Why GreenBiz is becoming Trellis this summer by Joel Makower
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Sponsored: Syngenta boosts transparency through a new framework to rate how its products impact agricultural sustainability.
By Petra Laux
July 10, 2024
Image courtesy of Shutterstock.
This article is sponsored by Syngenta Group.
No one can seriously question the hugely positive role that agriculture plays in our societies, from feeding the world’s 8 billion people to employing some 26 percent of the global workforce. There is, however, a tendency to assume that all agricultural inputs such as fertilizers, seeds and crop protection products or other materials to increase agricultural yields are bad for the environment.
This incomplete (and inaccurate) perception ignores two important truths: that over the last six decades agriculture, with the help of technology, has been feeding a fast-growing world population with very limited increase of land under production; and that agricultural technologies are powerful levers for reducing farming’s impact on the environment — by lowering the sector’s carbon footprint or water use, for example.
Certain seed treatments, soil treatments and sprays reduce farmers’ reliance on resource-intensive activities such as irrigation or fertilization. Other innovations can make it easier for farmers to practice regenerative agriculture, which can enhance soil health, reduce erosion and promote biodiversity. And modern pesticides can reduce carbon footprints through lower use rates and fewer applications.
Most significantly, every product, practice and service that maximizes the productivity of existing farmland helps to reduce the chances that farmers will need to clear additional forests or vegetation. After all, the world population is projected to grow to almost 10 billion people by 2050.
In contrast to the energy and transportation industries, where the best thing we could do for our planet would be to reduce their use, we know that we must dramatically increase food production. The United Nations Food and Agriculture Organization (FAO) estimates that by 2050, we’ll need to produce 60 percent more food — even in scenarios where protein consumption is diversified, and food loss and waste is cut. Population and economic growth, changing dietary preferences, with people consuming more animal-based products, fruits, vegetables and processed foods, all of which require more resources, and urbanization with its increased demand for more diverse and resource-intensive foods are just a few reasons why food demand will continue to grow exponentially.
Syngenta Group has spent the past two years developing a tool it is calling the Portfolio Sustainability Framework (PSF), which measures how it helps farmers achieve higher yields with less impact while also measuring the sustainability of its own operations. Its efforts were driven by the notion that something can be better managed and improved only if it can be measured.
It was inspired by the Portfolio Sustainability Assessment (PSA) framework used within the chemical industry, developed by the World Business Council for Sustainable Development (WBCSD) and forward-thinking chemical companies.
Through the PSF, Syngenta’s entire product portfolio gets systematically mapped out across two key dimensions: sustainability benefits and stakeholder alignment. The purpose is to encourage the continuous development of products and solutions that not only offer increased sustainability benefits to customers and society at large, but also align with key stakeholder expectations in terms of carbon footprint and ecological profile.
The PSF rates a particular product for a specific crop in a given geography, for example, an insect control product as used for corn in the United States. The PSF scores the yield benefit, carbon footprint and environmental score of that product and consolidates these into an overall rating.
Syngenta has rated close to 20,000 product/crop/geography combinations along the PSF dimensions. Its ratings are based on millions of data points, from internal sources such as sales figures, product label information and carbon footprint estimations to external sources, including farmer panel data from Kynetec and the Field EIQ scores determined by Cornell College of Agriculture and Life Sciences.
Products and services with the highest sustainability benefits, as well as the strongest stakeholder alignment, are classified as Tier 1; those with moderate or higher stakeholder alignment as Tier 2, and the remaining ones with lower stakeholder alignment as Tier 3. Syngenta’s ambition is to grow the portion of Tier 1 products as much as possible. The portfolio currently under analysis represents sales totaling $16 billion in 2023.
Results from 2023 baseline for Syngenta Crop Protection portfolio expressed in sales % per tier. Image courtesy of Syngenta.
As it refines and develops products and services, Tier 1 will be the company’s North Star. The PSF gives Syngenta a way to hold itself accountable and provides its business leaders with tangible metrics to systematically incorporate sustainability considerations into their decisions.
The PSF strongly increases Syngenta’s portfolio reporting transparency towards investors and other stakeholders, at a time the share of sales generated with sustainable products is increasingly (and rightly) important to them. The PSF process, aggregated results (the share of products falling into each tier), and any methodological changes will be voluntarily published, and externally audited, every year.
Developing the PSF was certainly not easy. Over two years, Syngenta delved into reams of data and consulted with stakeholders including ESG rating agencies, ESG-focused financial analysts, banks, NGOs such as The Nature Conservancy and Solidaridad, and guidance-setting bodies such as the World Business Council for Sustainable Development. It also learned from existing tools, metrics and frameworks used throughout the agriculture industry, such as the Cool Farm Tool, FAO SAFRA, Global Farm Metrics, SAI Platform Farm Sustainability Assessment and World Benchmarking Alliance.
The company had intense discussions with internal stakeholders. It was important to build the trust that products would be accurately rated and that this exercise was not meant to single out individual products, but rather to move the overall portfolio to a better place. Altogether, it was an extensive undertaking. But sustainability is critically important, and Syngenta knew it needed to get this right.
As policymakers and advocacy groups seek to hold companies accountable for their impact on the planet and its people, I’d encourage other companies to embrace methodologies that rate their products’ sustainability profiles and that facilitate internal decision-making in favor of a comprehensive approach to sustainability. This strengthens an organization’s understanding of customer and stakeholder expectations, which leads to greater innovation and, ultimately, more sustainable portfolios.
Tackling climate change isn’t simple, but the agriculture industry has a critical role to play. That’s why Syngenta has placed the PSF at the core of its business model. After all, what gets measured gets managed.
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