
US-based agro-food giant Cargill published its 2010 corporate responsibility report this month. Mark Murphy, who oversees corporate responsibility within Cargill’s corporate affairs department, spoke with Ben Cooper about the company’s achievements and how Cargill’s approach to sustainability is evolving.
Corporate actions around sustainability tend to arouse most scepticism when they are seen as ‘box-ticking’ exercises so it is refreshing when companies concede they have issues still to address and areas where they have not yet found the answers.
With that in mind, Mark Murphy’s admission that Cargill is ‘not there yet’ regarding certain aspects of its approach to sustainability is disarming.
While the US-based agro-food combine’s 2010 corporate responsibility report, published earlier this month, details some notable achievements in areas such as farmer training, community investment in supply chains and workplace conditions, Murphy candidly concedes that the company’s overall global approach to sustainability is still at an evolutionary stage.
“It’s evolving,” Murphy says. “There are many models that companies have. It’s easy to call out a Unilever or a Nestle who have been at these issues, and have been quite committed from the top of the house down for many, many years and have pretty sophisticated models. Cargill haven’t gotten to that level yet.”
For Murphy, Cargill’s approach can be characterised as decentralised, with an emphasis on sustainability work within the company’s 75 business units or its six operational ‘clusters’. The activities detailed in the report bear witness to the fact that Cargill is not sitting on its hands.
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By GlobalData
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Cargill’s Mark Murphy |
For example, the company reports that it has used biogas to displace 20% to 25% of natural gas demand at its North American beef processing plants, while reducing greenhouse gas (GHG) emissions by more than 1.3m metric tons over the last four years.
The report also catalogues community investment in agricultural supply chains. Among other programmes, the company participates in the West Africa Cocoa Livelihoods initiative which aims to help 200,000 farmers in Côte d’Ivoire, Ghana, Nigeria, Cameroon and Liberia. Meanwhile, Cargill’s Sustainable Soy Partnership provides support to farmers working toward compliance with the Brazilian Forest Code. Cargill is also involved in farmer training in China and Indonesia.
Murphy highlights the company’s engagement with NGOs in multi-stakeholder partnerships, such as the Roundtable on Sustainable Palm Oil, as a key development in recent years. Cargill is also a member of the International Cocoa Initiative and was a co-founder of the UTZ certified cocoa programme.
There has been a focus on work “on the ground” out in the individual business units partly because “actions speak louder than words”, Murphy says, adding that those specialising in sustainability in operating units are “networked to the corporation and also networked to the people playing more of a public role such as myself and my peers”.
The very fact that Murphy functions as the company’s lead champion on sustainability but is in fact based within the corporate affairs department tells its own story. It should be said that in that role he oversees corporate responsibility activities, involving stakeholder relations, global giving, community engagement, reputation and issues management. Also, prior to joining Cargill in 1996 Murphy had 15 years working in the non-profit sector, and clearly has a strong grasp of the wide range of issues within the sustainability ‘brief’.
Cargill clearly recognises the need for some form of external and internal sustainability champion, and Murphy points out that the corporate affairs department plays “a major role in helping shape the sustainability work”. But this is arguably not the same as having a CR or sustainability team, headed by someone whose sole responsibility it is to drive a company-wide, concerted and coordinated approach on these issues. “Cargill does not have a sustainability guru per se,” Murphy says.
The problem of sustainability residing primarily in communications or corporate affairs functions is far from unique to Cargill. But many companies have recognised that, without creating unnecessary administration and bureaucracy that could inhibit action, the formation of a centralised dedicated sustainability team, responsible for a cohesive, over-arching sustainability strategy and platform is beneficial. This can foster implementation, cross-learning, measurement and effective communication of what the company is doing.
In fact, Cargill does not have a central corporate responsibility or sustainability committee, which is even rarer nowadays. Most companies have some form of corporate responsibility committee often including high-level representation from operational units.
The company is currently considering this very question. “We do not have a corporate-level committee for sustainability. We haven’t gotten there yet,” Murphy says. “We have some key leadership people at practitioner level that are driving these things inside different businesses today.” But he adds that Cargill is working on a project “at the top of the house” aimed at determining how to “truly drive this into the business strategy and the business processes”, looking at actions, metrics and structure and governance. “And we’re in the midst of those discussions right now,” he adds.
While Murphy’s candour about Cargill having matters still to address is disarming, being open about having a lot to learn only works for so long. And while campaigners are wary of box-ticking, they are also suspicious of the ‘we are on a journey’ mantra, if they perceive it is disguising prevarication or a lack of focus and urgency. That is why Murphy’s prediction that the way Cargill approaches some aspects of the sustainability challenge could look substantially different in two years’ time is noteworthy.
Murphy believes there has been “a cultural sea change” within the company “at the leadership level as well as at the operating level” during the past few years, recognising the greater expectations that its customers and other stakeholders have with regard to corporate responsibility. And he believes this will lead to further change over the next couple of years.
A key manifestation of this next stage of development will be how the company reports on sustainability, Murphy says.”Cargill is a privately-held company and we don’t have a history of being as transparent as a publicly-held company may have been,” he explains. “But we recognise that in the future we have to be out there with a clear platform to communicate what it is we are doing and what we are committed to.”
Murphy agrees that the recent report is more narrative in nature, focusing on informing stakeholders on what the company has been doing. While it may be open about where it did not achieve an objective, Murphy concedes that the report is relatively light on quantitative data and targets.
However, he believes the process of examination the company is currently undertaking will lead to a greater focus on quantitative information and greater “clarity around targets” in future reports, for example moving closer towards increasingly recognised external frames of reference such as the Global Reporting Initiative (GRI) standards, so “our external public can look at us apples to apples”.
“I would hope that in two years’ time, Cargill would have well-defined targets and will be in a place to be very transparent about where we are meeting those targets or we’re not.”
Given the company’s involvement in some of the most contentious agricultural sectors, such as soy, cocoa and palm oil, it is inconceivable that the company would escape severe criticism if it failed to deliver on at least some of this. Murphy’s preparedness to up the ante therefore can only be taken as a good sign.