How to address sustainability impacts across the agri-food value chain

Identify factors causing the target area’s significance to focus the scope on one or two actionable issues. In the US dairy example, on-farm enteric fermentation and manure comprise 49% and 43% of greenhouse gas emissions, respectively.2 The deeper dive reveals that the biological nature of cows themselves causes most of the 52% GHG eq attributed to dairy production.2 In this case, investment is needed to develop and scale solutions that reduce the amount of enteric fermentation or manure per gallon produced or to better manage manure waste.

Consider the historical context that led to the issue and why market dynamics have not yet resolved it. Economics are often the biggest barrier for companies to execute a transition toward more sustainable technologies and approaches. Customers have grown accustomed to or are dependent on low prices for commoditized goods such as food and clothing. While some segments are willing to pay more for the guarantee of sustainable practices, most agribusiness organizations, especially those located further upstream, do not have the ability to raise their prices to cover the costs of a sustainability investment. Therefore, focus primarily on cost reduction opportunities.

Now that the issue has been narrowed to a single or a few specific problems, identify leading practices and ideas that may warrant continued development. Survey the landscape of technology offerings, research conducted and competitor approaches attempted.

How are US dairy stakeholders addressing anerobic emissions? Genetics and improved feed mixes increase the efficiency per cow.3 The use of an anaerobic digester can cut emissions by converting the methane into carbon dioxide, which is a less potent GHG.² Understand the available options for solving the issue and where further research and development are necessary.

In many cases, achievements in sustainability goals have been met through partnerships and agreements between sectors. In the case of on-farm anaerobic digesters, the capital cost of investment is expensive for farmers. A possible solution could be the development of a program that would allow farmers to sell compressed natural gas, an output of anaerobic digestion, into the market.3 Studying the current landscape will not only produce research for internal project development but may also present potential partnerships.

Once the target problems are clearly defined and realistic mitigation options are carefully considered, set sustainability goals. Scenario plan possible investments revealed during the prior steps, determine time frame to implement and set measurable goals consistent with these projections.

Incentivize those responsible for driving implementation and earn respect from key external stakeholders with ambitious yet practical targets. If goals are too striving, managers will quickly realize the task is unrealistic. If goals are easily met, critics may label the strategy as greenwashing, thus risking the company’s reputation.

One gain in a single sustainability effort may be offset by equal or greater harms in another business area. Not all sustainability initiatives will have direct co-benefits without added risks or consequences, so it is also important to consider and measure the potential trade-offs.

State metrics in terms of a baseline. When considering the baseline metric, calculate based on marketable unit produced (for example, tons of CO2e/gallon of milk). Change in efficiency and product loss along the value chain are important aspects of sustainability. Calculating aggregate contributions to an environmental indicator can provide a data point, but apply measurements based on marketable unit when comparing the impact of a sustainability initiative.

Whether in the development, testing or commercialization stage, track and validate environmental impacts. Measurement can be resource-intensive, creating direct financial costs and indirect opportunity costs. Consider lowering costs by applying technological solutions to automate these processes or provide data that was otherwise unavailable at scale. For example, satellite imagery, sensors and platforms capture farm-level data at scale.

Identify reliable third-party organizations that verify and audit the specific sustainability metrics. To build trust with stakeholders, an unbiased source provides transparency by validating methods and claims.

This is not the final step, as sustainability is a process. Even once most businesses have shifted to practices that reduce the target area to a relatively insignificant size, new areas throughout the value chain will become main issue areas. To adopt a sustainable process, repeat the steps to continue realizing value potential.