This is an article I wrote for the CRN Daily Supplement member newsletter, covering a session I attended at the Natural Products Expo East trade show in September 2021—additional stories here.
The natural products industry, as part of the greater food industry, is responsible for one third of the greenhouse gas (GHG) emissions that are causing climate change.
By the numbers: The largest contribution to harmful emissions is made by agriculture and land use/land-use change activities (71%), with other sources being supply chain activities: retail, transport, consumption, fuel production, waste management, industrial processes, and packaging.
Six strategies for companies to reduce GHG emissions, as explained by Nova Sayers from independent research company HowGood at Natural Products Expo East, include:
- Choosing different ingredients
- Choosing better sourcing locations
- Choosing certified suppliers
- Engaging suppliers to reduce their footprint
- Supporting regenerative agriculture
- Purchasing agricultural offsets where they source
Companies can rapidly assess which ingredients, production practices, and locations can help them improve their climate impact using HowGood’s product sustainability database.
Why it matters: “The same conditions that are causing GHG emissions and climate change are also causing significant species loss and loss of biodiversity that our industry depends on,” Sayers explained. “We need diverse ingredients that are grown in a way that allows them to be nutritionally dense.”
The bottom line: In addition to protecting their ingredient sources, companies can reap rewards in terms of price premiums. Data from the NYU Stern School in partnership with IRI showed sustainable products:
- Accounted for over 50% of the market growth even though they only comprise about 16% of the overall market in terms of number of products.
- Command a 39% price premium over conventional products, according to data from the NYU Stern School in partnership with IRI.