Swimming in Their Own Direction: Explaining Variation in Responses to Transnational Sustainability Governance in Asia’s Aquaculture Sector

To ensure product quality and safety and promote corporate social responsibility, food retailers increasingly require their suppliers to comply with private sustainability standards through eco-certification. Over the last two decades, the use of such certification schemes as an approach of regulatory governance have become particularly prominent in global value chains (GVCs) of several agricultural commodities including seafood, coffee, and cocoa. Many stakeholders believe that the relevant certification schemes can fill the regulatory void left by the state to promote sustainable production, especially in the Global South where state sustainability regulation tends to be weak. However, in recent years, an increasing number of studies began to question the implementation of transnational regulatory governance in many Southern producing countries. To explain challenges that private regulatory governance face in developing countries, existing research often highlights lack of capacity, be technical or financial, of Southern producers to comply with transnational rules. However, this perspective is too narrow to capture the impact of specific local contexts on transnational private regulatory governance and various homegrown initiatives in the Global South to promote sustainable production. What explains variation in the design and features of sustainable commodity governance led by Southern actors? The paper argues that local political economy in producing countries can shape Southern actors’ responses to transnational private governance, and accordingly limit the impacts of the relevant transnational regulatory schemes. It offers a novel conceptualization by identifying two types of Southern responses to transnational regulatory governance in GVCs: domestic standards and bottom-up capability-building programs. Drawing on data collected from in-depth fieldwork, the paper compares the cases of sustainable aquaculture governance in three Asian producing countries - China, Vietnam, and Thailand. As major aquaculture suppliers of Northern markets, all three countries receive pressure from their Northern buyers on the adoption of private sustainability standards. Despite similar challenges to comply with transnational governance, these countries have reacted in different ways because of local political economy contexts leading to different actors supplying homegrown initiatives. The study makes two novel contributions to the burgeoning literature on the interface between private regulatory governance and GVCs. First, it provides new insights into interaction between domestic political economy and transnational governance in the GVC context, highlighting challenges that private regulatory governance face in the non-democratic context. Second, it sheds light on eco-certification’s limitations as a tool of regulatory governance to promote sustainable production in GVCs, indicating that third-party verification cannot ensure rule compliance.