Kraft upping sustainability goals

When Kraft Foods acquired Cadbury a couple of years ago, concerns were raised that Cadbury's ethical image would suffer. Some even said Kraft takeover would hit Cadbury's ethical rating. But nothing of that sort has happened. Kraft continues to up sustainability goals for the group, including Cadbury.

They have just announced more aggressive sustainability goals. A summary of their new goals:

From a 2010 base, by the end of 2015 Kraft Foods plans to:

·Increase sustainable sourcing of agricultural commodities by 25 percent

·Reduce energy use in manufacturing plants by 15 percent

·Reduce energy-related CO2 emissions in manufacturing plants by 15 percent

·Reduce water consumption in manufacturing plants by 15 percent

·Reduce waste at manufacturing plants by 15 percent

·Eliminate 50,000 metric tons (100 million lbs.) of packaging material

·Reduce 80 million km (50 million miles) from transportation network

See here my story in Ethical Corporation magazine on the much debated Cadbury takeover.

Will Nestle budge?

A Greenpeace campaign is in full swing against Nestle on palm oil sourcing. Greenpeace has released a report "Caught Red-Handed: How Nestlé's Use of Palm Oil is Having a Devastating Impact on Rainforest, The Climate and Orang-utans," which says "Nestlé is using palm oil from destroyed Indonesian rainforests and peatlands in products like PowerBar, Nestlé Crunch Crisp, and Coffee Mate, pushing already endangered orangutans to the brink of extinction and accelerating climate change."

Will Greenpeace succeed in extracting a commitment from Nestle on sourcing sustainable palm oil the way they did against Unilever two years ago?

In early 2008, environmental campaigner Greenpeace targeted Unilever over unsustainable sourcing practices of palm oil. The dramatic campaign, in true Greenpeace style, saw activists dressed as Orangutans and making jungle noises descended on the offices of consumer goods giant Unilever. The campaign coincided with Greenpeace releasing a damning report "How Unilever suppliers are burning up Borneo.”

The campaign brought Unilever on their knees within days. A deal was stuck. And Unilever committed buying all its palm oil from certified sustainable sources by 2015. The consumer goods giant also promised to have all palm oil it uses in Europe from certified sustainable sources by 2012. See the complete report here that I wrote for Ethical Corporation magazine then.

Unilever has since taken a leadership role on moving toward sustainable palm oil. Nestle, another company named in the Greenpeace report then, watched from the fence. Until then, Nestle had not even joined the Roundtable on Sustainable Palm Oil, a multistakeholder forum to develop a certification scheme for sustainable palm oil.

After securing a commitment from Unilever, Greenpeace then said they would turn their attention to other companies, one by one. So now it is Nestle' turn, it seems. This time, Greenpeace is using the power of social media to attack Nestle.

While Unilever responded to the crisis with a certain grace, Nestle has adopted a hostile approach. Within hours, Nestle got YouTube to remove the video that Greenpeace had uploaded as part of the campaign. Greenpeace now accuses Nestle of censoring the campaign advertisement.

Nestle' actions will be closely watched in the coming days and weeks. Will they act by committing to sustainable palm oil? or will they create a reputation mess and offer new lessons in mismanaging a crisis?

Sustainable palm oil: A pipe dream

So where is sustainable palm oil? The Roundtable on Sustainable Palm Oil, a multi-stakeholder initiative, was founded in 2003 with a promise to establish a mechanism for sustainable palm oil production. An impressive number of multinational companies and NGOs signed up to the initiative to work together to find ways to produce palm oil sustainably.

The RSPO finally came up with a certification scheme to certify sustainable palm oil in 2008 generating hopes that soon sustainable palm oil will start flowing.

But WWF, a key NGO in RSPO, lamented in May that only one percent of the total sustainable palm oil produced was actually bought. It said out of 1.3 million tonnes of certified sustainable palm oil produced, only 15,000 tonnes was sold. By the way, the world produces 43 million tonnes of palm oil annually. Only 1.3 million tonnes of this was certified sustainable palm oil.

A media report recently pointed out that only three palm oil producers have managed to obtain the RSPO certification so far. And seems they are now stuck with unsold stock of sustainable palm oil which no one wants to buy. Why should other producers make the mistake of going through the trouble of RSPO certification?

Surprisingly, when I visited the RSPO website today, I could not find any list of certified palm oil producers. Rather, I found several isolated announcements mentioning names of companies which have been given interim approval, based on self-assessment, to claim compliance with the certification criteria of RSPO. Now this is scary that a RSPO member can be allowed to claim its palm oil from sustainable sources based on self-assessment.
The actual certification though is given only after a third party audit which, it appears, only three producers have managed to get so far.

I wrote about the RSPO initiative in Ethical Corporation magazine in the July 2008 issue. The report mentioned Unilever’s lead (after they were embarrassed by a high-pitch campaign by Greenpeace) by committing to the tough goal of buying all palm oil from certified sustainable sources by 2015. I concluded the feature by saying “Though Unilever has taken the lead, the rest of the industry will have to act as well in order to make any real impact. A public commitment by large companies to purchase palm oil only from certified sources will send a clear signal to producers on the ground. Failing to act may turn sustainable palm oil into a pipe dream.” And sadly, a pipe dream it remains.

Kraft Foods transportation sustainability initiative

Kraft Foods is one of those companies which pursues ambitious sustainability goals rather quietly. As a result, the company's path-breaking initiatives often go unnoticed by the CSR media. I therefore decided to write a bit about their sustainability programme on this blog.

In one of the key initiatives, the company has eliminated more than 50 million truck miles since 2005 through transportation sustainability efforts.

Here are some of the things the company has done:

• In North America, the company saved more than 1.5 million km, replaced 10,000 truck shipments and reduced 2,000 tons of CO2 emissions by shipping wheat via waterways to its Toledo, Ohio, flour mill. Now, ships make bigger deliveries less frequently.
• In Brazil, employees saved nearly 390,000 miles and reduced 300 tons of CO2 emissions by using boats to send products to distribution centers. In just six months, the change saved more than 125 truck shipments.
• In Germany, the company transports coffee beans from Bremen to its Berlin roasting plant, saving about 2.8 million km and eliminating 2,300 tons of CO2 emissions. And the project took 7,000 trucks off the road.
• In Austria, it saved more than nearly 250,000 km by sending products in refrigerated containers on rail cars, eliminating 400 truck shipments and reducing 250tons of CO2 emissions.
• In the United Kingdom, the company now sends products to one of its key customers by train instead of truck, saving more than 70,000 km and eliminating 120 truck shipments.
• In Europe, the company is modernizing its transportation network by establishing a single hub in Bratislava, Slovakia to make 20 percent fewer trips between its European plants and distribution centers. And in the Philippines, the company now uses a national distribution center so customers receive shipments 20 percent faster than before, saving miles and fuel.
• In North America, it has purchased 11 hybrid direct store delivery vehicles for frozen products. The hybrid power train and electric refrigeration technology use up to 30 percent less fuel than a traditional truck.
• And in Mexico, the company has pioneered a double-decker transport system that allows trucks to safely carry up to 56 pallets in one load – twice as many as before.
  

More on Kraft Foods sustainability initiatives here.

Source: Kraft Foods

Amazing Disg-Race

I was appalled to see the contestants of the current season of the Amazing Race, a reality TV show, sitting in the middle of mountains of electronic waste in a tiny scrap shop in Vietnam and using bare hands to dismantle electronic waste items looking for the clue which was hidden inside one of the waste items. Once they found the clue, they hurried out of the shop to their next destination, leaving behind heaps of torn apart pieces of electronics on the uncemented dusty floor. The shopkeeper, obviously dazzled by being under the spotlight, proudly watching over with the family which included children!

Showing electronic waste piles in dingy shops in the narrow lanes of Vietnam must have sounded a sexy idea to the producers of the show. After all, they can't find such exotic locations in western Europe or the US where electronic waste is strictly regulated!

Developing and poor countries, including many in Asia, are being used as dump yards for the developed nations' electronic waste. We all know that. Unsuspecting communities in the host nations are becoming victims of toxins released from electronic waste. Some of these toxins are deadly such as lead, cadmium, beryllium and mercury.

The toxic materials are released when local operators exploit valuable metals from the electronics scrap using crude methods. These include burning in the open, disassembling electronic gadgets with bare hands to extract precious metals, and dumping the left-overs on public lands which then may be sent to landfills with the rest of the city garbage. This lays ground for the poisoning of water and soil for future generations as well.

Wondering if the folks behind The Amazing Race show have any clue to sustainability or basic environmental responsibility.

A must read speech text by the Coke president

I stumbled across this wonderful speech by Muhtar Kent, the president of the Coca Cola Company, on sustainability and what companies can do to lead the world to a sustainable path. Though over a year old, the speech is worth reading (yes, text is available). Here.