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Sustainability

Encouraging our farmer suppliers and logistics providers to improve their GHG emissions intensity and build in climate resilience

Olam’s scope 3 emissions emanating from our suppliers are the major source of emissions associated with our business.

There are 4 main indirect emission sources requiring mitigation:

(1) Changes in land use

(2) The production and use of synthetic fertiliser

(3) Paddy rice cultivation

(4) Ocean logistics.

Farmers can adapt to some changes but there is a limit to what can be managed. If temperatures increase by 3°C or more, the capacity for farmers to adapt in regions closest to the equator is likely to fall short. This is why we need to employ a combination of mitigation and adaptation techniques in our supply chains.

Challenges include:

Climate change cannot be tackled in isolation

Climate-related risks for agriculture are particularly acute in developing countries. They expose vulnerabilities of farmers who lack resources fundamental to resilience including finance, technology and knowledge. Moreover, climate-related risks interact with existing environmental stressors such as biodiversity loss, soil erosion, and water contamination, and with social stressors such as inequality, poverty, gender discrimination, and lack of institutional capacity. These interactions compound risks to agricultural production and food security.

Reducing waste

Global estimates suggest that about 30 – 40% of all food produced is lost in the supply chain from harvest to consumption (Godfray et al., 2010).

When comparing losses in the developing world versus developed nationals the statistics are startling:

  • For developing countries, up to 40% is lost on farm or during distribution due to poor storage, distribution, and conservation technologies and procedures.
  • In developed countries, losses on farm or during distribution are smaller, but the same amount is lost or wasted in service sectors and at the consumer level.

Reaching farmers

Olam sources from 4 million smallholders. Reaching so many is simply not possible on our own.  Where we can reach farm-gate, we still have to encourage those farmers to come together in groups and co-operatives to facilitate training.  Climate-smart practices are now a key component of the Olam Livelihood Charter and in 2015, we reached 60,000 cocoa, cotton, coffee, cashew, sugar, and black pepper farmers with training on forest conservation, reforestation, avoiding bush fires, and climate education.

Solutions to these challenges include:

Working with nature

Cocoa grows in a narrow equatorial belt around the world and is therefore at risk from climate change impacts. During 2015 in Côte d’Ivoire, the Cocoa teams distributed 20,000 Glyricidia leguminous trees which, when planted, help to maintain a permanent shade over the cocoa to avoid excess moisture loss in dry season. The Glyricidia has further benefits:

  • Through decomposition it provides vital nitrogen and other nutrients to the soil, improving the soil fertility which in turn improves water retention
  • Through the shade cover, it reduces weeds and significantly extends the productive life of the trees
  • At the same time it helps to reduce the farmers need for additional fertilisers.
  • And it helps to reduce deforestation as branches are also used for firewood.

Taking a wider landscape approach

Olam and Rainforest Alliance’s 5-year landscape level programme in Bia Juabeso, Ghana, has produced the world’s first verified climate smart cocoa. The programme focuses on developing an agri-business model which breaks the link between cocoa production and deforestation.

As of the end of 2015, the partnership had trained 2,000 farmers from 34 communities in the voluntary climate module of the Sustainable Agriculture Network (SAN) standards to increase yields without illegal encroachment, while 286 hectares of trees had been planted to reconstitute the forest.

This graphic helps to explain the landscape approach being taken.

Landscape chart

Read an article by Rainforest Alliance senior manager Martin Noponen here.