Cutting supply chain emissions saves money for food giant General Mills

Author:
Ilario D'Amato
17 November 2015

John Church, Executive Vice President, Supply Chain, General Mills

NEW YORK: Climate change is “one of the biggest risks to our business model, and as such it would be foolish not to start taking steps properly,” says John ChurchExecutive Vice President of the Global Supply ChainGeneral Mills, in The Climate Group’s latest Climate TV interview.

This September the American multinational consumer-foods giant General Mills committed to an ambitious and science-based target of 28% absolute reductions in greenhouse gas emissions by 2025 on 2010 levels, with a longer-term aspiration to achieve ‘sustainable emissions’ levels by 2050.

These targets, which were developed with BSR – a fellow founding partner of the We Mean Business coalition along with The Climate Group – will have a huge impact on the industry, and as the first major business to set specific, time-bound goals across its entire value chain, sets the bar for other companies to follow suit.

In the exclusive video, John Church explains that General Mills’ goal is unique because it is an “absolute reduction rather than dividing growth versus our footprint”. He explains: “It’s based on the best science available. We want to achieve this goal so to be part of the solution for climate change.”

General Mills is a world-leading manufacturer and marketer of consumer food brands, ranging from Haagen-Dazs and Cheerios to Pillsbury and Yoplait. The size of the company is in part a driver for its bold commitments to become climate resilient. “Our purpose is to serve the world by making food that people love,” says John Church, “and that relationship starts with our relationship with the Earth. If we want to be around on the next 150 years, we must have an ecosystem to rely on.”

The company started its journey to tackle climate issues in 2005. Since then, it has reduced absolute greenhouse gases emissions from its operations by 40%. However, 66% of all General Mills’ emissions come from the agricultural sector. “What we are doing is necessary but not sufficient,” explains the Executive Vice President. “We’ve done things to improve our distribution system, but really this is going to be very intensive around agriculture, and ensuring we’re doing the right things there.”

As well as focusing on agricultural growers and suppliers across its entire value chain, General Mills is also changing its packaging, ensuring reuse of products at the end of their life cycle. These action all reflect the company’s commitment to its consumers, according to John Church, who believes society “is starting to understand at a deeper level” climate change issues.

BUSINESS CASE

Other than being a marketing and moral issue though, there is also a clear business case for climate action. “Since we’ve been on this journey, we’ve saved money,” says John Church. “When you look at an entire value chain, there is the opportunity to apply only the right amount of inputs to reduce waste – waste that, inevitably, leads to greenhouse gases generation.”

Despite companies having different opinions on climate change, John Church says most recognize it as a potential risk within their business model – and not doing something about it is “probably irresponsible. He adds: “I would encourage everybody to take a hard look at this, regardless of what side of the line they stand on there.

“We’re open for business. We’re not going to solve this by ourselves. Hopefully, we can cause collaboration and innovation to happen, which will bring other people to the table, and we can lead by example.”

But responsibility does not lie entirely with corporations – there is also going to be a role for public policy to play in the business shift to low carbon supply chains. “First of all, that policy has to be proportionate,” concludes John Church. “This means to take a look at all sources and all levels of carbon, and to address them evenly: not the ones that are easy or the ones that are politically correct, but we [must] truly address the issue in order to sustain this planet.

“Secondly, it has to be effective, which means it has to be based on science – not subjected to potential changes in policy based on what’s politically favorable at the time. Lastly, it has to be efficient: a policy that is easy to understand, easy to work through, and not a burden from a red tape prospective.”

WE MEAN IT

General Mills’ goal to commit to a ‘science-based target’ achieves one of several policy asks set by We Mean Business, a coalition of organizations working with thousands of the world’s most influential businesses and investors. The coalition states that because the world’s leading climate scientists agree it is essential to limit global temperature increase to below 2°C, setting science-based targets allows companies to align corporate GHG reductions with global emissions budgets generated by climate models.

The collective policy commitments from We Mean Business partners aim to reduce dangerous greenhouse gas emissions while growing the economy, creating jobs and delivering low carbon products and services for billions of people.

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