Frankly CSR

I must admit, when I started this blog last August, I was a little apprehensive about commenting on what other companies and industries are doing (or not doing) in the area of CSR, since I was writing the blog as a representative of my employer, Lawson.  While Lawson has a long history of being active in its communities and maintains a very strong employee code of conduct, like most companies, Lawson’s formal CSR programs are still evolving.  My objective has been to evaluate and comment on CSR news, trends and activities without implying that Lawson has perfected its approach to CSR. 

With Lawson’s announcement last week of a new global community service program, I thought it was a good time to talk a little more about what Lawson is doing in the area of CSR.  The community service program I just mentioned is intended to encourage every Lawson employee to use up to eight hours of company-paid work time during a year to volunteer for a community service activity. The program is designed to support Lawson employees who currently do various types of community service and to help motivate other employees to volunteer their time in their communities.  With approximately 4,200 employees around the world, the goal is that individually and collectively Lawson employees can have a positive impact in their communities.  

Lawson’s plan is for the community service program to become part of a broader CSR initiative that is expected to include a formal environmental program and sustainability reporting.  Lawson is already a stakeholder in the Global Reporting Initiative (GRI).  Over the last year we have become active in several of GRI’s sector activities for Lawson focus markets such as food processing and apparel and footwear.  As part of our GRI membership, we are in the process of formulating our own sustainability reporting approach. 

If you have followed my blog you also know Lawson has been focused on how it can help customers better manage their CSR programs using Lawson products (see posts from September 24, October 4, October 18, March 17).  It’s an area that is gaining momentum. 

Borrowing an old Nike advertising slogan, “there is no finish line.” This is particularly true when it comes to CSR. CSR is evolving and Lawson will continue to assess how it can make a difference.  

Jeff 

For many companies product safety is a fundamental component of their CSR efforts.  But in the last year or two no market has had to re-evaluate its product safety practices more than the food industry.  Increasing health concerns by consumers, new government regulations, growing (often global) supply chains and increasingly competitive markets have all been influencing factors. And, of course, recent incidents like those at Topps Meat, Cargill, Westland Meat and Menu Foods – to name just a few – have not helped the food industry. 

The Food Marketing Institute’s survey, “U.S. Grocery Shopper Trends 2007,” reported that consumer confidence in the safety of the food supply has dropped dramatically. Confidence had consistently hovered in the 80th percentile for years, but dropped to 66 percent, the lowest point since 1989. Consumer confidence in the safety of restaurant food is even lower, at 43 percent. 

So, how do we address the food safety issue? There are a number of possible solutions that can help companies.  Forbes.com provided a good overview in a recent article, “U.S. Food Safety: Solutions at a Glance.”  One of the solutions the article highlights is product traceability.  Generally speaking, this means food companies are able to track their products from “field-to-fork.”  The flow of raw materials and ingredients are tracked from producers to the manufacturer, and then the finished product is followed through the distribution process to the retailer. 

The Aberdeen Group, a research firm focused on business technology, also views traceability as a solution. Aberdeen’s December 2007 benchmark report, “Compliance and Traceability in Manufacturing,” recommends that companies “…implement technologies with core track and trace capabilities…” to achieve best-in-class performance. The report is based on a survey of 650 manufacturers (not limited to food) primarily in the United States.   

At least one food company had a vision to improve food safety using a traceability solution years ago.  Nutreco is an international animal and fish feed company with over 100 production and processing plants in more than 25 countries.  In 1999, Nutreco, already a customer, came to Lawson with the idea of proactively managing food safety throughout their supply chain. Our co-development effort resulted in a software solution called Lawson Trace Engine. Today it’s the technology that drives Nutreco’s NuTrace feed and food safety program.  This week Lawson announced a new global version of Trace Engine.  

Ultimately, traceability solutions create transparency in the food supply chain, which can only help with the consumer trust issues mentioned above.  And while it’s the “socially responsible” thing for companies to do, it’s also good business.  Consumer trust can improve brand loyalty and customer satisfaction and drive revenue.  A possible alternative is the Topps Meat story I noted above.  In part because it had no tracking capabilities, Topps was required to recall a full year’s worth of product and is now out of business. 

Jeff