What is Sysco’s overarching vision for sustainability, and how does it guide the company's operations?
Sysco is a purpose-driven organization with sustainability at its core. Our purpose, which is to "connect the world to share food and care for one another," wasn't crafted by a marketing team—it was developed internally by our management team and reflects our genuine commitment. This purpose serves as our North Star, guiding how we approach decisions, strategies, and daily operations. It’s not just about talking the talk; it's about walking the walk, ensuring that sustainability is embedded in every aspect of our company.
To ensure sustainability remains central to our operations, our CEO, Kevin, and I decided that the person in charge of the company's strategy would also oversee sustainability. This unique structure ensures that our sustainability initiatives are not seen as separate from our business goals but are fully integrated into our strategic planning. This combination gives us a "seat at the table" and ensures that sustainability considerations are part of every decision, making it an essential aspect of how we create value for the business.
How does Sysco integrate sustainability with strategy, and how do you see the business case for sustainability?
At Sysco, we see sustainability and strategy as inseparable. I’m constantly focused on demonstrating that our values can drive value. We aim to prove that sustainability isn't just a feel-good initiative but a driver of business value, increasing sales, profits, and strengthening relationships with customers and suppliers. This alignment means that sustainability isn’t a side project; it's a fundamental part of how we create enterprise value.
We bring this perspective to our teams, encouraging them to see sustainability as a means of enhancing the business. For instance, by meeting sustainability goals, we can win contracts with customers who are also committed to reducing their carbon footprints. This approach helps us elevate sustainability from being merely the "right thing to do" to being a strategic driver that helps grow our business.
You have set an ambitious goal to reduce global emissions by 27.5% by 2030. How does Sysco plan to achieve this while maintaining efficiency and profitability?
We were the first in our industry to set a science-based target initiative goal, aiming for a 27.5% reduction in Scope 1 and 2 emissions by 2030. Achieving this target requires two main strategies: committing to renewable energy and decarbonizing a significant portion of our fleet. As a distributor with large warehouses and extensive fleets, this is a challenging goal, but it's one we deliberately set to be difficult, ensuring it’s credible and not just a marketing slogan.
We’re investing strategically in electrifying our fleet, starting with orders from Tesla and Freightliner for electric vehicles. We’ve already deployed 130 of these trucks, and we plan to continue expanding this fleet. Additionally, we’re leaning into solar energy, installing solar panels on our facilities and creating solar farms to power our operations.
However, achieving our emissions goals also requires collaboration with our supply chain partners, as about 98% of our overall emissions come from this area. We’re working to ensure that suppliers representing 67% of our scope 3 emissions commit to their own sustainability targets, which is essential for reaching our overall goals.
How is Sysco addressing plastic and packaging waste in the food industry, and what initiatives are you implementing in this area?
Packaging is a significant issue for Sysco, given the volume of products we handle. Although we're not a manufacturer, we influence our suppliers through our size and scale. We have introduced several initiatives to reduce packaging waste, starting with our own branded products, where we have more control. For example, we've shifted from white corrugate to kraft corrugate for our packaging, which reduces energy usage by 30% and material usage by 17%.
We've also launched a “packathon,” a shark-tank-style event where suppliers pitch innovative packaging solutions to reduce waste. By setting clear packaging standards and working with suppliers who adhere to them, we're driving change across our supply chain. One notable innovation is our agave straw, which offers a durable, eco-friendly alternative to traditional plastic straws. These initiatives demonstrate how we leverage our influence to drive sustainability in packaging.
What is the biggest challenge Sysco faces in its sustainability journey, and how are you addressing it?
Our most significant challenge is the infrastructure required for electrifying our fleet and facilities. As we operate in numerous locations with varying degrees of infrastructure readiness, securing the necessary electricity and charging capabilities can be complex. Some sites handle the transition smoothly, but others require substantial investment and time to build the needed infrastructure, especially in areas with less developed utility support.
To overcome these challenges, we are investing in infrastructure improvements, exploring solar and battery storage options, and working with local utilities to ensure we have the necessary power. While it’s a heavy lift, we remain committed to building the infrastructure that will support our transition to a more sustainable fleet and operations.
How is Sysco navigating infrastructure challenges across different regions, particularly in markets that may not be as advanced?
Within the United States and internationally, we operate in regions with varying levels of infrastructure sophistication. For example, in Great Britain (GB), the infrastructure presents unique challenges, requiring additional investment to facilitate our sustainability goals. To address these obstacles, we work closely with governments, sharing insights and solutions from our successes in other regions, such as Canada and certain U.S. states. By collaborating with governments and other stakeholders, we're finding ways to overcome infrastructure challenges and advance our sustainability objectives.
We have found governments generally receptive to our initiatives and eager to learn how they can support infrastructure improvements. These partnerships have been crucial in overcoming the obstacles we face, ensuring we can continue to progress towards our sustainability goals even in regions with more complex infrastructure requirements.
How responsive have governments been in supporting Sysco's sustainability efforts, and how do you see the role of public-private collaboration in this journey?
In our experience, governments have been quite responsive and interested in supporting sustainability initiatives. We've worked with various government entities, from the federal and state levels in the U.S. to Canadian and British governments, and they have shown a willingness to collaborate. They understand that sustainability efforts can create jobs, reduce emissions, and provide broader benefits to society.
By demonstrating how our sustainability initiatives can drive economic growth and environmental benefits, we’ve been able to build strong partnerships. These collaborations have enabled us to work through challenges such as infrastructure development and investment, ensuring that sustainability becomes a shared goal between Sysco and the communities we serve.
