Supply Chain

Leading Up to Fair Trade Month, Keurig Green Mountain Ramping Up Efforts to Develop Resilient Supply Chains

With Fair Trade Month beginning tomorrow, Keurig Green Mountain Inc. (KGM), formerly Green Mountain Coffee Roasters, has revealed its strategy for building a more resilient supply chain. By continuing its support of fair trade, the company is aiming to build lasting relationships with its suppliers, and help communities become more robust in tackling climate-driven issues that could impact their supplies over the coming decades.

By Hannah Ritchie | Published 10 years ago | About a 4 minute read

“Fair Trade Month is a time to examine how we engage with our supply chain communities to address challenges and identify new opportunities to effect positive change,” Monique Oxender, Senior Director of Sustainability at KGM, said in a statement. “Fair trade is one element of our mission to build a resilient supply chain. It helps ensure a stable supply of high-quality coffee for our customers and consumers, and contributes to a higher quality of life for our suppliers.”

Keurig Green Mountain’s efforts include:

The coffee company has set a Resilient Supply Chain 2020 target of engaging at least one million people in its manufacturing and agricultural supply chain, with the aim of improving the livelihoods of farmers and workers across its supply regions. It began purchasing fair trade coffee in 2000, and has since then become one of the largest buyers of Fair Trade Certified™ coffee.
Earlier this year, KGM expanded its fair trade commitments beyond coffee for the first time - teaming up with its tea partners, Bigelow and Celestial Seasonings, to offer its first Fair Trade Certified hot teas. It has converted two of its bestselling teas — Bigelow English Breakfast Tea and Celestial Seasonings Green Tea — to be Fair Trade Certified, with the goal of improving the lives of tea farmers and their communities through investment in areas such as infrastructure, schools, and health.
KGM has also highlighted the importance of its Intercambio exchange events as an opportunity for all stakeholders — including producers, microfinanciers, exporters, importers, certifiers, NGOs and other industry leaders — from its supplying countries to come together to discuss their challenges, quality standards and plans for the future. Extending its engagement with suppliers and increasing its supply chain transparency is key to making these events productive. In November the company will host its fifth Intercambio in Guatemala, with previous events held in Colombia, Peru, Indonesia, and Nicaragua.
The coffee giant has been one of the leading companies in the fight against coffee leaf rust (la roya), a disease intensified by climate change, which could severely affect its coffee supply chains. KGM has teamed up with partners such as World Coffee Research and Mercy Corps to provide support for rust recovery, in the hopes of mitigating the risk to its Latin American supply chain. Its support includes education on good agricultural practices, access to inputs, and recovery support to help farmers continue coffee-growing in the midst of crisis.
Partnering with Root Capital, the Inter-American Development Bank and the Skoll Foundation, Keurig launched the Coffee Farmer Resilience Initiative (CFRI), making to a US$1.9 million, three-year funding commitment. The CFRI provides financial advice to rural farmers and long-term rehabilitation finances for crop recovery; it helps farmers replace their coffee plants affected by la roya, and incorporates a wider contribution to increasing the resilience of growing communities to the effects of climate change.
The coffee company also contributes to the Coffee Farmer Resilience Fund (an element of the CFRI), which is matched by USAID to invest in on-farm education of best agricultural practices in a changing climate. With multiple-stakeholder collaborations, the total fund amounts to US$23 million, and aims to support more than 40,000 coffee farmers.

KGM says it will continue to focus its efforts on supply chain resilience and support following the results of a 2013 study- released earlier this year — that smallholder coffee communities have improved food security since 2007, partly as a result of some KGM-funded initiatives. The company has also been upping its efforts in other areas of sustainability — earlier this year, it committed US$11 million to support leading NGOs working to promote water security across the world.

Last week at New Metrics ’14 (see highlights here), Fair Trade USA’s Chief Impact Officer Mary Jo Cook presented the organization’s new Impact Measurement and Management Framework, which has been developed to define, measure and communicate the impacts Fair Trade enables for farmers, workers, businesses and consumers. The Framework generates new insight into the complex relationships between value creation (risk management, reliable production, profitable growth), sustainable livelihoods (human well-being, income empowerment, environment sustainability) and consumer activation (product choice, preference for Fair Trade).