In Case You Missed It: In the Fight Against Food Waste, Leaders Focus on the Business Case

In Case You Missed It: In the Fight Against Food Waste, Leaders Focus on the Business Case

09/23/2019

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In the fight against food waste, leaders focus on the business case

Supply Chain Dive
By Emma Cosgrove
September 23, 2019

On Sunday morning at the Bronx, New York, headquarters of online grocer Fresh Direct, Environment Protection Agency (EPA) Administrator Andrew Wheeler met with food waste non-profits and food-waste conscious firms, along with other EPA officials to receive an update on the food waste mitigation work in progress in the New York area.

"Food waste is a top domestic and international priority for the Trump administration," Wheeler said. In April, the administration committed to reducing food waste by 50% by 2030, launching six strategies to meet this goal including a two-year partnership with nonprofit ReFed. The U.S. wastes 75 billion pounds of food annually — the equivalent of 4.4 billion tons of carbon dioxide, the administrator said.

The Trump administration has taken a more carrot-based path — creating a "2030 champions program," eschewing the regulatory routes several states have taken to mandate responsible re-purposing and/or disposal of surplus food.

Twenty-five corporations, including Ahold Delhaize, Yum! Brands, Campbell's, Walmart, Blue Apron and Pepsico, have signed onto the program. The companies have committed to reducing food waste caused by their operations by 50% by 2030. The committed companies are required to post their progress publicly on their websites, but so far no formal benchmarks beyond the 2030 deadline have been made public, according to the EPA.

Recognition from the White House can be a powerful inducement to action, but Chris Cochran, executive director of ReFed, told the group the financial case against food waste can be just as compelling.

"I think it's important not to frame it first environmentally, but to frame it first in the business case because there is one," Cochran said.

The cost of food waste not only includes the cost of the product, but also disposal cost, Wheeler said, who added he would try to talk more about the economic benefit of lowering food waste.

"One of the challenges in introducing this to people who are thinking about it for the first time — maybe executives — is when they hear food waste and then they hear the environmental stats first, I think their mind goes, 'ok I need to pass this off to my corporate affairs team versus my CFO,'" Cochran said.

Measuring food waste in volume and value is the crucial first step to moving mitigation work out of the philanthropic realm and into a financial or operational portfolio, Cochran told Supply Chain Dive.

"Right now it sits in a lot of different silos and different departments in companies, but putting that together into a single view of how much food waste is happening and how much that's costing them is a first step," Cochran said.

Andrea Kelly, senior analyst for global partnership solutions at PepsiCo, echoed that sentiment.

"Everything that we're doing, we're constantly trying to build the business case internally," Kelly said of the food waste mitigation work at PepsiCo, one of the Trump administration's corporate champions. "I think that's really important not only to get executive-level buy-in but also for long term sustainability of the program because it's not dependent on grant funding — we view it as an opportunity for business growth."

Good data can also help to allay the concerns Cochran often sees from executives surrounding the unintended consequences of fine-tuning supply chains to minimize food waste — for example, stockouts.

"It's fear of unintended consequences that can be a barrier," he said. Cochran emphasized in the meeting that in order to meet the 2030 goal, stakeholders need to move out of the research phase and toward action and implementation. The United Nations, which shares the 2030 goal, said last year understanding progress toward the goal of a 50% cut is nearly impossible due to a lack of data and standardized measurement.

Beyond the private sector, the Trump administration is also working with the FDA to encourage consistent food date labeling practices to keep consumers from discarding edible food.

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