At The Coca-Cola Company, we rely on agricultural ingredients for our products. In 2013, we set a goal to more sustainably source our priority ingredients by 2020. Priority ingredients include cane and beet sugar, high fructose corn syrup, stevia, tea, coffee, oranges, lemons, grapes, apples, mangos, pulp and paper fiber for packaging, palm oil and soy.
For us, “sustainably sourced” means that our farm suppliers meet certain standards, among other requirements, relating to human and workplace rights, environmental protection and responsible farming management, otherwise known as our Sustainable Agriculture Guiding Principles (SAGP). Consisting of 15 principles, our SAGP establish the framework for defining progress against our goal of more sustainable sourcing and are integrated into internal governance routines and procurement processes.
Making Sustainable Sourcing Progress
With agriculture accounting for approximately half of what The Coca-Cola Company spends on inputs to our products and packaging, we have an opportunity and responsibility to positively contribute to more sustainable agriculture practices worldwide. We are working toward engaging suppliers of all our key ingredients through our Supplier Engagement Program. The initiative includes a Seven Steps to Supplier Verification framework of improvement toward meeting our SAGP, from step 1, “Initiating Engagement,” through step 7, “Entire Supply Audited.”
In 2017, we made noteworthy progress in the sustainable sourcing of several commodities. We sourced more than 2
When it comes to our top five agricultural spend ingredient crops—cane sugar, beet sugar, corn, oranges and lemons —we have experienced both successes and challenges. As of the end of 2017, less than 25% of our cane sugar, corn and oranges were validated as more sustainable, while 51-75% of our lemons and beet sugar were more sustainable. Challenges we have faced include regulated markets with little sustainability traction, social issues at the farm level and limited knowledge of sustainability practices by and fragmentation of smallholder farmers. We continue to expect and encourage adoption of sustainable agriculture practices and are on track to deliver against our goal of 1 million acres in the Field to Market program.
Growing our business requires an advantaged supply of agricultural ingredients. In 2017, in preparation for a 2018 European launch of FUZE Tea, we reviewed and reformulated the brand to suit local tastes and positioned our Europe operations to use 90% sustainably sourced ingredients. Europeans will be able to enjoy more than 20 flavor variations in 15 types of packaging. This strategy is all part of our work to give people more of the drinks they want.
Celebrating and Supporting the People of Agriculture
Behind the agricultural ingredients we depend on are dedicated, hardworking people. We strive to create economic opportunities for all our supply chain partners, including women and smallholder farmers, and to help protect the land rights of local communities where we operate.
In 2017, through our suppliers, we relied on millions of farmers to deliver our agriculture supply. Women farmers contribute significantly to our agricultural supply chain, including thousands who have been economically enabled through The
Together with our bottling partners, fruit suppliers and processors in India, we will contribute more than $1.7 billion to the country’s agri-ecosystem by 2022, benefiting more than 200,000 fruit farmers. “We have already expanded our Minute Maid juice range from one variant in 2007 to 11 variants in 2017, and if we are to realize our portfolio ambitions of being a total beverage company, we must invest in the agri-ecosystem,” said T Krishnakumar, President,
“The investments announced today by
Contributing to the advancement of our longstanding intention to drive transparency, accountability and sustainability throughout our business and supply chain, we are working to conduct 28 baseline country sugar studies by 2020. The studies focus on child labor, forced labor and land rights related to our sugar supply chain. To date, 15 studies have been completed and published.
Holistically Addressing the Vision of Sustainable Agriculture
When it comes to the rising demand for key commodities, there are many aspects to consider: human and labor rights, women’s empowerment, economic development, water management and energy and climate impacts. As an example, agriculture represents approximately 70% of the world’s water withdrawals, so water must be considered in the agriculture space. Recognizing the interconnectedness of these areas and addressing more sustainable agriculture practices in a holistic way is vital to the success and long-term sustainability of our business.
We also see how agriculture impacts other areas. We measure our sustainable agriculture progress through our climate protection goal, which aims to reduce the carbon footprint of the “drink in your hand” by 25% by 2020. Agriculture accounts for 20-25% of climate-related impacts of the “drink in your hand” according to our climate protection goal measurements.
One way we’re advancing our sustainable agriculture strategy and contributing to our climate goal is through membership in Field to Market: The Alliance for Sustainable Agriculture, through which we work on more sustainable corn production in the United States. With our four biggest corn suppliers, we are aiming to fulfill a 2014 commitment to expand the application of Field to Market’s Fieldprint® Platform, a data-driven tool that quantifies water use, energy use, greenhouse gas emissions and other measures of sustainability performance. The target is to engage corn farmers representing 1 million acres by 2020, which would position The
Our suppliers, which integrate sustainability into their business, are also critical to advancing our sustainable agriculture progress. German-based Nordzucker Group supplies beet sugar to the Coca-Cola system across Europe, the Middle East and Africa. Earlier in 2018, the group achieved a major milestone toward sustainable beet sugar production by becoming third-party verified against the Farm Sustainability Assessment (FSA) silver level through the Sustainable Agriculture Initiative (SAI) Platform, of which The
Ingredion is one of The
Planning for long-term sustainability, we are increasing climate preparedness measures to ensure resiliency. In 2017, we partnered with BSR to develop a more holistic picture of our climate risks along our value chain and identify opportunities to build resilience across our operations, supply chain and the communities where we operate. As a starting point, we identified coffee and tea to serve as proxies, which influenced a framework for identifying and mapping our climate-related risks.