Consumers want it, regulators will enforce it: transparency around your product impact is quickly becoming unavoidable. Almost 69% of shoppers want to know more information on how your product can contribute to a better planet. Meanwhile, governments and institutions are preparing laws that will make disclosing information to consumers about your value chain obligatory.
The good news is there’s a lot in it for your company, too. Here are 9 reasons why conducting an impact assessment for your food products is smart business.
1. You have to do it anyway. To get the obvious reason out of the way: Mandatory labelling is coming. The EU is going to introduce “Mandatory sustainability labelling and disclosure of information to consumers on products along value chains.” Businesses that do not fulfil their obligations in terms of labelling will not be able to enter the EU market. Doing an assessment now, before the regulations come into force, means you will be prepared when they finally become a reality.
2. You save money. Inefficient use of resources such as energy, water and raw materials causes real costs your business has to shoulder. Deloitte investigated resource use for a global media and entertainment company and discovered they could reduce the amount of plastic in the DVD case, which in turn saved €40 million in costs annually.
3. You can choose better (and often cheaper) supply chain partners. Choosing supply chain partners who are making efforts to use less water and reduce their carbon impact can result in you paying less for their services. There is no better example of this than Unilever, which cut costs by €1.2 billion through sustainable sourcing between 2008 and 2021.
4. You will improve your brand value. A study in Singapore shows beyond a doubt that companies with sustainability disclosures enjoy higher brand value. 90 unique companies were awarded “Top 100 Singapore companies with the highest brand value” in 2016 and 2018. Of these, 82% have sustainability communication. Talking about your sustainability efforts pays off. What’s more, when a company confronts their business risks transparently with counter strategies, it builds brand trust.
5. You can easily communicate your sustainability achievements. Food labelling can inform retailers and consumers in detail about how sustainable your product is across several categories including animal welfare, biodiversity, and nutrition. This clears up any worries they might have about your product.
6. You can mitigate risks to your value chain. An assessment will lay bare the environmental, social and other hotspots in your production processes. It informs you about the risks posed to these processes through climate change, so you can decide how to deal with them and ultimately save yourself hassle and money.
7. You can make better policy decisions for your company. An assessment of your product impact can help in making your sustainability goals more realistic, as you can use the data to determine which objectives can be met in which timeframes.
8. You avoid simply shifting the problem. A product impact assessment is a holistic approach that takes into account all the different aspects that come into play throughout a product’s lifecycle. For example, when environmental issues are identified in a vacuum, making improvements to them can actually lead to undesirable consequences such as further environmental damage elsewhere along the supply chain. The US introduced the Energy Policy Act in 2005, which required ethanol to be mixed with gasoline. Because most Renewable Fuel Standard requirements are fulfilled using corn ethanol, this move significantly increased the demand for corn. However, this had multiple negative impacts on the environment, such as increased carbon emissions, greater water scarcity, lower water quality, lower soil quality, and harm to wildlife. One issue was that corn needs more fertiliser than any other crop found in the US. This meant around 2.39 million additional tons of nitrogen fertilizer were necessary to meet the RFS requirements. Increased use of such fertiliser in turn degrades local water quality. And there you have the perfect example of how a well-intentioned policy seemed to solve one environmental problem but ended up creating many more in the process.
9. You won’t be accused of greenwashing, or worse, greenwishing. Many companies are promoting token sustainability initiatives, while happily continuing to destroy the planet. This is known as greenwashing and will only end up damaging their reputation. However, there is another serious issue when it comes to sustainability efforts; greenwishing. This means companies are making wishful climate and environmental commitments that won’t go into effect for decades. At that point, it will be too late to save the planet anyway. An impact assessment immediately offers a wealth of data with which your company can take effective measures to reduce its overall impact right away, rather than making promises thirty years into the future.
Have we convinced you yet? Great! We at inoqo provide Product Impact Assessments, which cover a multitude of factors, including animal welfare, biodiversity, and social impact. If you are curious about how your products are impacting the world or would like to understand our methodology, simply reach out to us at firstname.lastname@example.org.