I spend a lot of time discussing environmental and social issues around sustainability, both here and in other publications. I often focus on the risks and opportunities, and how they relate to a company’s entire supply chain. At Asia Pulp & Paper, it’s something that’s at the core of the company – it’s engrained in our business model. Our Forest Conservation Policy (FCP) lays out an ambitious roadmap and commitments on how we supply and conduct our operations, a policy that’s on the leading edge of improving the way the pulp and paper companies supply their operations.
Today, I saw a great example of another company, one that has implemented rigorous social and environmental policies for their supply chain, just as APP has, and that made a decision to enforce their sustainability commitments through their supply chain in a very public manner. The North American quick-serve restaurant chain Chipotle Mexican Grill announced this week that they would temporarily stop serving “carnitas,” or pork, at one-third of their restaurants. As the Associated Press reported:
Chipotle learned of the violation by the supplier on Friday through a routine audit, and did not have a timeline for when carnitas would return to affected stores, about a third of its total base…In New York City on Tuesday, a sign on the door of a Chipotle location stated, "SORRY, NO CARNITAS."
[A Chipotle Spokesman] said most of the issues related to the violations concerned the housing for the pigs. Chipotle demands that its suppliers raise pigs in humane conditions with access to the outdoors, rather than in cramped pens.
This was the right decision and I applaud them for moving so decisively. When faced with these types of important decisions, executives and procurement professionals must move quickly to protect their brand and to maintain the sustainability of their supply chain. This formed part of our thinking when we decided that we were not going to accept fiber from tropical rainforests in our products – the interruption to supply was considered secondary to the potential long term risk to the forests, our supply chain and our brand.
When APP first announced its FCP, we spoke closely to our suppliers to ensure they were prepared to meet our standards. We encountered one that was not and that led to the decision to immediately cease business with that supplier. Did this cause some supply issues, absolutely. Was it the right decision? Absolutely.
Chipotle should be applauded for this decision. It’s vital to adhere to your sourcing policies and standards. After all, if you can’t stick to the standards you set, why should the customers stick with you? The truth is, they probably won’t.