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Private Sector Contributions to Sustainability in Global Food Networks

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Private Sector Contributions to Sustainability in Global Food Networks Private Sector Contributions to Sustainability in Global Food Networks A case study on the sustainable rice sourcing strategy and practices of Mars Food Laura van Hamburg ‘Private Sector Contributions to Sustainability in Global Food Networks A case study on the sustainable rice sourcing strategy and practices of Mars Food’ Amsterdam, March 2016 Student L. van Hamburg (920116-302-040) Supervisor Wageningen University: dr.ir. P.J.M (Peter) Oosterveer Supervisors Mars Food: Luc Beerens - Global Sourcing Director Rice Louke van Beek - Koopmans - Global Sustainable Sourcing Insight Manager Wageningen University Mars Food Europe Hollandseweg 1 Benjamin Franklinstraat 19 6706 KN Wageningen 3261 LW Oud-Beijerland The Netherlands The Netherlands Copyright © 2016 All rights reserved. No part of this publication may be reproduced or distributed in any form of by any means, without the prior consent of the author. iii Abstract We live in a world that is continuously globalizing, and so are our food chains. Due to globalization one is no longer able to sufficiently regulate the (negative) side effects of global food production and consumption due to a mismatch between globally organized food chains and the national regulatory arrangements. Alternative governing networks including NGOs, public and private sector emerge and seem to offer a more suitable approach. This research identifies and explains the contributions that private food companies deliver to positively affect sustainability of global food production and consumption networks, and their role in making sustainability achievements that go beyond their own supply chains. Three different approaches towards governing sustainability via supply chains – governing sustainability in, of and trough chains – are used to analyse the sustainable rice sourcing strategy and practices of Mars Food. An extensive empirical research at the sustainable sourcing department of Mars Food tackled their opportunities for delivering a contribution to sustaining the rice sector beyond their own supply chain. The results from this study show that, although Mars Food developed an external oriented strategy and aims to positively affect the total rice sector, for a successful execution of this strategy they still highly depend on others. The amount of power that Mars Food possess as a lead firm, stays limited to their own (vertical) supply chain actors. In order to deliver sector-wide contributions, multi-stakeholder collaboration among vertical and horizontal supply chain relations is vital in the both the developing and the executing phase of a strategy. Key words: Sustainability Governance, Global Value Chains, Global Networks, CSR, Sustainable Sourcing iv Preface and Acknowledgements Sustainable food provisioning is one of the key themes that guide me during my masters at Wageningen University. The Environmental Policy group (Wageningen University) approach that makes ideals and pragmatism meet, really inspired my and made me decide to go for this specialization and write my thesis at this chair group of the Wageningen University. Via an internship at the sustainable sourcing team of Mars Food, I got the opportunity to study this subject as a part of a lead firm in many supply chains. A bit different than the usual procedure I decided to combine this internship with writing my thesis and hereby add an extra, scientific, dimension to my internship. Studying sustainable food provisioning from a company point of view was new and very insightful. Combining thesis research and an internship was both interesting and challenging Succeeding both activities would not have been possible without the guidance and support of my supervisor Peter Oosterveer (Wageningen University). During the entire process from writing my proposal, doing the research at Mars Food to writing the actual report, I always felt that I was welcome to ask for advice or support. I would like to thank him very much for his efforts and sharing his scientific expertise with me. I would like to thank Mars Food Europe for the opportunity of being involved at one of the first stages of implementing the global sustainable sourcing strategy. Special thanks go to Luc Beerens and Louke Koopmans (Mars Food). I would like to thank both of them for their confidence, time, efforts and supportive words. I enjoyed being part of their team a lot and whish them al the best in the continuation of their sustainability journey. Off course I would like to thank everyone that was able to participate in my interviews. Despite busy schedules and (sometimes) large time differences, all participants were willing to share their story and perspective. I have experiences these conversations as insightful and honest, which means a lot to be. I really enjoyed encountering so many people that are passionately working about sustainability and ethically motivated to be involved in this theme. This is something that motivates me for the future. Laura van Hamburg v Table of Contents Abstract ............................................................................................................................ iv Preface and Acknowledgements ......................................................................................... v List of Figures .................................................................................................................... ix Table of Abbreviations ....................................................................................................... x 1. Introduction ................................................................................................................... 1 1.1 Background ............................................................................................................................ 1 1.1.1 Globalized food networks ...................................................................................................... 1 1.1.2 Food Industry Challenges - The effects of globalized food networks .................................... 2 1.1.3 Insufficient regulation ............................................................................................................ 3 1.2 The research .......................................................................................................................... 3 1.2.1 Problem statement ................................................................................................................ 3 1.2.2 Research Objective ................................................................................................................ 4 1.2.3 Research Questions ............................................................................................................... 4 1.2.4 Relevance ............................................................................................................................... 5 2. Global Sustainability Governance ................................................................................... 6 2.1 Governance approach ............................................................................................................ 6 2.1.1 Governance Defined .............................................................................................................. 6 2.2 Chain and Network Perspectives ............................................................................................ 7 2.3 The Company Role in Governance Arrangements ................................................................... 8 3. Addressing sustainability in, of, and trough chains ....................................................... 10 3.1 Internal Perspectives ........................................................................................................... 10 3.1.1 Governance in chains ........................................................................................................... 11 3.1.2 Governance of chains .......................................................................................................... 11 3.2 External Perspective ............................................................................................................ 12 3.2.1 Governance through chains ................................................................................................. 12 3.3 Illustrative practices ............................................................................................................. 13 3.3.1 Corporate Code of Conduct - Unilever ................................................................................. 13 3.3.2 Third Party Certification – UTZ Certified .............................................................................. 14 3.3.3 Multi Stakeholder Arrangement – International Cocoa Initiative ........................................ 15 4. Methodology ................................................................................................................ 16 4.1 Research Design ................................................................................................................... 16 4.1.1 Literature Research .............................................................................................................. 16 4.1.2 Empirical Research ............................................................................................................... 17 4.2 Research Units ..................................................................................................................... 17 4.2.1 The Company ......................................................................................................................
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