Agribusiness Performance: Beyond the bottom line Can we maximize returns for profit, people, and the...
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Transcript of Agribusiness Performance: Beyond the bottom line Can we maximize returns for profit, people, and the...
Agribusiness Agribusiness Performance: Beyond Performance: Beyond the bottom linethe bottom line
Can we maximize returns for profit, Can we maximize returns for profit, people, and the planet?people, and the planet?
““Green Investing Is Paying Off: Eco-Green Investing Is Paying Off: Eco-friendly investments, from individual friendly investments, from individual stocks to mutual funds and ETFs, stocks to mutual funds and ETFs, have outperformed the Dow and S&P have outperformed the Dow and S&P 500 this year” (11/09)500 this year” (11/09)
WHY ARE FIRMS USING GREEN WHY ARE FIRMS USING GREEN MARKETING?MARKETING?
Organizations perceive Organizations perceive environmental marketingenvironmental marketing to be an to be an opportunity that can be used to achieve its objectivesopportunity that can be used to achieve its objectives
Organizations believe they have a Organizations believe they have a moral obligationmoral obligation to be more to be more socially responsible socially responsible
Governmental bodies are forcing firms through Governmental bodies are forcing firms through legislationlegislation to to become more responsible become more responsible
Competitors'Competitors' environmental activities pressure firms to change environmental activities pressure firms to change their environmental marketing activities their environmental marketing activities
Cost factorsCost factors associated with waste disposal, or reductions in associated with waste disposal, or reductions in material usage forces firms to modify their behaviormaterial usage forces firms to modify their behavior
AgribusinessAgribusiness
Corporate sustainability and responsibilityCorporate sustainability and responsibility Corporate sustainability http://www.winwinpartner.com/Who%20We%20Are/index.htmlhttp://www.winwinpartner.com/Who%20We%20Are/index.html
Dow Jones Sustainability IndexDow Jones Sustainability Index EnergyEnergy Pollution managementPollution management Environmental stewardshipEnvironmental stewardship Workforce developmentWorkforce development
An investable concept?An investable concept?
GreenGreenAgribusinessAgribusiness
Green marketing Winslow Green Growth Fund
seeks capital appreciation through environmentally responsible investing. The fund normally invests at least 80% of net assets in equity securities of domestic companies that create products or provide services that offer solutions to environmental problems and promote a healthier environmental future or integrate the principles of waste management, pollution prevention, or efficient use of natural resources into its business practices.
Winslow Management
Top Ten HoldingsTop Ten Holdings 09/30/2010 09/30/2010 First Solar, Inc. Bioexx Specialty Proteins First Solar, Inc. Bioexx Specialty Proteins
inc American Superconductor Corporation inc American Superconductor Corporation Waterfurnace Renewable Energy Inc Waterfurnace Renewable Energy Inc Horsehead Holding Corporation Schnitzer Horsehead Holding Corporation Schnitzer Steel Industries, Inc. A Rubicon Steel Industries, Inc. A Rubicon Technology, Inc. Nalco Holding Company Technology, Inc. Nalco Holding Company ProLogis Trust WabtecProLogis Trust Wabtec
Winslow Green Growth Fund 1994-2008
Winslow Fund – recession Winslow Fund – recession proof?proof?
Source: MSNBC.com financial charts, Nov 2011
Reorganized as Brown Advisory Sustainable Growth in 2012Struggles, like other green funds, to keep up with S&P 500
Some Agribusiness Some Agribusiness ExamplesExamples
P-R Farms (CA tree fruits & nuts)P-R Farms (CA tree fruits & nuts) Solar Energy ImplementationSolar Energy Implementation
Fair Oaks Dairy, Koetsier FarmFair Oaks Dairy, Koetsier Farm Anaerobic digestersAnaerobic digesters
WeyerhaeuserWeyerhaeuser Recycled packagingRecycled packaging Sustainable products from forestsSustainable products from forests
Weyerhaeuser | Growing Ideas
More interesting More interesting examplesexamples
Green mountain energy – branding “eco-Green mountain energy – branding “eco-friendly” electricityfriendly” electricity
Green Mountain Energy Company California Energy Company now servicing 7 California Energy Company now servicing 7
statesstates More expensive (5-6%)More expensive (5-6%) Purchase power on-linePurchase power on-line
What about investments in What about investments in alternative energy?alternative energy?
Is ethanol going to Is ethanol going to work?work?
Subsidies?Subsidies? Use mandates?Use mandates? See Terry Kasten’s See Terry Kasten’s
reportreport
Scarce Energy ChronologyScarce Energy Chronology
1859:1859: Drake discovers oil in PennsylvaniaDrake discovers oil in Pennsylvania 1879:1879: USGS formed to deal with running out of oilUSGS formed to deal with running out of oil 1882:1882: 95M bbl remain (Institute of Mining Engineers)95M bbl remain (Institute of Mining Engineers) 1918:1918: 3 million cars on the road3 million cars on the road 1919:1919: auto industry shouldn’t ignore that only 20 years left (Scientific American)auto industry shouldn’t ignore that only 20 years left (Scientific American) 1926:1926: 4.5B bbl left in the U.S. (Federal Oil Conservation Board)4.5B bbl left in the U.S. (Federal Oil Conservation Board) 1930:1930: 18 million cars18 million cars 1932:1932: 10B bbl left in U.S. (Federal Oil Conservation Board)10B bbl left in U.S. (Federal Oil Conservation Board) 1944:1944: 20B bbl left in U.S. (Petroleum Administrator for War)20B bbl left in U.S. (Petroleum Administrator for War) 1950:1950: 100B bbl left in world (American Pet. Inst)100B bbl left in world (American Pet. Inst) 1980:1980: proven oil reserves 648B bblproven oil reserves 648B bbl 1993:1993: proven oil reserves 999B bblproven oil reserves 999B bbl 2000:2000: proven oil reserves 1016B bblproven oil reserves 1016B bbl 2007:2007: proven oil reserves 1317B bblproven oil reserves 1317B bbl
Source: Adapted from Terry Kasten, Kansas State Univ
Another example…Another example…
Forest Stewardship Council
Integrated Supply Integrated Supply Chain ControlsChain Controls
Branding targeted to Branding targeted to the green consumerthe green consumer
Values driven supply Values driven supply chain chain
poulet de Bressepoulet de Bresse Label RougeLabel Rouge Scottish salmon industryScottish salmon industry
Economic benefitsEconomic benefits
Tea & Coffee and child laborTea & Coffee and child labor http://www.teaandcoffee.net/0102/special2.htmhttp://www.teaandcoffee.net/0102/special2.htm
Social impacts of Social impacts of international marketinginternational marketing
Do food and agribusiness firms have an Do food and agribusiness firms have an obligation to developing communities to “get obligation to developing communities to “get the product right”?the product right”?
Nestle Infant FormulaNestle Infant Formula Misuse of formulaMisuse of formula Promotion impacts on feeding programs in poverty Promotion impacts on feeding programs in poverty
areas – samples, mediaareas – samples, media World Health Organization (response to protestors)World Health Organization (response to protestors) Nestlé & WHONestlé & WHO
The Cocoa Plan Ecuador In The Cocoa Plan Ecuador In ActionAction
Purchasing beans with Arriba taste
Winning consumerReferences on 60/40+
Supporting farmers through
“Farmer Connect”
Linking back to producer through claims towards health, origin, and purity
Managing the supply Chain and monitoring Critical control points
Nestlé Corporate AgricultureNestlé Corporate Agriculture
Nestlé “Farmer Connect” sourcing of agricultural raw materials around the world
Nestlé Corporate AgricultureNestlé Corporate Agriculture
Interacting with nearly 700,000 farmers in more than 50 countries
PEOPLE
LAND
WATER
ENERGY
CLIMATE
To ensure supply we have to smarter use natural resources by
• Not wasting
• Not polluting
• Not destroying
and a good start is eradicating the worst and promoting better
Sustainable Agricultural Practices.
Producing more food from the same area of land while reducing the environmental impacts requires what we call “Sustainable intensification of Agriculture”.
Our “Sustainable Agriculture Initiative Our “Sustainable Agriculture Initiative Nestlé” (SAIN) Nestlé” (SAIN)
NO FOOD WASTENestlé Corporate AgricultureNestlé Corporate Agriculture
Agribusiness and sustainability:Agribusiness and sustainability:Profits, people, and planetProfits, people, and planet
Relating to an environmentally conscious Relating to an environmentally conscious generation – mixed results in the marketgeneration – mixed results in the market
Working with interest groups, technology Working with interest groups, technology and supply chains to deliver differentiated and supply chains to deliver differentiated products – new value netsproducts – new value nets
Adapting products and marketing Adapting products and marketing approaches to account for economic and approaches to account for economic and cultural differencescultural differences
Planning for the Planning for the McDonald’s CaseMcDonald’s Case
How does sustainability impact McDs?How does sustainability impact McDs? Is there sound business justification for McDs to pay attention to Is there sound business justification for McDs to pay attention to
sustainability for supply?sustainability for supply? Is McDs too big? Scale dis-economies and sustainabilityIs McDs too big? Scale dis-economies and sustainability What is your perception of them as a consumer? Are they What is your perception of them as a consumer? Are they
reaching the LOHAS folks?reaching the LOHAS folks? How does McD’s need to look at profits, people, and planet long How does McD’s need to look at profits, people, and planet long
term? What term? What conflictsconflicts might they expect to emerge? might they expect to emerge? Accounting jargon uses the term ‘viable going concern’ fairly Accounting jargon uses the term ‘viable going concern’ fairly
narrowly. Does the definition need to be broadened?narrowly. Does the definition need to be broadened?
McDonalds Brazil