The shift to a more sustainable energy source for part of its production processes is just one of eight different areas where the firm hopes to be able to "reduce our environmental footprint and improve the efficiency of our company", according to CEO Bill Johnson. Heinz, like many other food companies, has been keen to stress the health and nutrition benefits of many of its products in recent years as consumers become increasingly concerned about the food they eat. But there is also a growing trend towards 'greening' the entire production and supply chain as companies look to reap the benefits of being seen to be more responsible and sustainable. A study by US-based management and technology consultants Diamond released earlier this year said that firms are keen to 'go green' because it helps improve not only their image but also their bottom line. "Green supply chain initiatives have moved rapidly from mere compliance with environmental regulation towards a means of effecting real cost savings in areas such as energy conservation or recycling," said Diamond analysts Mark Baum and Darin Yug. The eight specific goals set by Heinz for 2015 are:
- Reducing energy consumption by 20 per cent through the use of alternative sources
- Reducing packaging by 15 per cent through the introduction of alternative packaging materials and reduction of existing packaging use
- A 10 per cent reduction in transport through improved efficiency of the distribution network
- A commitment to source at least 15 per cent of energy requirements from renewables, including solar, biomass and bio-gas
- In agriculture, a 15 per cent reduction in the company's carbon footprint, a 15 per cent reduction of water usage for crops such as the tomatoes used to make the company's flagship ketchup brand, an improvement of yields by five per cent through the use of hybrid tomato seeds that require less water, fertilizer, pesticides and fuel to harvest
- A 20 per cent reduction in total water use through the reuse of water and improved sanitation techniques
- A 20 per cent reduction in solid waste through increased recycling and reuse of waste
- A commitment to educate company employees about the benefits of living and working more sustainably
Johnson said that the company had a number of projects lined up to help it achieve these goals which made innovative use of the by-products of its existing production processes - such as turning potato peels into biofuels. The project, run at the company's Oregon production facility, should generate enough energy to heat 4,000 Oregon homes for a winter, the company said. The same project in Oregon will also treat and recycle 90 per cent of the water used for daily potato production, saving a billion gallons of water per year, or enough to supply 11,000 Oregon homes with water. Energy savings will also be made by ensuring that trucks distributing Heinz goods across the country are fuller and make more direct routes. This, and a shift to more rail freight, could save the company up to two million gallons of fuel a year, Johnson said. Reducing the carbon footprint of the company's growing facilities will be helped by staring more local production - tomatoes for ketchup production will be grown in countries such as China, Egypt and eastern Europe, rather than being transported in the form of paste from other parts of the world. And the company's facility in Dundalk, Ireland, is already recycling 95 per cent of the plastic and 99 per cent of the cardboard, wood and steel it uses, a project that will be taken up by other production sites.