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The Australian agriculture industry is at a pivotal moment, facing evolving consumer expectations for the environmental, social and governance (ESG) attributes of food products.

Changing consumer expectations, particularly for credence attributes, such as environmental and social considerations, animal welfare, and health and wellbeing, are significantly affecting on-farm practices and the agriculture sector more broadly. Increasingly globalised markets and longer food supply chains have contributed to further distancing consumers from food producers, leading to limited understanding of agricultural practices and the values of food systems among consumers.

This report by ACIL Allen Consulting analyses the influence of changing consumer expectations and ESG and social licence to operate on a producer’s ability to maintain market access and the prices they receive for their products. The aim was to provide comprehensive information on how producers and emerging industries can respond to these changes through standards, certification and accreditation schemes.

While credence attributes, such as environmental and social impacts, are challenging for consumers to assess independently, the analysis found that standards, certification and accreditation schemes bridge the information gap between producers and consumers, and can be used by producers to achieve price premiums and secure market access. However, the complexity and cost of compliance can be significant, which poses opportunities and challenges. Trends also demonstrate some certifications have increasingly become a prerequisite for market access, rather than a marketing tool.

To address these findings, the report makes strategic recommendations for producers and industry stakeholders to address evolving consumer demands. The recommendations focus on developing a greater understanding of market requirements, quantifying the value consumers place on credence attributes, assessing value flow from certification practices, and identifying threats to social licence.

This report supports AgriFutures Australia’s ambition to grow the long-term prosperity of Australian rural industries. Most of AgriFutures Australia’s publications are available for viewing, free download or purchase online at AgriFutures Australia’s website.