If I ask people in the sustainability field which company this statement describes, maybe some would know it is Mars.
“The company’s objective is the manufacture and distribution of food products in such a manner as to promote a mutuality of service and benefits among consumers, distributors, competitors, our direct suppliers of goods and services, governmental bodies.”
I doubt though anyone would guess that it was written in 1947. It comes from Forrest E. Mars, Sr. and reflects the unique philosophy and heritage of Mars, which has grown to become a $30 billion company, selling confectionery, pet food, and other food products worldwide.
The Mars family, which still owns the company, expanded Mars Sr.’s thoughts into the Mars Five Principles (quality, responsibility, mutuality, efficiency and freedom), which have been the compass of the company since 1983. The principals shaped Mars’ sustainability policies, which include very ambitious goals, especially with regards to Mars’ supply chain that is responsible for 60 percent of the company’s carbon footprint. For example, Mars aims to source 100 percent of some of its main materials, like coffee, cocoa and fish and seafood from certified sources in the next couple of years.
I had the chance to meet with Andrew Hobday, the company’s Chief Sustainability Officer at the Responsible Business Summit in New York and learn more about the company’s efforts and challenges.
TriplePundit: What is the level of support sustainability efforts receive from Mars’ management?
Andrew Hobday: In some ways I have quite an easy job because we’re a private business and the fundamental principles of Mars, which started with the idea of mutuality benefits that Forrest Mars, Sr. introduced in 1947, which then translated into the five principles about 30 years later means that I’m not trying to persuade the company to do something new and different. In that sense the job is relatively easy because we have significant support from the owners of the business and senior managers who live these principles on day to day basis.
3p: Given Mars’ history and commitment, do you still need to make the business case for sustainability?
AH: Yes, absolutely. Having said that we got the history and the heritage and the privilege if you like of inheriting those principles, we’re still a business working in a competitive world and trying to do our best in the marketplace. So that means we have to play by the same rules like everybody else. So my job really is to take those sustainability issues, opportunities and challenges and then find the way to convert them to performance benefits. We talk about it in Mars as making a difference to people and planet through performance.
I very rarely have the situation where doing the right thing and doing the sustainable thing can’t be made into a good business case. But that’s the challenge – we’re not trying to do philanthropy here within the business. We try to make the Mars business a successful business, but do the right thing on people and planet bases as well.
3p: How do your suppliers react to your efforts to embed sustainability in your supply chain?
AH: Most of our raw materials come from the agricultural sector. If you accept that the world is not going to have more land to grow things on in the next 50 years it means that many of the activities the agricultural sector engages in will have to change. We’re not farmers ourselves. We don’t own farms, but what we want to do is provide a number of mechanisms to help the agricultural sector to not only exist, but also prosper in the next 50 years. Without a prosperous agricultural sector we won’t get the materials we need.
So we’re trying to do it with a lot of education, including in our cocoa centers, which we see as critical for accessing people in the supply chain. Our job is to try and find the best mechanism for talking to the farmers. In many cases that’s education.
3p: When you address all of these challenges, do you feel the effort should be focused on the company level or on collaborations between companies?
AH: It depends which problem you want to address and specifically where it sits in the supply chain. So for example on the beats that we control in 100 percent – factories and our operations – we can do it on our own. When you go outside our four walls and particularly upstream, problems and challenges of agriculture and farming will not be solved by Mars alone. They require a collaborative approach.
3p: Do your customers care about all the efforts to make your products more sustainable?
AH: One of the biggest challenges we’ve got, and not just Mars but those of us who operate in the consumer products industry, is trying to get consumers to both understand and ultimately change their behavior. We’re doing a lot of work on this at the moment, and the evidence is that understanding is pretty limited – up to 80 percent of consumers say they’re concerned about this stuff, but it’s not translating into buying behavior, or only at a limited level.
I’m sure it will come and it’s definitely shifting, but it’s by no means a significant factor, so at the moment most of our effort is going into other benefits around the supply chain, while we’re still figuring out how best to address the consumer opportunity.
Raz Godelnik is the co-founder of Eco-Libris, a green company working to green up the book industry in the digital age. He is an adjunct faculty at the University of Delaware’s Business School, CUNY and the New School, teaching courses in green business and new product development.