Implementing Sustainability is a series of case studies intended to provide practical examples of how Sustainable Food Trade Association (SFTA) members execute on the SFTA declaration areas. By highlighting the work of companies with strong systems in place, we hope to encourage wider adoption of sustainability practices and encourage transitioning companies towards sustainable business models.
In July 2009, Annie’s became a member of the SFTA. At this time Annie’s signed the “Declaration of Sustainability,” a pledge committing to continuous improvement and transparency as well as annual reporting on the company’s environmental and social impacts.
From its inception, Annie’s has embraced the values of sustainability. However, in 2009 the organic industry was changing, and values-based businesses began identifying the need to formalize these values into a comprehensive strategy. In 2010, Annie’s saw this opportunity to bring on the company’s first director of sustainability, who quickly identified that the major environmental and social impacts of operations were not at the corporate office, but rather, throughout its supply chain. As such, Annie’s began to delve deeper on its ingredients – how they were grown and where they were sourced. In order to get this information, Annie’s developed a strategy for engaging suppliers.
Annie’s director of sustainability Shauna Sadowski says, “We have to strike a balance between where we can make the greatest impact and what we have control over.” For Annie’s, developing strong partnerships with manufacturing facilities – had always been a priority in order to ensure the highest quality products. This partnership paved the way for the sustainability team to collect social and environmental data and create a supplier engagement program.
Annie’s engages with its supply chain through three distinct areas: 1. Farmers and ingredients suppliers 2. Packaging suppliers, and 3. Manufacturing, Distribution Center and Re-packers. Each area has specific programs in place to improve sustainability performance. The team decided to seek quantitative data from the suppliers in group 3 (and most recently, group 2) as a way to further engage with them on facility performance.
The first question for Annie’s was, “What do we want to know about our manufacturing supply chain when it comes to environmental and social impacts?” Guided by SFTA’s Declaration of Sustainability and the company’s own focus around food, planet and people, Annie’s developed a simple but comprehensive survey and drafted 15 “yes/no” questions with the opportunity for additional comments. Within this first survey, the company identified energy as the first metric on which to collect data; this aligned with the company’s long-standing focus on climate change. This short survey included a set of qualitative questions like, “Do you track your energy use?” or “Do you offer benefits to employees (above and beyond legal requirements) that contribute to overall health and well-being?”
The survey was designed to ensure a high response rate, which in subsequent years would lead to better relationships and more consistent data. However, it was not the survey alone that created a high response rate; it was Annie’s history of building enduring relationships with suppliers. “We got an 80% response rate out of the gate,” says Sadowski, “and that truly was because of the work our operations team has done since the inception of the company.”
The operations department identifies supplier partners to make Annie’s products and packaging; it’s important these suppliers understand the brand and values. The sustainability department adds another dimension to the relationship by engaging and learning about the sustainability impacts of the supplier.
It is a recent trend for companies to ask for additional information from suppliers. Some of the information might previously been considered confidential. To build trust, Annie’s began utilizing their annual supplier meeting to have face-to-face conversations about their sustainability strategy and desire to measure key supply chain metrics. From these meetings, suppliers learn what is most important to Annie’s from a sustainability perspective, and thus where they should be focusing their efforts in order to be aligned with Annie’s mission and goals.
In 2012, Annie’s reached out to suppliers again, this time asking for more quantitative data on energy and waste, rather than the simple “yes/no” answers as they did in the previous survey. This helped Annie’s start to develop a system by which to fairly compare sustainability practice outcomes of suppliers, using data as the underlying criteria. Getting the data was not about criticizing suppliers, but identifying areas of best practices and introducing operational efficiencies to the entire supply chain.