Measuring the Environmental Impact of Food Products
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1 Measuring the Environmental Impact of Food Products Melissa A. Schweisguth Food Trade Sustainability Leadership Association (FTSLA) Sustainable Foods Summit 1/18/11
2 Agenda Why measure environmental impact? Measurement frameworks Measurement process Key Considerations: Boundaries & Context Choosing metrics (materiality) Outcomes & Examples
3 About FTSLA Non-profit Trade Association Organic food industry focus Mission: Build the capacity of the organic food trade to transition to leadership-oriented sustainable business models Members span organic food supply chain Partner with diverse industry organizations Core activities: Measurement & reporting, education, networking, advising
4 Why Measure Environmental Impact? It s good for business, society, environment Manage impacts, costs, risks Inform priorities & goals Quantify impact, progress, costs, ROI Gauge fit for certifications Meet regulations Stakeholders expect transparency & responsibility Back up sustainability claims Tap markets for responsible products & services
5 Why Measure Environmental Impact? Stakeholders Reward Better Practices 65% of consumers will recommend responsible brands, pay more 93% of consumers: businesses should improve impact 79% of employees want values-aligned employers 85% of investors prefer socially responsible companies Third-party rankings rest on data & disclosures Data sources: BBMG, 2009; BCCCC/Reputation Institute, 2008; Yankelovich, 2007
6 Measurement: Metrics & Indicators Qualitative yes/no, narratives, lists Quantitative Numeric data Absolute Total impact, gauge true footprint & costs Relative Relative performance across change, peers (e.g., energy/unit produced) Can be deceptive in isolation
7 Measurement Frameworks Global Reporting Initiative (GRI) Global Environmental Management Inst. Stewardship Index for Specialty Crops Food Trade Sustainability Leadership Assoc. Area-specific: Greenhouse Gas Protocol, Sustainable Packaging Coalition Retailer assessments: Wal-Mart, etc. Certifications may have useful metrics
8 Global Reporting Initiative (GRI) General & sector specific metrics (food processing) Extensive guidance: measurement & reporting Widely used, international, multi-stakeholder input Six reporting areas Economic Environmental Human Rights Labor Product responsibility Society Templates for reporting grade levels
9 Global Reporting Initiative (GRI)
10 Global Reporting Initiative (GRI)
11 Global Reporting Initiative (GRI)
12 Global Environmental Mgmt Inst (GEMI) Measurement resources include Environmental metrics & guidance Metrics navigator tool Water Sustainability tool Financial quantification tool Environmental self-assessment ISO 4001 self assessment & guidance
13 Stewardship Index for Specialty Crops Metrics from farm to retail In development & pilot stage 15 areas of reporting Multi-stakeholder development process
14 Stewardship Index for Specialty Crops Example metrics
15 Retailer Assessments: Wal-Mart Total energy, climate, packaging/materials, waste for facilities producing product for Wal-Mart
16 FTSLA Metrics & Indicators For organic food trade, farm to retail 11 focus areas Based on GRI, organic & ecological principles, sustainable business frameworks Shaped by multi-stakeholder input Quantitative & qualitative Current year & cumulative performance Goals Narratives on practices and policies
17 FTSLA Framework Goals: Drive most critical improvements, peer learning Members report to FTSLA annually Many report & communicate publicly Flexible & functional Members choose metrics per priority & relevance Expand scope over time Support via materials, advising, education, templates, tools
18 FTSLA: Reporting Areas Organic Distribution Energy Climate Imp/Emissions Water Waste Packaging/Marketing Materials Labor Animal Welfare Education Community & Governance
19 Organic FTSLA: Example Metrics Total and % production (farms) Total and % purchasing (others) State organic policy and practices for food and non-food agricultural inputs Facility Energy Energy Use: Total by type, Normalized Percentage renewable energy Energy conservation in past year
20 Distribution FTSLA: Example Metrics Fuel Use: Total and normalized Renewable fuel as % of total fuel use % local, regional and domestic purchasing in pounds or dollars Greenhouse Gas and other emissions Scope 1 and Scope 2 emissions: Total & Normalized CO2e Total REC and CO2e offset purchases Other emissions: Particulate and non-ghg Protocol
21 Waste/Zero Waste FTSLA: Example Metrics Waste to landfill & diverted waste materials: Total, normalized and overall % of total Proportional breakdown of diverted materials, % landfill, compost, recycling, reuse, etc. Water Water use: Total and normalized Non-potable & reuse: Total and % of total water use State water use policy and practices
22 FTSLA: Example Metrics Packaging & Marketing Materials Pounds and % materials eliminated by reduction Percentage materials by input type: Renewable, recycled, etc. Percentage materials by end-of-use outcome: Reusable, Recyclable, Compostable, etc. Note: Additional Non-environmental measurement areas not covered here: Labor (workplace & supply chain), Animal Welfare, Education, Community & Governance
23 Set boundaries Select metrics Gather data Evaluate data Measurement Process Use data to inform improvements Revise boundaries & metrics.and continue Consider how you ll account for real-world factors
24 Setting Boundaries Supply chain responsibility = growing expectation Lifecycle scope Operations, Wholly owned, Joint ventures Agriculture, Contract manufacturing Warehousing, Transport, End use, disposition Product/service scope Processes, Ingredients, Packaging, etc. Operational scope All operations, Production only, Key impacts often external Start internally, expand to key external impacts
25 Considering Context Context-based sustainability management (McElroy/Deloitte) Quantify environmental boundary/allowance (or social need) Quantify company share of environmental allowance Evaluate total impact against share of allowance Examples: Ben & Jerry s, Cabot Creamery
26 Considering Context Image: Cabot
27 Considering Context Image: Mark McElroy, Ph. D./Deloitte
28 Choosing Metrics (Materiality): Relevance Which metrics represent your most critical impacts? What are your business goals and mission? What are your business activities, inputs, outputs? What key issues does your supply chain involve? Where do have an impact geographically? What issues matter to stakeholders? Where can you make unique contributions? What regulatory and legal issues do you face?
29 Choosing Metrics (Materiality): Priorities Which relevant metrics represent your most critical internal and external impacts & opportunities? What impacts your business most? Where can you have the biggest impact? What are your goals, mission and values? What s most important to stakeholders? Employees, business customers, consumers, shareholders, etc What issues are most critical now?
30 Choosing Metrics: Peer Reporting Common metrics among FTSLA members Organic production/purchasing Energy use & conservation Greenhouse Gas Emissions (Scopes 1 & 2) Waste and Landfill Diversion Packaging reduction, preferable materials Employee benefits Equitable trade certifications Volunteerism & contributions Internal & external communications
31 FTSLA Member Outcomes Energy savings through efficiency GHG Emissions reduction: Conservation, renewable generation/purchase, RECs, commuting programs Fuel savings through logistics optimization Reduction in waste to landfills Packaging materials & weight reduction Increase in compostable & recyclable packaging Water savings through process optimization Peer best practice sharing & application Better management & design from the start
32 Frontier Sustainability Report
33 Nature s Path Sustainability Report
34 Clif Bar Annual Report
35 Organic Valley Website
36 Nature s Path Packaging Packaging improvements on pack
37 Communicating Activities & Impact Sustainability report: Print, PDF, online Integrate in Annual Report Website Newsletter Social media Press releases Packaging Ads & flyers, Circulars Start smaller and scale up Use multiple modes: timely & targeted
38 References: Frameworks & Examples FTSLA: Additional presentations & guidance ftsla.org Global Reporting Initiative globalreporting.org Global Environmental Management Inst. gemi.org Stewardship Index for Specialty Crops stewardshipindex.org Greenhouse Gas Protocol Context-based measurement: /2010/01/26/getting-real-about-measurement-how-size-triple -bottom-line FTSLA member public sustainability reports & websites ftsla.org/ourmembers/activity.html Clif Bar Report clifbar.com/uploads/default/annualreport_2009.pdf Organic Valley website organicvalley.coop/about-us/sustainability PCC Markets website pccnaturalmarkets.com/pccgreen
39 References: Research BBMG: Conscious Consumer Survey (via GreenBiz.com) (2009) GreenBiz.com/blog/2009/04/13/earth-day-green-marketing-and-polling -america-2009 BCCC/Reputation Institute Global Pulse Study (2008) reputationinstitute.com/advisory-services/global-pulse Deloitte/GMA: Finding the Green in Today s Shoppers (2009) deloitte.com/us/greenshopperstudy09 Hartmann Group: Marketing Sustainability in an Economic Downturn (2009) hartman-group.com/publications/view/81 Natural Marketing Institute: Winning at Green (2009) nmisolutions.com/downloads/wp/nmi_winning_at_green.pdf Roberts Environmental Center sustaianbility repoer analyses roberts.cmc.edu/psi/sectorreports.asp TNS: Global Shades of Green (2008) tns-us.com/greenlife/ NOTE Some of the above are reports for purchase but free summaries can be downloaded.
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