Introduction
As the urgency to address sustainability and climate risks grows, companies across various industries are facing increasing pressure to reduce their environmental and social impact. With no exception, food & beverages together with textile (Apparel, Accessories & Footwear) companies are facing growing pressure to demonstrate their commitment to responsible practices. Central to this effort, is the need to comply with increasingly strict sustainability regulations, such as the Corporate Sustainability Reporting Directive (CSRD) in the European Union or the International Sustainability Standards Board’s (ISSB). These regulations require companies to provide detailed, verifiable information on their environmental and social impacts, including greenhouse gas (GHG) emissions, biodiversity, water usage, and more.
For food & beverages and textile companies, a significant portion of their carbon footprint is tied to scope 3 emissions—indirect emissions across their supply chains. A substantial share of these emissions stems from the agricultural production of raw materials, making sustainable practices critical. Regenerative agriculture offers a promising solution. To maximize its potential, companies must prioritize data collection and analysis at the farming level to make informed decisions that drive improvements.
Regenerative Agriculture: Pathway to Compliance
Regenerative agriculture is a holistic approach that not only sustains but actively restores and enhances ecosystem health. It includes practices that improve soil health, increase biodiversity, sequester carbon, and strengthen the resilience of agricultural systems to climate change. By adopting regenerative practices, food and textile companies can significantly reduce their supply chain's environmental impact and meet multiple sustainability goals, especially regarding scope 3 emissions.
Key Benefits of Regenerative Agriculture
• Soil Health and Carbon Sequestration: Techniques like no-till farming, cover cropping, and composting enhance soil organic matter and sequester carbon. These methods reduce GHG emissions and improve soil fertility and resilience, ensuring long-term productivity.
• Biodiversity Enhancement: Practices like agroforestry, crop rotation, and integrating plant and animal species into farming systems increase biodiversity. This is crucial for meeting regulatory requirements related to ecosystem health and biodiversity protection.
• Water Management: Regenerative methods improve soil structure, enhancing its water retention capacity, which reduces irrigation needs. This aligns with compliance requirements focused on sustainable water management.
• Reduction of Chemical Inputs: By minimizing the reliance on synthetic fertilizers and pesticides, regenerative agriculture supports pollution prevention and protects soil and water quality, aligning with broader sustainability objectives.
How Data Collection and Analysis Drives Impactful Results
Implementing regenerative agriculture and achieving sustainability compliance depends on robust data collection and analysis at the farming level. Without accurate data, companies cannot quantify the impact of these practices, track progress, or make informed decisions to drive improvement.
However, collecting agricultural data is challenging due to the decentralized nature of farming operations. Diverse practices, lack of standardized data collection methods, and varying technology adoption levels complicate gathering consistent data. Additionally, the complexity of measuring emissions, soil health, and biodiversity requires specialized knowledge and tools that aren't always available.
Sustainability reporting frameworks like the CSRD and the EU Deforestation Regulation (EUDR) demand detailed data on environmental and social indicators. Companies must invest in the infrastructure and capabilities necessary to collect, manage, and analyze data from their supply chains.
Future-Proof Your Agribusiness with SAP and msg's Comprehensive Solutions
msg global solutions, in collaboration with SAP, offers a of advanced solutions for companies in the food and textile sectors to overcome the challenge of collecting and analyzing data from agricultural activities, and meet the requirements of sustainability frameworks.
At the heart of these offerings is the Green Ledger, a powerful tool that enables companies to record and track their environmental impact across the supply chain. Alongside the Green Ledger, several other innovative solutions form part of this ecosystem:
• Digital Farmers App
Empowers farmers with digital tools to optimize agricultural practices, enhancing productivity while ensuring sustainability. This tool further offers the possibility for companies to collect data directly from the farmers to report on their value chain impact and scope 3 emissions.</p
• Green Token
Provides a secure and traceable way to verify sustainable sourcing, which is key to facilitate compliance with regulations such as the EU Deforestation Regulation (EUDR).
• Sustainability Survey Portal
Offers a platform for collecting and analyzing data on sustainability practices from suppliers and across supply chains.
• SAP Sustainability Control Tower
Provides real-time insights and monitoring of sustainability metrics, enabling companies to proactively manage their environmental performance.
• SAP Intelligent Agriculture
Enhances agricultural decision-making through advanced data analytics and AI, driving both sustainability and productivity.
• SAP Analytics Cloud
Delivers robust analytics capabilities that allow companies to visualize and optimize their sustainability strategies.
• AI-Based Decision Support
Leverages artificial intelligence to provide data-driven recommendations that improve sustainability outcomes.
Together, these solutions from msg global solutions and SAP provide a comprehensive approach to sustainability compliance. With a focus on technology, automation, interoperability, and optimization, we enable companies to gather the data they need, analyze it effectively, and meet the demands of today's stringent sustainability standards. Whether addressing the requirements of the CSRD, EUDR, ISSB, TNFD or other regulations and frameworks, these tools equip companies with the insights and capabilities needed to lead in sustainability.
By adopting standardized metrics, leveraging technology, and continuously monitoring progress, companies can make informed decisions that drive positive environmental outcomes and support long-term sustainability. In doing so, they not only achieve regulatory compliance but also position themselves as leaders in the global movement toward responsible and resilient supply chains.
