Sustainable should also mean affordable

In order to cut both costs and climate impacts, retailers must share data insights and innovate with suppliers – while also selling products that customers want to buy, and can afford. Like any other business on the journey to net zero, the UK’s second largest¹ supermarket chain J Sainsbury plc must ensure it brings its customers along if it is to succeed.

Since the world’s food supply chain is responsible for approximately 26 per cent of global greenhouse gas (GHG) emissions, every shopper’s food choices make a difference². A beef roast and a nut roast, for instance, have starkly different impacts on CO2 production³. Responsible sourcing goes beyond GHG emissions. Does a particular product support or harm local ecosystems and communities?

These are not the only factors the supermarket must consider. Planet-friendly, healthy choices must also be affordable. In the process of repositioning its message to focus on helping everyone to eat better, Mark Given, Sainsbury’s chief marketing officer, highlights the importance of remembering the context in which most of its 30m weekly customers do their shopping. “I impress on my teams the fact that the average median income is £24,000,” he says.

Put simply, eating sustainably cannot be a luxury, only for the rich. Having grown up in a council house in Northern Ireland, Given knows this as well as anyone. “Everyone, regardless of their budget, should be able to eat well, healthily and sustainably.”

To add to the challenge, the supermarket must condense and simplify complex sustainability information to help time-starved shoppers make informed choices, says Given. “When we talk to customers in this space they are confused. The science can be complicated, and they can be unclear about what to do.”

Given already has some ideas about how to approach this, using insights from data, behavioural nudges, and the ubiquity of the smartphone. A "gamified" fruit and veg challenge that Sainsbury’s ran last year through its Nectar loyalty card scheme attracted more than 450,000 customers, who took home more fruit and veg during and after the challenge. “We do a lot of work on incentives and nudges, and I find that hugely interesting,” says Given.

It is a tip many other businesses can act on, he adds. “People spend so much time on their phones, it’s possible to use a little bit of that time to engage them, tell them something they did not know, and gain an insight into their actions.”

Another insight that transcends the supermarket floor is the need to see sustainability and profitability through the same lens. New solutions must achieve both aims in any sector, Given says. Reducing plastic waste, for example, is a sustainable practice that makes commercial sense and is also popular with customers.

Sustainability through technology

As they audit their supply chains for the sources of carbon, every company will identify where savings might be found, but may not know how to realise such savings. The potential to look for and even co-create technological solutions is one important way to achieve emissions-reducing efficiencies.

For Sainsbury’s, refrigeration is a major source of GHG emissions, and it has worked successfully with the Williams Formula 1 engineering team to improve refrigeration efficiency by applying Aerofoil technology to optimise chiller airflow.

Measurement and verification is another major challenge for businesses, on which collaboration is key. The supermarket is also working with non-profit OceanMind to verify sustainable fishing practices and, ultimately, reassure customers that they can make informed choices when it comes to shopping sustainably.

Recognising that everything is connected in the bid to cut climate impacts, Sainsbury’s is collaborating across the supply chain to move the dial in the race to net zero. “We have been hugely supportive of plant-based proteins and we have been a big champion of smaller brands and suppliers here, putting them in prominent locations alongside the meat products.”

Working with suppliers to gather insights from data and act on them is an essential part of this plan, says Given. One example is the work Sainsbury’s has done crunching data for all its primary producers, from livestock and dairy to crops and horticulture. “We have been working with farmers to collect data on welfare and environmental aspects, and using that to play back to them to get to more sustainable ways of farming and productive ways of working,” he says.

“The level of knowledge and passion our suppliers have for getting these things right is humbling and hugely important. These are people who have dedicated their lifetimes to making things better. However, the science is still evolving and the data quality is mixed, so we need to work closely with our suppliers on these things.”

This is creating deep subject matter expertise in the business and is one of the most satisfying aspects of the role, says Given. “I have a great job because I get to make a difference at scale. We have a huge influence in how the country eats.”

Supply chain savings

Such work with suppliers is the only way to achieve net zero and Scope 3 targets, since the average company’s supply chain emissions are estimated to be more than five times greater than its direct emissions.⁴

According to the Carbon Disclosure Project⁵, a charity that helps investors and companies manage their environmental impacts, more than a third of respondents to their survey are already engaging with their upstream suppliers. Given the growing regulatory imperative for publicly listed companies to report their GHG emissions, including those from their supply chains, this figure will surely only grow further.

Sainsbury’s is already on this path. It will invest £1bn over 20 years to become net zero by 2040, and aims to reduce emissions across its value chain by 30 per cent by 2030.

What has surprised Given is the extent to which the sustainability mission has recently moved to become a central strategic issue. “Before, it was seen as one thing the business did, but there is now a recognition that profitable growth has to be done sustainably, as well. It is one and the same conversation across all our brands.”

“The level of challenge we are getting from stakeholders is continuing to grow, and it is something people materially think about when they are thinking about the company they want to work with,” concludes Given. Ignoring sustainability or simply placing it in a separate CSR box is no longer enough.