Inside Supply Management Magazine
Hershey Takes a Lead in Sustainable Sourcing
Consumers’ relationship with food is changing — shifting populations and demographics are influencing how we all evaluate and make buying decisions when it comes to foodstuffs.
As a result, such organizations as The Hershey Company — the largest chocolate manufacturer in the U.S. — have put several components at the top of their sourcing agenda. Chief among these is responsible sourcing, said Susanna Zhu, Hershey chief procurement officer, in her presentation, “Procurement & Sustainable Sourcing,” at ISM2018 last month in Nashville, Tennessee.
In an effort to up its game regarding transparency and simple ingredients, Hershey has pursued a variety of programs, including the SmartLabel Initiative, its Cocoa for Good strategy and the Project Peanut Butter program:
●SmartLabel: Hershey, said Zhu, helped lead the SmartLabel Initiative (smartlabel.org), which provides brand owners with a tool providing consumers with access to comprehensive product information via an on-pack QR code. With limited room on packaging, and consumers wanting more and more detailed information on foods and other products, SmartLabel enables them to view nutritional information, ingredients, allergens, third-party certifications, social compliance programs, usage instructions, advisories/safe handling instructions and more. Announced in 2015, SmartLabel now has more than 40 companies and hundreds of brands utilizing it.
●Cocoa for Good: Announced earlier this year, Hershey’s Cocoa for Good program is a cocoa sustainability strategy that addresses the most pressing issues facing cocoa-growing communities, including poverty, poor nutrition, at-risk youth and vulnerable ecosystems. The company is making a US$500 million investment, said Zhu, working in four primary areas: increased family access to good nutrition; elimination of child labor and increased access to educational opportunities; increased household incomes; and zero deforestation and increased agroforestry.
●Project Peanut Butter: Hershey has been involved for several years with Project Peanut Butter (projectpeanutbutter.org), a nonprofit that seeks to treat severe malnutrition using locally produced, ready-to-use therapeutic foods (RUTFs). In 2012, Hershey announced it would fund the construction of a Project Peanut Butter factory in Ghana to produce the peanut-based RUTFs; Project Peanut Butter distributes them to relief agencies, which provide the product to malnourished children in Ghana at no cost to them or their families.
Zhu also noted how important it is to have a talented procurement team. Some of the attributes and skill sets she looks at when recruiting sourcing managers and teams include (1) a purchasing background (typically), (2) an understanding of commodities, (3) the ability to take a broader perspective “beyond dollars” and (4) good stakeholder management.