Interview

Chain sustainability and value creation

Jan Willem Straatsma & Auke Zeilstra

Worldwide standard for demonstrable sustainability

Reading time:
6 minutes

Interview Long-term sustainable growth for current and future generations is a key theme for FrieslandCampina. This is why FrieslandCampina is one of the founders of the Sustainable Dairy Partnership (SDP). This is a global standard for demonstrably making dairy products sustainable. The methodology was agreed upon among international dairy producers and their commercial customers. The SAI Platform in Brussels is the standard’s organiser. Jan Willem Straatsma, Programme Manager Corporate Sustainability, and Auke Zeilstra, Corporate Key Account Director at FrieslandCampina, explain how this not only elevates sustainability within the chain to a higher plane, but also that this is a good thing for business and dairy farmers.

The Sustainable Dairy Partnership not only stimulates sustainability within the chain in the Netherlands. Sustainability is also encouraged in other regions

Jan Willem: “Until recently, dairy producers generally used their own definitions, checklists and value propositions for sustainability. That made it virtually impossible to compare producers. However, customers want to be able to rely on the sustainability of the dairy products provided by their suppliers. The lack of a standard also meant that every customer conducted its own audits and inspections of the dairy plant, as well as the dairy farming sector. That resulted in a great deal of administrative burden and it consumed a great deal of time.”

A single standard

“In the Dairy working group of the Sustainable Agriculture Initiative Platform, FrieslandCampina met with other leading dairy producers and customers from Europe, Australia, New Zealand and the US for the purpose of developing and agreeing on a single sustainability standard,” Jan Willem continues. The methodology determines the extent to which the dairy producer, together with its supplying dairy farmers, has a handle on sustainability and is demonstrably constantly improving in this area. Five sustainability levels are used for this purpose, so that dairy companies that are just starting out with sustainability can also participate. In addition to a demonstrable policy of sustainability, dairy producers together with the dairy farmers that supply them, are evaluated on the basis of eleven criteria, such as biodiversity, animal welfare, product quality and waste management. A total score, on a scale of 1 to 5, is assigned on this basis, which indicates the dairy producer’s status in the area of sustainability. The scores are determined by the dairy producers themselves, but they can be audited by an external party.”

Stages in

Sustainable Dairy Partnerships

Foqus planet: frontrunner and inspiration

Inspiration for the new standard came from various sources, including FrieslandCampina’s current sustainability policy. Foqus planet forms an important part of this policy. Jan Willem explains: “Foqus planet is used to chart the sustainability performance of our 18,000 plus dairy farmers, for example in terms of biodiversity, milk quality and grazing. As a result we can quickly provide our customers with insight into our sustainability performance. Foqus planet also makes it possible to reward dairy farmers who are frontrunners in this area with a premium milk price. This intensifies sustainability, which ultimately benefits the collective. As such, Foqus planet was an excellent trailblazer for the Sustainable Dairy Partnership. However, the new methodology goes well beyond this, because it applies to the entire chain and can therefore be used by anyone.”

The beauty of the Sustainable Dairy Partnership is that we continue to challenge each other to further intensify sustainability, as a result of which the entire sector ultimately improves

Accelerating sustainability

The Sustainable Dairy Partnership offers added value to all involved parties, such as a reduction in the number of audits and inspections, and a reduction in the associated time spent and in the administrative pressures,” Auke adds. “This time can be invested in further demonstrably improving sustainability, because the Sustainable Dairy Partnership functions as a key accelerator in this respect. The dairy farmer now has access to an overview of the relevant themes agreed upon within the chain and the criteria needed to implement integral sustainability on his/her farm. The customer has immediate insight into the sustainability performance of its suppliers and no longer needs to monitor this for each player. For the dairy producers this means that we can now jointly invest in the system, which saves costs for each participant. Furthermore, not participating can serve as a disqualifier, because customers would like to know how suppliers perform in terms of sustainability. Finally, participation is of strategic importance to FrieslandCampina because we are frontrunners in this area and are making a difference for the customer this way.”

Sustainable Dairy Partnerships indicators

New partnerships with customers

“The Sustainable Dairy Partnership also offers opportunities for creating added value,” Auke argues. “For our customers it is becoming increasingly more important to provide sustainable products, because this is how they respond to the demands of consumers, who are also prepared to pay more for this. Our customers can make good use of this in their advertising and are also prepared to pay us for this, but then we do have to be able to transparently demonstrate that sustainability! This is exactly what the system does. On this basis customers are also prepared to co-invest and this creates new partnerships. This increases the added value within the chain.”

Taking responsibility as chain

Jan Willem and Auke have high expectations of the Sustainable Dairy Partnership, in terms of sustainability, as well as value creation, even though it has only been operating for six months. Auke: “First, we ensure our own employees are aware of this partnership so that they can actively make use of this in our business. At the same time, this puts FrieslandCampina on the map as a frontrunner in the field of sustainability. This can open doors at customers that up until now were closed to us. I am certain that this will result in more business, but it is still too early to precisely quantify this.”

Jan Willem: “We score high on various criteria in the system, such as biodiversity, CO2 reduction, milk quality and animal welfare. We differentiate ourselves this way. Of course the competition is not sitting still and will want to improve in these areas as well. And that is the beauty of the Sustainable Dairy Partnership – we constantly challenge each other to further intensify sustainability, as a result of which the entire sector ultimately improves. We are able to realise more together as a collective. Even in times like the nitrogen debate, for example, it is important that we as chain – from dairy farmer to dairy producer and customer – demonstrate that we each take our responsibility in this area.”

Now and for generations to come

Greenhouse gas emissions
by member dairy farms

11,964

-3.5% 2018: 12.398

kt CO2 -equivalent

87%

Sustainable procurement
of raw materials
77% in 2018
Percentage of total
volume of raw materials

94%

Green electricity
90% in 2018
Percentage of total
electricity consumed at
production facilities

83%

Pasture grazing
81.2% in 2018
Percentage of total number of
member dairy farms in the Netherlands
applying a form of pasture grazing

FrieslandCampina

27/02/2020

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