Singapore-based Rubber Study Group (RSG) developed a sustainable plan for the rubber industry

This article is not just focus on one business, but an industry. It tells that Singapore-based Rubber Study Group (RSG) is developing a sustainable plan for the rubber industry to overcome the bottleneck it faced with during the development. The plan is trying to give the industry a new, important mission of trying to balance its commercial success while not being overly destructive of the environment
The snapshot of the industry: * The industry structure is fragmented: An overwhelming 85% of rubber production comes from small growers. So there is not unit sustainable standard currently. * Natural rubber has a long history of being cultivated for commercial uses. It prices increased a lot in the past 10 years and the total market value is more than $30 billion annually. * Increasing demand spurs planting of rubber in new areas.
Firstly, I think the plan will be helpful to set up the standard rules of the industry. We can see from the article that rubber produced by emerging producing countries and small growers are filled with a lot of impurities. If standard of product exists, those inferior products will not come into the market. This will on some level increase the industry entry barrier and weed out some small growers. Not only the business environment is improved, consumer’s rights are also protected. Besides, from the article we know that about 85% of natural rubber is produced by smallholders and tire producers purchase around 70% of total natural rubber placed on the global market. The plan will help the suppliers and customers communicate more efficiently. Stable cooperative relationship between the two counterparties will help to keep a stable supply system, including a price without too much fluctuation.
Because of the demand for natural rubber, there is a lot of large-scale investment in emerging countries. One issue involves the use of forested versus degraded land. RSG encourages using degraded forest, and this initiative encourages this type of cultivation versus cutting down forested land. A comprehensive range of social issues, like land use shift, tenure rights, food security, are also within the broader impact on large-scale investments. Also, when land is given for rubber cultivation, investors have to ensure food security for residents in the area first before they can cultivate a non-food crop like rubber. RSG helps to ensure a balance between the two crops.
It is also mentioned that because rubber trees absorb carbon, large tracts of planting will lead to habitat loss for birds, elephants, tigers and other wildlife in the region, and also disrupt water movement, they argue. RSG’s plan takes the environment endurance into consideration in the circumstance of plant expanding.
I think such a plan will help to improve the industry in both economy and society side. This article is also a good example about an organization helping to enhance the relationship between business and environment. I think this kind of organization is necessary in the fragmented industries. Although the organization itself is not a business, it can help to integrate the separate and near sighted small entities, also can help to connect the industry with its upward and downward chains.

http://blogs.wsj.com/searealtime/2013/09/03/rubber-study-group-looks-for-sustainability-plan/?KEYWORDS=sustainability