It is important for The Coca-Cola Company to address agricultural challenges and opportunities systemwide and across our entire value chain. Approximately half of what the Coca-Cola system spends on inputs to our products and packaging is an agricultural spend, linking us closely with agricultural communities worldwide.
There are many aspects to consider, including rising demand of key commodities, women’s empowerment, economic development, water management, human and labor rights, and energy and climate impacts. The need to understand the interconnected relationships among all of these topic areas has led to the conclusion that the most effective approach to address sustainable agriculture is through the development of an integrated Water-Energy-Food Nexus approach.
Four areas that we will focus on as part of this approach are
- Embedding sustainability into ingredient-procurement decisions.
- Developing and implementing crop-specific programs to enhance the economic well-being of farming communities, improve yields and protect natural resources across the supply chain.
- Building industrywide collaborations to gain alignment and affect change in the agricultural sector.
- Driving change through partnerships.
We will continue to convene workshops for suppliers and farmers to provide information about opportunities to work with us and to take part in our programs and projects. Some of our near-term sustainable agriculture objectives include
- Achieving significant increase in supplier engagement toward our sustainable sourcing goal in sugar, lemon, coffee and tea.
- Enrolling suppliers across all commodities in our seven-stage Supplier Engagement Program.
- Continuing to work collaboratively with our bottling partners to develop best practices—sometimes taking the lead and other times learning from their leadership.
- Formalizing a data gathering, collection and management process to track the sourcing of ingredients we use in our products.
- Implementing the Bonsucro Chain of Custody Standard program for cane sugar so that we can trace the sugar we purchase to its source.
- Engaging and enrolling smallholder farmers in our efforts toward improved sustainable sourcing.
Engaging our suppliers is an essential component of our multifaceted approach. Our Sustainable Agriculture Guiding Principles (SAGP) help define what “more sustainable sourcing” means to us and outline our expectations for suppliers in the areas of human and workplace rights, environmental stewardship and responsible farm management.
Building on these principles, we have developed a new Supplier Engagement Program, which gives guidance to our suppliers on various pathways to achieve SAGP compliance. This comprehensive program applies to all geographies and covers the key commodities and ingredients used to produce our products.
We believe that sustainable agriculture is in our collective best interest, ensuring improved environmental health, economic profitability and inclusion. For example, the global purchasing power of the Coca-Cola system allows us to apply our leverage and resources to support partnership initiatives and programs that seek to address universal and local social, political, environmental and other sustainability challenges.
We are working hard to create positive, long-term impact. As our strategy and activities evolve, we will continue to highlight our progress.
Our Agricultural Supply Chain Journey
In 2013, we began a journey to better understand the key human rights risks for Coca-Cola’s extensive agricultural supply chain, and we knew we would learn a lot. We also knew that it would require significant collaboration with our suppliers, bottlers and key stakeholders to carefully examine these risks and to better prevent potential future violations.
Our third-party country sugar studies on child labor, forced labor and land rights have served as important vehicles to build an understanding of Company policies internally and a framework to undertake action in collaboration with our supply chain partners. Thus far, we have developed in-depth studies examining potential human rights impacts throughout its sugar supply chain in Colombia, Guatemala, El Salvador and Honduras and Brazil. We will continue to release additional studies throughout the year, including our work in Brazil, India, Mexico and several other countries in Africa.
This work advances the company’s longstanding commitment to driving transparency, accountability and sustainability throughout its business system and supply chain in close collaboration with bottlers, suppliers and stakeholder partners. Coca-Cola’s Human Rights Policy and Supplier Guiding Principles (SGP) provide the foundation for this commitment, which extends deep into the agricultural supply chain where many key ingredients in the company’s products originate. Promoting sustainability throughout the supply chain begins with going straight to the source to assess environmental and social impacts. This effort will take time, and Coca-Cola is working in collaboration with its bottling partners, suppliers and others to help bring about the development of a healthy agricultural supply chain for the communities in which it operates.
More on Journey
- Muhtar Kent Remarks: U.S. Water Partnership 2017 Water Leader Award
- Conservationists and Coca-Cola Find Mutual Passion in Watershed Protection
- Coca-Cola Unites with Top Consumer Companies to Collectively Source from U.S. Women-Owned Businesses
- Infographic: 5by20 By the Numbers
- Muhtar Kent’s Key Accomplishments as Coca-Cola CEO