CSR is a wide and confusing subject that affects every link in the fresh produce supply chain. With regards to the fresh produce industry, CSR means maintaining environmentally sound agricultural practices in growing safe produce and looking after individual employees, while monitoring the industry’s impact on the environment and communities across the world.
It is a lot to consider, and involves a good deal of work at all points of the supply chain, but, as we move towards a more sustainable future, the fresh produce industry is increasingly going beyond the minimum legal CSR standards and proving that it is ahead of the game.
Many in the industry think the issue of CSR goes comfortably hand in hand with fresh produce, as it seems that consumers are naturally concerned about where their fruit and vegetables originate and how they were cultivated.
“Knowing how high profile the fresh produce industry is, it would be very negative to ignore CSR issues,” says Martin Dunnett, trading director for importer and distributor Capespan. “The industry has been under the microscope recently, and I think this has been a very important development. We like, image-wise, to go back to source and show the orchard or farm where the produce has been cultivated and this process works as a marketing tool. But there are extra pressures for our industry because of the outdoor capacity of the business and, of course, the health issues surrounding it. As an industry, we are well equipped to prove our credentials, and we cannot allow this to slip.”
And this process applies to every part of the supply chain, from growers to packers, to suppliers and the supermarkets. Fresh produce companies across the board maintain that if there is one weak link in the chain, the whole concept of CSR is lost.
JP Fresh, supplier of fresh produce such as bananas, citrus, and top fruit, makes sure that it is involved at all points of the supply chain. Group marketing manager Dickon Poole says that social responsibility has always been a top priority for JP Fresh, and will be a firm part of its future now that the company is 100 per cent owned by the world’s largest producer and marketer, Dole. “The fresh produce industry is probably further ahead than most in the area of CSR, so we need to continue the good work,” says Poole. “But everyone’s house has to be in good order for it to work.”
And now, more than ever, the pressure is on for the fresh produce industry to prove that it is socially responsible, as consumers become concerned with ethical practices, both in the UK and abroad. GlobalGAP has become aware of this increasing trend and has included a strengthened section on both integrated crop management and workers’ conditions in the third version of its protocol, which was released in January. “These are subjects that we will continue to work on,” says Nigel Garbutt, chairman of GlobalGAP. “Worker welfare is becoming more high profile due to customer and consumer demands. CSR is a partnership through the supply chain: retailers reflect what they hear from consumers and work with suppliers to see how standards can be developed. The whole issue is coming under the magnifying glass from the media, as well as various sections of civil society, like non-governmental organisations (NGOs) and the EU.”
As well as producing a fairer and more sustainable world, CSR is also a good move for a business, according to Muddy Boots. The leader in food traceability and quality assurance solutions maintains that an effective CSR strategy enables businesses to take account of their economic, social and environmental impact, while maximising benefits and minimising the downsides. Muddy Boots has devised a solution, called Quickfire, which delivers brand protection, product safety and quality assurance. The solution can accommodate almost any inspection or verification protocol and can be used to monitor areas from corporate governance to the environment.
Marks & Spencer’s fresh produce supply base uses Muddy Boots’ solution, and the programme is instrumental in the retailer’s Plan A; a five-year, 100-point plan that sees M&S working with its suppliers to combat climate change, reduce waste, safeguard natural resources and trade ethically. The implementation of Muddy Boots’ field-to-fork assurance scheme in 2006 has meant that all M&S suppliers now carry out their field-to-fork assessments electronically. The data collected is consolidated in a central M&S database and, using server-based and internet-based management reporting, M&S is able to assess all areas of its supply base, building powerful performance statistics to support Plan A.
Although CSR is now firmly in the multiples’ remit, it has been the very make-up of many fresh produce businesses for years. Capespan has been importing and distributing fruit from South Africa for more than 50 years, and has been leading the way towards social responsibility, particularly over the last 15 years. “The issue is close to our hearts, as we are 50 per cent owned by South African growers,” says Dunnett, “and we were involved with this issue before it became a subject in the retailing environment.
“Although Capespan is now a commercial enterprise, it started life as a board of the South African government in the 1980s. The business has gone through a lot of changes - some political - but farmers have their own objectives, and all have felt that looking after workers, the environment and the community has been their social responsibility for years.”
Similarly, international marketer and distributor Chiquita has been carving social responsibility into all its practices worldwide. The pioneer project was the one implemented in the banana farms in South America. The company is responsible for an extensive and complex supply chain in the area, and employs 21,500 people across its farms, offices and distribution sites. “The trust of our customers and consumers in our brand is a priceless asset, and operating as a socially responsible company helps us to earn and keep that trust,” says George Jaksch, Chiquita’s senior director of corporate responsibility and public affairs. “We have long-established systems that enable us to be quite sure that our produce is produced and distributed in a way that is responsible, covering issues like human rights, labourers’ rights and the environment. We have to assure our customers and consumers that we are maintaining high standards.”
Chiquita has been working towards sustainable banana production in South America for more than 15 years, and has developed a standard that incorporates social and environmental requirements. The company conducts annual audits on its farms with NGOs from the region. “Our work with Rainforest Alliance standards has been an important learning experience regarding the practical meaning of sustainable and responsible agriculture in the tropics,” explains Jaksch.
“Our next major milestone was the development and company-wide adoption of our corporate values and our code of conduct, which were published in 2000. We adopted the SA 8000 human rights standard as part of our code of conduct, and then worked towards the certification of all of our owned banana production in Latin America, which was completed in 2004.
In 2001, Chiquita signed an agreement of co-operation, called the International Framework Agreement, with the sector’s regional and global trade union organisations, COLSIBA and IUF. “This works to make sure the rights of workers are correctly enforced,” says Jaksch. “There are two key elements to this agreement. The first is the commitment of the company to respect and implement the standards of the International Labour Organisation (ILO) throughout banana production in Latin America, looking after issues such as child labour and discrimination.
“The second is working together in the form of two meetings a year as part of a joint review committee. This is an excellent mechanism to resolve any problems that may not have been resolved locally, and has improved our farms and those of our suppliers,” he continues.
“Since implementing this, we have seen incidents such as strikes and stoppages decline rapidly.”
As part of Dole, JP Fresh has been working with the Carbon Trust and its growers to create a carbon-neutral supply chain. “We are one of the companies leading the way in terms of reducing carbon emissions in the supply chain, and are the only company to have a team dedicated to the Carbon Trust,” explains Poole. “We are working with the Costa Rican government to produce carbon-neutral bananas; we look at the entire process, from the plantation right through the supply chain, and we are also looking into the process of carbon offsetting.”
In December last year, JP Fresh was M&S’s number-one supplier of the month for its work with the Carbon Trust and banana production in Costa Rica. “We are working very closely with M&S, which is very encouraging of our work in Costa Rica. It is all part of the retailer’s 100 commitments to social responsibility,” says Poole.
Food manufacturer Unilever has been working towards managing its environmental impact for more than a decade, and has launched a campaign to highlight its sustainability credentials called ‘Growing for the Future’.
“The scope and scale of our endeavour, and sourcing all raw materials from sustainable sources, means we must make sustainability improvements among all our suppliers and the millions of farmers involved with our business,” says Jan Kees Vis, sustainable agriculture director at Unilever, which also uses Muddy Boots software Quickfire. “It is crucial to have good information on performance, trends and gaps.”
The company intends to cover the whole supply base, meaning that thousands of farmers will be introduced to this new means of sustainability measurement. Unilever is also extending the system to third-party suppliers requiring growers to work towards goals, such as improving soil fertility and supporting local communities.
But as we move into an era where CSR dominates, will we see the pressure to comply with CSR standards fall equally on the different parts of the fresh produce supply chain?
“It is a very problematic subject, certainly when dealing with UK retail customers and their inevitable cost demands,” says Poole. “It is a main priority as a marketing company to reassure retailers and consumers that the product they buy has been grown in a safe, healthy environment. Consumers want to know how produce has been harvested, and that workers are getting a good deal.
“Many NGOs will say that large multi-million pound businesses are not socially responsible, but why wouldn’t they be? It makes sense to be. CSR is not a pressure; it is good business practice. When supermarkets ask for social responsibility credentials, they are looking after their customers, just as we do.”
Dunnett says supermarkets have embraced their social responsibilities. “From a UK point of view, it is the principle that we have been taking across the world. We have all the systems in place that retailers expect us to have,” he says.
“The Fairtrade push has been slow in happening, but now it is firmly on everyone’s agenda. The Fairtrade foundation has been very active, and retailers have now put it at the front of the shelf, rather than the back.
“This is, of course, reflecting consumer demand, but it is also showing that retailers are using Fairtrade as a plus point to sell, rather than a defence mechanism to any bad press - and Sainsbury’s has raised the bar in this area. Fairtrade is giving consumers a choice to pay a premium and help the workers get a good deal, and now it is becoming recognised and expanding, the volume of produce can increase, therefore making it cheaper for the consumer,” adds Dunnett.
Industry insiders are worried that pressure to conform to the supermarkets’ CSR demands could have a negative effect on certain parts of the industry that may not be ready to meet the challenge. But Chiquita welcomes the added pressure brought by the multiples. “Over the years, we have seen how leading UK retailers have increasingly focused on social and environmental responsibility,” says Jaksch. “For us, this has been very important, and we welcome the development because it has reinforced and encouraged us in our conviction that CSR is essential for investment in the future of our brand and our company.
“In our view, all participants in the fresh produce industry need to establish ways of producing and distributing that are constant with the concept of CSR, and this good work also needs to be communicated to consumers and promotion needs to be done,” says Jaksch.
“However, many of the environmental and social challenges facing our industry are of such complexity - for example, reducing carbon emissions - that they can only really be effectively addressed by a high level of co-operation within our industry.”
The industry needs to maintain its good work and make sure that the elements of social responsibility are understood and enforced throughout the supply chain, without forcing the weight of the load on one particular element.
Dunnett believes that changes will have to be brought about if the fresh produce industry is to become completely compliant to the concept of CSR. “From a grower’s point of view, I think that the requirements from the market, from both a technical and CSR viewpoint, need to be co-ordinated somehow,” he says. “We need to make it easier for growers to accommodate all the requests made of them.”
GLOBALGAP INTEGRAL TO CSR APPROACH
GLOBALGAP certification is an important part of both retailers’ and producers’ CSR policies, says GlobalGAP chairman Nigel Garbutt, pictured. And GlobalGAP is helping retailers and producers work together with suppliers to improve issues like food safety, worker health and welfare and environment protection.
The certification body has published a report on its website called the Grasp Project, which is a collaboration with a public-private partnership pilot programme with Swiss retailer Coop and German technical co-operation GTZ. The project has seen GlobalGAP assessing social aspects at farm level over 24 months. “Consumers are interested in social standards, primarily in horticulture, and this project will help producers assess their performance, with a self-assessment in terms of how their workers are being looked after,” says Garbutt. “This will not be part of GlobalGAP certification, but a voluntary assessment, of which the producer can then report back to its customers.
“It would be a huge operation to make this social responsibility assessment part of the GlobalGAP certification. A lot needs to be done to understand the local conditions and laws - GlobalGAP covers more than 80 countries - and that is why it is self-assessment only,” adds Garbutt.
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