Global Business Strategy ProjectStephanie Chapman🔴Estefanie

Lopez🔴Derek Mitchell🔴Chapman Parker

Policy & Strategy Atlanta Module Summer 2012

SUSTAINABILITY

Global Business Strategy Project

Environmental Demand• Pollutes air, water, and land • Produced on large scale – Up to 100 square kilometer plantation – Deforestation

• Soil quickly depleted – No natural leaf litter –More land expansion – Soil erosion – Runoff causes frequent flooding

Monoculture• 300 species of banana – Cavendish is only grown for

international trade • All bananas are genetically identical • Increases susceptibility to single

pest, fungi or disease • Increases pesticide use • 30 kilograms of pesticides per

hectare

Pesticides• Bananas are judged on aesthetic standards • 400 types of agrochemicals –More chemicals used than any other crop

except cotton • Insects become resistant – Stronger, more toxic pesticides are needed

• Affects mammals, birds, and plants – Biodiversity disappears – Destroys pioneer plant species

Waste• Banana industry produces most waste • Two tons of waster per ton of bananas • Types of wastes – Plastic bags – Containers – Banana trees – 30 to 40 percent discarded –Waste is contaminated with pesticides

Dole Sustainability

• Water management

• Carbon footprint

• Soil conservation

• Packaging

Global Business Strategy Project

Dole Latin American Operations

Certified Sustainable

Dole Latin American Operations

Latin America-Caribbean (LAC) Urbanization

• 28% increase in urban population between 2007-2025 (127 million people)

• Agriculture share of GPD declines as manufacturing increases – Major city share of national income (World Bank) • 55% for low income countries • 73% for middle income countries • 85% for high income countries

• Over 78% of LAC population lived in urban areas as of 2007 – More highly urbanized than Asia, Europe or Africa

• 67 cities with populations over 1 million – 46% of population living in these

cities • 4 of world’s 19 mega cities (10

million inhabitants)

Latin America-Caribbean (LAC) Urbanization

LAC Urbanization Breakdown• South America: 81.8% – Projected (2015:85.2%) (2025%:86.4%)

• Central America: 71.7% – Projected (2015:73.25) (2025:76.2%)

• Caribbean 64.3% – Projected (2015:69.3%) (2025:73.6%)

• Costa Rica 64.3% • Ecuador 66.9% • Honduras 48.8%

Urbanization Trends• Rural to urban migration for economic

opportunities reason for early urbanization • Rural migrants now more educated

including a disproportionate share of women

• Migration trends have shifted to more intra-metropolitan migration

Urbanization Effects• Fosters aggregate economic growth – Made little impact on urban poverty – Increased urban poor population – Decreased rural poor population

• Majority of poor in LAC in urban areas (2002) – 59% living on less than$1 day – 65% living on less than $2 day

• Relocation of poverty – Migrant concentration in outer edges of cities, inner

suburbs and center cities – Weak migrant integration into health and education

systems

Dole Rural Incentives• Workers – Health & safety – Training programs – Wages, working hours & social benefits – Labor organizations

• Community – Medical programs – Housing & community programs – Drinking water – Education programs

Dole Rural Incentives

• Costa Rica –Mobile medical units – Bananito - Costa Rican farm

providing nurturing work environment and benefits

• Ecuador – Health & medical programs – Paved road projects – HIV/AIDS prevention programs

• Honduras – Hospital Vicente d’Antoni

Urbanization MatrixWhere we produce Where we sell

Supply ChainProducts

Labor shortage Need to provide community infrastructure

Banana is convenience food Goes along with urban lifestyle

Migratory people will recognize their rural foodstuffs

Urbanization corollary with natural

More centralized distribution

Generation gaps occur where people have enjoyed the rural banana People will be more accepting of cavendish variety

Dole Rural Incentive Project Map

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o

o

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o

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Mobile Medical Units

BananitoHospital Vincente d'Antoni

Paved Road ProjectsHIV/AIDS Prevention Programs

People

SUSTAINABILITY MEASURES

Profit

Planet

Global Business Strategy Project

Sustainability Measures

• Dole Sustainability Measures • Sustainability Benchmarking:

Indicator use

DOLE SUSTAINABILITY MEASURES

Certifications Carbon footprint assessment Water assessment Social Indicators

Certifications

ISO 14001• Standard for environmental

management systems • Areas of focus – Waste management – Practices to avoid adverse

changes in air, water and land quality

• All banana farms certified (except Sri Lanka, Vietnam, Malaysia and Indonesia)

Global G.A.P.• Standard designed to

reassure consumers of environmental impact minimizing production techniques

• Reducing chemical inputs • Responsible approach to

worker health & safety • Certification adopted to

satisfy European customer demands

Certifications

SA 8000• Monitors and evaluates the social

accountability of companies • Areas of focus

– Child labor – Forced labor – Health and safety – Freedom of association – Discrimination – Disciplinary practices – Working hours – Remuneration – Effective management implementation

• Dole is the first agricultural company to receive certification

Organics• Organic operations certified

by accredited independent agencies

• Accrediting agencies – USDA – National Organic Program – European Union

• Areas of focus – Use of environmentally

sensitive and natural remedies instead of pesticides

Certifications

Rainforest Alliance• Conserve biodiversity and

ensure sustainable livelihoods • Areas of focus

– Reforming land-use practices, business practices and consumer behavior

• Three pillars – Social equity – Environment protection – Economic viability

• Consists of ISO 140001 standards – Certification trademarked seal

appeals to European and American consumers

FAIRTRADE• Movement seeking to improve

trade terms for farmers • Ensures market prices covers

costs of sustainable practices, acceptable working conditions and longer trade relationships

• Consumers pay premium for FAIRTRADE marked products that is reinvested into economic and social development for producers

Carbon Footprint Assessment• Calculated carbon footprint of bananas produced in

Costa Rica and distributed in Germany • Areas of focus – Cradle to grate approach • Raw materials to retail shelf

– Defines sources of greenhouse gas during various supply chain stages

• Results – The carbon footprint of Dole bananas amounts to 1124 kg

CO2e per ton of bananas. – The majority of emissions are related to overseas

transportation. – Emissions related to fertilizer use have a significant impact on

the total carbon footprint of Dole bananas.

Water Assessment• Conducted water footprint study on Costa Rica and Honduras

facilities including independent grower’s farm Dole purchases from • Water footprint measures human demand of freshwater

– Measures water consumption by source and polluted volumes • Areas of focus

– Analyze impact of different watering methods • Costa Rica-rain-fed crops • Honduras-irrigation systems

– Analyze impact of packing facilities • Results

– The water footprint of handling bananas and pineapples (packing facility phase) is much smaller than the water footprint of growing them (farm phase).

– In Costa Rica, the blue water footprint of both pineapples and bananas is zero due to the fact that farmers feed their crops via rain rather than irrigation systems.

– The water footprint of growing pineapples is lower than that of bananas. – Growing bananas (blue and green water footprint) on Dole’s banana farm

(Guanacaste) versus growing them on the individual grower’s farm (Casmul) – both in Honduras – yield similar water footprints.

Social Indicators• HIV/AIDS prevention program – Developed alliance with CARE and UNIVIDA – Served over 85,000 people through: • Educational talks • Home visits • Counseling • Screening test

• Medical records – Dale Medical Record Program – Obtain data on health conditions of Ecuadorian communities to

identify prevalent illnesses and ailments • Mobile clinics – 61,000 patients in Ecuador in 2009 – Expanded medical services by 25% in same year

Dole Sustainability Model

Dole Sustainability

Water Assessment

Carbon Footprint

Assessment

Certifications

Social Indicators

Dole Sustainability Model

SUSTAINABILITY BENCHMARKING

Sustainability Definition EU Sustainable Development Focus 25 Sustainability Indicators Sustainable Community Model

Generic Definition“Sustainable is a community that meets the diverse needs of existing and future residents, their children and other users, contributes to a quality of life and provides opportunity and choice. They achieve this in ways that makes effective use on natural resources, enhances the environment, promotes social cohesion & inclusion, protects the human rights and strengths economic prosperity” (Eagan-review UK, 2004)

EU Sustainable Development Indicator

• Areas of focus – Address issues of Greece, Tunisia, Italy, Palestine &

Jordan as pilot for Mediterranean area – Fair trade driven local economy based on olive oil

production and exporting to U.S. and EU markets • Sustainable community model indicators – Governance – Economics – Social & cultural – Environmental – Labor capital – Quality – Global partnerships

25 Indicators• Governance – Provide continuous process of

participation – Establish means for continuous

monitoring – Promote local community

resiliency • Economics – Optimize benefits to households – Optimize direct consumer and

producer linkage – Emphasize social and

environmental business models – Invest in local capital

• Social and cultural – Ensure adequate local olive oil (banana)

supply – Reverse rural abandonment – Promote education and cross

communication – Provide equitable returns – Respect cultural and legal norms – Protect heritage and enhance

community resiliency – Promote family identity and wellbeing – Special attention to non-native workers – Opportunities for women/youth

*all of these may not apply to Dole and banana industry but I think it’s relevant for the most part

25 Indicators• Environment

– Environmentally friendly process – Practice regenerative agriculture – Increase resiliency to hazards

• Quality – Establish traceability – Implement best practices

• Labor – Fair wage and protection of workers – Non-exploitive relations

• Global partnerships – Understanding diversity and commonality among partners – Cross-cultural connection among consumers and producers

Sustainable Community Model

Sustainable Community

ModelEconomics

Labor Capital

Governance

Environmental

Global Partnerships

Social & CulturalQuality

Global Business Strategy Project

Thank youContact info. Derek Mitchell

dlmitchell3001@gmail.com www.linkedin.com/in/dereklmitchell