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Sustafy collects origin supply chain data to overcome new EU trade barriers, while creating the circumstances for systems-level transformation of the Indian crafts sector—and beyond. We're a project of The Jaipur Crafts Festival, which touches 13000+ maker lives; unifies 7000+ sustainable, fair trade, craft, social enterprises in 558+ countries, territories and villages. Everything we do activates a differentiation strategy to repair broken markets.
In less than a year, new EU regulations will prevent products without Digital Product Passports from entering the EU. Digital Product Passports are issued by GS1 and must document a product's supply chain, circularity, sustainability and marketing claims. The European Union buys 36% of India's crafts, which means there is urgency. Only pharmaceuticals, animal feeds and food are exempt. The critical legislation for our project is the European Commission's "Eco Design for Sustainable Products Regulation". Doing nothing is an existential risk for makers of India's marvelous crafts patrimony. Enforcement date: March 30th, 2024. There are 13 buckets of currently planned or enacted legislation that require supply chain transparency. G7 and G20 countries are considering their versions of similar legislation. Supply chain data will be the sea change.
Why | Why Now?
There is growing consensus every country needs to move towards resilient economies which are circular, sustainable and ultimately—regenerative. Until February 2022, the new EU regulations were more focused on climate goals. The March 2022 updates respond to Russia's invasion of Ukraine, a newly swaggering China and the pandemic—which pushed western countries into defensive postures that are de-linking from full globalization. The result is that increasingly, the west regards material and energy supply chains as vital to economic policy and national security.
Climate goals have been drivers of policy for many years. However, the security focus and defensive thinking are new. Official EU reports claim that digitized supply chains, supported by Digital Product Passports, are the keys that unlock self-reinforcing "Twin Transitions" of climate neutrality and sustainable economies. National security, social cohesion and strategic autonomy are baked into their definition of sustainable economies. The Twin Transitions are very closely linked. Failing on one means failing on both goals and a climate-neutral single market by 2050. "Green and Digital" are shorthand for the longer descriptions.
Stage One
The Sustafy Transparency Project helps each of the 13 legislation buckets being considered or already enacted in the EU and other large markets. The legislation requires documenting the individual origins of every product through the entire lifecycle and beyond. Sustafy is building a documentation UI on top of customized functionality based on Resources, Events, Agents Accounting (REA). REA is an ISO accepted flow-state accounting system and supply chain documentation methodology. REA is expressed as Resource Description Framework (RDF), which the accepted Web3 data model to facilitate data interoperability. The project foundation is a promising, low-cost, peer-to-peer Web3 technology called Holochain. Holochain has the best features of Blockchain without the high cost and problems of scale. We describe it as having the ethics baked-in. https://www.holochain.org/
Enacted or Under Consideration Global Legislation
1. German Supply Chain Act – This Supply Chain Due Diligence Act was approved in July 2021 and is planned to take effect on January 1, 2023. The legislation states that companies with 3,000 or more employees must take appropriate measures to respect human rights and the environment with their supply chains.
2. European Commission (EU) Conflict Minerals Regulation (Started 2017. In effect, January 1, 2021) – Ensures imported minerals and metals are derived from responsible sources only. Alongside, supporting the development of interdependent local communities.
3. European Commission (EU) Corporate Sustainability Due Diligence Directive Started February 2022. Expected to be in effect by 2024) – The draft legislation has passed and will require large EU organizations to detect, prevent and mitigate breaches of human rights, such as child labor, as well as environmental hazards in their supply chains.
4. European Commission (EU) Sustainability Textile Strategy (Started July 2022. In effect, now) – Fosters only durable, repairable, recyclable, and circular textiles/products that respect social rights.
5. European Commission (EU) Eco Design for Sustainable Products Regulation (Started March 2022. Expected to be in effect by May 2023. Product Seizures begin by May 2024) – Furthers greener, circular, energy-efficient products that disclose environmental sustainability information (via digital product passport). March 30th, 2024.
6. European Commission (EU) Corporate Sustainability Reporting Directive (CSRD) (Started March 2021. First Set of Standard Compliances begin by January 2024) – Upholds ESG+ Markets for investments, finances and accountability for community-based products.
7. European Commission (EU) Unfair Commercial Practices Directive (Stared March 2022. In effect now) – Fosters consumer protection from greenwashing and other false claims through e-commerce transparency.
8. European Commission (EU) Taxonomy Regulation (Started June 2020. In effect since July 2020) – establishes six environmental objectives viz. Climate change mitigation; climate change adaptation; sustainable use and protection of water and marine resources; circular economy transition; pollution prevention & control; protection & restoration of biodiversity and ecosystems that an economic activity has to meet in order to qualify as environmentally sustainable.
9. Swiss Code of Obligations – Effective in January 2022, supply chain reporting requirements relating to conflict minerals and child labor were added to the Swiss Code of Obligations.
10. USA's Security and Exchange Commission’s Climate Disclosure (SEC) (Started 2010. In effect, now) – Urges for all businesses with US Public companies to report climate-related financial disclosures.
11. New York Fashion Sustainability and Social Accountability Act – If passed, it will require New York fashion retailers and manufacturers with over $100 million in annual revenue to make required social and sustainability information available.
12. The USA Fabric Act – If passed, this would improve fair pay and sustainability.
13. California Transparency in Supply Chains Act– Signed into law in 2010, it requires large retailers and manufacturers to disclose activities focused on eradicating human trafficking from the supply chain and educating consumers on how to purchase goods from responsibly managed supply chains.
About Us
Sustafy is a project of the Jaipur Crafts Festival, which focuses on long-term projects in neglected areas like strategy, technology, data, urban planning and market development. Aiming for the level of causation brings the potential for changemaking at scale.
Everything we do activates a crafts differentiation strategy, which creates change via maker alignment. This project directly impacts over 12,000 pastoral people in India's Thar desert by keeping their sustainable wool available for sale in the EU. There are over 200 million Indian makers and many more globally who will face the same EU legislation. Project success means we could capture origin data at scale as an accelerant for systems change.
What We Do
Data is the key that unlocks circularity, traceability, pervasive measurement, sustainable products, data-driven decisions and AI models. We focus on long-term projects in neglected areas like strategy, technology, data, urban planning and market development. Aiming for causation, rather than direct services, brings the potential for changemaking at scale. Simultaneously, it reaches for the UN’s Millennium Development Goals and create freer, fairer, more transparent markets via an emerging Web3 platform that activates the quality, sustainability, fairness and circularity of things you use every day.
There is very little actionable data on smallholders, which makes it impossible for them to plan, grow, identify risk, satisfy markets, address externalities or activate changemakers.
We approach problems at the level of causation rather than focusing on direct needs, although we do that with festival activations, too. We use technocratic skills in strategy, data, technology, urban planning and market development for long-term projects that reach for Millennium Development Goals. We demonstrate four years of research and engagement that prioritze structural change, which is a less tended aspect of connection, commitment and changemaking in India's crafts sector
SMALLHOLDERS | The Bottom 25%
What if Web3 technology could simplify selling, shipping and getting paid so the bottom 25% could breathe easier and focus on making.
Smallholders create the world's most beautiful, delicious and sustainable products: handmade textiles, jewelry and coffee, cocoa/chocolate, rice. corn. cereals, vegetables, fruits and livestock
Global food security, collected cultural memory and untapped economic growth—and resilience in general reside with the world's 2 billion smallholder farmer and maker livelihoods. What happens if the bottom 25% gains access to new markets, finance, land security and higher bargaining power that comes with technology? What if these tools lead to self-organized cooperatives, greater inclusion and equity that reinforces democracy?
What if we could preserve traditional techniques that prioritize soil health, water conservation, biodiversity.regenerative, greater ecological resilience and health.
Copyright 2023, Scott Frankum and Nilesh Yadav
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