The largest yogurt producer in the US, Dannon, is revamping how it sources milk to meet the growing demand for ethical and environmentally friendly products.
Overall, the company plans to pursue, “sustainable agriculture practices and technology that leads to better soil health, better water management, an increase in biodiversity, and a decrease in carbon emission.”
The biggest change involves buying milk directly from farmers rather than through intermediary suppliers. Going through a supplier makes it difficult for a brand to impose ethical and environmental standards because it can be difficult to trace the milk’s origin.
By going to farmers directly, the brand can monitor conditions to ensure that standards are upheld.
Some of the standards include providing cows with spaces to relax in the shade to protect them from overheating and prohibiting tail docking, which means cutting a cow’s tail off.
The next part of the initiative involves promoting sustainable farming practices. Farmers will be encouraged to rotate crops and minimize the use of pesticides and herbicides.
A milk condensing plant will be built that will save 20 million gallons of water annually. The saved water will then be used to water crops.
The company will also phase out all GMO products and reduce the amount of ingredients it uses generally.
Dannon’s evolution is the direct result of consumer pressure. While Dannon’s revenue grew by 6% last year, the company is facing increasing pressure from emerging brands that tout ethical and environmentally sound practices. Consumers have shown a preference for small-scale brands that can clearly demonstrate ethical and environmental standards.
Across food categories, consumers are demanding transparency and accountability and this is causing food giants to change their behavior to avoid being left behind.
Unilever has become a pioneer in corporate sustainability; Starbuck’s has made efforts to ethically source coffee; McDonald’s is overhauling its food system to emphasize “sustainability;” Walmart has substantially increased its organic foods section.
Dannon will not become an ethical or environmental model overnight. The sheer size of the company means that it will have a hard time living up to all of the standards it sets and that its eco-footprint will stay large.
Regardless, the company’s ambitious proposals are worth applauding. Every effort to conduct business in an ethical and environmentally friendly way is important and adds momentum to the movement.
Dannon would have stayed on top of the US yogurt market for years to come. But the company realized that its current model was already outdated. The future is all about sustainability. And it’s never too early to prepare for the future.