Sustainability Overview and
Sobeys Inc. Sustainable
Seafood Direction
Atlantic Lobster
Sustainability Foundation
David Smith, Sobeys Inc.
July 27, 2011
Moncton
About Sobeys Inc.
• One of two national supermarkets in Canada
• >$15 billion in sales;
• >1,300 stores
• >100 years old
• Owned by Empire Ltd; Sobeys family majority
shareholder
Markers of Time: 25 Years
Markers of Change: 8 Years
The Case for Sustainability ?
Sustainability – Why?
80% Middle Class by 2030
+ 50% food production
Feeding the World: Largest Environmental Footprint
Agriculture Today
• consumes 70%
of fresh water
• major global
warming impact
(80% is from
nitrogen fertilizer)
Sustainability Lifecycle Thinking:
2 Key Risks Facing Business
1)
Supply Side:
“Externalities”
2)
Demand Side:
“Radical Transparency”
“Externalities”
• Threat of inputs/outputs previously not a business cost, becoming
an internal cost
• Previous examples: employee benefits; product safety
• Near term:
• Carbon emissions
• Water
• Post-consumption handling of packaging: “Extended Producer
Responsibility”
• Increasingly on the agenda of Regulators; Institutional Investors
• Magnified cumulatively across supply chain
“Radical Transparency”: Products ~80-90% of footprint
Consumers:
…want to “do the right thing”
…want to “know the story”
…will not sacrifice (performance, price, convenience)
… are not enabled (products, information)
Industry led
“External” led – start-ups
Now. 70,000 products.
5 years? All consumer products?
Scan Barcodes Easily with your Phone
barcoo links products in stores with independent consumer
information.
Extensive Product Information and Assessments
Price comparison, test reports, health, green and
sustainability information.
Supply Chain Transparency:
Beyond Voluntary Best Practices
“Trust but Verify”
“Without documentation it’s just a rumour.”
“Without measurability it’s just checking a box.”
Beyond Certification:
Requirements for “Step Change”
1) Create the business systems
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Supply chain ~ 80-90% of footprint
Pre-competitive “Radical Collaboration”: systemic solutions
“Yard stick” vs. “Gold standard”
Incremental improvements focused on laggards – “can’t hide”
2) Leadership
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“Eco-literacy”
“What gets measured gets done”
Optimism !!!
Need the Sustainability “Infrastructure”:
Measurement Systems
Product “Lifecycle Analysis” / Lifecycle Thinking
“Cradle to Grave”
“Ecosystem Thinking”
Lifecycle Inventories
“Radical Collaboration” – Supply Chain
Global Food Safety Initiative
Reciprocity of 5 regional
standards
Global Social Compliance Program
Harmonized labour code from
1,000 versions; and Facilities
environmental module
Walmart, Tesco, Carrefour, HP, Dell, The Gap, Best
Buy, IKEA, Disney, Timberland, Hasbro, Chiquita, Dole
Global Packaging Project
Tesco, Kraft, Walmart, Unilever, Safeway, Target, P&G,
Kellogg, Pepsico, Coca-Cola, J&J, L’Oreal, Heineken
Consumer Goods Forum
Unilever, P&G, Kraft, Coca-Cola, Pepsico, General
Mills, Nestle, Sara Lee; Tesco, Carrefour, Walmart,
Kroger, Ahold, Delhaize
GS1
B2C (US): Microsoft, Google, Apple, Verizon,
Motorola, Oracle, P&G, Coca-Cola, Kimberly Clark
Indicators & metrics for packaging
sustainability
Product sustainability
measurement –WRI/WBCSD
product GHG protocol; then add
other indicators
Product registries
Bar codes – add sustainability
characteristics
B2B & B2C
Focal Areas
Direct Operations (Stores, Warehouses, Fleets):
1) Carbon Footprint
2) Waste Diversion
Supply Chain:
1) Sustainable seafood
2) Sustainable packaging
3) Ethical & environmental performance – Private Label
Over-the-horizon:
1) Sustainable agriculture
2) Animal welfare
Sobeys Sustainable Seafood
Direction
Sobeys Seafood Sustainability: Case Study
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Stakeholder engagement: beyond Greenpeace
Strategy: beyond eco-labels
Sourcing baseline: data capture12 months
Procurement: evaluation web tool
Supplier engagement: National Summit
Staff training: e-Learning Module
Marketing: integrated program – make it easier
Sustainable Seafood: Making Sources Visible
Sobeys’ Sustainable Seafood Policy:
Beyond Eco-labels to “Fix the Worst First”
Certification to-date: The “Low Hanging Fruit”
But what about the Biggest Challenges?
7%
Green
Yellow
Red
Sobeys Sustainable Seafood Policy
Goal By 2013:
Stop selling any “seriously challenged” seafood
species sourced from areas where the
producers do not have an improvement plan,
with specific milestones.
Sobeys’ Sustainable Seafood Direction:
“Fix the Worst First”
• Not dependent on eco-labels (i.e. MSC, BAP)
• Focus: improving our sources of species considered most at risk (i.e.
worst of the “Red List”)
• Improvement via Engagement: not de-listing; Improvement Plans
• Stop selling only as a last resort: when situation calls for it; when
producers do not commit to improvement
• “Green list” and “Yellow List” sources/species are fine to sell
• Do not need to be certified if independently and credibly reviewed
• Eco-labeled product is a sub-set
Sustainable Seafood: Making Sources Visible
Our suppliers input monthly sourcing
data into a web tool that provides us an
evaluation of each species purchased
Sobeys’ Product Focused Actions To-Date
1. Tightened our specs:
1. any Chilean sea bass we sell will only come from a MSC certified
fishery, and not in Ross Sea;
2. Swordfish will only come from Atlantic Canadian sources that are
harpoon caught (MSC certified) or longline caught (in MSC full
assessment)
2. De-list: only when dire situation warrants –
1. - all sharks, skates, and rays, Orange Roughy, and “Bluefin tuna”
Sobeys’ Product Focused Actions To-Date
3. Improvement Plans: source from areas with
commitments –
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Existing fisheries improvement plans:
– Wild Pacific Coho salmon from British Columbia (2010)
– Wild shrimp from Gulf of California (2007) and Gulf of Mexico (2008)
– Indonesian blue swimming crab (improvement plans launched in 2007)
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Acting as a catalyst we look forward to announcing new Canadian
based fishery plans as they develop
4) Sobeys’ Product Focused Actions To-Date:
Eco-Labels
• Are part of the solution; just not the only solution
• To-date 50 Private Label skus in-store & in-progress:
Sobeys Ontario Traceable Pacific Halibut
T-stand
Sticker on package
– staff write in code
Flyer
Recipe
card
ThisFish.info system
Customers can trace who, where, how, when;
Fishermen can see who, when, where traced.
BC Wild Salmon Videos @ Sobeyscorporate.com
• Objective: educate public on an example of the
complexity of challenges and solutions in wild seafood
sustainability
• Support the Wild Salmon Policy direction, and seek
collaboration to help implement
• Example of Sobeys policy in action: “Beyond Eco-labels”
Thank You.