The recent “Future in Food UK: Driven by Sustainability” conference held on the 18 June 2014 highlighted that sustainability is an issue for the food and drink sector and will become increasingly important in future. Eversheds’ associate Catherine Manning attended the conference along with a large number of food and drink sector companies, service providers and consultants.
The key issues considered during the event were:
Why the focus on sustainability?
This is not merely due to PR and the brand credentials of “doing the right thing” being “environmental” or “ethical”, for the food and drink sector the increased focus on sustainability is linked to the concerns around expected population increases and a lack of suitable farm land. These pressures mean food will need to be grown and managed more efficiently. Greater regulation which requires improved environmental practices (e.g. less packaging) is also a factor.
The increased costs of energy, and costs relating to emissions are also making certain projects more cost effective.
Pay Back Period
Sustainable practices can reduce environmental impacts in a number of ways including through reduced energy usage, water usage, greenhouse gas emissions, waste and increased transport efficiency. This in turn reduces costs.
Whilst many companies currently focus on a three year pay back period this may alter in the future. Anecdotal evidence suggests that certain companies (especially those in private ownership) are starting to accept lower rates of return/longer payback periods for sustainability projects or are focusing on issues other than purely financial repayment.
Retailers and large food and drinks manufacturers are contractually requiring their supply chain to undertake sustainable practices. Audits are increasingly being used to verify compliance and enforcement of these requirements.
Therefore for many businesses sustainability is as much about retaining and obtaining customers as it is about anything else.
Whilst there is no suggestion that sustainable practices will become the norm overnight, the days when sustainability was just a buzz word are certainly over. A combination of commercial pressures from the large players and the real cost benefits mean that sustainability will remain an issue for the whole of the food and drink sector supply chain.
The Food and Drink Federation is holding a conference on sustainability on 21 October 2014.