Sustainable Value: an application to the Swiss dairy farms of the mountainous area

The improvement of the sustainable performance of the agricultural sector is a priority of the Swiss agricultural policy. The sustainability of Swiss dairy farms located in the mountainous area might be critical as many of them show a weak performance in the use of their economic and/or social resources, and sometimes also of their environmental resources. An improvement of the sustainability of these farms prerequisites to better know on a large scale their sustainable performance and its determinants. For a representative sample of 480 dairy farms, we perform an assessment of their sustainable efficiency with the “sustainable value”, an approach to assess corporate sustainability based on the capital and opportunity cost theories. Using a linear regression, we analyze the determinants of the sustainable efficiency. The results show a tight positive relationship between sustainable performance and pure economic performance. The intensity of the use of intermediate consumptions is found to be the most important determinant of the sustainable efficiency. Farms with a high sustainable efficiency are those that use their intermediate consumptions in the most efficient way. The part of direct payments in the gross profit is shown to negatively affect the sustainable efficiency. The structural characteristics of the farms and the sociologic characteristics of the farmer managers are shown to hardly influence the sustainable efficiency.