METRO AG's Veronika Poutcheva has big ideas about improving both the environmental performance of the wholesale giant and the consumer goods industry at large. Stephen Wynne-Jones met her. This article previously appeared in ESM's September/October 2021 edition.
When ESM last had the chance to sit down with METRO AG’s Veronika Pountcheva, it was on the sidelines of the Consumer Goods Forum Sustainable Retail Summit in Lisbon, back in the autumn of 2018.
Thus, with this year's Sustainable Retail Summit taking place recently (read our Day One and Day Two reviews), we welcomed the opportunity to catch up with the Bulgarian native, and found her in optimistic form, both about the post-pandemic recovery and her own role as a sustainability leader.
As well as her long-standing position as global director for corporate responsibility at METRO, Pountcheva holds a variety of additional roles, including co-chief executive officer of NX-Food, the wholesaler’s innovation hub, which was spun off from the main business in October of last year. It is spearheading a number of next-generation food transformation projects, including plant-based initiatives, in-store farming, 3D printing, and waste reduction programmes.
“At NX-Food, the team is seeking to explore which of these great ideas has the viability to become the next big thing in food,” Pountcheva explains.
This includes working with other aspects of the METRO business, including its Asian-based Classic Fine Foods arm, pushing out new innovations into the marketplace.
“For example, in Singapore, with our food service delivery unit Classic Fine Foods (CFF), we supported the launch of TiNDLE, a plant-based chicken alternative, as an exclusive for that territory in March 2021,” she says. “In a second step, and based on the success in Singapore, with CFF we facilitated the roll-out in Hong Kong, Macau and Kuala Lumpur in June. So, it's very promising territory and also interesting from a commercial perspective."
Green Thinking
For the purposes of this article, we’re going to focus on sustainability, and thanks to Pountcheva and her team, METRO has become a benchmark-setter for the global wholesale/cash-and-carry industry in this regard. In July, the group became one of the first signatories to the EU Code of Conduct on Responsible Food Business and Marketing Practices. As well as the mandatory commitments therein, the group has also committed to a number of additional sustainability goals, including halving its food waste by 2025, building sustainability and product reformulation into its supply chain process, and a pledge to become a climate-neutral business, globally, by 2040.
“We don’t have all the answers on how to get there, although we have the ingredients that will help us achieve this ambitious target,” Pountcheva says of the group’s 2040 goal.
The wholesaler plans to invest €1.5 billion between now and 2040 in optimising its energy, heating and cooling infrastructures, which together account for 93% of its greenhouse gas emissions. This includes the introduction of energy-saving measures, the expansion of photovoltaic systems, and switching to natural refrigerants, as well as, crucially, working with its suppliers to ensure that its commitments extend beyond its own organisation.
“Something that is really important to us is our supply chain – looking at the environmental and social footprint of the products that are on our shelves,” says Pountcheva. “That has the potential to be a real game-changer and will require a completely different dialogue with many of our suppliers, because many of them, whether local or international, are not currently managing their own product footprint."
This also extends to customers. Building on already established measures to assist its HoReCa clients, METRO has introduced My Sustainable Restaurant, a new programme that aims to assist hospitality businesses with improving the sustainability of their operations, touching on topics such as water and energy efficiency, responsible sourcing, food waste, and sustainable menu creation. While the roll-out of this programme has been affected by the pandemic, METRO is seeing adoption increase rapidly.
“Restaurants are seeing customers return – eating out is social glue, it has been missed dearly, and people are not going to continue cooking everything at home like they did last year,” says Pountcheva. “At the same time, customers will be paying even more attention to how restaurants operate.
“We can see that demand for more sustainable menus, vegetarian and vegan options, and more animal welfare-friendly products is rapidly growing. An important part of our strategy is to ensure that sustainable products aren’t just available, but also affordable, because there are certain expectations or certain fears that sustainable products also mean more expensive products. Building bridges is critical in terms of moving the needle.”
Global Approach
METRO is a truly global business, with operations in countries such as India, Japan and Pakistan, as well as extensive pan-European operations. As you might expect, the pace of change can differ from market to market – while a new sustainability initiative might be rapidly adopted in its home market of Germany, it could take longer to roll out in South-East Asia, for example. Taking into account the group’s 2040 targets, the wholesale giant has adopted a somewhat flexible approach to implementation – it’s far from a one-size-fits-all strategy.
“There’s a shared understanding within METRO that one framework is essential, but different speeds of transformation within this framework are fully acceptable,” says Pountcheva. “Cage-free eggs are a good example. What will be rule-of-law in Europe by 2023 or 2025 will maybe happen in Asia by 2027, or even later. This is because of market development, because of supplier education, and because of other local issues. We think along these regional differences and deadlines within our commitments.
“Also, I think there is a good chance to share knowledge through this approach. Those countries that are a little bit more ahead can be great sources of inspiration and best practice for those that are at an early stage.”
At the same time, the pandemic has actually accelerated progress on some targets, such as around plastic. In June, the group set out the METRO Plastic Initiative alongside social enterprise Plastic Bank, which aims to prevent around 65 million plastic bottles (equivalent to 1.3 million kilograms of plastic) from flowing into the oceans within the first year of the initiative. As of the end of August, that target is well on course, with around 15 million bottles kept from the oceans.
Coalitions Of Action
Along with her roles at METRO and NX-Food, Pountcheva has been closely aligned with the Consumer Goods Forum for a number of years and currently holds the role of co-chair of its Human Rights Coalition of Action, which is working to end forced labour in supply chains around the world, as well as being a member of the steering committee on the Forest Positive Coalition of Action. She believes that the forum’s focus on delivering collective action has furthered its importance as a catalyst for change.
“I think that the Consumer Goods Forum has made a great step forward by implementing an achievement-driven approach – it’s a more ambitious set-up,” she says. “For example, within the Human Rights Coalition, we have, for the first time, a real road map on how to address forced labour in Malaysia, and it’s great to see some quite experienced, helpful NGO partners assisting with this. It's transformative, collaborative work that will make an impact.
“While nobody anticipated the pandemic, it has actually helped us, in a way, to become more focused and more targeted, and hopefully will enable us to deliver something meaningful for the industry.”
© 2021 European Supermarket Magazine. Article by Stephen Wynne-Jones. For more Retail news, click here. Click subscribe to sign up to ESM: European Supermarket Magazine.
