Ep. 506 wine2wine 2020 Recording Session | Sustainability And Resilience

Italian wine podcast. Chinchin with Italian wine people. Italian wine podcast as wine to wine twenty twenty media partner is proud to present a series of sessions chosen to highlight key themes and ideas and recorded during the two day event held on November twenty third and twenty fourth twenty twenty. One to wine twenty twenty represented the first ever fully digital edition of the business to business forum. Visit wine to wine dot net and make sure to attend future editions of wine to wine business forum. Welcome everybody to sustainability and resilience, staying the course on climate adaptation. Since the end of twenty nineteen, when momentum was building for changing the course on climate change, Our collective consciousness has now shifted to COVID nineteen. Yet climate change continues unabated. Every wine grower faces the immediate consequences of climate change. They realize that their continued success depends on rethinking their business models in the face of climate related events that represent a clear and present danger, not just a future risk. What steps must the wine industry take to adapt? My name is Remy Cohen. I'm the chief executive officer at Domaine Carneros in the Carneros region of Napa Valley. I have a twenty year career that focuses on sustainable wine growing, and I currently focus on producing sparkling wines and pinot noir in Carneros. We are very fortunate to have the esteemed Sandra Taylor here to speak on this subject. Sandra Taylor is an internationally recognized expert on environmental sustainability, social responsibility, agricultural supply chains and public relations. She is the CEO of sustainable business international, a consulting business that assists clients at various stages of environmental sustainability, corporate social responsibility, primarily in the food and beverage sector with offices in both San Francisco and Washington DC. She has been a senior executive at Starbucks coffee company based out of Seattle, where she led global corporate responsibility and sustainability in the coffee supply chain and she has also been with Eastman Kodak Company where she oversaw global public affairs and corporate citizenship. Sandra has a lifelong passion for wine. She's a graduate of the wine MBA program at Nicole Superior De Commerce de Bordeaux, the Bordeaux business school in France. Her first book, the business of sustainable wine, how to build brand equity in a twenty first century wine industry was released in two thousand seventeen and it shares important insight into the complicated world of agricultural sustainability. Sandra is a wine educator. She's founder of fine wine divas, a learning experience for women on the origin of wine grapes, geography, terroir, and food pairing. Sandra has traveled the world and has a career that spans from law to diplomacy, to the c suite, and most relevant here to wine. Sandra, welcome. Thank you very much, Rimmie. Good morning. So first question, good morning from California. And Sandra's on the East Coast. So hello, everybody in Italy. So, Sandra, the term sustainability might have many meetings. Let's set the stage here for this conversation. Please give us a definition of sustainability. Thank you. Well, sustainability can be a very complex concept. It's been defined in many ways, but the most frequently quoted definition is from a UN conference report in nineteen eighty seven. And that definition is meeting the needs of the present without compromising the ability of future generations to meet their own needs. Circability presumes that resources are finite and should be used conservatively and wisely with the view to long term priorities and consequences of the ways in which resources are used. In simplest terms, sustainability is about our children and our grandchildren in the world. We will leave them. Typically, when we use the term sustainability, we think of avoiding the depletion of natural resources and protecting the natural environment, but it really is more than that. I believe sustainability is more than just protecting the land. It extends to preserving culture and community. We also need to protect social and economic resources. So my preferred definition of sustainability is the integration of environmental health, social equity, and economic vitality in order to create thriving, healthy, diverse, and resilient communities for this generation and generations to come. Sandra, that's beautiful. And I think it's really great because you really do need all of those different components to create a sustainable business. So many wine regions around the world have developed sustainability protocols or certifications to guide the industry in undertaking more sustainable practices in the vineyard and in wineries. How do these certification regimes contribute to the protection of these both social and economic resources? Well, first of all, certification allows a winery to get credit for their sustainability efforts through a third party verification. This is a a certification that's credible with consumers and retailers who value sustainability, recognize verification increasingly consumers want proof, an independent validation of sustainability efforts. The sustainability certification programs have been fairly well embraced, but many, but but not all, wine born regions around the world. Mostly in the so called New World. Best practices are being implemented in New Zealand, California, Chile, South Africa, Oregon, and Argentina. But more can be done in wine regions globally to embrace higher sustainability standards, treat workers and community with care and reduce the industry's carbon footprint. Now, typically, these programs are characterized by a a commitment to continuous improvement. That's really important. Independent inspection and validation, all designed to improve air quality, water quality, and energy use to reduce or eliminate chemical use for soil health with an added focus on climate change, community engagement, and social advancement. That's a lot, but these programs are are very rigorous in my opinion and have very specific criteria in all of these areas. Now certification is good for the environment, of course, as growers and wineries commit to preserving natural resources, protecting ecosystems and wildlife habitat. From a social standpoint, verification is also good for the community. A sustainable wine growing helps growers and vendors be stewards of both natural and human resources. It also helps provide a favorable environment for employees and neighbors. Now certification, it's been proven that across many industries that investing in sustainability practices saves money and reduces risk over time. It increases brand value and recognition. So while some of these requirements may be costly initially, over time, there's a payback, for the for the winery. Sustainable practices also require in-depth attention to detail in the vineyard and in the winery, which I believe results in higher quality grapes and vine and wine. And that, of course, it gets a payback in the marketplace. Now it's ultimately the decision of the Viticulturists and winemaker as to which system is best for their climate, region, and their circumstances. However, a successful sustainability protocol, whatever it's origin or its components requires these things, I think, as basics. Record keeping, reporting, independent inspection, continuous improvement, audit, and verification. And I believe certification that fulfills these requirements, are critical so that the retailer and the consumer have assurance and confidence in whichever system is applied. That makes a lot of sense. As a producer ourselves here at Demand Carneiros, we participate in four different sustainability certification programs. We feel like we get, different tools for best management practices from each different certification. So I have a question for you. Where would you say these certifications fall short and what would you like to see with them in the future? Well, I do believe that, the distinctions between sustainability certifications and organic and biodynamic certifications are worth mentioning. Those vineyards that are certified organic and biodynamic should go further and include sustainable criteria among their practices. Now while organic and biodynamic practices require elimination of all chemical use, they do not as a rule cover air quality, water conservation, emissions, reduction, responsible packaging, and social responsibility. So accordingly, I believe biodynamic and organic practice alone are not sufficient to ensure our sustainable future. A sustainable framework or certified sustainable framework, and that's important needs to be certified. It's not enough just to say you're sustainable. There needs to be a independent verification of that. But I believe a certified sustainable framework is the ideal approach for the wine industry, one that takes account of all the material and social inputs that contribute to the finished product. And it includes a process in which a third party provides validation that a grower or farming operation is in compliance with a defined set of mandates mandatory standards or practices. I would love to see these, these regional programs include much more about packaging because I think that's gonna be critical for for carbon, reduction. And so that's one of the things that I think are missing. But most of the requirements I think are being covered, and they're being improved upon in these sustainable certification programs, and they're making a difference in the protection of both social and environmental resources. That's great. Thank you, Sandra. How do you feel the wine industry will bounce back after COVID? There's a lot of economic insecurity right now, and we discussed needing all the different components of sustainability how can there be economic sustainability in this new environment? Yeah. And, of course, we're all very worried and despondent right now given the impact of COVID on the global economy. Obviously, we're very concerned in the US and in Europe and elsewhere about the impact on our health, but also just the impact on the global economy. I mean, it's easy for me to say, but we'll get through this, and we'll bounce back in a bit in a big way as we've gotten through worse. World Wars, the great depression, prohibition, of course, and the two thousand eight global financial crisis. Of course, many wine drinkers are experiencing financial pressures, and that will continue. So reduced they have reduced income, and they're having to watch how much they spend on extras, I think. So they'll be added pressure on price, and that may make more costly sustainable and organic initiatives look like an expensive luxury, unfortunately. Regarding sustainability, post COVID, environmental responsibility has been a growing focal point in the wine industry over the last few decades, and it's certainly here to stay. I don't think I don't see us back tracking in the wine industry from that. And while COVID has brought us much despair, it's also worth noticing the many new beginnings that the first half of twenty twenty has brought from a sustainability perspective. Perhaps most notably is a renewed focus on health and wellness, both in the workplace and in the work at home environment. Also glimpses of environmental repair which has been very exciting for environmentalists, although fleeting. So fresh water, cleaner air, smog free city skylines. I mean, San Francisco is the exception of, obviously, more recently. But in many cities, are experiencing smog free city guidelines, and they've all been a part of this reduced industrial activity and frankly reduced human activity. Of course, these signs of environmental repair are only temporary due to this reduced activity rather than long term results, but they point to shifts and trends that could influence our new normal. At least that's my hope. The other really important, development I think, for sustainability, post COVID is that many more people now rely much more on science and the advice of scientists which should influence our approach to a number of environmental challenges as it's has it's starting, I think, to, affect our ability to the health impacts of COVID. And on the social side, the protests against racial injustice, we saw around the world and the heightened awareness of gender inequities in our industry and in the Me Too movement have all hopefully made us all aware of the painful injustices many have suffered for decades, while others have thrived financially and socially. Those inequities have been brought front and center and at least we're now having a national conversation in the US about these inequities and hopefully elsewhere in the world about solutions to some of these issues. And the wine industry is no exception. Absolutely. I, I do think that we are going to have a positive rebound from this experience, and it's offering an opportunity to learn and for businesses to pivot it's been one of the most interesting things to see is how businesses are surviving, and in some cases, even thriving throughout this. I think, unfortunately, we might not have seen the worst yet in terms of the recession. As more regions are experiencing surges and tightening of restrictions, we will more likely see more restaurants closing this winter. On the bright side though, people are drinking wine, they're drinking wine at home. And so we expect retail to remain strong, through the next several months, maybe not as strong as the initial surge when people were stocking up in the spike and demand in March, April, May of twenty twenty. But it's great to see that people are drinking wine, and they're bringing it home, and they're having it with dinner. On the on the negative side, we might see another surge in unemployment more businesses are struggling through the winter. So there might be some continued strain on wide sales between restaurant closures and a negative impact on retail purchasing as you mentioned with people's finances being limited. But I do believe that there is pent up demand for social engagement and experiences. So I agree with you that we will bounce back. The question is when. And there's reason to hope then. So COVID nineteen is obviously not the only threat to the industry. Climate change really remains a threat to the wine industry. And, you mentioned to me in December twenty nineteen, American adults had finally come around to the conclusion that climate change was the number one issue facing our society. But in late July, concern for climate change had fallen from second, almost to last place. How can the wine industry respond? What can we do about this? Yeah. It's unfortunate that we've kinda lost the momentum that we had on climate change, but but I I think it's, you know, hopefully, I think it'll come back, that support and awareness. Now many scientists concur that climate change is completely locked in it isn't going away. And and frankly, some scientists believe we won't meet the targets that were set set, in Paris, no no matter what. So the choice now is how we respond and adapt. To this certain threat. For some industries, this news from the scientists that it's locked in, it may come as shocking news. But in the one industry, climate change disruptions, have been unavoidable for many years already. Growers and winemakers see commitments to climate action as a critical strategic priority. Even as they deal with the pandemic, In this case, resilience requires adaptation. Now the responses are varied. You know, some winery operations are switching to different more climate resistant grapes where regional regulations permit that. Or relocating to vineyards to co relocating vineyards to cooler, to cooler climates. Some Napa winemakers are planting experimental plots of grapes, such as Aglialteco and Dupernio, which may be more resilient to a hotter climate. Others are implementing new growing practices, believing that a change in farming and not variety could solve the problem. Still others are collaborating, with wineries through the international wineries for climate action, which is led by Fabilio Torres in Spain and Jackson family wines in Sonoma. And the the international win is for climate action. Really focuses on, seeking to uncover more science based solutions to reduce carbon emissions across the wine industry and to become more resilient. And I mentioned a little earlier packaging. A packaging is changing to become more sustainable, lighter weight bottles, which use less energy in glass manufacturing, and in shipment, wine on tap, boxed wines, and wine in cans, even for top end wines. Installing renewable sources of energy such as solar powered wineries are also being employed. And then, of course, waste management is critical as well given the emissions that come methane emissions that come from waste. So think there's a lot the winery industry can do. And we don't control, obviously, climate action, but these are some steps that many in the industry are taking. Thank you. Sandra, we have a question about fires? What have we learned in Napa about the fires from, Ricardo Oldani? And are there lessons that you've learned from the fires in California that could be adopted to other regions of the world? I think I'll I'll give that question to you, Rami. That makes sense. I it's not just fires. We've had floods. We've had heat waves. I as Sandra mentioned earlier, wine growers have learned to be resilient and will continue to learn to be resilient. And one of the things that I think is paramount in terms of any business operation is creating an emergency business continuity plan. So knowing what the business is going to do and how is how are you going to respond and who is going to respond to which areas, emergency contacts, and individual, and backup people for different responsibilities, obviously, we've learned here in California that we need to create defensible space around our vineyards. Though vineyards in many cases have served as firebreaks, which has been really great, which means that your cover crop and your ground floor management has to be on point, so you need to make sure that you're mowing your cover crop, that it's going dormant in the, in, in, in the winter, in the summer months. We have a lot of different farming techniques. Sandra mentioned some of them, variety selection, also rootstock selection that's drought tolerant, irrigation management for water conservation is really critical. We also have decided that we need to maintain equipment to defend our own properties. So we have water trucks, we have land moving equipment to build fire breaks. In our case, we have portable generators, but we just signed a contract to build a solar micro grid, which is a solar array that has battery backup power that will allow us to operate as an island in the case of a power shutoff. So many of you might know that now in California, because some of the fires have started, due to high wind events, knocking down power lines and igniting fires, they will do preemptive power shut offs. So in this case, if the power goes off for any reason, domain Coronaros will operate as an island, and will operate off of battery backup from the solar generator, reducing carbon emissions in greenhouse gas generation. So other little things that we've done are not little because they're important to our business and our business continuity plan, is putting our data storage in the cloud, getting the right insurance, and I think it's important for the industry to share information. I know Australia has had an unfortunate horrible experience last year. The Pacific Northwest had fires along with us this year, it's important that we all get together share information in forums like wine to wine and other forums and so that we can, prepare ourselves for the future. So we're welcoming any other questions from the audience. People were asking about it Italy programs. There's SQL, NPI, and GRI, empowering sustainable decisions. And in Veneto, there is Viva, and in Valpolicella, there is r r r. So in case anyone in Italy is interested in participating in more sustainability programming. So, Sandra, what do you think is the low hanging fruit in terms of environmental sustainability? What are the easiest changes that can make a significant impact? Well, I think that one of the easiest is reducing use of pesticides. I mean, that to me, that's the easiest in in eliminating the use of the most harmful herbicides like Roundup glyphosate. Also not spraying as a regular routine, but paying more attention to the vines and what's needed when. So often growers have a schedule. They've always done it this way. Their father did it that way, and they spray on a schedule. So spraying when it's needed or adding, what the vine needs when it's needed and not just in in general. So pesticide management, I think it's critical to maintaining soil balance and for the health of workers and the surrounding communities. Wine growers have a unique opportunity to contribute to the health of their immediate environment when they adopt processes that are less chemical intensive. We have another question from the audience. What is the first step towards corporate social responsibility that a company should take the first, for any company, it's really deciding what's, what we call in this sustainability, what's material? It's also a financial term. What's really material to your business? What's critical to your stakeholders? To your executives, to your investors, to your employees, to the community. What do they see as critical? They'll I mean, if you ask them, they'll come up with a long list of things. And of course, the business then has to prioritize But that's the first step. What's really critical in terms of our sustainability program? And then secondly, I believe, integrating sustainability into the supply chain. If every business figured out how to how, where along its supply chain, there were environmental issues, social issues, community issues, and sought to address them just for the supply chain, that would cover, I would say, eighty percent of a company's business. And then, of course, there's distribution of the value chain beyond just supply and and production, but, but looking at your supply chain, after deciding what's most material to your business. So wineries and other businesses have to take a lot of steps we talked about not only implementing the best management practices, but all of the record keeping that gets involved with getting certified how do you recommend that businesses educate their customers on their sustainability and corporate responsibility initiatives? How do they communicate the value of these programs? Yeah. I mean, the language of growing of greening has become really commonplace in marketing across many business sectors, and, of course, with the wine industry as well. And growers and producers in the supply chain, really, they they know the benefits of sustainability. But how do we make those benefits apparent to consumers? That's really the question. And that's not been all that successful, frankly, within the wine industry. The in terms of wine sustainability, specifically, the marketplace remains confused by the terminology of sustainability. There's organic. There's biodynamic that's made with organic grapes. There's organic wine. And then they're sustainable. So, essentially consumers have not valued these initiatives in the industry by purchasing sustainably produced wines in the way they've adopted fair trade or shade grown or organic certification in other agricultural and consumer products. So it's critical for the industry to be more transparent. And to undertake smart communication strategies, to encourage cooperation across wide regions, and avoid proliferation of sustainability labels. You know, all these various regions have their own labels and their own programs. And so I think there is room for collaboration perhaps not harmonization, but really much more thinking in terms of the consumer and the retailer. And perhaps the wine industry could benefit from a sustainability rating system that would be easier for consumers to understand. Perhaps we should adopt a new approach to wine marketing and provide shoppers with what I call an at a glance rating for sustainable farming practices. An easier methodology for communicating sustainability beyond some of a lot of the technical terms that we talk about. And often sometimes the negative terms we talk about climate change and, you know, health impacts of chemicals. So this could be accomplished by establishing a new, simple, universal, global rating system for sustainability, sort of like Olympic medals or lead designations of platinum gold, silver, and bronze. This this could be linked to quality wine ratings, and it could help dis consumers make informed decisions, about buying wine that sustainably produce and select a wine that's appealing to drink with their friends and family, but it's also, sustainably produced. So a wine rating system is something I would recommend. Thank you so much, Sandra. I feel like we could talk for hours more on this. For anybody who's interested in learning more, Sandra has published the business of sustainable wine, how to build brand equity in a twenty first century wine industry. So be sure to check it out. Thank you so much, Sandra, for your time. We really appreciate all of your insights. And thank you, Remi, for your insights as well. Listen to the Italian one podcast, wherever you get your podcast. We're on SunCloud, Apple Podcasts, Himalaya, them, and more. Don't forget to subscribe and rate the show. If you enjoy listening, please consider donating through Italian One podcast dot com, any amount helps cover equipment, production, and publication costs. Until next time.