The Definitive Guide To Enterprise Supply & Value Chain Sustainability
Achieving Unified Sustainable Goals in the
Age of Carbon Neutrality
Today, businesses are not only looking to make a profit but do so sustainably. They do so by measuring, tracking and reducing the carbon footprint of their products and services. Organizations are focused on doing their part to reduce the impact of society on climate health and create positive change. This starts by taking stock of their own carbon emission activities – both the activities they directly influence and the activities they indirectly touch.
There are three groups of greenhouse gas emissions sources, usually categorized as Scope 1, 2 and 3 emissions. These are emissions:
Understanding how agriculture fits into enterprise sustainability goals – whether it is part of the supply chain or value shed – provides another opportunity to make a difference. Building regenerative agriculture into the foundation of enterprise sustainability is one critical component for meeting and exceeding carbon, climate and regeneration goals. Regenerative farming practices are proven to draw down and sequester atmospheric CO2 and CO2 equivalents as well as decrease greenhouse gas emissions. In addition to these climate benefits, regenerative and sustainable agriculture is proven to create healthier soils, more abundant and nutritious crops and, ultimately, healthier humans. Regenerative agriculture builds resilience of the land and provides environmentally-friendly products and services that help combat climate change.
In this CIBO Definitive Guide To Supply Chain Sustainability, we will explore the fundamental components and challenges that impact supply and value shed sustainability initiatives. The final section is dedicated to how CIBO Enterprise is being used by enterprises large and small to help power their insetting and sustainability goals.
By understanding the combination of elements and opportunities, organizations can easily identify areas of success and bring into focus the sustainability goals that require action.
With a strong supply chain sustainability program in place, your organization will be ready to unlock the true power of regenerative agriculture.
Many enterprises have agriculture somewhere in their supply chain. From food companies that make and package human food, to animal feed companies to industrial products and textiles, agriculture is present, usually at the start of the supply chain. Today, sustainability and regeneration are more important than ever. Today’s modern enterprises are increasingly diverse, distributed and complex environments. They rely on a mix of suppliers and growers to meet their product needs.
Financial costs from supply chains due to climate crisis, deforestation, water scarcity and poor water quality could all be placed onto or absorbed by businesses who fail to disclose environmental data or fail to build sustainability into their supply chain. According to a report from CDP, Transparency to Transformation: A Chain Reaction, businesses could face up to $120 billion in additional costs across their supply chains from the impacts of climate and environmental breakdown in the next five years.
Boardroom commitments to climate solutions and carbon neutrality goals have to be activated. When regenerative agriculture is part of the solution, those boardroom commitments come to life at the farm gate. In order to realize these commitments, businesses face the 3-fold challenge:
Each of these sustainability challenges arise in addition to the day-to-day management of farming operations. Sustainable farming, regenerative agriculture and ag-based climate solutions require accurate, real-time, awareness of current conditions and predicted outcomes in order to work. Understanding the potential impacts of local weather, regional climate impact and historical practices on crop yield, soil health, and land valuation are imperative. While seasonal yield is foremost in the mind of farmer and agri-businesses, sustainable practices are also increasingly vying for attention and integration into the business of farming. Consequently, sustainable and regenerative farming programs must keep yields firmly in the forefront of their mind in order to gain traction with growers. Of course, standardized, consistent monitoring across the counties, states and regions is vital for any solution to scale.
Agricultural supply chains and value sheds are highly decentralized and independent; just like farmers. A solution to enterprise supply-chain sustainability requires visibility to all crop land, accurate and reliable quantification of CO2e sequestration and GHG footprints and emissions reduction, as well as verification at scale of the practices which lead to supply chain decarbonization.
Each of these three challenges and their solutions are addressed in detail in the following sections.
There are many practices that are often grouped together under the label of regenerative agriculture. One study of over 200 scholarly articles found that there are five main principles that were agreed upon the most: improving soil health, increasing biodiversity, aiding in carbon sequestration, incorporating humane treatment of livestock and farmworkers and improving the overall larger ecosystem as a whole. The most common practices include:
Ultimately, enterprises intend to power better business outcomes by supporting innovation, accelerating time to market, and delivering incredible customer experiences. In the mid 2010s, it was hypothesized that corporate sustainability goals could help business. These hypotheses have since been proven. Forbes outlines 6 ways in which corporate sustainability helps business. These include creating additional brand value and competitive advantage, especially as more than 65% of consumers have demonstrated willingness to pay more for similar, sustainably produced products. Harvard Business Review has performed even deeper analysis and found that incorporating sustainability and regeneration into business decreases risk, improves financial performance and fosters innovation.
For businesses, incorporating sustainability and regeneration into their operations starts with understanding their baseline environmental impact. When it comes to carbon and climate commitments, enterprises must first be able to calculate their carbon footprint across their Scope 1, 2 and, especially, Scope 3 emissions. While a detailed explanation of Scope 1, 2 and 3 emissions is beyond the scope of this CIBO Definitive Guide, generally speaking, Scope 1 covers direct emissions from owned sources like manufacturing and operations, Scope 2 covers indirect emissions, typically from the generation of power, steam, heating and cooling. Scope 3 includes emissions from an organization’s supply chain. Understanding the direct carbon footprint of Scope 1 and 2 emissions is fairly straightforward. Impacts are able to be quickly realized; from streamlining business operations to incorporating building and power efficiency measures.
Scope 3 and supply chains are different. Because the supply chain and value shed is distributed, diffuse, and diverse, getting accurate environmental impact insight scaled across the entire system is a challenge. Organizations need carbon footprint visibility that scales across the vast land and independent operator network of their agricultural supply chain. Comprehensive visibility is the only thing that will allow them to make rapid, scientifically impactful changes. Clear, quantifiable baseline reporting on GHG emissions is what allows enterprises to set achievable goals, create meaningful incentives for independent operators, and improve their GHGe emissions and CO2e reductions. In gaining this understanding they can lay in a course that helps to scale regenerative and sustainable farming investments and operations. It is these operations and investments which achieve the science-based targets and longer term climate goals.
An effective regenerative agriculture solution should provide complete insight, quantification and practice verification across growers and fields with real-time updates as weather changes, crops mature, and cover crops emerge. This comprehensive visibility enables an enterprise to identify and help prevent issues across the entire complex, distributed modern supply chain while hedging against risk. It is easy for growers to know their own fields, it’s difficult for a business to have a single, complete view of their entire supply and value chain. In short, the challenge is scale across fields, growers, and states.
Sustainable farming practices grouped under regenerative agriculture include:
There is broad agreement that most regenerative agriculture practices are good for soil health and have other environmental benefits. No-till reduces soil erosion and encourages water to infiltrate soils (although it can require greater use of herbicides). Cover crops do the same, and can also reduce water pollution. Diverse crop rotations can lower pesticide use. And good grazing practices — such as moving cattle around frequently, adding legumes or fertilizers, and avoiding overgrazing — can increase vegetation and protect water sources.
It is rare for agricultural supply chains to be vertically integrated. Farming operations are distributed, diffuse, and diverse. As a result, the ability to verify and certify that end products are sustainably and regeneratively farmed is difficult. This leads to challenges for product manufacturers to label or claim that some or all of their products are regeneratively produced. This is an area where scaled monitoring and verification technology is ideal.
Monitoring is an essential aspect of the growing season. But given the vast land areas involved in supply chains and some still common but antiquated practices, monitoring can also be one of the most frustrating, time consuming parts of the job. Walking fields, counting ears of corn, and taking soil samples are expensive, error prone and suffer from challenges of scale. Additionally, competing interests make monitoring at scale a challenge. Farmers want to monitor the weather, water, health and maturing of their crops and anticipated yields. Agronomists want to monitor health and soil conditions in season and across seasons. Downstream consumers and manufacturers want to monitor commodity quality and also the practices with which those commodities were produced. ESG (Environmental, Social & Governance) professionals want to monitor how practices in the supply chain are impacting their ESG goals – like Scope 3 emissions reductions. Companies with agricultural supply chains want to monitor how historical farming practices, changes to land productivity, soil stability, current practice implementation, land prices, changing climate and local weather affect commodity prices, capacity planning and logistics as well as larger ESG and certification goals. In the event that these companies have incentive programs, monitoring and verification is especially important so that they can both confirm program eligibility and payouts as well as measure effectiveness against decarbonization, labeling, Scope 3 and related ESG goals.
New technologies that provide an integrated and bespoke view of agriculture operations is vital to transforming the industry. According to McKinsey, If connectivity is implemented successfully in agriculture, the industry could create as much as $500 billion in additional value to the global gross domestic product by 2030.
Monitoring Grower Practices
As enterprises with Scope 3 emissions, net-zero, regeneration, and ESG goals create programs for their growers, the ability to enroll and monitor practices quickly becomes the bottleneck. To keep track of supply chain programs and products, enterprises currently meet with and speak to each growing operation. It’s common to have a full-time staff of agronomists dedicated to monitoring multiple growers who sample, visit and report on farming operations in their supply chain multiple times a month. Having so many boots on the ground is expensive, time consuming and reports can quickly become outdated. There are simply too many land acres to allow physical visits and sampling to efficiently scale.
Monitoring and verification of practice at a farm, field and then across the entire supply chain is essential. If a company creates an incentive program for their growers that are implementing or willing to start using a practice – like cover cropping or intercropping with another nitrogen-fixing crop – the diverse, distributed and diffuse nature of the farming network quickly becomes daunting. Finding growers able and willing to participate is one challenge. Segmenting growers and land owners who have operations in the correct geography, who have ideal soil conditions, who have a history of the ideal mix of crops and practices can all become a challenge to document, let alone engage.
Even when those ideal growers are found enrolling them in the programs can be a huge barrier to entry. Farmers are in the business of farming, not locating years of historical data, performing onerous ETL (extract – transform – load) operations on data and filling out massive forms. The legacy approach of tasking agronomists and low level employees with traveling or calling growers to collect this data and walk them through collection, reporting enrolling and sampling processes is inherently limiting, expensive and time consuming. Multiply those program start up and enrollment tasks with the sheer number of growers and acres involved and the limits quickly end up thwarting the potential of aggressive Scope 3 emissions, net-zero and ESG goals.
Monitoring Agriculture Operations
As described previously, the sheer volume of agriculture data required to monitor an enterprise supply chain can be overwhelming. Everything in modern agriculture generates data and logs it continuously. The wealth of data is alluring and holds promise if it can be quickly, securely, and comprehensively acquired. However, it can become difficult for organizations to efficiently understand, verify, and track activity at the farm level and scale it up to entire portfolios of grower networks. Reviewing and reporting on data quickly and efficiently helps logistics, pricing and expectation management of Scope 3 and ESG goals.
Verifying Crop Growth Information
Finding and monitoring useful information from grower operations is only half the battle. Verification is required to prove each action from crop emergence to tillage practice to input application in order for growers to qualify for incentives and for organizations to properly account for achievement of their program goals.
Manually traveling to each field to verify practices is costly and inefficient due to the sheer number of operations and acres producing crops. As infrastructure and operations scale, systems that go beyond individually verifying practices and outcomes become a necessity.
Advances in AI-based satellite and computer vision combined with detailed, science-based simulation and modeling enable verification and monitoring to scale. Such scaling saves time and money while empowering more growers to participate in regenerative and sustainable farming incentive programs that pay for practice, generate carbon credits and help reduce overall GHG emissions.
Each week, it seems like there is another announcement about an enterprise pledging to be carbon neutral. It ranges from household names including Amazon, Best Buy, Henkel, Infosys, McKinstry, Mercedes-Benz, and Verizon down to smaller family run businesses. These pledges announce the intent to reduce Scope 3 emissions, understand greenhouse gas footprints, and reduce CO2e. The mix of initiatives vary but most often they are a combination of insetting, pay for sustainable and regenerative practice and direct offsetting with carbon credits. It is incumbent on each organization making such pledges to document and report – with confidence and scientific accuracy – the steps they and their supply chain are making each and every year.
In addition to the reporting requirements, businesses need a better way to connect with, advise, recruit and pay supply chain members into their programs. Such connection, advising, recruitment, and paying has to be enabled at scale if businesses are to achieve their emissions, decarbonization, regeneration and sustainability goals.
A carbon protocol is an annually updated document that reflects developments in climate science, international policy, standards and business practice. It is an open source standard and guide developed for business by business that draws together leading independent standards for greenhouse gas accounting into a practical guide to carbon neutrality.
A Carbon Standard lays out the rules and requirements which all projects must follow in order to be certified. These are rigorous assessment processes which certify carbon emission reductions are eligible to be issued as representing one metric tonne of greenhouse gas emissions being reduced or removed from the atmosphere.
Carbon registries track carbon offset projects and issue carbon credits for each unit of emission reduction or removal that is verified and certified. Registries are vital in creating a credible, offset commodity. Registries record the ownership of credits.
The Leading Harvest Standard is a third-party audit certification standard that serves to provide assurance for the sustainability of farmland management. Farmland managers and owners can use the Leading Harvest Farmland Management Standard 2020 to become certified, certify farmland under their management, and then make verifiable sustainability claims to the market regarding their management.
The Leading Harvest Farmland Management Standard 2020 is outcome-based through the use of qualitative indicators that serve as operational goals. It does not prescribe practices necessary to conform with the Standard; rather, it provides family farmers and farm managers the flexibility to select best practices for sustainable outcomes. This approach allows for adaptation across crops and geographies, recognizing that even a single crop can require unique management strategies in different regions.
The Climate Pledge, with its bold goal of net zero carbon by 2040—ten years earlier than specified by the Paris Agreement—presents a leadership opportunity for companies around the world to join together in taking urgent action on the climate crisis. Amazon co-founded The Climate Pledge with Global Optimism in 2019, and became the first company to sign the pledge. The Climate Pledge currently has over 100 signatories, including Verizon, PepsiCo, Best Buy, Visa, Reckitt Benckiser (RB), Microsoft, Unilever, JetBlue Airways, Uber, and more.
The Climate Pledge calls on signatories to be net zero carbon across their businesses by 2040. Companies that sign the pledge commit to three principal areas of action:
Science-based targets provide companies with a clearly-defined path to reduce emissions in line with the Paris Agreement goals. More than 1,000 businesses around the world are already working with the Science Based Targets initiative (SBTi).
Science-based targets provide a clearly-defined pathway for companies to reduce greenhouse gas (GHG) emissions, helping prevent the worst impacts of climate change and future-proof business growth.
Targets are considered ‘science-based’ if they are in line with what the latest climate science deems necessary to meet the goals of the Paris Agreement – limiting global warming to well-below 2°C above pre-industrial levels and pursuing efforts to limit warming to 1.5°C.
Organizations and growers who support sustainability pledges need more transparency into the pricing and timelines associated with returns. Established registries including Climate Action Reserve (CAR), Verified Carbon Standard (VCS), and the Gold Standard (Gold) all have different ways of quantifying carbon which are not necessarily tailored for agriculture. Existing standards and protocols were originally developed for the energy sector. They evolved to incorporate tree farming, and other carbon offsetting like direct air capture. Unfortunately many mention but do not seriously contemplate the detailed biodynamics of agriculture. Because of this, the existing protocols all too often try to force-fit farming into dated methodologies for carbon and GHG quantification, sequestration and measurement. It simply doesn’t fit. Farming is just too different. This has prevented agriculture, which accounts for as much as 10% of all GHG emissions, to be an active and enthusiastic participant in carbon programs. It also creates confusion for enterprises and growers. Fortunately, this is changing.
All the registries listed above require growers to adopt a practice for the first time, limiting the supply even more. Most markets take months or even years to provide growers with a reliable estimate of the number of credits they could generate for those that do meet enrollment requirements.
Before signing a contract, it’s vital to look at how long growers and organizations are committed to a registry. Carbon markets may require multiple-year commitments, typically from 7-20 years. This prohibits growers who operate on an annual lease from participating. With more attention on carbon credit prices, these markets require long-term commitments that lock growers in a low carbon price. Ideally, the contracts will only be one year so there’s no risk in being locked into an unsuccessful program. It can be hard for growers to get a clear understanding of how much they stand to earn and over what time period until after they enroll in a program.
Organizations with agricultural supply chains are increasingly interested in creating their own programs that incentivize and pay for regenerative and sustainable practices. These pay-for-practice programs sit alongside carbon registries and provide a bridge, designed for farming, that enable growers to generate ROI today while waiting for the big 3rd party carbon registries to evolve to meet the needs of farming.
Different growers have different practices based on their location, soil conditions and what the markets want. Incentives are required to invite and subsidize the switch to sustainable and regenerative farming that will also provide a pathway to monetize the carbon they capture. Creating opportunities for growers who are just starting sustainable and carbon reducing practices is important, as is creating opportunities for farmers who have been doing these practices for generations.
An effective technology enables rapid connections between enterprise incentives and interested and qualified growers. Furthermore, such a technology should not be tied to just one kind of regeneration or carbon farming program, but rather provide navigation assistance to growers to see all of the incentive programs for which they may qualify.
One program might be a 3rd party verified carbon credit program selling high-value carbon offsets the come from verified carbon farming practices. Another program might be a voluntary regenerative farming credit program where growers who implement regenerative practices but don’t necessarily qualify for 3rd party verification can sell their practice credits to individuals and corporations who are interested in incentivizing that kind of farming. Another program might be an incentive program just for the supply chain of one company who want so pay-for-practice and ensure that grains they buy from their grower supply chain are conforming with their company’s stated sustainability and regeneration goals. Another program might be a governmental program for farmers in a particular region, or a cover crop seed company offering discounts or other incentives to use their cover crops. The different kinds of programs are endless and growers should have the ability to stack incentives while doing good for the soil and climate.
Regenerative agriculture is essential for today’s increasingly diverse sustainability commitment. CIBO enables enterprises to seamlessly build, manage, monitor and verify regenerative agriculture and incentive programs into their supply chains.
The key three components of CIBO are the ability to monitor, verify and incentivize grower networks within organizations. These elements work together to help enterprises and their leaders deliver superior service quality and availability, collaborate and innovate better, and keep their technology aligned to the sustainable business outcomes they want most.
CIBO Enterprise is the first technology platform built to power regeneration, carbon, and incentive programs across grower networks. It is the enterprise solution that’s built on scaled platform technology that is designed to meet each of the challenges outlined above and accelerate enterprise sustainability, carbon, and climate goals.
CIBO Enterprise enables companies such as ag inputs, CPGs, Alt-Protein, commodities, and grower cooperatives to help their grower-partners monetize regenerative practices through carbon markets and incentives programs. The product quantifies the carbon footprint of a portfolio of land under various management practices and verifies management practices across the entire portfolio with cutting edge, AI-driven computer vision. In addition to carbon credits and offsets, incentive programs supported by CIBO Enterprise include insetting, direct payments for practices, product discounts and premium pricing for regenerative-verified crops.
Assemble and integrate your collections of fields, and manage them based on your own business needs. Oversee a portfolio of assets and build dashboards and alerts to stay connected to your land-based business.
Strengthen relationships and support your organization’s farmer partners. Farmers can evaluate their own land or use it as a primary tool to prospect and expand their operations. Farmers can simulate the impact of sustainable practices and be rewarded for their verified activities.
CIBO helps organizations transform the monitoring and quantification of the environmental impact of their agriculture network. The platform allows enterprises to monitor and quantify the environmental impact of your agriculture network. Organizations can build incentives for growers in their network to use sustainable farming methods, like no-till or cover crops, to capture and keep carbon in their fields, preventing it from joining existing greenhouse gasses. Farmers who want to use regenerative practices get a financial incentive to do the right thing, and you get the peace of mind of knowing the impact of your supply chain has been reduced.
Key features include:
With CIBO Enterprise, organizations can now verify regenerative and sustainability practices as they happen across their portfolio.The CIBO platform applies proprietary data science algorithms and AI modeling to remotely sensed data, and is backed by some of the best minds in the agricultural industry. Verification of past and current farming practices happens at scale using computer vision and remote sensing. For the first time, organizations can track and act with complete insight on the value, productivity, stability and carbon footprint of their entire portfolio.
Key features include:
Connect with deep insights about land and agricultural operations anywhere in the U.S. with CIBO Enterprise. With a patented combination of big data, computer vision, and science-based modeling, CIBO provides insights to all farmland in the US, delivered in an easy to understand, visual user experience.
Key features include:
CIBO Enterprise can help organizations transform the monitoring and quantification of the environmental impact of their agriculture network by building private incentive and carbon practice marketplaces. Building a regenerative agriculture strategy into your organization is a powerful way to meet and exceed your sustainability goals. By enabling your grower network to expedite regenerative agriculture, you are able to quickly adopt new technologies, drive innovation, and refine better, long-term strategies.
Build incentives for growers to use sustainable farming methods, like no-till or cover crops, to capture and keep carbon in their fields, preventing it from joining existing greenhouse gasses. Farmers who want to use regenerative practices get a financial incentive to do the right thing, and you know the impact of your supply chain has been reduced. Build a sustainable private marketplace by leveraging your customer base to generate and monetize carbon credits, at scale.
Supporting offsetting carbon solutions plays an increasingly necessary and complementary role to the decarbonization of business operations. These solutions can neutralize emissions that companies cannot yet eliminate within their value chains due to technological barriers. The solutions also provide many benefits that preserve the natural world, promoting soil health, protecting farmland, improving water quality, and reducing flood risk. All of these benefits can enhance well-being in communities around the world.
Enterprises can directly purchase agriculture carbon credits and regeneration units from farmers across the US who generate credits through regenerative agriculture practices. Each field goes through a rigorous review process where CIBO quantifies, verifies, and registers the carbon credits. The marketplace allows enterprises to either purchase from the pool of growers or pick specific fields or states they would like to see more regenerative practices rewarded.
CIBO is the breakthrough technology platform that accelerates regenerative agriculture and is the first, direct-from-the-farmer carbon marketplace. CIBO starts from the ground up and scales to county, state and national levels without requiring expensive or complex data from farmers. CIBO’s insights include land and lease values, productivity, soil stability, sustainability, yield forecasts, and more.The CIBO platform combines proprietary, science-based ecosystem simulation with artificial intelligence, machine learning, and computer vision to evaluate land in a powerful way.
CIBO simulates billions of agricultural ecosystems for any crop, and at any point in time. The model scales from a micro-view of how a plant and soil interact to a macro-perspective of regional and global climate patterns to predict current and future scenarios. CIBO Enterprise is fully scaled and is easily extensible to additional crops and geographies.
CIBO has an exclusive license to the SALUS model, developed by Dr. Bruno Basso at Michigan State, to predict crop growth, yield, carbon sequestrations and more. SALUS has been deployed and validated across multiple crops around the world.
Using Deep Neural Networks and transfer learning to identify on the ground practices, CIBO Enterprise is fully extensible across the globe. CIBO uses remote sensing to provide analyses of agricultural ecosystem scenarios and draws conclusions about why—down to the specific variable—certain outcomes will occur. CIBO’s scientists can do this even where there is limited or low-quality data.
CIBO’s platform architecture allows flexibility and scalability for any organization. The robust design system and component library enable rapid prototyping and delivery to production. CIBO’s DevOps practices leverage Kubernetes hosted at AWS to ensure rapid development and access to Cloud-native technologies.
With its ability to help you meet and exceed your sustainability goals, CIBO Enterprise is an essential tool to maximize the impact of regenerative agriculture on your business, your customers, and your reputation. It can also provide insight into the grower network, to help you plan more efficiently, and anticipate impacts on your supply chain.
CIBO Impact can help any business, no matter the size, go carbon neutral and meet their individual goals to offset their organization’s footprint.
Schedule a meeting and learn how CIBO Enterprise can meet your sustainability needs.