But I can see there is a potential for some abuse in some areas \u2013 This is a general observation, and I am not referring to any one company here. Some areas of potential abuse that come to mind include.<\/p>\n\n\n\n
- Reporting metrics and KPI\u2019s could be abused, for example by having so many of them that it\u2019s always possible to weave enough positive signals together to give a misleading interpretation.<\/li>
- Auditing is weak, infrequent, or relies on self-certification.<\/li>
- Inter-organisation cross certification, where one part of the company certifies another part.<\/li><\/ol>\n\n\n\n
One temptation is to set goals that can be achieved easily but frame those same goals as ambitious. Executives, like all of us, want to succeed, but many of them are also rewarded on results.<\/p>\n\n\n\n
If you review the salary structures from the remuneration committee\u2019s at public companies, you may be surprised to discover that the Executives salary makes up only a small amount of their overall pay. Stock options and other bonuses may represent two thirds or more of their total remuneration.<\/p>\n\n\n\n
Since stock options increase in value when the company\u2019s share price goes up, these executives are heavily incentivised to achieve results in a time frame as short as 12-36 months.<\/p>\n\n\n\n
If as a society, we want a better environment, and a fairer distribution of risk and wealth, then we have to be prepared to pay for it.<\/p>\n\n\n\n
The most important weapon in our arsenal to achieve this, are the opinions of consumers, and the public needs simple messaging to explain how closely a brand is aligned to their own sustainability priorities.<\/p>\n\n\n\n
The first step is by establishing a sustainability framework that can be applied in different contexts on the ground and scaling to large numbers, so that a real impact can be made.<\/p>\n\n\n\n
This framework should have verification mechanisms through audits, and a set of KPI\u2019s that are appropriate for the context of the environment and project, and which are reported consistently from year to year.<\/p>\n\n\n\n
There is a lot to learn from others much more knowledgeable than me on this subject, so I\u2019ve tried to keep my opinions to areas where I have some experience or based on common sense.<\/p>\n\n\n\n
I have experience in creating and running programmes for large companies, setting up the KPI\u2019s and reporting structures, so in this regard at least, I think I am qualified to comment.<\/p>\n\n\n\n
I came into this interview with little exposure to Olam\u2019s sustainability initiatives, so I wanted to keep the objectives simple:<\/p>\n\n\n\n
- The nature of the different initiatives Olam uses for managing sustainability; Coffee LENS<\/a>, AtSource<\/a>, and Rainforest Alliance’s LandScale. <\/li>
- How LandScale can be a basis of collaboration between RA and Olam, and what each brings to the table<\/li>
- What LandScale does to create a more holistic answer than just increasing farmer productivity<\/li>
- If the metrics consistent and enduring \u2013 that is to say, used for a real purpose beyond allowing the positive ones to be cherry-picked for good PR sound bites<\/li>
- If we are genuinely moving the sustainability goals forward. Is there cause to be optimistic?<\/li><\/ol>\n\n\n\n
What Olam Says about their Objectives<\/h1>\n\n\n\n
Olam\u2019s overarching approach to sustainability is outlined by their Living Landscapes Policy (LLP) has a time-bound element. That is to say, it must be completed by 2020, and we believe the company is planning to publish the updated goals.<\/p>\n\n\n\n
The specific goals set were (text taken from the report directly):<\/p>\n\n\n\n
During 2018:<\/h2>\n\n\n\n
- We will consult widely on our Living Landscapes principles and lay the groundwork for appropriately measuring, valuing and reporting natural and social capital in our operations and in the landscapes we work in.<\/li><\/ol>\n\n\n\n
- We will establish a consultative multi-stakeholder group to help us further develop the net positive impact framework for agriculture.<\/li>
- We will set out a framework of action for putting the Living Landscapes principles in operation in key geographies.<\/li>
- We will develop a set of indicators related to this Policy for priority businesses during the course of 2018. We will report on these in the FY 2018 report.<\/li><\/ul>\n\n\n\n
These were achieved through multiple processes:<\/p>\n\n\n\n
- Convening the multi-stakeholder Living Landscapes Forum<\/a> to advise how Olam achieves its vision to put more back into food and farming systems than they take out, as defined by the LLP.<\/li>
- Developing the Forest Loss Risk Index (FLRI), a tool to understand recent trends in tree cover loss, and identify the riskiest areas on which to focus our attention.<\/li>
- AtSource<\/a>, specifically the environmental and social country-risk indicators, water risk metrics, and establishing the AtSource<\/a> Infinity framework \u2013 geared towards achieving change at scale through multi-stakeholder partnerships.<\/li><\/ul>\n\n\n\n
By 2020:<\/h2>\n\n\n\n
- Based on our consultative process, we will analyse gaps in our current approach to Living Landscape production systems in key geographies, comprising not just the elimination of unacceptable practices, but the triple-positive impact objectives. We are implementing the FLRI across priority areas with action plans in progress.<\/li>
- We will include in our Annual Reports a standardised valuation of natural and social impacts of agriculture and land use across our businesses, including third-party sourcing. (this is captured in our Annual Reports)<\/li>
- We will set out a long term plan to embed a net positive approach in the commodity systems in which we participate. Reflected in AtSource<\/a> roll-out and the CR&S strategies of our Business Units, such as Coffee LENS<\/a> (standing for Livelihoods, Education, and Nature at Scale).<\/li><\/ul>\n\n\n\n
Ongoing:<\/p>\n\n\n\n
- We will continue to catalyse, build and support effective partnerships for local and large-scale conservation efforts in the landscapes where we operate.<\/li><\/ul>\n\n\n\n
This represents the programmes and work under AtSource<\/a>.<\/p>\n\n\n\n
Interview with Olam and the Rainforest Alliance<\/h2>\n\n\n\n
To help alleviate my curiosity, I was fortunate enough to be allowed to pick the brains of some subject matter experts, Jeremy Dufour the Global Sustainability Projects Manager of Olam Coffee, and Sophie Persey, a Senior Manager for LandScale at the Rainforest Alliance.<\/p>\n\n\n\n
The rest of this document is based on the conversation I had with these parties. The writing reflects more of a conversational tone, which I hope is a closer representation of the discussion than if I was to transform it into a report.<\/p>\n\n\n\n
During the discussion, we learned how Olam is using LandScale to help assess and evidence sustainability impact at the landscape level, under one of its AtSource<\/a> Infinity programmes in Chiapas, Mexico. <\/p>\n\n\n\n
First up, Jeremy explains the different initiatives in Olam and how it fits together.<\/p>\n\n\n\n
Living Landscape Policy<\/h1>\n\n\n\n
This is an international policy that forms part of its core purpose. It tries to address how Olam translates interventions in the landscape, not only with things like deforestation but how to regenerate the environment.<\/p>\n\n\n\n
Their \u2018Core Purpose\u2019 comprises, not just a list of \u2018do nots\u2019, but also a list of \u2018dos\u2019.<\/p>\n\n\n\n
For example, how DO<\/strong> Olam regenerate ecosystems and supply chains in the areas they operate.<\/p>\n\n\n\n
LINK TO LIVING LANDSCAPE POLICY<\/a><\/p>\n\n\n\n
ATSOURCE<\/h1>\n\n\n\n
AtSource<\/a> is Olam\u2019s sustainability insights platform that allows customers to track the social and environmental footprint of their coffee purchase\u2013as well as other products – at each stage of its journey right back to the farmer group and\/or Olam estate. They access this via a digital dashboard which is customised to their supply chain and product(s).<\/p>\n\n\n\n
![\"\"](\"https:\/\/bartalks.net\/wp-content\/uploads\/2021\/03\/Picture-16546.png\")
<\/figure>\n\n\n\nAtSource<\/a> will allow the customer to access up to 180+ social and environmental metrics including the value of quality premiums paid, the number of farmers receiving training on good labour practices, or the total number of hectares rehabilitated. The idea is that this transparency helps customers meet their own sustainability requirements, but also work with Olam on action plans to transform supply chains.<\/p>\n\n\n\n
They can interrogate the platform to see what has been done over the last year or more and it gives the full environmental footprint including carbon, water, and land.<\/p>\n\n\n\n
For social issues, data is available on diversity inclusion, education and health and nutrition.<\/p>\n\n\n\n
Jeremy wanted to emphasise that customers should also access the \u2018impact stories\u2019, which turns the numbers into meaningful narratives on the difference Olam\u2019s sustainability programmes are making for people and the planet. These<\/p>\n\n\n\n
can be shared with their consumers to demonstrate customers\u2019 own role in advancing sustainable sourcing.<\/p>\n\n\n\n
COFFEE LENS<\/h1>\n\n\n\n
In October 2020 Olam launched \u2018Coffee LENS<\/a>\u2019 which is their vision of the future of the coffee sector.<\/p>\n\n\n\n
In a way, the Coffee LENS<\/a> announcement was similar to a mission statement for their coffee business. It commits Olam to report on an annual basis as they move toward achieving the overall goal by 2025.<\/p>\n\n\n\n
Numbers are reported consistently using the same metrics each year, and they hope to achieve some of them early so they can set new goals.<\/p>\n\n\n\n
Coffee LENS<\/a> is a translation of Olam\u2019s sustainability commitments for the coffee division of Olam explained Jeremy, with published targets that are aligned with the Olam Living Landscapes Policy and the global sustainability vision.<\/p>\n\n\n\n
They believe this can only happen when working collaboratively with other stakeholders. So from this starting point, they ask how do we make this a collective effort, because larger objectives need a multi-stakeholder approach.<\/p>\n\n\n\n
How the Rainforest Alliance works with Olam<\/h1>\n\n\n\n
Sophie explains that the mission of the Rainforest Alliance is to create a more sustainable world by using social and market forces to protect nature and improve the lives of farmer and forest communities.<\/p>\n\n\n\n
For this purpose, they have a couple of tools in the toolbox, but the longest established and best known is the farm-level certification scheme. This scheme promotes and develops best practices to ensure farms are managed sustainably.<\/p>\n\n\n\n
LandScale is a new initiative, co-led by Conservation International, Vera and the Rainforest Alliance. It provides an impartial, holistic, and globally recognised system for assessing the cumulative impact of activities within landscapes dominated by natural resource-based industries.<\/p>\n\n\n\n
This could include, for example, the Rainforest Alliance certification at the farm level, Olam\u2019s contribution with AtSource<\/a> programmes, or the work they are collaboratively doing on things that go beyond the farm. So LandScale is a way to assess and monitor all of the different efforts and then communicate them in a credible manner.<\/p>\n\n\n\n
![\"\"](\"https:\/\/bartalks.net\/wp-content\/uploads\/2021\/03\/Picture-111.jpg\")
<\/figure>\n\n\n\nIn Mexico, they\u2019re working together on an agroforestry project in Mexico as part of the Alliance for Sustainable Landscapes and Markets and piloting the LandScale framework to assess the impact of their interventions at the landscape level.<\/p>\n\n\n\n
In response to a question over whether the Rainforest Alliance\u2019s activities are aimed at a micro level, Sophie explains that the Rainforest Alliance has several different roles, including certification, but then also have regional teams that work collaboratively on sustainability interventions. <\/p>\n\n\n\n
LandScale then is a more \u2018macro level\u2019 tool that is complementary to the certification tool and used by a variety of different organisations around the world, such as Olam. LandScale includes an assessment framework, verification mechanism, and reporting platform. These tools help the private sector, governments, and civil society access robust insights that can guide and incentivize sustainability improvements at scale.<\/p>\n\n\n\n
LandScale has had good responses to the public consultations they\u2019ve held in which they\u2019ve published the framework and asked for feedback. There is a lot of buy-in to the further development of the framework.<\/p>\n\n\n\n
They can point to a growing coalition of global partners, and incorporate a number of different perspectives via the advisory panel, including Christopher Stewart, Global Head of Sustainability at Olam<\/p>\n\n\n\n
Sophie points out that there are other schemes out there, and LandScale is open to collaboration and learning from all of them.<\/p>\n\n\n\n
However, the broader partnership has been going for much longer, and we ask Jeremy for his comment.<\/p>\n\n\n\n
Jeremy picks up the conversation and suggests that while the Mexico project is 2 years in, one key point they have learned is that Stakeholder engagement is critical for success, not only with organisations like the Rainforest Alliance, but, for example, with the local communities to ensure their buy-in to the initiative that intends to bring change in the way they work and live, and with local governments and authorities.<\/p>\n\n\n\n
In this case, when talking about stakeholders, Jeremy says he is referring to the communities and government. It is important to understand what they are willing to do and what efforts they are also going to put into the project.<\/p>\n\n\n\n
Local government is a critical actor, for example, because some landscape initiatives require the support and a level of ownership from the authorities. He believes the partnership is going in the right direction.<\/p>\n\n\n\n
Jeremy calls this a \u20183 Pillar\u2019 collaboration, which brings much more success. In this structure, Olam works with NGO\u2019s and other Stakeholders. We asked Jeremy to expand upon his definition of stakeholder and to explain what each of them has to gain in the partnership.<\/p>\n\n\n\n
He explains the key stakeholders are the community, including the farmers. What\u2019s in it for them? Getting access to technology allows them to move up the value chain and get a better price for their products.<\/p>\n\n\n\n
But they look beyond the coffee producers into the wider community as a whole, they identified nutrition as an example of how they can make a positive impact on the community. This was done with an academic partner \u2013 who is another stakeholder in the project, showing what should be done and how, and then demonstrating the benefit.<\/p>\n\n\n\n
At the Federal and State level such as the\u201cNational Forestry Commission of Mexico (CONAFOR)\u201d and the \u201cNational Commission of Natural Protected Areas of Mexico (CONANP)\u201d. They see the benefit of working together to prevent deforestation and the destruction of natural resources.<\/p>\n\n\n\n
Working with partners such as these stakeholders and the Rainforest Alliance complements Olam\u2019s capabilities, so that together they can be more effective.<\/p>\n\n\n\n
Assess. Verify. Communicate.<\/h1>\n\n\n\n
Before the interview, Bartalks reviewed the framework of metrics from Olam\u2019s AtSource<\/a> platform and compared that to the metrics included in LandScale, and we were honestly a little surprised when we saw that there was indeed a strong correlation between the two. This seems to support the case Olam is making for having all their initiatives move towards a common set of goals.<\/p>\n\n\n\n
In the interview, Nick noted that sometimes it seems, fairly or unfairly, that different numbers get used from year to year by some companies reporting on sustainability, and it becomes hard to see whether real progress in any one area is happening.<\/p>\n\n\n\n
The sustainability numbers from companies always seem to be positive, which suspiciously looks like they are \u2018cherry picking\u2019 the best metrics. While this is understandable, it would be preferable to have a list that included some metrics where the programs fell short and hear how the companies were planning to address the problems.<\/p>\n\n\n\n
Jeremy said that it is a relevant question to ask, but he hopes and truly believes their annual reporting of the KPI Matrix and targets are consistent and lasting over the next five years.<\/p>\n\n\n\n
It is first important to understand the key material areas that are critical to the coffee sector. They understand the needs are for climate action, development of a healthy ecosystem, and water and soil management are priorities.<\/p>\n\n\n\n
Jeremy moves to discuss the social area \u2013 where education and skills are critical. In coffee farming, the average age of farmers is an issue, he says. For example, in Colombia, the average age of a coffee farmer is 62 years. So, it makes sense that Olam invests in helping the next generation learn the skills of the industry and encourage them to see farming as an attractive career.<\/p>\n\n\n\n
Last but not least is the economic viewpoint. If coffee farmers can\u2019t be profitable from coffee farming, perhaps with the support of a supplementary crop, then there\u2019s no hope for the sector, and as a result, no hope for Olam. This is why the community and Olam have a shared interest in addressing any issues in this regard.<\/p>\n\n\n\n
So, the stakeholders conducted a detailed analysis and identified that nutrition was the biggest issue, so they will be focused on developing an intervention at Chiapas in Mexico to address this concern.<\/p>\n\n\n\n
Jeremy agreed that as an industry, they must use a common language that avoids being overly technical or focused on metrics, else risk losing the engagement that they want from people in the communication. He explains that behind each output there is an internal discussion on how best to communicate them.<\/p>\n\n\n\n
As we start to wrap up, we post a question to Sophie \u2013 \u201cWhat is the biggest challenge in sustainability in the supply chain.\u201d<\/p>\n\n\n\n
I think particularly focusing on landscape scale, there hasn’t been that much effort yet in terms of collecting social data sets at landscape scale.<\/p>\n\n\n\n
On the environmental side, she explains, there are a lot bigger data sets available that enable assessments to be done relatively quickly and easily for those indicators.<\/p>\n\n\n\n
However, for some of the social issues, it requires more effort to collect the data and that means assessments take longer. But they don\u2019t want to \u2018over prioritise’ environmental issues at the cost of social issues. She believes this will change over time as more data is gathered, which will enable more holistic assessments to be conducted easier.<\/p>\n\n\n\n
\u201cOlam is leading the way in terms of commitment at improving sustainability at a landscape scale.\u201d \u2013 Sophie Persey<\/p>\n\n\n\n
In the World Cocoa Foundation, for example, we see lots of collaboration on that scale, but we need to see more cross-sectorial and multi-stakeholder collaboration. A willingness to look beyond your own borders and realise that no organisation can operate in a vacuum.<\/p>\n\n\n\n
So even though Olam might have the best practices in the world in their own supply chain, that alone is not enough if other actors are not at the same level, for example consuming more water than is necessary, or where we see deforestation. So we all need to realise the interconnected nature of the challenges we\u2019re facing.<\/p>\n\n\n\n
Is Competition a Barrier to Sustainable Investment?<\/h1>\n\n\n\n
We pose the question \u201cDoes being a commercial organisation, operating in a competitive environment, mean that sometimes you can\u2019t do as much as you\u2019d like, because unless the industry co-invests equally, an expensive sustainability programme could put the company at a cost-disadvantage\u201d.<\/p>\n\n\n\n
Is this why some organisations are actually calling for governments to regulate them?<\/p>\n\n\n\n
Jeremy responds that he may not be the right person to ask about this point in Olam. But that working on a level playing field, helps everyone to work in the same direction.<\/p>\n\n\n\n
Jeremy moves the discussion to ask a related question \u201chow do we achieve critical mass? Doing something on a scale of 1,000 farmers is a small intervention, but how do we move that to 10,000, 15,000, or 20,000 farmers.<\/p>\n\n\n\n
This is not possible for a single organisation acting alone but requires a multi-stakeholder approach which may require the stick or the carrot. This is the first thing, but having a pathway to scale is critical.<\/p>\n\n\n\n
The example of Chiapas is a good example because it\u2019s been categorised as an AtSource<\/a> Infinity programme. These \u2018Infinity\u2019 programmes are the cherry at the top of the platform, under which Olam wants to incorporate all aspects of transformational goals.<\/p>\n\n\n\n
Any initiative must still have boots on the ground, says Jeremy, which gives the connection to the small holders and coffee farmers they\u2019re working with.<\/p>\n\n\n\n
But in this programme, all stakeholders are participating and sharing the same vision and goals, so in this way, we can address the issue of a level playing field. This is the objective of Infinity and the LandScale project.<\/p>\n\n\n\n
We ask about the three tiers of AtSource, which offer customers increasing levels of granularity and opportunity, depending on the maturity of their sustainability ambition.<\/p>\n\n\n\n
- Entry<\/li>
- Plus<\/li>
- Infinity<\/li><\/ul><\/div><\/div>\n\n\n\n
![\"\"](\"https:\/\/bartalks.net\/wp-content\/uploads\/2021\/03\/Picture-155.png\")
<\/figure>\n\n\n\nWe asked Jeremy what the key differences were between these levels.<\/p>\n\n\n\n
Jeremy explains that the entry-level is where they are able to give assurances to the customer that the coffee they\u2019re buying is produced in adherence to a set of codes, principles and procedures. This is formulated around what they refer to as the \u2018Olam Supplier Code\u2019.<\/p>\n\n\n\n
It also comes with a general third-party risk screening, so the customers feel involved and are aware of the risks that exist in their supply chain, starting in this specific community and country.<\/p>\n\n\n\n
At the Plus level, they start talking about the metrics \u2013 they report on the social aspect, the number of farmers they are training, the number of acres they conduct soil management, etc.<\/p>\n\n\n\n
So this is providing a Farmer Group level where they can ensure the traceability at the AtSource<\/a> Plus Level.<\/p>\n\n\n\n
![\"\"](\"https:\/\/bartalks.net\/wp-content\/uploads\/2021\/03\/Picture-188.png\")
<\/figure>\n\n\n\n
- We will continue to catalyse, build and support effective partnerships for local and large-scale conservation efforts in the landscapes where we operate.<\/li><\/ul>\n\n\n\n
- Convening the multi-stakeholder Living Landscapes Forum<\/a> to advise how Olam achieves its vision to put more back into food and farming systems than they take out, as defined by the LLP.<\/li>
- The nature of the different initiatives Olam uses for managing sustainability; Coffee LENS<\/a>, AtSource<\/a>, and Rainforest Alliance’s LandScale. <\/li>