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Sustainability: going from charity to business model
We need to create new business models that drive and finance a climate-smart transformation of coffee farms while increasing value for all parties – farmers, importers, roasters, customers and consumers. But above all for the planet, future generations and the future of coffee. I think it's possible, do you?
Published April 12, 2023
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Kajsa-Lisa Ljudén
Coffee experts@Löfbergs
Companies that have a good understanding of their value chain know where risks are greatest and what measures are needed, but if the financial incentives are missing, the measures are difficult to implement. In the coffee value chain, we find the greatest risks linked to climate change and loss of biodiversity at the back of the value chain, in farming. Coffee grows at high altitude in a band of countries along the equator. Climate change means that the conditions are slowly changing and farms have to be moved up into the mountains, which in the worst case leads to deforestation.
Coffee is for many farmers a so-called 'cash crop' and an important part of the income, which means that changing weather conditions have a serious impact on people's ability to put food on the table. It drives a short-term approach where you don't always have room to think about the ecosystems and the possibilities for future generations, which is not so strange. In the worst case, you leave the coffee business entirely and invest in other professions, which is a clear trend among the younger generation.
It is clear that we both need to reduce climate emissions but also create resilience to the climate changes that are occurring. Through the organizations International Coffee Partners and coffee&climate, Löfbergs has worked for over twenty years with development projects that strengthen the development opportunities of small-scale coffee growers. Learnings from the projects shows that cultivation methods that are more climate-smart, such as regenerative agriculture or agroforestry and shade cultivation, can also provide increased productivity and greater resistance to climate change and plant diseases. Together with training in for e.g. quality and entrepreneurship and with a clear inclusion perspective where you strengthen both young people and women, we have many examples of how this can lead to great success for both the coffee growers' income and the nature in and around coffee farm. It should be crystal clear; more climate-smart cultivation methods for all?
We coffee lovers who are worried about the future of coffee need to create incentives and reward systems that drive a change to more climate-smart cultivation methods. Right now, many companies are sitting with their climate accounts and discovering that the biggest impact occurs in scope 3, far back in the value chain. It is usually where you have the most to gain from taking action, but also where you have the least resources. The small-scale coffee growers are the ones who have contributed the least to climate change, but are still most affected by it. At the same time, they often have non-existent opportunities to invest in a change, and it is difficult to get access to the education and knowledge that is needed.
Climate compensation, where companies can 'reduce' their emissions by paying so e.g. forests are restored or preserved and trees are replanted, is an example of how companies can easily invest in biodiversity and climate. But there is rarely a connection to the companies' value chain, and it is possible to discuss whether one can offset one's fossil emissions by planting trees. It is also difficult to get it into the business model and is often handled alongside the business as a kind of charity - an expense, 'good will'. We need to create new business models that drive and finance the transition while increasing value for all parties – growers, importers, roasters, customers and consumers. But above all for the planet, future generations and the coffee of the future.
We therefore want to reduce the climate emissions from coffee farms and reach our climate goals, increase the farmers' income and improve their future prospects, and at the same time increase the value for our customers in the offers we present. I think it is possible, do you?
About the author
Kajsa-Lisa Ljudén
Passionate about coffee and sustainability. Let's change the world together, one cup at a time.
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