The Hershey Co. last week announced updates to its palm oil sourcing policy that provide more specific standards for growers to meet under its 2013 commitment to 100 percent sustainable and traceable palm oil. The updates fall largely in line with existing industry standards on sustainable growing practices but, with the help of a nonprofit supply chain consultant, denote an increased focus on traceability — a growing trend across the consumer products industry.
The new supplier standards include clarifications on previous commitments to avoid environmentally impactful growing practices like deforestation and peat farming. They also help to define best practices through international labor and human rights standards from the United Nations and the International Labor Organization. Hershey’s updated standards match existing standards for responsible farming from the industry’s leading certification group, the Roundtable on Sustainable Palm Oil (RSPO), which Hershey joined in 2011.
Earlier this year, the Pennsylvania-based company said it had met its goal of buying 100 percent “mass balance” RSPO certified palm oil — a mixture of sustainable-certified and conventional palm oils — a year ahead of its stated 2015 goal. Last year, the confectionery company announced it would commit to buying only fully traceable palm oil by the end of 2014.
Forget your reusable bottle at home this morning and find yourself towing an unwanted plastic bottle? If you are in Beijing, you are in luck — you could trade in that empty bottle for a subway ticket.
“Reverse vending machines” in subway stations around the city allow riders to deposit polyethylene terephthalate (PET) plastic bottles in exchange for a commuter pass or mobile phone credit. Donors receive 5 fen to 1 yuan (about 16 cents) for each PET bottle, depending on its weight and composition. Incom Recycling, which is owned by Asia’s largest PET processor, Incom Resources Recovery, first introduced the system to Beijing subway stops in late 2012, with 10 machines across the city. The company has since expanded to include 34 machines, and it plans to install as many as 3,000 across the city, according to local media reports.
The machines would seem like a great way to encourage recycling in a city of upwards of 20 million. Except that Beijing doesn’t have a plastics recycling problem — it already has a 90 percent recycling rate for PET bottles, above most cities around the world.
As the first federal criminal trial related to food-borne illnesses enters its third week, witnesses reveal a lack of regulatory oversight and unpalatable details of production at the Peanut Corporation of America (PCA), the company responsible for causing a 2008-2009 outbreak of Salmonella that killed nine and sickened over 700.
Samuel Lightsey, former plant manager at PCA, returned to the stand on Monday for his seventh day of testimony on the case, which alleges that the company knowingly shipped contaminated products to its customers and lied to federal authorities. According to Lightsey, the company prioritized sales over food safety concerns and had a system for deceiving its customers that included using fake lab results for untested or tainted products.
In his testimony on August 8, Lightsey explained that PCA regularly shipped its peanut butter to Kellogg’s, which had requested Salmonella testing, with false test results. Lightsey said that Mike Parnell, food broker and brother of CEO Stewart Parnell, had told him: “I can handle Kellogg’s. We’ve been shipping to them with false COA’s (certificates of analysis) since before you got here.”
Prosecutors showed company emails that documented Parnell filling out COAs — official lab results — himself. Other emails documented CEO Parnell’s insistence that products known to be contaminated with rat feces be shipped anyway.
Is access to clean water a fundamental human right? According to the United Nations’ Declaration of Human Rights, not exactly. But if you ask George McGraw, the founder and executive director of the DIGDEEP Right to Water Project, the answer is a resounding ‘yes.’
The goal of McGraw, who is also an international human rights lawyer, and DIGDEEP is not just to increase access to clean water or educate people about water issues, but also to fundamentally change the way we think about water — starting at home.
“When it comes to water it is really easy to silo people into groups, to treat other people as beneficiaries and see ourselves as donors,” McGraw told Triple Pundit after speaking at the Ford Trends conference in Detroit last week. “As a human rights organization, we really try to break down those barriers and get people to think about these issues differently.”
Our conversation was especially timely — as we talked next to an indoor fountain at a pricey hotel, thousands of homes in the city outside were without running water. Starting in March, the Detroit Water and Sewage Department (DWSD) sent out shut-off notices to 46,000 homes for overdue bills, arguing that people can afford to pay, but refuse.
In 2006 Walmart sold fresh Atlantic salmon fillets in its stores for $4.84 per pound — an incredibly low price. Where did it all this cheap salmon come from? As it turns out, over the previous 10 years, fish farms had proliferated along the coast of Chile, a country far from the natural habitat of Atlantic salmon in the cold waters of the northern hemisphere.
Despite a lack of experience with fish farming, salmon became the second largest export of Chile, thanks in no small part to the huge market reach of the big-box retailer. As Charles Fishman documented in his 2006 book, “The Walmart Effect,” Walmart bought all of its salmon from Chile, amounting to perhaps one-third of the country’s total exports.
Lax regulation and price-driven suppliers eager to meet Walmart’s demand led to exactly the kind of overcrowded, antibiotic-heavy, environmentally-destructive fish farms that environmentalists caution against. In 2007 an outbreak of an infectious disease led to a near-collapse of the salmon farming industry in Chile. Walmart, known for its ability to pressure suppliers to change their policies and decrease price, has since diversified its salmon purchasing. And Chile has started to improve its fish farm practices: In 2013 the country’s Verlasso farm became the first ocean salmon farm to receive a “good alternative” rating from the Monterey Bay Seafood Watch.
While Walmart is in a class of its own in terms of size, the point is that because of their massive purchasing power, large corporate grocery chains can wield incredible influence over product markets and even the policies of their suppliers. In the world of seafood, there are fairly immediate consequences — for better or worse — for the environment.
Unilever is taking agricultural risk into its own hands under a new partnership with a genetics research firm for a pilot project on one of its plantations in Kenya. The Anglo-Dutch company announced last week that it will begin a research and development project to create more resilient, so-called “future-proof,” tea crops using a natural breeding method known as genomic selection.
The project will pair Unilever with Nature Source Genetics, a New York-based genomics company that will sequence and analyze tea crop genomes. “The first objective of the project is to use new sequencing methods to monitor and capture, in a core collection, most of the tea diversity that exists today in natural varieties of Camellia sinensis,” Clive Gristwood, senior vice president of Unilever’s R&D Refreshment division, told TriplePundit.com via email — referring to the Latin name of the species used for black tea.
“Capturing the broadest possible tea genetic diversity is important in order to make sure that we don’t lose key genes that might help improve resistance to climate change or new tea pests in the future,” explained Gristwood.
Unilever is the world’s leading tea manufacturer and buys on average around 12 percent of global supply, which it markets worldwide under the Lipton, PG Tips and Brooke Bond brand names. The company grows about 10 percent of its annual supply from its own plantations in Tanzania and Kenya, including the Lipton tea plantation in Kericho where the genomic tea project will begin.
Researchers at the University of California, Davis Center for Watershed Sciences have attached a dollar estimate to the economic impact of this year’s ongoing drought in California’s Central Valley, the state’s agricultural heartland. Their preliminary report, released earlier this week, estimates a total economic loss of $1.7 billion, along with “substantial long-term costs” of groundwater overdraft that will go unaccounted for.
Last year marked the driest year in California since records began in 1895, and in January Gov. Jerry Brown declared a drought state of emergency. Seven of the state’s 12 main reservoirs are at or below 60 percent of the historical average, and a dry winter has left snowpack levels–an important source for replenishing water supplies–at just a fifth of historical levels, as of late April.
Several dry seasons in a row have pushed greater reliance on the state’s grounwater reserves. Overall water delivery to the agriculture sector will drop by 33 percent this year, according to the UC Davis report. But, with increased groundwater pumping making up for the bulk of that loss, the overall water losses will be about 7.5 percent of the industry’s average use. Still, researchers estimate this will result in the loss of 410,000 acres in fallowed land, or an estimated $740 million in crop revenue loss. Feed crops will take the biggest loss–close to 150,000 planted acres–contributing, in part, to expected rises in meat prices this year.
If something smells fishy the next time you step up to the seafood counter or sit down for sushi, it may not be the catch of the day. An estimated 33 percent of seafood sold in the United States is incorrectly labeled by type of fish, catch method or provenance, according to a recent report by conservation group Oceana. So that ahi tuna roll you ordered might actually be escolar, a cheaper substitute known as the ‘ex-lax fish’ for its digestive effects, and the wild-caught shrimp at the grocery store could have in fact been farm-raised in Thailand.
This is not a new problem—there have been documented cases going back to at least the 1930s when canneries tried to pass off mackerel for pricier salmon. But now, with the falling price of computing power and tech-enabled tracking devices starting to change traceability methods, technology is fast-becoming an unlikely hero in the traditional world of seafood.
Globescan and SustainAbility released the 20th edition of their sustainability leadership survey, and most of the results are largely unsurprising. According to the responses of more than 800 people working in business, government, NGOs and academia in 89 countries, industry stakeholders have all but completely lost faith in the government’s ability to create change, the Rio conventions don’t matter and technology is becoming one of the most promising sustainability drivers. But one statistic from the survey results, which were recorded in March, does stand out — Unilever’s 22-point margin lead in the corporate ‘sustainability leadership’ category.
The Anglo-Dutch corporation is well-known for its sustainability efforts, but even report authors seemed a bit surprised by Unilever’s dominance in that category, which asked which companies best integrated sustainability into their business practices. With 33 percent of the vote — an eight point increase over last year — 2014 marks the fourth year in a row that the company nabbed the number one spot. Patagonia followed in second place with just 9 percent of the vote.
“We need to find ways for other companies to play a role and be recognized for it,” said Chris Guenther, one of the report’s authors, in a webinar presentation on Wednesday.
Other top companies in the corporate leadership category included Interface, Marks & Spencer and Nestlé. Walmart, Puma, Coca-Cola and Ikea — in its leaderboard debut — rounded out the top-12 list with 3 percent of the vote each.
But no one came close to catching Unilever, which held the top spot with the widest margin of votes in the 20-year history of the Globescan survey.
So what is Unilever’s secret to being the hands-down leader among sustainabilty stakeholders? And what do they have to do to last at the top spot in a notoriously fluid landscape?
Last week’s shareholder resolution to investigate Dunkin’ Brands’ use of nanomaterials in its products was not approved, but resolution organizers are still claiming success. The resolution, the first of its kind on the controversial particles, received nearly 20 percent approval from investors — a sign of “victory,” according to As You Sow, the shareholder advocacy group behind the vote.
The resolution, filed by As You Sow (AYS) on behalf of Andrew Behar, CEO of AYS and a Dunkin’ shareholder, called for the corporation to create a report on the risks of using nanomaterials — extremely small particles with little-understood health effects — in its Dunkin’ Donuts and Baskin-Robbins food products and packaging. A 2013 report by AYS showed laboratory tests detected titanium dioxide nanoparticles in the sweet, white coating on Dunkin’ Donuts powered cake donuts. That report found the same materials in powdered donuts from Hostess, Walmart and Kroger brands, among others.
At the May 6 annual shareholders meeting, 18.7 percent of Dunkin’ investors — representing roughly $548 million in investor share — voted in favor of investigating the consumer risks of nanomaterials in food products. Austin Wilson, associate at AYS, says the organization was happy with the result — noting that it is extremely rare for shareholder votes to reach the 50 percent threshold required for company adoption.
“The resolution itself is helpful in that it demonstrates to the company that a significant percentage of institutaional investors are concerned,” said Wilson. “We don’t expect a Fortune 500 company to completely change its business model overnight. But it’s all about making progress toward addressing [investor] concerns.”
Too much talk, not enough walk. That’s one way to sum up a recent report from Ceres and Sustainalytics on just how well 613 of the country’s largest publicly-traded companies are integrating sustainability concerns into business decision-making. The ‘Gaining Ground’ report, released earlier this week, measures companies’ progress on a sustainability “roadmap” created by Ceres to help guide businesses toward meaningful, long-term and measurable sustainability tactics. It tracks the same group of companies assessed in a similar 2012 report, and covers 20 expectations across four areas: governance, stakeholder engagement, disclosure and performance.
The results leave much to be desired. The authors paint a picture — thoroughly backed with meticulous analysis — of a corporate world caught flat-footed in the accelerating race against climate change. While there were some standout actors and some modest gains across most areas under study, the authors contend that, overall, businesses are simply not moving fast enough to address sustainability concerns.
Nevertheless there at least two reasons to be optimistic that corporations will learn to catch up: 1) Investors are paying more attention to sustainability and, 2) with each passing day of crazy weather, natural disasters, workplace tragedies and materials shortages, the business case for sustainability is getting stronger and stronger.
Gaining Ground is definitely worth a full read for all you corporate social responsibility (CSR) wonks out there. The list of insights and fascinating examples is too long to detail here, so here are just a few of the most intriguing takeaways:
Citi Bike is hitting some bumps in the road as NYC Bike Share, the operating company, struggles to meet revenue targets and deal with ongoing operational snags, according to recent news reports. As the popular New York City bike-share program — which, unlike most programs, does not use public money — approaches its first anniversary, NYC Bikeshare is seeking to raise $20 million through investors and sponsors to smooth out problem areas and eventually expand. But, despite the program’s popularity, new sponsors have reportedly been hesitant to jump on board, concerned that heavy branding from Citibank, the namesake corporate sponsor, on bikes and kiosks would drown out any real marketing opportunity.
So, should Citibank, which — lest we forget — received $476 billion in bailout funds in the wake of the financial crisis, bail out the fledgling bike-share program in a good-faith CSR gesture? Or should NYC Bike Share shoulder the blame for poor management and revenue planning?
In an article posted last month on Salon.com, Julia Carrie Wong outs Silicon Valley for a lackluster response to the tech backlash embodied by protests of Google employee buses in San Francisco. She says “charity is not enough” and rightfully points out the relative stinginess of “community benefit agreements” that the city signed with tech companies in exchange for tax breaks. And while skyrocketing rents and higher-than-average eviction rates have their roots in a long-term housing shortage caused by intense bureacracy and local opposition to new developments, the effects of a booming tech industry in an otherwise slow-moving economy are very real in the Silicon Valley.
But to charge that tech companies and their now infamous employees are THE cause of displacement and gentrification seems misguided. It begs the question: Exactly how should tech companies be responding to their outsize effect on the local economy?
Proving that being green really can get you more of that other green stuff, Unilever CEO and leader in corporate sustainability Paul Polman received a £431,775 ($722,230) bump to his already hefty annual bonus in large part for his work on the company’s sustainability goals.
As Bloomberg reported earlier this week, in Unilever’s Annual Report the Board of Directors mentioned Polman’s “leadership, including progress against the delivery of [Unilever Sustainable Living Plan] goals and his overall contribution to making sustainable living commonplace,” as a factor in choosing a 137.5 percent “personal performance multiplier” on his year-end bonus.
In comparison, Unilever’s CFO, Jean-Marc Huet, received a 110 percent personal performance multiplier.
Among his fellow multi-national CEOs, Polman has been one of the most vocal proponents for integrating environmental and social goals into overall business planning. The Unilever Sustainable Living Plan was formed under his watch and aims to halve the company’s environmental footprint by 2020, among other metrics. He has also broken away from the pack in his approach to shareholder duty. Rather than focus exclusively on shareholder returns, he has actively sought out the kind of investors that agree with his “build a bigger pie” approach to business, which emphasizes the long-term value companies can reap from a more environmentally and economically stable world.
The International Fund on Agricultural Development (IFAD), a financing agency within the U.N., on Feb. 20 stuck a five-year global agreement with Unilever that aims to better train and connect smallholder farmers to the marketplace. The partnership–the first of its kind between IFAD and the private sector–will aid Unilever in reaching its ambitious goal of integrating 500,000 small farmers into its supply chain by 2020 and provide training on sustainable farming methods. The new initiative was announced at IFAD’s annual governing council meeting by Unilever CEO Paul Polman at a panel event called Small Farmers=Big Business.
No specific activities have been announced, and it is unclear where or when the partnership will unroll. So, why is this story even interesting? Two reasons: One, it shows that Unilever is taking food traceability concerns seriously and looking to get a jump over other large multi-nationals on the issue; and two, it shows Polman’s genius in the corporate social responsibility (CSR) realm. The partnership also raises some questions over just how a multi-billion dollar corporation is going to do business with one-acre farms in Timbuktu—an arrangement that often, to say the least, has mixed results.