Market governance is viewed as a potentially effective mechanism to achieve more sustainable global production-to-consumption systems when state regulation is uncoordinated between production and consumption regions.

Through examining a key global food sector, the soy–meat value chain, we assess how effective market governance is in practice. Supply chain approaches have proliferated in this sector, ranging from the first deforestation-free supply chain sectoral standard to eco-labeling and collective action on various topics.

To assess how effective these policy instruments are, the article examines the choices in sustainability made by leading companies in the sector and then analyses how coordinated these initiatives have been across the supply chain. It then assesses, via a literature review, which actors are setting “rules of the game” for sustainability, and the impacts of these on coordination and on-the-ground impacts.

It shows that companies along the soy–meat value chain have made different sustainability commitments, probably because they face very different risk factors: upstream actors such as soy traders are concerned mainly with international pressures associated with deforestation, while those further downstream have objectives on topics such as animal welfare, climate change and human health.

The authors find that supply chain initiatives do not sufficiently address the causes and effects of key drivers of sectoral impacts such as land appreciation and the global demand for cheap meat. Further, because the soy–meat sector is vertically integrated both upstream and downstream, business actors may not be able to impose sustainability norms without incurring costs or causing perverse outcomes.

A lack of coordination in market governance is translating into various instruments (e.g. certification) having low uptake, or costs and responsibilities falling onto soy producers (e.g. deforestation-free standards such as the Amazon Soy Moratorium). A perverse outcome of the latter is the displacement of impacts onto other regions and commodities.

In light of these challenges in market governance, the authors encourage more emphasis on network governance, which involves social interactions to build trust, vision, and exchanges of information and resources (e.g. between Brazil and China and Europe) – which are particularly important in the early phases of transitions for systems facing sustainability gridlock.