Sustainability policy in practice in supermarkets and food companies in Belgium: is progress being made?

Sustainability policy in practice in supermarkets and food companies in Belgium: is progress being made?

02/03/2018

Better for the environment! Better for your health! Better for people and animals! Supermarkets and food companies in Belgium are constantly launching initiatives on sustainability. At the same time, however, there are persistent reports about farmers and other suppliers struggling with increasing price pressure, or about appalling conditions in abattoirs. So it’s time to assess the situation. In what areas are supermarkets heading in the right direction with their sustainability policy? And where are the sticking points?

A little background...

In 2014 we wrote the book #SaveTheFoodture as an update on the efforts being made in the area of sustainability by supermarkets and food companies. What are they doing to reduce the environmental impact of their products? How are they working towards fair prices for each link in the chain and guaranteeing good working conditions? But above all: what obstacles do they encounter in extending those efforts from the niche to the mainstream?

In late 2015, after consultations with the retail and food sector, we therefore put together a list of nine “to-do’s” to have a sustainable purchasing policy. Buyers are the people in supermarkets who negotiate with farmers and other suppliers about the products that find their way onto the shelves. Is price the only thing that counts? Or are social and environmental criteria important too? Purchasing policy largely determines how our food chain works.

In 2016 we ran a campaign with the slogan: “Could you pay a bit more? It’s for the farmers.” The following year there were a number of crises demonstrating that there is a greater need than ever to get from “to-do” to “done”. So how is it going with the introduction of those nine principles? Together with our team working on improving the sustainability of supply chains for supermarkets and food companies in Belgium, we take stock of the situation in this article.

"There is a lack of engagement at the sectoral level"

Gert Engelen
Gert Engelen
Program Advisor public & private sector

We finalised our nine to-do’s in collaboration with experts from supermarkets and the food industry. The aim was to engage people at the sectoral level. So far that has not been successful. If just one player starts having doubts, nobody takes the plunge. It’s very frustrating. The argument put forward by the supermarkets was that they are developing their own far-reaching policies. That’s fine, but in that case let’s see them. Yes, some progress has been made. You can see individual initiatives from all the retailers addressing one or more of the nine to-do’s. For example, the sustainability policy presented by Lidl in 2017 (read the policy in French) includes almost all of them.

In practice, however, it’s evident that sustainability is being narrowed down to ecological criteria. Animal welfare and health are also increasingly prominent issues. This can be seen in the Netherlands, for example, with initiatives in the dairy sector. It’s a good thing for retailers there to set the bar higher, but I’m also seeing a lot of new demands being placed on farmers, and it’s not clear how all the operators in the chain will be able to cope with these investments. The economic viability of farms at the beginning of the chain is much more complex to achieve – but it’s needed just as urgently and is essential if people are going to make substantial environmental investments.

Another thing that often strikes me is the gulf between Purchasing and CSR (Corporate Social Responsibility). If these two departments don’t work closely together, no progress will be made. They may set out some fine principles in the CSR department, but if their colleagues in Purchasing are judged solely on the price they negotiate, we have got nowhere. So that principle is also on our list of nine to-do’s.

Our supermarkets as a sector are also lagging behind in terms of reporting on sustainability efforts. FEVIA, the federation of the Belgian food industry, has now published its third biennial sustainability report. This includes indicators that can be used to monitor progress in each area. The Belgian retailers’ association, Comeos, has been working on its first sustainability report in recent months. Based on what I already know, we should expect to see nothing more than a list of initiatives – but who knows, we could be in for a surprise. Starting in 2018, all companies listed on the stock exchange will also have to produce a sustainability report. That could speed things up.

"Involve the consumer as a partner"

Liesbeth Van Meulder
Liesbeth Van Meulder
Program Advisor public & private sector

In late 2016 we launched a process that got a group of Belgian consumers talking to representatives from the supermarkets. The question discussed was: how can we extend sustainable consumption from the niche to the mainstream range? This resulted in seven concrete ideas. In the past year I’ve been working with every supermarket to look at which of these ideas they’re able to test. So far it’s been an uphill battle, without much in the way of actual results. There are a number of factors at work here: reluctance to share their ideas with competitors, fear of losing market share, a certain amount of apprehension about being “caught out” where things are not right, store layouts that don’t leave much room for experimentation, etc.

With my rose-tinted spectacles on, however, I can see that many supermarkets are nevertheless introducing initiatives behind the scenes that are in the spirit of those seven proposals. One example is the “consumer’s brand” initiative launched by Carrefour (read more about it in French). This gives consumers a say in what sustainability criteria their milk should meet and what price they’re willing to pay for it. It’s only a small thing at the moment. In my dreams, though, I can see a supermarket doing this for a whole range. If you involve your customers like this, you can radically change the way we talk about food. We could come to regard it not as something that ought to cost as little as possible, but as something precious that reflects the choices we feel are important in our society.

My message to supermarkets in 2018... Can I put it bluntly? Stop harping on about consumers not being interested and only caring about price. To a large extent that’s what you’ve taught them. You guide consumers on so many levels. Use the same techniques to steer us towards more sustainable choices.

Race to the top?

Jelle Goossens
Jelle Goossens
Communications officer
016/74.50.33 | 0485/08.29.60

The campaign conducted by Lidl in Belgium last year (“at Lidl making the right choice is easy” - read more about it in French) was a glimmer of light in this respect. The campaign talked about how they make the sustainable choice the easiest choice for a number of products. It’s particularly striking because Lidl is a hard discounter. Normally all their advertisements are about price, price and more price. It’s a step in the right direction for a supermarket to show how it can create value for the customer in a different way.

Unfortunately, stiff competition on price is still the kingpin in the game being played by the supermarkets. However, marketing is about more than just price. The best marketing is a product with a story that rings true from beginning to end.

Our ambition with Rikolto should be to create a playing field where supermarkets can engage in a race to the top on sustainability issues. The “I am more than my till receipt” campaign, which we are jointly launching this year with civil-society organisations (Femma, KVLV and Gezinsbond), Test Aankoop, which defends the interests/rights of consumers, and Fairtrade Belgium, should give things a push in this direction.

Innovation in food chains: are we reaching a turning point?

Joris Aertsens
Joris Aertsens
Program Advisor sustainable chain development

My job is to make supply chains more sustainable and I’ve noticed various positive developments in this area. Up to now we’ve only been working with the Colruyt Group, looking carefully at a number of product chains such as Congolese coffee. Several supermarkets are now interested in re-inventing the supply chains behind their products through collaboration. Pressure from the environment and also from society is creating a demand for more transparency and fair conditions.

Internationally you can see that cooperation between retailers and civil-society organisations is bearing fruit. One good example of this is the Sustainable Trade Initiative (IDH) in the Netherlands, which aims to improve the sustainability of important food products such as cocoa, coffee, fruit and vegetables, palm oil, etc. Another interesting example is Danube Soy, an association that brings together retailers, traders and NGOs to promote European soya.

You can feel that the way people think is changing. Of course, that’s partly thanks to our sustained efforts over the years. Our food chain projects are not such a rarity any more. One example is the new apple variety being launched by the Colruyt Group (read more in French), or the “Better for everyone” pigs at Delhaize (read more in French). You see the same principles again and again: collaboration between producers, supermarkets and scientists, fair sharing of risks and benefits across the chain.

So is there a “but”? Of course there is. When you look at the impact in comparison with total sales, these food chain projects account for only a small percentage of sales. More difficult choices need to be made to roll out these experiences from just a few products to a whole product category.

The abattoir scandals (Animal Rights group spread shocking images showing maltreatment of the animals and illegal practices) made it quite clear that there is actually no other way to be credible. As a supermarket you are not legally responsible if things are not right with one of your suppliers, but you have a share in the harm that is done to their image.

Conclusion?

Gert Engelen: “Supermarkets have many advantages when it comes to improving sustainability in the food chain. In my view, however, you need pre-competitive agreements at the sectoral level, because otherwise the pressure of competition will make any new initiative impossible before you start. So can we still force a breakthrough?”

Joris Aertsens: “The greatest blind spot in the shift towards sustainability is pricing mechanisms that achieve viable prices in the longer term but without distorting the market. You could certainly see that as an ambition.”

Liesbeth Van Meulder: “Retailers take inspiration from us, but often they organise the actual process of implementation themselves and don’t involve us. That’s fine – as long as they’re making progress. Although I can’t deny that it’s a bit frustrating sometimes.”

Jelle Goossens: “Above all, we need to stay on the ball when dealing with the supermarkets. Doing things not quite so badly is not enough.”