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Olivia Knight Adams Coca Cola Profiting from Sustainability Conference York Dec 2014


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Conference Presentation at Profiting from Sustainability in York (UK) Dec 2014

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Olivia Knight Adams Coca Cola Profiting from Sustainability Conference York Dec 2014

  1. 1. Coca-Cola and Sustainable Agriculture Presented by: Olivia Knight-Adams – NWEN Environment Manager 10 December 2014
  2. 2. 2 Content 1. Sustainability at Coca-Cola 2. Why sustainable agriculture matters 3. Our approach to sustainable agriculture 4. What sustainable agriculture means for our suppliers? 5. Sustainable agriculture in practice
  3. 3. 3 Sustainability at Coca-Cola …
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  6. 6. 6 Why sustainable agriculture matters…..
  7. 7. 7 Agriculture is critically linked to energy and water and all three are at the heart of the sustainability challenge greater supply volatility more unpredictable higher production costs yields
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  10. 10. Why sustainable agriculture matters to Coca-Cola? Brand risk tied to sourcing Supply disruptions £ increases & £ volatility Changing consumer preferences Social media Power of civil society Globalization Declining trust in corporations Population growth Emerging middle class Climate volatility Water stress Soil degradation 2020 Growth Vision More agricultural ingredients = Changing operating conditions + Agricultural supply constraints + Global trends magnifying market forces
  11. 11. 11 Our approach to sustainable agriculture….
  12. 12. We are committed to promoting sustainable sourcing and supporting sustainable sourcing practices across industry • Incorporating sustainable sourcing criteria into long-term ingredient sourcing plans • Working with partners and suppliers to improve livelihoods through efforts to increase crop yields and reduce production costs 12 • Helping farmers to improve agricultural practices and reduce environmental impacts such as minimizing use of pesticides & optimizing fertilizer applications. • Helping build industry-wide collaboration to gain alignment and effect change in the agricultural sector
  13. 13. Coca-Cola’s 2020 Sustainable Agriculture Goals GOAL: 100% of priority commodities meet sustainable procurement standards 13 SUSTAINABLE AGRICULTURE Sweeteners: Tea Sugar (Cane) Sugar (Beet) Corn (HFSS) Stevia Fruit: Orange Lemon Mango Apple Grape Coffee Soy Palm Oil Pulp & Paper (Forestry products) Other: and Commitments
  14. 14. Sustainable Agriculture Guiding Principles 14 LAY THE FOUNDATION FOR “SUSTAINABLY SOURCED” EXPECTATIONS Environment 7. Water Management 8. Energy Management and Climate Protection 9. Conservation of Natural Habitats and Ecosystems 10. Soil Management 11. Crop Protection 14 Human and Workplace Rights 1. Freedom of Association and Collective Bargaining 2. Prohibit Child, Forced or Abuse of Labor 3. Eliminate Discrimination 4. Work Hours and Wages 5. Safe and Healthy Workplace 6. Community and Traditional Rights Farm Management Systems 12. Harvest & Postharvest Handling 13. Reproductive Material Identity, Selection & Handling 14. Management Systems, Record Keeping and Transparency 15. Business Integrity
  15. 15. 15 Building a comprehensive set of criteria Sustainable Agriculture Guiding Principles Environment (shortened) Principle 7. Water Management Comply with applicable laws and regulations The annual volume of water withdrawn is recorded and withdrawal amounts do not exceed an authorized or permitted amount Sources of water (surface and groundwater) utilized are inventoried. Overall demands on local water source(s) are understood. If the water source is under stress, a dialogue is initiated with other stakeholders to develop a solution. Total water usage is reduced by implementing water saving practices. Where irrigation is used, the most efficient system as is technically available and financially affordable is implemented Appropriate management and treatment systems for all wastewater discharges exist and are maintained. Land management practices are implemented to minimize impacts of diffuse pollution (e.g., runoff) on surface and groundwater bodies. Irrigation water quality is monitored and managed to minimize negative impacts on crops and surrounding ecosystems.
  16. 16. 16 What sustainable agriculture means for our suppliers…..
  17. 17. 17 Route to SAGP compliance Beet Clear expectations All Tier 1 direct suppliers must have full line-of-sight to farm locations-which must meet SAGP minimum expectations Flexible approach Various pathways to compliance according to commodity whether supplier is already working against existing standards (which we have benchmarked SAGP against) Industry alignment Where existing standards do not exist (e.g. beet) we are supporting development of industry wide initiatives such as SAI Platform FSA to demonstrate compliance with SAGP
  18. 18. 18 What is SAI Platform? • Founded in 2002 by Unilever, DANONE Nestle, as non-profit organization to exchange sustainable agriculture knowledge across range of food chain stakeholders • SAI Platform now a global food and drink industry initiative with 60 active members supporting the development of sustainable farming practices at the field level. • Retailers are being invited to join SAI further changing the dynamics of the platform • Aims to make it easier more flexible for farmers worldwide to adopt sustainable farming practices • Developed series of common principles practices which evolved into Farmer Sustainability Assessment (FSA)
  19. 19. Why SAI Platform FSA? Provides harmonised approach to sustainable sourcing across FD industry Meets needs of the industry A simple, yet comprehensive tool with implementation verification guidelines to assess farm sustainability Applicable to all crops (including arable, fruit and vegetables) and all farm sizes Addresses environmental social economic criteria promotes continuous improvement Offers an easy scoring system resulting in a clear overview of the farm’s sustainability Unique advantages for farmers Increases supply chain consistency Excel tool backed-up by comprehensive IT solution reduces duplications and time requirement by farmers, Responds to needs of many customers in value chain (Unilever, Heineken, Mondelez, Mars already support joint action on sugar beet) reducing audit needs costs Reduces work for the farmer as it pre-filters legislation and cross-compliance requirements (in EU) on the ITC tool Added value from SAI training, insights tools for continuous improvement Our preferred route to demonstrate compliance with SAGP for beet fruit
  20. 20. 20 Sustainable agriculture in practice….
  21. 21. Globally: We support over 40 sustainable sourcing projects in 25 countries aimed at improving crop yields livelihoods of farmers, while reducing costs environmental impact Europe: We actively support Innocent’s Doñana Strawberry Sustainable Water Management project in Spain Skylark Foundation in Netherlands (friends in rotation” approach) England: Partnership with WWF since 2012 promoting water sensitive farming, supply chain sustainability and good water stewardship. Focussed on River Nar in Norfolk, source of approximately 80 % of beet used in our drinks made in GB Collaborating and sharing knowledge with farmers, local communities and other strategic partners has been key to successful implementation of sustainable agricultural practices
  22. 22. Pressures on the River Nar • Nar failed to reach “Good Status” under EU Water Framework Directive • Soil erosion compaction resulting in in-river sedimentation • Phosphate and nitrate loss from soils resulting in in-river eutrophication • 21 high sediment ingress points identified • Need identified to reduce farm runoff (which carries nutrients, pesticides and sediments) from entering the River Nar
  23. 23. Solutions Built partnership with Norfolk Rivers Trust – trusted local knowledge Appointed Farm Advisor to provide farmer support – hotspots identified bespoke farmer management plans created Key interventions included installing: - baffles - swales - silt traps - reed beds Achievements Benefits Preventing agricultural pollution running into river, restoring 1.8km of river habitat for trout other species Reducing need for fertilisers and improving soil quality for farmers Worked with communities government in river catchment planning to help rivers meet good ecological status Promoted water stewardship through stakeholder engagement
  24. 24. THANK YOU