No more greenwash: the era of data-driven sustainability
Marcel Koks, Industry & Solution Strategy Director, Food & Beverage, Infor, asks how food manufacturers can practice what they preach when it comes to delivering on sustainability commitments
Consumer and investor pressure on the food industry to embrace sustainability is stronger than ever. In the past, greenwashing was very much the order of the day for many businesses, talking-the-talk on sustainability without actually walking-the-walk. More recently, we’ve seen a distinct shift in sustainability efforts within the industry, with firms now taking the necessary steps to implement more sustainable practices, reducing waste and carbon footprints right across the supply chain.
But why now for this increased focus on sustainability and, aside from the CSR (corporate social responsibility) implications, are there other benefits for food processors and manufacturers in particular? And, perhaps most importantly, what does sustainability look like in practice and how can firms ensure they fulfil their promises, doing away with the greenwash and implementing a strategy that delivers?
The Food and Agriculture Organization (FAO) estimates that we will need to produce 60% more food by 2050 if we’re to feed a global population that’s expected to hit 9.3 billion. That’s no mean feat and certainly something that will take a heavy toll on the planet if things carry on as usual, with resource-intensive farming, production and distribution processes simply unsustainable long-term when you’re dealing with such large volumes. Add to this the fact that roughly one third of all food produced in the world is wasted each and every year, and the potential problem just gets even bigger. If production is to increase to meet demand, waste has to be reduced substantially.
While there’s no specific regulation at the moment, we’re seeing more food production businesses voluntarily aligning themselves to the United Nation’s Sustainable Development Goals, recognising the importance of putting the right processes in place. More retailers are insisting on robust sustainability credentials from their suppliers in an effort to not only meet their CSR objectives, but to differentiate themselves from the competition in a marketplace where customers are increasingly environmentally conscious, particularly when it comes to the carbon footprints of the products they consume. These demands on suppliers will only increase. Leave it too late to implement an effective sustainability strategy and food processors run the risk of finding it both impractical and unaffordable to put one in place, trailing in the wake of their more environmentally proactive competitors.
But what about those producers supplying retailers for whom sustainability will never be viewed as a competitive advantage? Aside from image and CSR, what’s driving them to embrace sustainability? Well, eventually legislation and regulations will come into force which stipulate just what represents sustainable production, so getting ahead of the game makes real sense. There’s also the potential to develop new revenue streams, turning by-products and waste into additional sources of profitability, such as animal feed or biofuels and we’re already seeing some manufacturers making a success of this approach, boosting profits while moving steadily towards zero-waste operations.
Sustainability in practice
In an effort to achieve these sustainability goals, what exactly do food manufacturers need to do? As mentioned before, waste reduction is key and not just in terms of waste products but relevant to efficient working practices too, minimising the amount of water and energy wasted through inefficient operations, with a view to reducing the overall carbon footprint of individual products.
This doesn’t just apply to the producers though, with any serious commitment to sustainability reliant on examining the issue of sustainability right across the wider supply chain. Operations can be as sustainable and environmentally responsible as possible in the factory, but it’s vital that sustainable processes are the order of the day outside of this, both upstream and downstream, from farm to fork.
This need to demonstrate supply-chain wide sustainability has seen some food manufacturers localising their supply chains where possible, as well as demanding proof from their suppliers of sustainable practices. They’ve also adapted packaging and reassessed their transportation methods, as well as striving to optimise in-factory efficiencies. Some are even helping to educate consumers as to how they too can play their role in the sustainability agenda, be that by recycling responsibly or changing their understanding of best-before and use-by dates. Savvy businesses are implementing sustainability measures right across the supply chain, making it part of the very fabric of the organisation. But, that’s still not enough.
Often, it’s the bringing together of all this information that’s the biggest hurdle. The onus is usually on food manufacturers to provide this comprehensive, supply-chain wide information to retailers, demonstrating not only their own environmental credentials but the sustainability of individual products too.
Technology as an enabler
This is where the right technology can help, delivering the right platform where the manufacturer can collect the necessary information, from both internal and external sources, and pass it on to the retailer. It really goes hand-in-hand with traceability, facilitating a transparency of operations, right across the supply chain, to deliver the right information, in the right format, in context, at the right time. The most effective systems can connect all the dots within the supply chain, capturing data from farm to fork, applying analytics and advanced AI to this data to deliver the insight needed to drive decision-making that will improve not only sustainability, but food safety and overall supply chain transparency too. Additionally, this comprehensive visibility across the entire breadth of the supply chain, both up and downstream, informs more accurate demand planning, with this increased planning precision helping to drive down waste further still.
While this is obviously beneficial to the food manufacturer as it evidences the sustainable credentials and carbon footprints of their processes and products, the information and insight available are also of use in other ways. The access to this comprehensive data highlights any supply chain bottlenecks or inefficiencies, pinpointing exactly where improvements can be made to achieve sustainability goals and also to optimise operational efficiency, streamlining processes and reaping significant cost savings at the same time.
Ultimately, with the right tools in place, food manufacturers can pursue data-driven improvements in sustainability right across the supply chain. The right technology affords access to the quality and transparency of information that’s needed to make real in-roads into delivering on sustainability promises, securing substantial cost and efficiency savings in the process. With the pressure to demonstrate a real commitment to sustainability showing no signs of abating any time soon, food manufacturers should act now, leaving any signs of greenwash behind and truly delivering on their sustainability promises.