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Friday, January 10, 2014

Going "green"

by Pete Crow - Publisher

There’s that word again— “sustainability”—and now McDonald’s is using it. I think I know how most ranchers define sustainability— the ability to make a profit from one year to the next. And if you look around, there are lots of ranches in this country with long productive histories. In that case, I would say they have done a good job of being sustainable.

 

But the definition of sustainable is about to be changed into something that may be a little more difficult to get your head around. McDonald’s restaurants announced last week that they would begin buying verified sustainable beef starting in 2016… even though they don’t know exactly what sustainability is for the beef business. However, they do know it starts with the producers and ends with the consumer.

McDonald’s says they have been moving in the sustainability direction for years and that, in a small part, it’s about risk management and, in a large part, being socially responsible. They say they have done the research and have learned their customers want to know more about where their food comes from. They see the sustainability issue as an opportunity to grow their business. This sounds like a marketing strategy that will take them into the future.

A group called the “Global Roundtable for Sustainable Beef” (GRSB) is going to take on the global task of defining what sustainability is around the world. The Roundtable is comprised of beef industry stakeholders like McDonald’s, Walmart, Tyson, JBS, the World Wildlife Fund, environmental groups, animal health companies and the National Cattlemen’s Beef Association, along with a host of similar organizations that have a stake in the meat and animal protein business. And in a large way, GRSB was a result of global warming, and the UN’s work on livestock and their contribution to greenhouse gas, and feeding another three billion people in 35 years.

So GRSB is going to define the standards and is rapidly working on their definitions of beef sustainability. They plan on releasing their definitions by March 1 of this year and are providing a comment period for stakeholders to share their thoughts. Their process reminds me of the federal government’s rulemaking process.

So get ready for a new way of doing business. Mc- Donald’s knows that this is an initiative that they won’t be able to accomplish by themselves and are expecting a large number of food suppliers to hop on board the sustainability project and create the synergy to change how we produce beef.

McDonald’s has studied their carbon footprint and figures that operating their 34,500 restaurants represents one third of that footprint and that their supply chain represents two thirds, with most of it coming from beef. They are also buying renewable energy credits from American wind farms for roughly 30 percent of their company-owned restaurants. McDonald’s is clearly concerned about being “green.”

“Beef is the number one thing we want to make an impact on and the one that has the most impact. If there’s one area we want to put our cards on the table, it’s with beef. We want to use our size and influence to work with the industry and non-government organizations, like the GRSB, to come up with definitions of sustainable beef,” said Bob Langert, McDonald’s VP of Sustainability. He also makes reference to the UNīs Food and Agriculture Organization’s controversial report that claims that livestock production is responsible for 18 percent of greenhouse gases worldwide, "Livestockīs Long Shadow."

Why McDonald’s would make this announcement now is perplexing when the GRSB is planning on releasing a more industry-wide definition of what beef sustainability is this March. And what will they consider the model for sustainability or the standards to be? They clearly want to change the beef industry, but how and to what extent? According to NCBA, the beef industry has improved its social and environmental sustainability by 7 percent in the past six years. I don’t know if any other national livestock group can say that.

The NCBA and the Cattlemen’s Beef Board (CBB) have been in the middle of this issue for quite some time and has a seat at the GRSB table, so I’m confident this episode won’t get too out of control. The CBB has also done consumer research on sustainability, and for the most part, consumers don’t seem to care for the concept. They still want their 99 cent hamburgers! — PETE CROW