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Sustainability Overview and Sobeys Inc. Sustainable Seafood Direction. Atlantic Lobster Sustainability Foundation. David Smith, Sobeys Inc. July 27, 2011 Moncton. About Sobeys Inc. One of two national supermarkets in Canada >$15 billion in sales; >1,300 stores >100 years old - PowerPoint PPT Presentation
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Sustainability Overview and Sobeys Inc. Sustainable Seafood Direction
David Smith, Sobeys Inc.July 27, 2011Moncton
Atlantic Lobster Sustainability Foundation
About Sobeys Inc.
• One of two national supermarkets in Canada
• >$15 billion in sales;
• >1,300 stores
• >100 years old
• Owned by Empire Ltd; Sobeys family
majority shareholder
Markers of Time: 25 Years
Markers of Change: 8 Years
The Case for Sustainability ?
80% Middle Class by 2030
+ 50% food production
Sustainability – Why?
Feeding the World: Largest Environmental Footprint
Agriculture Today
• consumes 70% of fresh water
• major global warming impact (80% is from nitrogen fertilizer)
Sustainability Lifecycle Thinking: 2 Key Risks Facing Business
1) Supply Side: “Externalities”
2) Demand Side: “Radical
Transparency”
• Threat of inputs/outputs previously not a business cost, becoming an internal cost
• Previous examples: employee benefits; product safety
• Near term: • Carbon emissions• Water• Post-consumption handling of packaging: “Extended Producer
Responsibility”
• Increasingly on the agenda of Regulators; Institutional Investors
• Magnified cumulatively across supply chain
“Externalities”
“Radical Transparency”: Products ~80-90% of footprint
Consumers:…want to “do the right thing”…want to “know the story”
…will not sacrifice (performance, price, convenience)… are not enabled (products, information)
5 years? All consumer products?5 years? All consumer products?
Now. 70,000 products.Now. 70,000 products.
Scan Barcodes Easily with your Phonebarcoo links products in stores with independent consumer information. Extensive Product Information and AssessmentsPrice comparison, test reports, health, green and sustainability information.
“External” led – start-upsIndustry led
Supply Chain Transparency:Beyond Voluntary Best Practices
“Trust but Verify”
“Without documentation it’s just a rumour.”
“Without measurability it’s just checking a box.”
Beyond Certification: Requirements for “Step Change”
1) Create the business systems• Supply chain ~ 80-90% of footprint• Pre-competitive “Radical Collaboration”: systemic solutions• “Yard stick” vs. “Gold standard”• Incremental improvements focused on laggards – “can’t
hide”
2) Leadership• “Eco-literacy”• “What gets measured gets done”
Optimism !!!
Need the Sustainability “Infrastructure”: Measurement Systems
Product “Lifecycle Analysis” / Lifecycle Thinking
“Cradle to Grave”
“Ecosystem Thinking”
Lifecycle Inventories
Global Food Safety Initiative Reciprocity of 5 regional standards
Global Social Compliance ProgramWalmart, Tesco, Carrefour, HP, Dell, The Gap, Best Buy, IKEA, Disney, Timberland, Hasbro, Chiquita, Dole
Harmonized labour code from 1,000 versions; and Facilities environmental module
Global Packaging ProjectTesco, Kraft, Walmart, Unilever, Safeway, Target, P&G, Kellogg, Pepsico, Coca-Cola, J&J, L’Oreal, Heineken
Indicators & metrics for packaging sustainability
Consumer Goods ForumUnilever, P&G, Kraft, Coca-Cola, Pepsico, General Mills, Nestle, Sara Lee; Tesco, Carrefour, Walmart, Kroger, Ahold, Delhaize
Product sustainability measurement –WRI/WBCSD product GHG protocol; then add other indicators
GS1B2C (US): Microsoft, Google, Apple, Verizon, Motorola, Oracle, P&G, Coca-Cola, Kimberly Clark
Product registriesBar codes – add sustainability characteristicsB2B & B2C
“Radical Collaboration” – Supply Chain
Focal Areas
Direct Operations (Stores, Warehouses, Fleets):1) Carbon Footprint
2) Waste Diversion
Supply Chain:1) Sustainable seafood
2) Sustainable packaging
3) Ethical & environmental performance – Private Label
Over-the-horizon:1) Sustainable agriculture
2) Animal welfare
Sobeys Sustainable SeafoodDirection
Sobeys Seafood Sustainability: Case Study
• Stakeholder engagement: beyond Greenpeace• Strategy: beyond eco-labels• Sourcing baseline: data capture12 months• Procurement: evaluation web tool• Supplier engagement: National Summit• Staff training: e-Learning Module• Marketing: integrated program – make it easier
Sustainable Seafood: Making Sources Visible
Certification to-date: The “Low Hanging Fruit”
But what about the Biggest Challenges?
7%
Green YellowRed
Sobeys’ Sustainable Seafood Policy: Beyond Eco-labels to “Fix the Worst First”
Sobeys Sustainable Seafood Policy
Goal By 2013:
Stop selling any “seriously challenged” seafood species sourced from areas where
the producers do not have an improvement plan, with specific
milestones.
Sobeys’ Sustainable Seafood Direction: “Fix the Worst First”
• Not dependent on eco-labels (i.e. MSC, BAP)
• Focus: improving our sources of species considered most at risk (i.e. worst of the “Red List”)
• Improvement via Engagement: not de-listing; Improvement Plans
• Stop selling only as a last resort: when situation calls for it; when producers do not commit
to improvement
• “Green list” and “Yellow List” sources/species are fine to sell• Do not need to be certified if independently and credibly reviewed• Eco-labeled product is a sub-set
Sustainable Seafood: Making Sources Visible
Our suppliers input monthly sourcing data into a web tool that provides us an evaluation of each species purchased
Sobeys’ Product Focused Actions To-Date
1. Tightened our specs: 1. any Chilean sea bass we sell will only come from a MSC
certified fishery, and not in Ross Sea; 2. Swordfish will only come from Atlantic Canadian sources
that are harpoon caught (MSC certified) or longline caught (in MSC full assessment)
2. De-list: only when dire situation warrants – 1. - all sharks, skates, and rays, Orange Roughy, and “Bluefin
tuna”
Sobeys’ Product Focused Actions To-Date
3. Improvement Plans: source from areas with commitments –
• Existing fisheries improvement plans:– Wild Pacific Coho salmon from British Columbia (2010) – Wild shrimp from Gulf of California (2007) and Gulf of Mexico
(2008)– Indonesian blue swimming crab (improvement plans launched
in 2007)
• Acting as a catalyst we look forward to announcing new Canadian based fishery plans as they develop
4) Sobeys’ Product Focused Actions To-Date: Eco-Labels
• Are part of the solution; just not the only solution• To-date 50 Private Label skus in-store & in-
progress:
Sobeys Ontario Traceable Pacific Halibut
Sticker on package – staff write in code
T-stand
Flyer
Recipe card
ThisFish.info system
Customers can trace who, where, how, when; Fishermen can see who, when, where traced.
BC Wild Salmon Videos @ Sobeyscorporate.com
• Objective: educate public on an example of the complexity of challenges and solutions in wild seafood sustainability
• Support the Wild Salmon Policy direction, and seek collaboration to help implement
• Example of Sobeys policy in action: “Beyond Eco-labels”
Thank You.