Thirty-six of the biggest names in agriculture have teamed up to launch the Global Agri-business Alliance (GAA), which aims to tackle the key challenges facing agricultural supply chains across the world.
The new alliance is a CEO-led private sector initiative that has pledged to work towards the United Nations Sustainable Development Goals, with particular emphasis on Goal 2. The goal aims to end hunger, achieve food security and improved nutrition, and promote sustainable agriculture by 2030.
The SDGs are a set of development goals set by the United Nations to guide global development efforts for the next 15 years.
The alliance was announced at the Building Sustainable Futures Forum hosted by Singapore-listed agribusiness giant Olam International in the city-state’s Gardens by the Bay in September.
Speaking at the launch, Peter Bakker, president of the World Business Council for Sustainable Development (WBCSD), noted that the SDGs are “no longer just one government talking to another”.
“Business also has a role to play to get these goals delivered,” he said, adding that the new alliance is “one of the biggest private sector initiatives out there”.
“This is going to bring the sector together, which until now hasn’t done a lot collectively.”
The agricultural sector employs more than 2 billion people globally. Yet, the Food and Agricultural Organisation (FAO) estimates that of the 795 million undernourished people, about half are from smallholder farming communities, surviving off marginal lands prone to natural disasters including drought or flood.
There’s no way forward without a shared understanding of the challenges and objectives. The GAA is a promising starting point.
Anna Simpson, Forum for the Future
The sector also accounts for 70 per cent of freshwater withdrawal and generates 12 per cent of all manmade greenhouse gases – or up to 25 per cent if forestry and other land use are included.
The sector’s ability to boost productivity, minimise food losses and reduce impacts on natural resources is critical to food security and inclusive growth.
The companies already involved are headquartered across the world with representation from Africa, Asia, Australia, USA and South America and are involved in multiple commodities including grains, dairy, edible nuts, edible oils, pulses, rubber, sugar, as well as agro-chemicals. The WBCSD will be the interim secretariat until the alliance is set up.
Sunny Verghese, Olam International chief executive, who was behind the idea, said that he was excited about the new alliance “because as an industry, we need to be both brave and restless to make a real difference to the major developmental challenges that face our sector”.
Verghese noted that competition in the global agri-business sector is fierce.
“Margins are hard-won, long-term investments are critical for scale even while agri-commodity prices are volatile. The sector’s drawdown of natural capital for production is significant. Some question whether companies in our sector can truly cooperate in a pre-competitive way to be part of global sustainability solutions,” he said in a recent statement.
In this context, the GAA is ground-breaking in that it requires the cooperation of various companies to work together to solve, said observers.
Anna Simpson of non-profit Forum for the Future, which works on agribusiness issues, told Eco-Business that “for agribusiness to make a meaningful contribution to the SDGs, let alone take a lead, a pre-competitive collaboration is essential.”
“There’s no way forward without a shared understanding of the challenges and objectives. The GAA is a promising starting point.”
Forum’s senior sustainable advisor, Jiehui Kia, added that businesses need to “rethink the purpose of competition and collaboration, and move some activities from the “competitive” into the “pre-competitive” box”.
For example, in order to change mainstream consumer expectations such that sustainable products and services are the norm, consumer-facing companies need to stop viewing sustainability is a source of competitive edge, she explained. Pre-competitive collaboration – that is, multiple interventions by multiple players - is required to bring about the wider change that moves sustainable products and services out of the niche and into the mainstream,” she said.
Some big Asian names in the alliance include Musim Mas Group and Sime Darby Group from Malaysia, Wilmar International from Singapore, and Von Bunditi Co from Thailand.
The GAA said that its unique offering is in bringing together the companies operating closest to the ‘farmgate’ and therefore having the greatest influence on the stewardship of natural resources and surrounding communities, many of whom may also be employed by the sector.
Member profile includes growers and producers; traders; fertiliser, agro-chemical and seed suppliers; agri-service providers, primary processors and agri-tech suppliers for both food and non-food crops.