5.2 Community development

Social and environmental impact in our supply chain

The complex nature of the global commodity-based agricultural supply chains brings with it the risk of human and environmental abuses, particularly among our tier 2 and tier 3 suppliers.

While we have full control over our own operations, the challenge for Nutreco and other companies that operate in these global and complex supply chains is to engage with suppliers with whom we do not have direct relationships, to ensure they adhere to our high standards. We use tools such as our Code of Conduct Business Partners, compliance audits and the EcoVadis program to assess supplier risks and ensure suppliers are meeting our environmental and social standards or following steps to improve.

In 2023, we will set targets to reduce the supply chain risks and improve environmental and social performance in our supply chain. To ensure we reach these targets, we will track progress and report against them in monthly cross-functional meetings with the relevant stakeholders.

Our Code of Conduct Business Partners

Nutreco is committed to engaging only with suppliers that uphold the same principles as we do and, where necessary, ensure the implementation of corrective measures. This is why all our suppliers and business partners are required to adhere to our Code of Conduct Business Partners, which we launched in 2013 and updated in 2021. The Code contains the basic principles of what we expect from both Nutreco’s direct and indirect suppliers and

the minimum legal and ethical requirements they need to meet. It enables us to engage with our suppliers on material sustainability issues relating to their operations, and to set minimum criteria for them to meet. All our new suppliers receive an email during the onboarding process stating, “by engaging into business with Skretting / Trouw Nutrition / Nutreco you accept and comply with this Code of Conduct for Business partners.”

In 2022, Nutreco started to implement the EcoVadis program, which helps us understand and mitigate sustainability risks among our suppliers so we can accelerate environmental and social improvements across the value chain. EcoVadis will enable us to embed sustainability in all our procurement processes, including category management, sourcing, supplier risk assessment and supplier performance.

We use EcoVadis to perform an initial risk assessment of our suppliers. In 2022, we used it to risk assess over 50% of our supplier base, highlighting over 100 high- risk suppliers. We define high-risk suppliers as entities operating in sectors and regions where the risk for social and environmental issues is relatively high. We will engage with these suppliers to further evaluate and mitigate the risk, with an initial focus on the suppliers we spend the most with. 

One of the methods we can employ to help us do this is the EcoVadis Ratings; suppliers will be asked to answer a sustainability questionnaire and provide proof for their answers. The answers are then evaluated by EcoVadis and the supplier is scored accordingly. This will give us a good overview of the overall robustness of a supplier’s sustainability policies so we can offer them concrete action points of improvement. In 2022, 183 of our suppliers had an EcoVadis rating available, and we aim to increase this number over 2023.

Increasing due diligence in Norway

On July 1, 2022, the Norwegian Transparency Act entered into force. This act is meant to increase the transparency around how larger Norwegian companies deal with possible human rights violations in their operations and also in their supply chains. 

Read case study

Catfish Sustainability Project helps small-scale farmers succeed

We started the Catfish Sustainability Project (CSP) in Nigeria in 2016 with the objective to enhance the productivity and income
of small-scale catfish farmers, promote best management practices for achieving environmental benefits, and facilitate an organised structure to engage stakeholders in catfish production.

Read case study

Our Community Development Projects

At Nutreco, we believe that people must be at the heart of our industry's transition to sustainable food systems. Most of the local communities in the developing world depend on agriculture for people’s livelihoods. In recent years, Nutreco has committed to setting up projects in Asia and Africa to build inclusive, sustainable supply chain models. These projects focus on training and supporting local (smallholder) farmers to help them increase the quality and nutritional value of their products and grow their businesses in a sustainable way, so they can earn a living wage from their farms and feed their local communities.

In these projects, we work closely together with local NGOs and partners such as IDH Sustainable Trade Initiative, the Bill and Melinda Gates Foundation and Norwegian Agency for Development Cooperation. In 2022, Nutreco set up an additional four projects. One of the most significant was the Hendrix4U project, through which we are working closely with the Bill and Melinda Gates Foundation to enable sustainable access to affordable, safe, quality and custom- made animal feed solutions for small-scale livestock producers in Africa.

Summary of activities

Train the Trainer Program and Farmer Meets 
 
  • 2,436 Dairy Farmers - Participation of Farmers in such Meets. Mass and one to one interactions.
  • 669 Dairy Farmers covered under one-to-one interaction - Dairy Farmers touched in interior Villages.
  • 115 Dairy Farmer Meets - Dairy Farmer, mass and one to one interaction meets.
  • 12 Train the Trainer Program - Training of Extension team by local and international experts.

Performance Change in Area

Milk is the largest crop in India; 25% of Indian households (approximately 76 million) are engaged in dairy farming, a majority as small and marginal farmers. India has the largest bovine population in the world, but milk productivity per animal is quite low (three to four litres per animal per day),resulting in low levels of income and profitability from dairy.

The Trust Dairy Project is a sustainable dairy farming initiative in India, delivered through a collaboration between Solidaridad, Nutreco, Govind Milk and Milk Products and the Baramati Agriculture Development Trust. The objective of this community initiative is to create a robust framework for small dairy farming based around the adoption of sustainable and economically feasible modern dairy farming technologies. This is helping farmers in India produce high-quality, safe and hygienic milk with a lower environmental footprint.

The project has already been deployed in the western part of the State of Maharashtra. Dairy farmers are actively involved in all the project’s main focus areas – from dairy farm management to dairy nutrition and environmentally friendly manure management.

Our progress in 2022

Training the trainers

The project team selected 10 instructors to train the dairy farmers who are part of the project. They deployed the TART educational model (training, assessment, and re-training), coaching the trainers through classroom as well as on- farm training sessions at a centre of excellence for dairy managed by the Baramati Agriculture Development Trust. They also performed internal assessments to gauge the trainers’ understanding of the subjects that are part of the training.

Supporting women entrepreneurs

Through the project, we also work to encourage and motivate women dairy farmers and promote female entrepreneurship. We conducted motivational and training programs for women dairy farmers, covering important messages about dairy farm management, including the importance of loose housing, the role of women in dairy farming, nutrition management and milking hygiene. Women and their young school- age children are also welcomed to the projects’ dairy farmers meetings and training, giving the children a head start at learning basic dairy farming skills.

Forage improvement programs

Another aim of the project is to promote silage usage in feed to improve milk productivity and environmental sustainability. To this end, the team organised and conducted a workshop on the benefits and care of silage for balers. As a result, 190 dairy farmers are currently using silage on their dairy farms, assisted by Nutreco's NutriOpt onsite advisor, which helps them get the right quality and nutrient mix. Improving the quality of forage will not only help increase the dairy cows’ milk productivity but also change enteric fermentation digestion patterns to reduce methane emissions.

Biogas unit installation

In two of the districts that are part of the project, 50 dairy farmers agreed to install biogas units that use manure as fuel, in their farms for household use. Out of the 50 dairy farmers, 32 are already in the process of installing the biogas units. This will help us to reduce the carbon footprint of these farms through effective manure handling.

Customising and deploying technology

To promote better and more sustainable farm management, the project team has deployed different technology to the participating farmers, including the Cool Farm Tool, Mycomaster Plus NutriOpt Onsite Advisor and Formulation as a Service, extensively training the project coordinator and workers to help support these tools.

In final phase of this project, Nutreco's global and regional Technology application teams are also exploring the possibility of working with the Nutreco India Dairy technical team to create the fundamentals of GHG emissions control by deploying advanced Nutreco dairy farm sustainability tools.

The project partners have introduced the Solitrace traceability tool to bring increased visibility and transparency to the dairy supply chain. The tool captures the quality and sustainability practices adopted by milk processors and producers and makes this information available to consumers through a QR code on the milk packaging.

For more information about Solitrace, visit: https://www.hillsandvalleys.in/traceability

Chapters:

5.1 Diversity and inclusion
5.2 Community development
5.3 Key partnerships
5.4 Occupational health and safety