Ana Haberbosch is CEO and co-founder of seedtrace, a digital platform for traceability and visualisation of global supply chains. Through transparency and tracking, seedtrace minimises the operational risks of companies and supports them in achieving the Sustainable Development Goals (SDGs).
In the first part of our success story we already told you about the upcoming cooperation between seedtrace and the Business Scouts for Development (BSfD). Now the time has finally come and we can share more insights about this exciting project: Since October 2022, seedtrace has been mapping selected supply chains of SMEs from the food industry. The companies involved are Ecoterra, Just Spices, Midsona, Beckers Bester and Simply V (Hochland Group). Their product portfolio is diverse, yet they have one thing in common: they source at least some of their ingredients from abroad and thus have internationally oriented supply chains.
Between one and three products were selected per company, whose supply chains are being tracked, checked for sustainability criteria and visualised. The products range from macadamia nuts from Kenya and passion fruit from Costa Rica to lentils from Turkey, salt from France and tomatoes from China.
First, seedtrace maps the respective supply chain and identifies so-called "black boxes". These are sections in the supply chain about which insufficient information is available. Since some companies only know their direct suppliers, it can happen that the country of origin of a product is known, but not the various intermediate stations it passes through on its way to Germany.
Therefore, in this first step it is particularly important to gather all the information and clarify open questions:
- What activity is carried out at which location?
- How are environmental and social standards applied?
- Is sustainability data already being collected?
- Do the producers receive a fair wage?
- Are chemicals used that are harmful to the environment or human health?
The seedtrace team is working intensively on these and many more questions. "Our goal is to map every step from the field to the shelf. As soon as we have collected the necessary information, we check the now mapped supply chain for social and ecological risks," Ana explains. Depending on the country of origin of the raw material and the nationally applicable regulations, sustainability standards can differ greatly. Unfortunately, while inhumane working conditions still pose a potential risk in cocoa and coffee cultivation in Southeast Asia, ecological concerns are the main priority in industrialised countries. If an area of the supply chain is classified as sensitive, the seedtrace team checks to what extent the status quo can be improved to meet social and environmental standards.
In the next step, the most important stakeholders are gathered to obtain more in-depth information about the supply chain. In exchange with producers and intermediaries, seedtrace seeks to find out how the sustainability data is processed, which technological set-up underpins it and whether there are any concerns about sharing certain information. As soon as the necessary data is available, digitisation begins. Special attention is paid to the communication of critical elements. For example, the intensive water consumption in the production of almonds may be particularly emphasised.
Ana greatly appreciates the support of the German Development Cooperation and is pleased about the partnership with the Business Scouts for Development (BSfD) programme that developed through leverist.de. In addition to professional expertise and business contacts, seedtrace also receives financial support through the Business Scout Fund.
The results of the supply chain mapping are particularly relevant against the background of the German Supply Chain Due Diligence Act. After all, the law, which comes into force in 2023, aims to improve the protection of human rights in global supply chains (see Part I for more information). " Companies are under enormous pressure to audit their supply chains to ensure their competitiveness. We support them in creating transparency and managing risks," underlines Ana. Thereby, seedtrace enables especially small and medium-sized enterprises to comply with the obligations resulting from the law.
With the forthcoming EU Supply Chain Act, complying with ESG standards is also gaining enormous relevance in the European arena. The EU directive requires European companies to carefully manage social and environmental impacts along their entire value chain. The law includes their own operations, direct and indirect suppliers as well as their products and services. By considering not only direct suppliers, the EU law goes much further than the German directive. EU Justice Commissioner Didier Reynders even announced: "In the future, only companies that do not harm the environment and respect human rights will be allowed to operate in the EU”.
ESG and SDGs have become part of the everyday vocabulary of business leaders in all industries and sectors. The latest study by the UN Global Compact and Accenture confirms that sustainability has moved up the agenda of business leaders. While in 2021 just under four out of five (83%) of the CEOs surveyed saw it as their task to make their business more sustainable, by 2022 this figure had risen to 98%. In response to global challenges, executives are increasingly focusing on the implementation of sustainability measures - in all areas: strategy, corporate governance, workforce, supply chain, technology and operations.
In seedtrace, entrepreneurs find a reliable partner to manage the risks along their value chains. "We want to create visibility, transparency and traceability along international supply chains to minimise our clients' business risks and contribute to a more sustainable economy," says Ana. These are also important aspects for Ecoterra, Just Spices, Midsona, Beckers Bester and Simply V. Since the start of the project in October 2022, initial successes have already been achieved, such as the analysis of existing almond supply chains of Simply V or the complete mapping of the supply chains of Eco Terra and Midsona (from macadamia from Kenya to rice from Cambodia). Peter Stahl, CEO of Hochland Group, describes the collaboration with seedtrace as follows: „The dedicated team and platform enable us to take traceability along our supply chains to the next level. Together we can make sense of the data - for us, our partners and the consumers”.
Over the next few months, the supply chains of the remaining products will be filled with information to enable a complete representation. This will prepare the companies in the best possible way for the upcoming legislation.
The Business Scouts for Development (BSfD) are development policy experts in around 40 countries around the world. On behalf of the Federal Ministry for Economic Cooperation and Development (BMZ), they advise German, European and local companies on development policy matters and promote responsible business engagement through cooperation projects. You are interested in a collaboration? Contact them directly online through leverist.de.
leverist.de is a free online platform operated by the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH on behalf of the Federal Ministry for Economic Cooperation and Development (BMZ). The platform offers numerous opportunities for collaboration with German development cooperation and connects interested companies with experts on the ground.
Illustrations & Copyright:
- Cover image: Rice terraces, Kanenori, Pixabay, 2023
- Image 1: Risk mapping, seedtrace, 2023
- Image 2: Risk flagging, seedtrace, 2023
- Image 3: CEO Study, UN Global Compact, 2023