Strong brands are thinking daily about delivering affordable and accessible products to consumers that will allow the consumer to feel better about themselves as human beings. The key is the brand has to own making this easy and affordable so the consumer isn’t paying a significant premium to act on their values.
In fact, according to a new 2021 “Purpose Action Gap” consumer study between Barkley and Jefferies, 95% of consumers agree that environmental, social and governance (ESG) measures around sustainability are as important or more important than they were before COVID. This is a significant shift in consumer attitudes in a very short and turbulent time period.
According to Steph Wissink at Jefferies, “The new research highlighted that there is a real and quantifiable gap between consumers expectations of a brand and its CSR actions.”
In an effort to learn more I spoke to Lawrence Kurzius, CEO at McCormick & Company to get his views on how these consumer shifts are impacting their business strategy.
What differentiates McCormick’s sustainability approach and Grown for Good initiative from other certification programs in the Industry? Will farmers actually see the benefits?
McCormick sources over 14,000 ingredients from 80 countries around the world. Many of our most iconic flavors like Vanilla, Red Pepper, Cinnamon, Oregano and Black Pepper are grown in farming communities that are vulnerable to natural disasters, extreme weather conditions and poor living conditions. While some may see sustainable practices as a “nice to have,” we believe it’s a necessity for doing business. Sustainability is a core component of our Purpose Led Performance commitment of doing what’s right for communities where we live, work and source, and it is fundamental to our future.
Grown for Good, our third-party verified sustainability standard for suppliers, is the first-of-its-kind in the herbs and spices industry. Unlike other sustainability certification programs, Grown for Good goes above and beyond to also help improve farmer livelihoods. We are cutting out the middlemen, creating farmer Co-Ops and going more direct which is more economical for McCormick and allows farmers to receive higher pay. This framework includes metrics that drive community resilience, including economic stability for farmers, gender equality and women’s empowerment, as well as biodiversity conservation and regenerative farming practices. Farmers will see increased skills, income, access to financial services, education, and nutrition and health, all of which benefit these communities – and our supply chain – as a whole. Today McCormick is positively impacting the lives of over 21,000 farmers with a goal to reach 35,000 by 2025. The standard is currently being leveraged in Vietnam, Indonesia, India and Brazil, and will soon be available in other countries.
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This approach is holistic and thorough, tackling critical social and environmental issues through audits and clear requirements outlined in our Supplier Code of Conduct. In short, it’s a new, higher standard for the industry.
How has the pandemic shaped your thinking about ethics in your supply chain? Do consumers want to know more about the farmers that grow your iconic flavors? If so, why?
The pandemic, as well as increased expectations from ESG investors, customers, consumers, employees and society around having an ethical supply chain provided McCormick with an opportunity to highlight our sustainability practices. Consumers want to buy from companies that are doing what’s right and they want to know that the food and flavors they eat are safe and grown sustainably. We’ve found that the more we inform them of our efforts, the higher their loyalty to our brands.
Further, the strong relationships we’ve built at the farm level helped us maintain critical supply of our products during the pandemic. From better quality products and higher-yield harvests from our suppliers, to better overall relationships with farmers and partners, we’ve achieved a greater competitive edge by putting people and sustainability first. McCormick’s farm-to-facility Grown for Good standard and our overall approach to sustainability will allow us to achieve even better transparency and visibility into our global supply chain – to the benefit of farming communities and consumers.
Are you still predicting continued growth in eating at home, and how do you think sustainability will impact consumer purchase behavior going forward?
We are seeing sustained demand for our products as the long-term trend of cooking and eating at home continues. Even through the pandemic recovery, the cooking skills and habits that consumers formed are sticking and aren’t forecasted to change anytime soon. In fact, we found in a recent consumer survey that 68% of U.S. consumers say they are cooking more today than pre-pandemic, and 78% claim they would maintain or increase their level of cooking at home as things return to normal. We have seen similar results in other countries around the world.
Younger consumers, particularly Millennials who are cooking more at home than prior generations, are focused on sustainable and responsible business practices in making their brand choices. A recent online survey found that U.S. Consumers seeking flavor experimentation has grown by 71% with Millennials indexing higher than all adults. This demand can’t be ignored: these generations are going to increasingly dominate the grocery aisles and seek out brands with purpose.