Nature and Biodiversity

Twin transition – how food and drinks companies can decarbonize with data

A twin transition means merging digital and sustainability efforts in business, especially fruitful for the food and drinks industry.

A twin transition means merging digital and sustainability efforts in business, especially fruitful for the food and drinks industry. Image: Unsplash/ Gerrie van der Walt

Ronald den Elzen
Chief Digital & Technology Officer; Member of the Executive Team, HEINEKEN
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The New Data Economy

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  • Driving decarbonization and reaching net-zero goals is crucial to market success, especially for the food and drinks industry.
  • Food and beverage companies are embracing digital transformation to meet ambitious sustainability targets.
  • The Twin Transition Playbook provides a blueprint for aligning and accelerating digital and sustainable growth.

Sustainability is not only good for the planet, it’s good for business. In the past five years, online searches for sustainable goods have increased by 71%. This increased interest also holds for the kinds of organizations people want to work for, as demonstrated in the Twin Transition Playbook – research conducted by PA Consulting has found that sustainability is vital for employee value propositions during a battle for talent.

By merging digital and sustainability strategies within a “twin transition,” food and beverages companies can future-proof their business and the planet – one sip at a time.

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You can’t change what you can’t measure

To get to where you want to be, you need to understand where you are. The first phase of any twin transition journey is identifying high-impact areas – “hotspots” – and finding ways to cool the heat. Data can help connect the dots, guiding prioritization while supporting compliance.

Suppliers significantly impact the carbon footprint in the food and beverages industry through indirect “scope three” emissions. Collecting data across the entire value chain is a significant and complex task for procurement departments. But this data is vital, ensuring accurate carbon calculations, reporting and targeted reduction efforts.

Data and IT go hand-in-hand; with the right data, you can kickstart the right strategy. Two approaches are central to the twin transition – “greening of IT” and “greening by IT.”

Greening of IT focuses on reducing the carbon footprint of data centres, infrastructures and devices; it is an obvious priority for all IT departments in and beyond the food and beverages industry. Greening by IT uses technology and analytics to drive wider business improvements and can have a much bigger impact. It requires new, experimental and opportunistic thinking.

Making a splash in sustainability

Dutch brewer HEINEKEN is using data to voluntarily disclose 30 metrics around environmental, social and corporate governance (ESG) ahead of the new EU taxonomy, which will instruct businesses to disclose over 100 mandatory disclosures. This extended effort will heavily depend on data definitions, data collection and data audits.

HEINEKEN has seen an 18% reduction in scope one and two emissions versus its 2018 baseline, with 73% of barley and hops sustainably sourced. The company is powered by 100% green electricity in the Netherlands, using windmills and solar panels and has two fully renewable energy breweries in Austria. And, in Miami, a craft brewery uses spent grain to make fully biodegradable, compostable carriers for cans.

Dry spent yeast can also be used as biomass and there are opportunities to decarbonize value chains using hydrogen, which can be produced from almost all energy resources.

Despite these advancements, there is still much work to be done. But the opportunities are many. Until now, data has been mainly used for reporting – to know what emissions are produced and where to minimize or remove them entirely.

Data and analytics can play a much bigger role in supporting decarbonization. Tools like machine learning and AI can aid procurement and reduce waste by assessing the colour of crops to predict yield and quality. Data analytics can provide insight into electricity consumption and thermal use in various production processes.

Can excess heat be captured and used in another production process? Can by-products be upcycled into packaging, supporting circularity? With the right data, these previously impossible questions can now be answered.

Real change does not come from reporting. Real change comes from taking action.

Ronald den Elzen, Chief Digital & Technology Officer, HEINEKEN NV

Partnerships: a key ingredient

Data is just one part of the story. In the food and beverages industry especially, partnerships are another key ingredient for sustainability success.

Throughout the twin transition, key stakeholders should be brought in and consulted to understand impacts, find synergies and influence areas beyond the organizations’ direct control. Bringing together internal departments and major partners – such as manufacturing companies, transportation companies, tech companies and start-ups – is a fundamental part of solving shared problems. This collaboration leads to innovations that better serve the needs of consumers and help lower carbon footprints.

Different industries can come together for the greater benefit – take collection systems for returnable glass bottles, which bring valuable materials back into circulation while standardizing how emissions data is collected, exchanged and reported across the ecosystem.

Hard data, belief and resilience

Real change does not come from reporting. Real change comes from taking action. Making these changes requires investment and business change. Collecting billions of data points from the Internet of Things will help minimize the use of utilities.

There are still many unknowns. In the next decade, innovations will come down the line and not all experiments with digitization will be effective or scalable. Implementing a successful twin transition relies on hard data and belief and resilience. It takes a leap of faith and trial and error.

So, bring your key internal stakeholders on board, forge external partnerships and be prepared to share information. But most importantly of all, be curious. Ask the right questions, informed by the right data and you’ll get the right answers.

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The views expressed in this article are those of the author alone and not the World Economic Forum.

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