Sustainability in the Food Supply Chain: Hype or Trend?
25th January 2008 by Cor Groenveld1 Comment
A roundtable discussion was recently organised by LRQA’s Netherlands office. The focus was on sustainability in the Food Supply Chain. Participants were Bert Urlings (responsible for food safety, animal heath and certification at Vion Food Group, the largest meat company in Europe), Suzan Horst (working as Corporate Quality Manager for Campina, a global operating Dairy company), Olaf van Kooten (Professor in Agricultural Supply Chains at the Wageningen Food University in the Netherlands), and Cor Groenveld (Food Technologist and Global Product Manager Food Services for LRQA).
Here is a brief synopsis of the topics covered and the key points raised.
Why is the interest in sustainability growing?
The Food Supply Chain is one of the most complex and largest industry sectors in the world. Assuring risks like food safety and quality has always been one of the priorities of the different stakeholders like the retailers, food companies and food authorities. This is understandable because it involves the consumers directly and insufficient control can lead to high impact on the costs and brand image of food manufacturers and retailers. But recently, sustainability risks involving the environmental, social and ethical and animal healthcare issues get more and more attention.
What is sustainable food?
The round table discussion showed that sustainability is becoming part of the mission and strategy of most food companies, starting with the larger international operating ones in developed countries. This is mainly driven by the consumers and retailers who ask for sustainable and safe food products and the growing legislation on sustainable issues like environment and social responsibility. These requirements and needs are being transferred through the whole supply chain. What is important is to translate sustainability for your own organisation. This requires a tailor made approach, depending on the type of products, processes, raw materials and the requirements and needs of the clients and stakeholders of an organisation. For example, when animals are involved, animal healthcare will be of importance and when raw materials are sourced from developing countries, social responsibility and environmental issues will have a high impact. A food organisation has to address its objectives towards sustainability.
How to achieve assurance of sustainability?
Once an organisation has addressed its sustainability objectives, assurance can be achieved by a risk based approach. The sustainable aspects that are important for an organisation can be part of a Hazard and Risk analysis that will identify the critical control points and address the control measures needed. When this is integrated in the risk based management system of the organisation, the sustainability hazards and risks can be assured in the same way as food safety and quality risks. A supply chain approach is needed to identify all risks and assure that their control is at the right place.
What is the influence for developing countries?
There are two opinions on this. But for both, there is a difference between food companies that produce for their local market of those that produce for an international market. Specially when producing for the international market of retailers, food companies will get more and more pressure from their clients to meet sustainability requirements.
The positive effect is that the companies can develop and improve themselves to get connection to international requirements and markets. An example is three hundred farmers in Thailand who were supported to meet an international standard for vegetables and now have entrance to the global market.
The negative impact can be the difficulty for companies to meet these requirements and get entrance to the international markets. In some developing countries you see a few companies who achieve the high level of client requirements because of high investments, and hundreds of small companies who can not meet this and have the risk to be beaten by this competition. Another example is the eight hundred million farmers in China. The Chinese government is having big problems to keep them active as farmers in the countryside. The difficulty to stay compatible drives them to the big cities. To avoid this, an approach where the smaller manufacturers are supported to meet the international requirements is needed.
Are we prepared to pay the price for sustainable food products?
This depends per country and specific consumers but in general consumers are not often willing to pay a higher price for sustainability. Partly this is understandable, because a number of sustainability issues are already normal expectations. Consumers expect that animal welfare and social/ethical responsibility is already assured. Often we see that the consumer is not aware of the assurance in practice. When examples of incidents are published the awareness and interest in sustainability suddenly grows. On the other side a growing number of sustainability requirements will increase costs in the supply chain. And someone has to pay this bill. It is a fact that when consumers are willing to pay higher prices for sustainable food the drive to implement this can grow faster. Getting consumers prepared to pay higher prices for sustainable food products is also a case of good manufacturing. Some bottles of mineral water have a higher price than a bottle of milk.
But we also have to realise that not all sustainability improvements need to increase costs. Examples of decreasing costs are measures that reduce the use of energy or the recycling of water.
Is sustainability a hype of a trend?
Important issues like social responsibility, climate change, animal health and the reducing availability of sources, require strategy and objectives for sustainability. But in certain cases there is risk that under influence of the public opinion and non scientific information it will become a hype. Therefore close cooperation between stakeholders, good information for consumers and scientific approaches and evidence is needed.
So it is definitely a trend, but together we have to assure that it does not dissolve into hype!
Cor Groenveld is the Global Product Manager for the food services of Lloyd’s Register Quality Assurance Ltd. (
19th April 2008 at 12:41 am
I think that food supply chains have a significant impact on the environment. But we tend to focus on the issues that mainstream media presents to us (e.g. food miles, carbon footprints, etc). Companies should in fact focus on three main aspects:
(a) Operational issues. Aspects such as the effect of primary production on climate change, the impact of freight transport (Food Miles) and food and packaging waste are all operational issues.
(b) Consumer issues, which encompass consumer attitudes to environmental drivers and the impact of food consumption trends on greenhouse gas emissions.
(c) Corporate issues, which include standards and regulations, financial risks, carbon trading and offsets.
All these angles are important when environmental initiatives need to be encompassed into a company’s strategic planning.
I wrote an article about this particular issue, from an Australian perspective. It is freely available at my website:
http://www.food-chain.com.au/Cold_Chain_Consulting_newsletter.html
Regards