Quantis, a BCG company and
leading global sustainability consultancy driving sustainable transformation to
align businesses with planetary boundaries, has released Recipe for
Transformation
— a report assessing the efficacy of sustainability strategies across the global
food and beverage industry. The report surveyed more than 600 professionals and
C-level executives across multiple business functions in the food and beverage
industry. Respondents work in large companies within retail, wholesale, consumer
packaged goods, commodities and agriculture subsectors.
76 percent of respondents reported some level of confidence in their
sustainability roadmaps and ability to achieve environmental goals by 2030; but
Quantis identified critical components for success missing from many of their
action plans. And despite having the greatest potential for radical
transformation at scale, product portfolio redesign, regenerative
agriculture
and plant-based
initiatives
were cited as the lowest three priorities for the next year. Clear action plans
are the second-most important success factor (38 percent), but they are lacking
— and 26 percent of respondents still view them as a challenge.
Other key findings include:
-
The supply chain remains the top challenge: 42 percent of respondents
cite its complexities as the largest barrier to success.
-
As departmental budgets reflect, financial investment remains a barrier:
Cited as the second-largest barrier to success, allocating funds remains a
struggle: The average percentage of annual budget allocated to reducing
environmental impact is just 12.5 percent across departments.
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Chief Sustainability Officers need more interdepartmental buy-in:
Company commitment and culture set by leadership were the largest drivers of
sustainable practices across departments, but the two biggest barriers to
success (supply chain and budget allocation) sit largely outside their
control — proving the importance of aligning the strategies of
sustainability and
finance.
-
Packaging is priority: Most respondents have tools and budget in place
to make packaging more sustainable, and 62 percent cited it as a top
priority for the next year; this is a clear starting point across brands,
but critical levers for scaling and implementing these efforts are missing.
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Consumers are ready — the industry just needs to deliver: Even in the
current economic climate, 100 percent of marketing respondents have seen
changes in consumer
behavior
regarding sustainable purchasing habits. More than half cite that their
customers are more interested in sustainable products and willing to spend
more to get them.
“Though food and beverage sector leaders are making progress, the path to
alignment with planetary boundaries and resilience will require a shift from
sustainability in a silo to sustainability embedded across business functions,”
said Charlotte Bande, Global
Food & Beverage Lead for Quantis. “Estimates show that food and beverage
organizations could lose up to 26 percent of their
value
if they don’t act quickly, but much still stands in the way of doing so
effectively and efficiently. Securing more budget and driving impactful
transformation will require collaboration, both throughout departments
internally and with strategic partners across the value chain.”
5 areas of focus
Quantis
highlights
five key themes to guide companies, and the industry, toward a future in which
both business and the planet can thrive:
1. Increase resilience in the food supply chain
In the face of potential financial crises and unforeseen environmental shocks,
companies must invest in supply chain programs that foster business resilience.
Increasing investments in regenerative-agriculture
programs
can ensure long-term commodity supply, nurture farmer and grower relationships,
and increase
resilience
by helping companies adapt to disruptions and contribute to a more robust,
sustainable food ecosystem.
2. Transform product portfolios
What are the highest– and lowest-performing products across environmental,
nutritional, quality and profitability metrics? A forward-thinking approach to
sustainability involves a comprehensive assessment of alternative ingredients,
recipes, packaging design and portion sizing. Scaling sustainable practices
requires pragmatic piloting and collaboration within the industry. Innovation in
product portfolios should be driven by both the desire to reduce environmental
impacts and risks while also meeting consumer demands for quality and diversity.
3. Shift focus from reducing emissions to supporting nature
To effectively transition our food systems to align with a planetary economy,
companies must broaden their efforts beyond purely reducing carbon emissions.
Given the food and beverage industry’s heavy dependence on agriculture, nature
has a crucial role to play. While leaders may be overwhelmed by the idea of
adopting a nature
strategy
in addition to climate initiatives, prioritizing both can fuel progress toward
climate goals and ensure long-term resilience.
4. Drive consumer behavior changes.
While setting nature and climate strategies can help lead companies in the right
direction toward holistic, sustainable transformation, it’s just as important to
engage stakeholders — especially consumers — in sustainability goals. Companies
must remind consumers of their direct impact on planetary boundaries and how to
positively contribute to corporate sustainability goals through responsible
consumption,
reducing food
waste
and encouraging more sustainable
diets.
5. Prepare for the upcoming regulatory landscape.
Preparation is key when adapting to ever-evolving regulations. Companies should
hold C-suite, board members and functional leaders accountable to ensure
compliance with upcoming regulations related to
deforestation,
packaging,
ecolabeling
and broader ESG
reporting.
Staying ahead of regulatory changes in end markets and supplier regions will not
only avoid incurring the cost of inaction but also position companies as
sustainability leaders.
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Sustainable Brands Staff
Published Jun 4, 2024 8am EDT / 5am PDT / 1pm BST / 2pm CEST