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Not only do customers increasingly value these granular insights on aspects such as ingredients, suppliers and processes, to name but a few, but this same in-depth traceability data can directly support organizations in their broader sustainability goals.
As our own Traceability Report highlighted last year, 74 percent of food professionals now say that their businesses understand the importance of supply chain traceability. It’ s a major shift that signals how traceability has changed from a narrow and costly means of compliance to a critical mechanism for driving ESG progress- and adding value.
A pillar of ESG
Traceability data is now a cornerstone of any solid ESG strategy. Take emissions tracking.
Full transparency on the traceability of where a product has been, how it’ s been processed, transported and packaged, at each point in the value chain is invaluable when it comes to calculating an accurate and verifiable carbon footprint figure to weave through annual reports or even share on-pack. It enables companies to gauge greenhouse gas emissions through the whole lifecycle of a product, from farm to fork, and from both direct and indirect sources, a level of detail that’ s increasingly demanded by regulators, retailers and end consumers.
Much the same goes for ethical sourcing. It’ s no longer enough to slap vague claims around fair pay or eco-friendly supply chains on a product. At least not if companies want to avoid the wrath of US and UK regulatory bodies like the Federal Trade Commission in the US and the Competition & Markets Authority in the UK, both of which are stepping up efforts around greenwashing and unsubstantiated claims. Instead, any ESG claims now need to be backed up by clear evidence, be it on point-of-origin, ethical labor practices or deforestation-free supply chains.
For waste reduction meanwhile, traceability data has an added bonus. Not only can it verify any public-facing claims a company is looking to make but it can also provide the type of insight needed to accelerate progress. It can highlight inefficiencies or hot spots in supply chains where waste routinely occurs but might otherwise have been overlooked, such as areas of repeated overproduction, machine downtime or spoilage.
Higher Bar
If traceability data is already invaluable to achieving and verifying progress in ESG, it’ s only set to become more critical in the years ahead.
Regulators are currently rolling out a raft of legislative changes that will raise the bar on corporate sustainability, with a whole new set of rules and requirements for food and beverage companies to meet- or face hefty financial penalties.
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