As a sustainability advisor to the West Michigan Food Processing Association (WMFPA), I recently had the opportunity to facilitate a WMFPA industry discussion with different levels of food manufacturing management regarding sustainability best practices. The session provided great insight about the significant difficulties companies are having addressing current supply chain issues and risks. The need for implementation of sustainability best practices to help improve decision making and create positive sustainability impact was prominent in the discussion. There were , however, several lingering issues that many of the companies were facing. Sustainability was mentioned as one of many initiatives that companies were currently undertaking. However, some programs appeared to be of more importance than others as some sustainability directives seemed to have lost their influence. So the question was raised about how to gain favor and support for sustainability programs with C Suite management?


First, who is C Suite management? Depending on the size of the company, these executive leaders can be CEOs, Presidents, COOs, CFOs, divisional leaders, and other key management decision makers. Each level of executive management may have its own lens when looking at sustainability projects and programs and these parameters must be taken into account. The good news is that stakeholders, investors, shareholders, and employees today have all become increasingly more aware of environmental and social sustainability issues and opportunities. The breadth of these perspectives can all be communicated with management on a regular basis to stay informed. The concerns about greenwashing have also diminished, as companies are now able to pursue sustainability certifications, guidelines, standards for their products and processes in their manufacturing and operations.


So then, what does the C suite management sales pitch on sustainability look like? What should the message be?


  • First, sustainability must show positive economic performance. There are a number of ways that sustainability programs and projects can demonstrate this performance. Short term, sustainability progress can be achieved through cost avoidance in comparison to current company bottom line results. These cost savings can be translated into improved gross margins and overall cost budgeting. One area that can provide great insight is the use of total cost accounting that embraces all externalities including direct and indirect cost burdens. Today, there are also several “ROI” proformas that can also be developed, such as environmental ROIs and social ROIs that use total cost accounting techniques and can determine specific environmental or social sustainability performance. Sustainability programs and projects must also be able to create longer term value through positive sustained economic, environmental, and social impact. One significant helpful metric to use for these cases is the determination of economic impact dollars that the sustainability program or project generates over time. Additionally, many companies are now embracing the Sustainability Accounting Standards Board (SASB) sustainability adjusted reporting guidelines for specific projects such as the Carbon Disclosure Project.


  • Second, the marketplace cares about sustainability. Consumers, regulators, employees, and stakeholders alike all care about sustainability because it affects each of our individual lives. There is a great conscious awareness of sustainability issues across the world today, whether it be scarce resources such as water, climate change, deforestation, waste pollution such as with plastics, social justice, food access etc. Patagonia has recognized that everything they make has an impact on the planet and set short and long term goals to reduce and even establish zero environmental impact goals for their company. New markets also care about sustainability. One new growing market is known as the LOHAS market or Lifestyles of Health and Sustainability. This retail market is estimated at $300B+ today with about 30% of consumers willing to purchase LOHAS products at higher prices because of the sustainability labels, certifications, and standards that the products meet.


  • Third, investors and customers care about sustainability. Today, there has been a deepening cry for more transparency from companies about their operations and reporting sustainability results especially around environmental impact, human rights, and social justice issues. Complex sustainability issues are evidenced on a worldwide scale and now interwoven into global commerce. One reporting framework that many global companies are adhering to today is environmental. social, and governance (ESG) reporting. The ISSB is becoming the benchmark standard for ESG disclosures that are integrated into financial reporting, as well as for strategic capital investments. In 2021 $1.5T in debt was issued for ESG projects globally and that number should almost double to $2.5T in 2022. Over 450 companies within the Glasgow Financial Alliance have pledged $130T towards net zero goals and programs. However, it is best to think about ESG as a lens or mindset of doing business, which can be transformed across the supply chain, and not just as a reporting standard. Long term net zero goals are fine to start, but there must be accountability and results demonstrated in the short term to make realistic progress towards net zero goals. There is more ESG compliance and additional regulations forthcoming in the near future, so it is prudent for management to get ahead of the curve now with these new ESG standards and protocols being implemented in the marketplace. And the ESG framework may well ensure the sustainability of your business model by also addressing both tangible and intangible business risks. Smaller to medium size companies (SMEs) can also develop balanced sustainability reporting and scorecards to ensure overall progress for their stakeholders as well.



For food companies, having an unblemished brand image is tantamount to success. Implementing sustainability best practices can help achieve that success and preserve brand image across company operations, while contributing to the bottom line. Customers, employees, stakeholders, and investors all really care about sustainability, and so should business leaders and management at all levels.


Norman Christopher

Sustainable Business Practices LLC

www.sustainablebusinesspracticesllc.com


 

For more information about the West Michigan Food Processing Association, please contact:


Marty Gerencer

Executive Director

West Michigan Food Processing Association

(231) 638-2981

marty.gerencer@gmail.com


Sources:

Updated: Apr 23

The partnership aims to connect the resources of Michigan State University with west Michigan entrepreneurs and food companies.


MUSKEGON, Mich. — The Michigan State University (MSU) Product Center and the West Michigan Food Processing Association announced a partnership on Monday, August 2 that brings the university’s resources to the doorstep of west Michigan food companies and innovative entrepreneurs.


“Our mission is to help entrepreneurs in the food, agriculture and natural resource space add value to their products and to assist in the development of new and innovative products,” said Mollie Woods, director of the MSU Product Center. “We are excited to strengthen our presence in west Michigan and to share our expertise in food processing innovation.”


The MSU Product Center will expand outreach efforts by managing the Food, Agriculture, Research and Manufacturing (FARM) food processing accelerator developed by the West Michigan Food Processing Association. The facility will provide space and technical assistance to entrepreneurs and businesses to scale up new product and service ideas into the food, agriculture and bioenergy markets.


“It is very exciting for the MSU Product Center to be able to add FARM operations to our already successful model at the Food Processing and Innovation Center,” said Tina Conklin, director of the MSU Product Center’s Food Processing and Innovation Center. “This opportunity allows us to continue assisting food and agriculture business and entrepreneurs as they successfully launch products and gain market share.”


Clarence Rudat, former program coordinator for the Institute of Agricultural Technology (IAT) in Muskegon, was recently hired as the MSU FARM Manager and will oversee the FARM accelerator effective August 2, 2021. He will also serve as a direct resource for food companies throughout the region, bringing 33 years of experience in career and technical education about food, agriculture and natural resources to the table.


“We could not have accomplished this much progress with FARM without the ongoing support of our community partners, including Community Foundation for Muskegon County, Greater Muskegon Economic Development, Muskegon Community College, as well as several other regional and state partners,” said Marty Gerencer, executive director of the West Michigan Food Processing Association. “We are so pleased to welcome Clarence into this role and to have MSU’s support to continue the launch of this facility.”


The FARM accelerator will help startup food processing and agricultural-based businesses cultivate talent, create jobs, put down roots and grow in the west Michigan region. By now adding the Muskegon region to the MSU Product Center’s service area, budding entrepreneurs as well as seasoned food manufacturers can tap into the 160-plus years of research and innovation.

“With over $22.3 billion invested in food and agriculture start-ups in 2020, the synergy this partnership brings to the region couldn’t be more timely,” said Rudat. “With Michigan being the second most agriculturally diverse state in the nation, farmers are looking to add value to their products, and creative food entrepreneurs are looking to test and scale up innovative ideas. I can’t think of a better location to leverage the resources of MSU, MCC and the infrastructure of west Michigan.”


The FARM accelerator, located adjacent to Muskegon Community College, has manufacturing and training spaces including a docking station for the MSU Mobile Food Processing Lab, cold storage, logistic areas, office space and parking.

“This is a great addition to the training programs we already offer around manufacturing including our one-year food science certificate and the two-year associate degree in food processing, technology and safety that is delivered here in partnership with MSU IAT,” said Dr. Dale Nesbary, president of Muskegon Community College. For more information on these offerings:

MSU Product Center

Contact: Mollie Woods, Director

Email: willi751@msu.edu

Mobile: (517) 281-3100

MSU Product Center Manufacturing Operations, FPIC, FARM, DFP

Contact: Tina Conklin, Director

Email: conkli74@msu.edu

Mobile: (616) 443-1957

Food, Agriculture, Research and Manufacturing (FARM) Accelerator

Contact: Clarence Rudat, MSU FARM Manager

Email: rudatcla@msu.edu

Mobile: (231) 740-5615

West Michigan Food Processing Association

Contact: Marty Gerencer, Executive Director

Email: marty.gerencer@gmail.com

Mobile: (231) 638-2981