The World Food Prize International Symposium October 2006 Des Moines, Iowa, USA

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The World Food PrizeInternational
SymposiumOctober 2006 - Des Moines, Iowa, USA

• Sustainable Agriculture The Food Industry
• Dr. Hans Jöhr
• Corporate Head of Agriculture, Nestec SA.

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Sustainable Agriculture The Food Industry
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Sustainable Agriculture The Food Industry
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• Setting the Scene
• The Challenge for the Food Industry
• How is Nestlé engaged?
• Summarizing
• Conclusions

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Emerging economies are set to boost the GLOBAL
DEMAND and SUPPLY for consumer goods
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Setting the Scene
Source OECD
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Processed, storable food at high demand
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Setting the Scene
Source OECD
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Setting the Scene

• Natural resources are limited and locally
  eventually overexploited
• land, water, energy
• Caloric food demand increases fast
• Geographical decupling of supplyand consumption
  (logistic / infrastructure / legislation)

"What does it mean for the Food Industry?"
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The Challenge for the Food Industry

• The Food Industry relies on the increasing
  supply of safe agricultural raw materials in
  quality and quantity

• However, respecting the limits of natural
  resources and weakening of rural societies
  threatens agricultural production

• Consumers confidence depends on the quality
  safety of the food supply chain

? Need for the development of Sustainable
Agriculture
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The Food Industry Response The SAI Platform
Our definition
Sustainable agriculture (SA) is a productive,
competitive and efficient way to produce
agricultural products, while at the same time
protecting and improving the natural environment
as well as the socio-economic conditions of local
communities
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SAI Platform

• Principles
• Work on a pre-competitive basis between food
  chain stakeholders and other interested parties
• Include all valuable concepts and initiatives
  contributing to Sustainable Agriculture

• Activities
• Support the development of Sustainable
  Agriculture principles and practices
• Raise overall peoples awareness about
  Sustainable Agriculture

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SAI Platform
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How is Nestlé engaged?
The The The Concept of Shared Value Creation
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All inclusive value chain approach linking to
markets
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Corporate Social Responsibility built into
Nestlés strategy
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Creating shared value in practice
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Our Impact
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• Purchasing of agricultural raw materials US
  13'000 mio/yr.
• Interactions with more than 400 000 farmers
  directly supported by more than 800 sourcing
  agronomists and 3'500 technical staff working at
  farm level and in supply chain.
• Running more than 150 Sustainable Agriculture
  projects worldwide with many different
  stakeholders.

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Summarizing Current situation needs
Harmonization for Sustainability, Food Safety and
Quality Assurance
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non exhaustive list...
Consumer
Trade Retail
Food Industry
Trade Processor
Farmer
Input Providers
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Summarizing
Standardization Urgently Needed
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• Benefits of Process / Verification
  Standardization
• Safety, compliance and quality assurance at
  higher awareness level, decreasing risk
  potentials,
• Lower overhead costs due to identical
  documentation, training material and information
  systems across the organization,
• A company's supply chain with standardized
  processes presents one face to its suppliers and
  customers, reducing transaction costs to both,
• More flexibility and responsiveness of the supply
  chain.

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Summarizing The way forward
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• Implementation of harmonization processes through
  Strategic Alliances throughout the food value
  chain.
• But, standardization is only successful if
• Communication between stakeholders is very
  effective and based on trust and credibility,
• Agreement on which schemes, standards,
  guidelines being used is reached,
• Farmers, Cooperatives, Suppliers (trade
  primary-processing companies) work together, in
  order to achieve common goals and to secure
  common interests.

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ConclusionsSustainability is a business case
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• Sustainable sourcing practices are widely
  accepted by leading Business Research
  Institutions as being the way forward to
  successful business

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Conclusions
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Sustainable Agriculture leads to
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Conclusions
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• The big challenge today is breaking the link
  between economic growth and negative
  environmental impact. There are clear limits to
  the earth's natural resources capacity.

Thank you for your attention !

• Further information on http//www.nestle.com/Our_R
  esponsibility
• or/and
• hans.johr_at_nestle.com