Sainsbury’s boss calls for collaboration to build sustainable food system

The UK food system is a force for good, but the way it works together and is supported by government has to improve.

This was the central message of the 23^rd annual City Food & Drink Lecture, which took place at London’s Guildhall on Monday 11 March.

The keynote speech was delivered by CEO of Sainsbury’s Simon Roberts who emphasised the need to bridge the divide been retailers on one side of the food system, and suppliers, processors and growers on the other.

He acknowledged that, in the past, supermarkets’ relationship with growers, farmers and the supply chain has “too often been short-term in outlook” and “not always as collaborative as any of us would have liked”.

He said a new culture of collaboration and longer-term partnerships was needed to drive change “at a system level” and create a more sustainable and resilient food system.

Roberts also spoke of the significant threats to food security, as well as the risks posed by climate change, nature loss, pressure on resources, and health risks for consumers.

Low prices

The Sainsbury’s boss acknowledged concerns that Britain has some of the lowest food prices in the western world. And he pointed out that the proportion of UK household income spent on food has fallen from 31 to 12 per cent since 1957.

However, Roberts defended Sainsbury’s pricing strategy in the panel debate that followed his lecture.

Along with the other major UK supermarkets, Sainsbury’s has price-matched with Aldi and Lidl in recent years. Roberts said it should be recognised how much retailers have invested in reducing the impact of inflation at a difficult time for consumers.

The Covid effect

While hugely challenging for society, the Covid pandemic showed the British food industry “at its very best”, Roberts said. But since then, appreciation for the sector “as a force for good” has waned. And too many of the “gains” have now been lost.

During Covid, “the government became totally engaged and listened to the industry in a way and with a consistency that changed what became possible. Our food resilience became a national priority,” Roberts said.

Since then, “deeper cracks have reappeared”. Short-term crises such as soaring energy costs have “exposed the fragility” of the food system, leading to supply shortages.

Food policy

Going forward, Roberts highlighted four key priorities for make the UK food system more sustainable and resilient.

Firstly, he stressed the need for supportive government policies to give UK suppliers and producers the confidence to invest and become more efficient. ”Building greater food resilience needs to be a national priority and that starts with the government,” he said. 

The Sainsbury’s CEO emphasised the need to maintain British production, warning against environmental policies that incentivise growers to take too much land out of production.

However, he complained that a “conveyor belt of conflicting policies” from the government has made it difficult for producers in a number of ways, including on-farm investment, employing seasonal workers, and developing regenerative agriculture.

The latest government ministers are “some of the more engaged we’ve worked with”, Roberts said. But he echoed the views of Dr Clive Black, a food retail analyst at Shore Capital, that the present government structure for the British food system is not fit for purpose.

According to Black, UK food policy is uncoordinated, fragmented, and “not a priority for anyone in government these days”.

Britain needs a designated Minister for Food, reporting to the Prime Minister, Black argues. And Roberts added that lessons can be learned from Bord Bia in Ireland, where the food sector has a much stronger voice.

Other priorities

The other three priorities outlined by Roberts were partnership, sustainability and customers.

On partnership, he stressed that greater collaboration in the supply chain is “entirely compatible” with a competitive market.

He gave recent examples of ways in which Sainsbury’s has supported certain horticultural sectors. Apple and pear growers were given a pre-harvest cost price increase after this season’s yield was much lower than last year’s bumper crop. And in potatoes the supermarket introduced a cost model with a predictable margin to support smaller growers to be part of its supply chain.

On sustainability, Roberts stressed the importance of boosting biodiversity in Britain, which is the most depleted nation in the G7 on that front.

When it comes to customers, Roberts said Sainsbury’s has tried to support shoppers with price cuts, promotions, increased British sourcing, and by encouraging them to eat less processed food.

He concluded by saying: “The pressure on our food system, both in the UK and globally, is very real. And it is only by working together in genuine partnership that we can make it work in a way that is efficient and delivers for all its participants.”

According to Roberts, this is what is needed to deliver a more resilient and sustainable food system that improves the health of the population and supports prosperity and job creation.