What makes a sustainability leader? Meet the supply chain champions ADM
With the entry deadline for edie's 2022 Sustainability Leaders Awards less than a month away, this series showcases the achievements of previous winners and reveals their secrets to success. Up next: Winner of our Supply Chain Excellence' award, ADM.
SAVAN is ADM’s partnership with Sahanala – a farmer-owned cooperative based in Madagascar, where almost 80% of the world’s vanilla is produced through a complex supply chain. Through SAVAN, ADM has helped create the industry’s first farmer-owned processor and exporter of vanilla beans.
The aim of this unique initiative is to sustainably uplift the quality of life for farmers by directly connecting the economic and sustainability motivations of ADM customers globally with an incentive structure that supports socio-economic progress in Madagascan farming communities.
The main goals include: digital traceability, enhanced profitability for farmers, socio-economic sustainability, and supplying cost-competitive, ethically sourced vanilla to customers.
SAVAN was born from a genuine desire for farmers to have the opportunity to own and profit from the whole vanilla bean supply chain – from harvesting, to processing and exporting the beans to international markets. Through SAVAN, each farmer earns owner-incentive funds based on vanilla sales, along with the purchase price of their uncured vanilla beans. The project sets new standards for fair trading, while investing in the local community and ensuring it continues to thrive long term.
SAVAN directly correlates to the UN’s Sustainable Development Goal 8 – Decent Work & Economic Growth, while its focus on food security relates to Goal 2 – Zero Hunger. Both have been identified as two of five Sustainable Development Goals where ADM focuses its efforts overall.
ADM is also part of the Sustainable Vanilla Initiative for increased accountability and transparency. During the coronavirus crisis, SAVAN has bolstered the local economy, proactively created a safe working environment for staff, and supported farming communities at large. SAVAN supports 19 paramedics to help deliver basic medical support to remote farming communities. There, in partnership with public health officials, the business distributed 10,000+ bars of soap, 8,000+ pieces of PPE, and 8,400 medicine items, in accordance with the standard protocol of the Ministry of Health in Madagascar. Sahanala is also manufacturing 40,000 masks at its existing facilities for community distribution.
SAVAN plays an important role in the country’s economy. Recent developments include the opening of a new vanilla plant in Antsohihy in June 2020, employing 130 people. The President of Madagascar, Andry Rajoelina, visited this new facility in October, meeting Sahanala farmers and SAVAN staff.
SAVAN has taken the lead as the industry’s first farmer-owned processor and exporter of vanilla beans: it puts more control and earning potential in the hands of the farmer, resulting in fairer working conditions and profits. SAVAN also bolsters an extension worker program which provides agronomy support and promotes best practices to help increase crop yields, improve vanillin content, and establish a more stable industry. In comparison with traditional supply chains, where farmers receive approximately 76% of the revenue, SAVAN ensures they receive 100%.
SAVAN further implements industry-changing, farmer-focused social programmes, investing in the wider community. This includes providing access to medical care and food security, as well as reliable education for children and introducing adults to more sustainable and efficient farming practice.
Meanwhile, each farmer association can choose how to allocate the profits generated through the joint venture in ways that will immediately benefit their communities – including community health offices, schools and places of worship.
More than 4,000 vanilla farmers across 18 associations in Madagascar are currently farmer-owners as part of SAVAN. Additionally, in 2020, ADM Cares has provided $70,000 worth of rice through SAVAN to ensure food security during the winter months: benefitting 17,000 people, including 4,410 farmers and their families.
The SAVAN project would not have been possible without a partnership with the Sahanala vanilla farmer cooperative based in Madagascar, and their willingness to embrace ADM’s interventions. Sahanala has grown over time with the inclusion of smaller local farmer co-ops.
Other socio-economic and environmental impacts are also being monitored. For example, the number of new schools being constructed or supported, and the amount of land being re-forested to help maintain Madagascar’s renowned biodiversity.
Within a few years, SAVAN has become one of the largest exporters of vanilla beans in Madagascar. Meanwhile, the industry has taken notice of the business’ digital traceability initiative, and several exporters are now piloting similar programmes.
ADM hopes the legacy of SAVAN will be to ensure a fair profit, suitable working conditions and thriving local communities for Madagascan vanilla farmers. By setting an example of how farmer-owned initiatives can flourish, the business wants to inspire similar projects throughout the region and the industry.
The edie judges said: “This was a lovely example of best practice adoption in a commodity supply chain. ADM has demonstrated real business model innovation resulting in fair, stable, and sustainable working conditions for vanilla farmers, with tangible benefits for their families and communities. A real standout in the category.”
Are you our next winner?
After a tough and extraordinary year, edie's RSA-accredited Sustainability Leaders Awards are back for 2022, bigger and better than ever – celebrating the incredible people, projects and partnerships that are accelerating climate action and transforming business, for good.
Entries are now OPEN. The submission deadline for the 2022 Sustainability Leaders Awards is Friday 1 October 2021. The Awards is then set to take place as a live ceremony on the night of Wednesday 2 February 2022 at the Park Plaza London, Westminster.
Our 'Sustainability Leader of the Year' category is among the 23 categories to choose from. Make sure you get the recognition you, and your team, deserve. ENTER THE SUSTAINABILITY LEADERS AWARDS 2022 HERE.