I was discouraged after reading Oxfam’s 20 May 2014 report, Standing on the Sidelines – Why food and beverage companies must do more to tackle climate change. As I shared in my May 13, 2013 blog, “I have always enjoyed working with Oxfam and have long supported their work to fight poverty and injustice.” However, this most recent paper has me questioning their tactics, intentions, and credibility.
Standing on the Sidelines ranks the ten largest food and beverage companies (Associated British Foods, Coca-Cola, Danone, General Mills, Kellogg, Mars, Mondelēz International, Nestlé, PepsiCo and Unilever, referred to as “The Big Ten”) on their efforts to address climate change. While Oxfam makes it appear that agriculture companies as a whole are a negligent lot, three of The Big Ten (Unilever, Nestlé and Coca Cola) rank among the top ten leaders in integrating sustainability into their business strategies across all industries, according to GlobeScan/SustainAbility’s 2014 Sustainable Leaders Survey.[1] Not only is Unilever the top leader for the fourth year in a row, the company’s lead over the second-ranked Patagonia (a recognized sustainable corporate citizen), is the widest ever. Maybe other industries can actually learn from Unilever and the agribusiness sector.
Putting aside Oxfam’s failure to recognize that some agribusiness leaders are getting it right when it comes to sustainability, Oxfam’s report concerns me in other ways. First, the report fails to present the criteria upon which The Big 10 are evaluated and ranked. From what I can piece together from the paper, Oxfam picks leaders and laggards –nearly demonizing Kellogg and General Mills in the process – by formulating subjective opinions that are based on the following narrowly defined criteria:
1. Disclose greenhouse gas (GHG) emissions annually, preferably through the Carbon Disclosure Project
2. Have a written policy
3. Take a position on palm oil and, to a lesser degree, other deforestation or indirect land use change (iLUC)[2] issues
4. Use supplier codes to promote reporting and reduction of GHG emissions
5. Advocate for an effective climate change policy, which Oxfam limits to signing the Corporate Leaders Group Trillion Tonne Communiqué
I feel that some of these criteria are inadequate and inappropriate measures of a company’s environmental impact or contribution. For example, the Trillion Tonne Communiqué has minimal expectations of signatory companies, and as such is a weak barometer. Signatories are only asked to provide evidence that they are responding to the challenge of climate change (e.g. by crafting or having a policy statement), with no further obligation. There are many other options that Oxfam should consider when evaluating a company’s commitment, efforts, and impacts on climate change. In fact, in their recommendations section, Oxfam doesn’t refer to the Trillion Tonne Communiqué at all, instead asking companies to: 1) sign on to “a public statement committing to bold action on climate change,” 2) engage in their industry associations to address climate change, and 3) review company statements on climate change for alignment with a 2°C global target.
In addition, while the use of supplier codes to promote progress by suppliers is a good first step, many of us working in this arena recognize their limitations when not supported by audits, sourcing policies or other measures. Moreover, supplier codes are not “the most powerful way for companies to bring about significant GHG emission reductions,” as Oxfam states. Significant and lasting progress requires capital, technology, and other significant and longer-term investments. These investments will be more likely achieved through sourcing partnerships that provide commitments, shared investments and benefits, and that aim to achieve common goals.
I am glad that Oxfam addresses deforestation related to production of agricultural raw materials. However, it appears that Oxfam bases much of its ranking of The Big Ten on their efforts to stop the deforestation associated with production of palm oil alone, even though collectively The Big Ten only accounts for six percent of all palm oil use, with Unilever alone accounting for three percent. Palm oil is not the only (or most significant) driver of deforestation. It accounts for eight percent of crop-related deforestation compared to soybean and maize, which account for 19 and 11 percent, respectively. While we should expect The Big Ten to address palm oil, once again this should not be the sole criteria for evaluating how they address deforestation and iLUC. For example, Kellogg and General Mills are recognized for their strong zero deforestation commitments and palm oil sourcing policies, which extend beyond what is required by the Roundtable on Sustainable Palm Oil, yet they are referred to as the “laggards” throughout the paper.
Oxfam recommends that companies measure their GHG emissions along their supply chain and reduce GHG emissions while still meeting the growing demand for more food. From what I know of many food companies and others in the industry, they are already doing just this. In fact, even Kellogg and General Mills – the “laggards” – have assessed where their emissions are greatest along their supply chain.
What Oxfam does get right is their observation that agribusiness will be hit hard by climate change. And, yes, The Big Ten should be doing what they can to mitigate and adapt to climate change. Most of them know this and are taking action already – just apparently not the specific actions towards which Oxfam has a bias.
I know the agribusiness industry well and believe its doing a lot of good work. Many global brands are asking suppliers to measure report on their carbon footprints – driving change down their supply chains as Oxfam and others want. Some companies also require their top suppliers to make multi-year commitments to reduce their carbon footprints.
I will continue to be a fan of and support Oxfam, but its use of undefined and biased standards to measure The Big Ten’s efforts is not the way to pursue positive change. I believe we should support our farmers and the brands that partner with them to help them meet future demands in a new context, which includes the unpredictability and more severe conditions that will come with climate change. We would all benefit if Oxfam and others engaged in meaningful dialogues with agribusiness industry and supported the efforts they are making and acknowledge the challenges they face.
[1] The 2014 Sustainable Leaders Survey is a compilation of opinions of 887 of the most influential thought leaders in the sustainability arena from over ninety countries.
[2] Indirect land use change (iLUC) refers to a situation where the production of one crop on existing agricultural land displaces another crop may lead to someone producing the displaced crop somewhere else.
Standing on the Sidelines ranks the ten largest food and beverage companies (Associated British Foods, Coca-Cola, Danone, General Mills, Kellogg, Mars, Mondelēz International, Nestlé, PepsiCo and Unilever, referred to as “The Big Ten”) on their efforts to address climate change. While Oxfam makes it appear that agriculture companies as a whole are a negligent lot, three of The Big Ten (Unilever, Nestlé and Coca Cola) rank among the top ten leaders in integrating sustainability into their business strategies across all industries, according to GlobeScan/SustainAbility’s 2014 Sustainable Leaders Survey.[1] Not only is Unilever the top leader for the fourth year in a row, the company’s lead over the second-ranked Patagonia (a recognized sustainable corporate citizen), is the widest ever. Maybe other industries can actually learn from Unilever and the agribusiness sector.
Putting aside Oxfam’s failure to recognize that some agribusiness leaders are getting it right when it comes to sustainability, Oxfam’s report concerns me in other ways. First, the report fails to present the criteria upon which The Big 10 are evaluated and ranked. From what I can piece together from the paper, Oxfam picks leaders and laggards –nearly demonizing Kellogg and General Mills in the process – by formulating subjective opinions that are based on the following narrowly defined criteria:
1. Disclose greenhouse gas (GHG) emissions annually, preferably through the Carbon Disclosure Project
2. Have a written policy
3. Take a position on palm oil and, to a lesser degree, other deforestation or indirect land use change (iLUC)[2] issues
4. Use supplier codes to promote reporting and reduction of GHG emissions
5. Advocate for an effective climate change policy, which Oxfam limits to signing the Corporate Leaders Group Trillion Tonne Communiqué
I feel that some of these criteria are inadequate and inappropriate measures of a company’s environmental impact or contribution. For example, the Trillion Tonne Communiqué has minimal expectations of signatory companies, and as such is a weak barometer. Signatories are only asked to provide evidence that they are responding to the challenge of climate change (e.g. by crafting or having a policy statement), with no further obligation. There are many other options that Oxfam should consider when evaluating a company’s commitment, efforts, and impacts on climate change. In fact, in their recommendations section, Oxfam doesn’t refer to the Trillion Tonne Communiqué at all, instead asking companies to: 1) sign on to “a public statement committing to bold action on climate change,” 2) engage in their industry associations to address climate change, and 3) review company statements on climate change for alignment with a 2°C global target.
In addition, while the use of supplier codes to promote progress by suppliers is a good first step, many of us working in this arena recognize their limitations when not supported by audits, sourcing policies or other measures. Moreover, supplier codes are not “the most powerful way for companies to bring about significant GHG emission reductions,” as Oxfam states. Significant and lasting progress requires capital, technology, and other significant and longer-term investments. These investments will be more likely achieved through sourcing partnerships that provide commitments, shared investments and benefits, and that aim to achieve common goals.
I am glad that Oxfam addresses deforestation related to production of agricultural raw materials. However, it appears that Oxfam bases much of its ranking of The Big Ten on their efforts to stop the deforestation associated with production of palm oil alone, even though collectively The Big Ten only accounts for six percent of all palm oil use, with Unilever alone accounting for three percent. Palm oil is not the only (or most significant) driver of deforestation. It accounts for eight percent of crop-related deforestation compared to soybean and maize, which account for 19 and 11 percent, respectively. While we should expect The Big Ten to address palm oil, once again this should not be the sole criteria for evaluating how they address deforestation and iLUC. For example, Kellogg and General Mills are recognized for their strong zero deforestation commitments and palm oil sourcing policies, which extend beyond what is required by the Roundtable on Sustainable Palm Oil, yet they are referred to as the “laggards” throughout the paper.
Oxfam recommends that companies measure their GHG emissions along their supply chain and reduce GHG emissions while still meeting the growing demand for more food. From what I know of many food companies and others in the industry, they are already doing just this. In fact, even Kellogg and General Mills – the “laggards” – have assessed where their emissions are greatest along their supply chain.
What Oxfam does get right is their observation that agribusiness will be hit hard by climate change. And, yes, The Big Ten should be doing what they can to mitigate and adapt to climate change. Most of them know this and are taking action already – just apparently not the specific actions towards which Oxfam has a bias.
I know the agribusiness industry well and believe its doing a lot of good work. Many global brands are asking suppliers to measure report on their carbon footprints – driving change down their supply chains as Oxfam and others want. Some companies also require their top suppliers to make multi-year commitments to reduce their carbon footprints.
I will continue to be a fan of and support Oxfam, but its use of undefined and biased standards to measure The Big Ten’s efforts is not the way to pursue positive change. I believe we should support our farmers and the brands that partner with them to help them meet future demands in a new context, which includes the unpredictability and more severe conditions that will come with climate change. We would all benefit if Oxfam and others engaged in meaningful dialogues with agribusiness industry and supported the efforts they are making and acknowledge the challenges they face.
[1] The 2014 Sustainable Leaders Survey is a compilation of opinions of 887 of the most influential thought leaders in the sustainability arena from over ninety countries.
[2] Indirect land use change (iLUC) refers to a situation where the production of one crop on existing agricultural land displaces another crop may lead to someone producing the displaced crop somewhere else.
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