Mars Investing $2 Billion in Helping Farmers Adopt New Techniques

Coming out of the just ended the UN Climate Change Conference (COP26) meetings in Glasgow, sustainability leaders PepsiCo and Mars have detailed their efforts to reduce CO2 emissions from their extended supply chains – an effort both companies both say is challenging and expensive.

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According a report on Yahoo Finance, candy and pet food maker Mars faced the huge challenge of try to decarbonize the operations of 20,000 raw material suppliers in more than 100 countries.

Indeed, Mars’ analysis found that just 10% of its top 200 suppliers had any climate targets in place and that its top suppliers accounted for about 80% of its total greenhouse gas emissions.

So to start, Mars focused on 30 of the largest suppliers, predominantly major farms that were supplying to Mars and other companies globally.

Mars found that it can take six months to two years to map out a single supplier’s carbon footprint, depending on what data they have available.

PepsiCo is taking a similar aggressive – and expensive – approach to reducing emissions from its supplier base.

That involved analysis of the 40,000 farmers that work some seven million acres of land across the globe, Yahoo reports.

“They don't all sit in one place. They don't all grow the same crops. They don't have the same level of sophistication. And we’ve basically committed to bringing all of them along,” Jim Andrew, PepsiCo’s Chief Sustainability Officer, told Yahoo Finance.

Like many companies, the majority of PepsiCo’s total carbon emissions come from independent companies, in PepsiCo’s case a full 90% of its CO2.

So PepsiCo launched a large-scale education campaign for both medium and large farms around new farming practices that reduce CO2. That includes regenerative farming, which involves cover cropping and crop rotation. Such practices not only improve soil efficiency but also remove CO2 out of the atmosphere and return it back to the soil.

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The practices have been around for decades, but seen little uptake by farmers.

Why? Because to get there takes a significant investment most farmers are not willing to make.

Mars has invested $1 billion to help suppliers transition to a more sustainable operation over the last few years, and is planning to invest another $1 billion more to make it happen.

“If you want to drive changes for others, you have really got to prime the pump. And, our experience also is that you've got to commit to the long term,” Mars CEO Grant Reid recently said.

Yahoo says Mars has already cut 7% of its emissions from 2015 levels, and plans to slice it an additional 20% in the next four years.

PepsiCo has set out to reduce its carbon emissions from its supply by by 40% by on 2030.

But these companies remain exceptions. Though 80% of the S&P 500 companies offer disclosures on climate change each year, only 30% have offered detailed science-based targets for how they plan to decarbonize by 2050.

What are your views of what PepsiCo and Mars are doing. Let us know your thoughts at the Feedback section below.