Companies in the food industry are known to be the front runners in sustainable sourcing. One of these major contributors to developing sustainable agriculture worldwide is Nestle.
Hans Joehr, Nestle's corporate head of agriculture and co-founder of the Sustainable Agriculture Initiative Platform, highlights the industry's initiatives for green procurement in his interview by Nina Kruschwitz from the Massachusetts Institute of Technology's Sloan Management Review.
The SAI Platform has over 50 members from all over the food industry, including Kellogg's, McDonald's and PepisCo, according to its website.
The group calls itself the sole global food industry initiative that aims toward sustainable agriculture. It strives toward continuous improvement to have farmers around the world have an easier time adopting more eco-friendly practices.
"SAI Platform was created with a very simple idea of putting principles and practices together on sustainable agriculture for certain crops in order to address environmental, societal and economical topics around agriculture production systems," Joehr said.
SAI Platform's work toward sustainable sourcing
Joehr said SAI Platform's member companies share with each other environmentally friendly principles and practices that are tested and constantly improved. He said these companies helped form SAI Platform over 10 years ago because of issues they commonly faced.
"We all have the same problems of quality, of scarcity, of cross-border issues from child labor to pesticide residues to contaminants," Joehr said. "A lot of things are linked to agriculture practices that may end up, at the end of the day, in your raw materials and finally in your branded product."
Hazards that companies typically encounter regarding agriculture involve land use, pollution, resource waste and biodiversity.
In Nestle's approach toward sustainable agriculture, it incorporates the concept of creating shared value rather than dictating eco-friendly practices from the top down from either the CEO or a sustainability officer. Joehr said Nestle wanted to avoid having to turn to nongovernmental organizations to fix problems regarding corporate social responsibility, according to the MIT Sloan Management Review.
Rather than having outside parties attempt to manage risks, Nestle said the company handles them internally through embedded sustainability in its business model. He said environmentally friendly practices happen from the shop floor to the top and establish it into the key performance indicators of every worker. Joehr highlighted this process by saying Nestle cooperates with farmers in order to have raw materials needed for suppliers that provide for the company's factories.