Ahold's Sustainability Initiatives


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Case Details:

Case Code : BECG055
Case Length : 18 Pages
Period : -
Pub. Date : 2006
Teaching Note :Not Available
Organization : -
Industry : Retail
Countries : Netherlands

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Please note:

This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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"We are on a journey - to strengthen our company, to get closer to our customers and to further develop our approach to sustainability." 1

- Anders Moberg, President and CEO, Ahold in 2004.

"Offering quality product and low price are a given, but consumers are now demanding moral and ethical values." 2

- Manuel Fong Jr., Managing Director, Supervalue (Philippines) in 2004.

"On the one hand, the retail sector can influence suppliers to produce in a more sustainable manner - raising questions of resource and energy use, for example. On the other hand, the sector is in a unique position to help the public to adopt more environmentally friendly lifestyles and purchasing habits by providing customers with an appropriate choice." 3

- Klaus Toepfer, Executive Director, United Nations Environment Program in 2003.

Introduction

In 2004, Ahold NV (Ahold), the Dutch retail major, conceived of a project called Eco-Sound to evaluate Ahold's seafood sources in terms of their environmental impact.

The company sought the expertise and assistance of Heather Tausig, Director of Conservation at New England Aquarium.4

For the project; it partnered with the Aquarium to establish sourcing standards, and ensure sustainability and traceability of its seafood sources. The project involved an elaborate audit exercise of the domestic as well as international seafood sources of Ahold's US operations.

The sources were evaluated along two parameters - environmental soundness and sustainability. The audit had a direct effect on the buying decisions of Ahold's operating companies in the US.

For example, Ahold stopped selling Chilean sea bass5 when the audit report suggested that the particular species was being over-fished.

Ahold reduced its purchase of orange roughy6 by 75%, and also changed the source for cod7 to one which used environmentally friendlier fishing methods like the hook and line.8 Apart from the Eco-Sound project, Ahold and its operating companies (Refer Table I for Ahold's operating companies) were also involved in several other projects pertaining to energy conservation, waste management, promotion of organic produce, environmental protection, etc.

The company considered its sustainability initiatives as a long-term strategy which would enable customers to view it as a responsible corporate citizen and would help to differentiate it from other retailers.

Ahold's Sustainability Initiatives - Next Page>>


1] "Message from Anders Moberg," 2004 Sustainability Report, www.ahold.com

2] "Retailers set out their 'sustainability' credentials," www.foodanddrinkeurope.com, June 18, 2004.

3] UNEP News Release, "Shopping for a better world," www.unep.org, June 02, 2003.

4] The New England Aquarium, based in Boston, Massachusetts, was established in June 1969.

5] Chilean sea bass, a deep water fish species, also known as tooth fish is usually found in the waters near and around Antarctica. US Customs rules require that imports of Chilean sea bass are accompanied by a document certifying that the fish were caught legally.

6] Orange Roughy is a species of fish which is dangerously low in numbers because of over-fishing. According to the World Wildlife Fund, 90% of the documented catch of Orange Roughy finds its way to the US.

7] Cod, a fish species distinguishable by its three rounded dorsal fins and two anal fins, is available in most parts of the world.

8] Hook and line is a curved or sharply bent device made of metal attached to a string/cord used for catching fish. Hook and line fishing is preferred over nets and long-lines because by-catch is minimized and the ocean floor is not disturbed, thereby making it environmentally friendlier.

 

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