,’ which often would otherwise go to waste. Several tools and programmes in agriculture focus on diversifying livelihood options for farmers such as introducing honey, dairy or aloe vera production on farms and alongside cattle ranches to boost income and enhance business opportunities that can stem youth migrating away from rural farming communities.
Wages, income and yield are also important aspects of livelihoods; these are described in sections Worker Wages and Rights, and Participant Costs and Benefits.
Some resources that examine the impact of various approaches and tools on livelihoods are as follows:
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