Sustainable supply seen as emerging future risk for food companies

Companies increasingly see sustainable supply as a future risk to business

Food safety, quality and financial issues are considered the top three risks to business for most food companies, but sustainable supply is emerging as a growing area of concern, according to a new survey from DNV Business Assurance.

DNV recently carried out a web-based survey of about 500 food companies from 14 countries around the world, looking at what they consider the main areas of risk for the future of their businesses.

“What you see today is the three main risk areas: Food safety, quality and financial,” the company’s global manager of food and beverage Stefano Crea told FoodNavigator.

“When you ask them what they see in the future, they say more or less it will be the same but with some different dynamics….Those three will stay as the top ones but we are seeing quite a development on the environmental side. There is high interest on the area of sustainability.”

He added that sustainability concerns are rising at different rates in different parts of the world, with European business executives generally more concerned about sustainability than those in the United States, for example. Crea speculated that perhaps this was because US companies are currently embroiled in complying with a relatively new food safety law, the Food Safety Modernization Act, which was signed into law in January 2011.

“It came across quite clearly that in the US there are still different priorities,” said Crea. “They are completing the house before putting in a nice roof.”

By contrast, the current European food safety law was established more than ten years ago.

“In Europe, perhaps this gives the opportunity to start looking at new areas. The driver is very much aware and informed consumers. The media too….social media is really driving the speed of response needed at this end.”

Under the sustainability umbrella, particular areas of concern for food companies included energy – with some of the most advanced strategies for renewable energy coming from Northern European countries – and water supply is an issue that Crea said DNV had noticed becoming more and more a part of company policies.

 When companies were asked why they were incorporating sustainability into their business strategies, Crea said the number one answer was ‘because of our customers’, followed by ‘internal policies’ and ‘differentiation from competition’.

“The industry is maturing very quickly because it sees that this is important,” he said. “They are recognising it and setting up internal policies, not because they have to do it, but because they want to do it.”

He added that companies are seeing that they can leverage sustainability issues, and better understanding and management of supply chains means they can move away from simply responding to potential threats.

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Comments (2)

Christopher Gleadle - 26 Apr 2013 | 04:51

Sustainability - Core to any excellent business

It is interesting to note that food safety, quality and financial issues are considered the top three risks to business for most food companies, since sustainability, embedded and leveraged across the value chain correctly, addresses these three main areas. Capturing the circles of sustainability across all business units, demonstrates clearly, the interdependence of all functions - elevates operational performance and asset utilisation as well as highlights how environmental and social stressors conspire to impact the balance sheet negatively: or positively. To place sustainability at the core of the business; is to place it at the nexus of financial materiality.

26-Apr-2013 at 16:51 GMT

Richard Stephens - 23 Mar 2013 | 11:06

Consulting

Very interesting

23-Mar-2013 at 11:06 GMT

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