APAC Lead (Supply Chain Compliance), Neste
Agri-food organisations are striving to meet the current generation’s needs using the available resources, while also battling global concerns such as population growth, climate change, poverty, and food insecurity among several others. Their problem-solving efforts also focus on the adoption of sustainable practices by producers to ensure that the future generations have enough to provide for their own needs. However, sustainability requires a holistic approach that focuses on the three primary pillars of economic viability, social equity, and environmental protection, which correspond to profits, people, and planet respectively.
Our thought leader shares with us today his learnings and experience working with diverse organisations with respect to the various sustainability measures adopted by them around the world. Read on to know more.
In Conversation With
Kavickumar Muruganathan joins us today with remarkable experience in the agricultural industry, specifically in the paper and pulp industry, the natural rubber sector, and the palm oil industry. He engages in supply chain sustainability and compliance from a corporate perspective and currently heads the APAC division for Supply Chain Compliance at Neste. Kavickumar played an active role in the concerted boycott efforts on unsustainable products from errant companies that had resulted in forest fires and the regional haze in Singapore in 2014. The NGO-led effort was recognised as a national movement, and the residents have not witnessed forest fires and haze of that scale since then. The spur to inspire positive change and create equality in our food value chains motivates him to work continuously in the sector. He also regards that the current lopsided value distribution needs to be corrected to ensure that farmers also have sustainable livelihoods and are not mired in poverty cycles. Kavickumar believes that there is a lot of room for creating positive change in this industry through investments not only in monetary terms but also from strategy, knowledge, and technological perspectives. This definitely requires a many-hands-on-deck approach and he aspires to play a positive role in this process.
Having been the head of the Singapore Environment Council’s (SEC) eco-certification unit, what would you say are some of the challenges that businesses face in ensuring sustainable production of products?
Kavickumar Muruganathan: The key challenge is matching the demand with supply. Eco-certifications are by large voluntary schemes. Certification requires cost and hence there generally tends to be a pullback when an organisation wants to certify its products. On the other side of the coin, the challenge remains in generating demand; what is in it for end-users to buy these certified products that are often priced at a premium? The other concern would be performing your role as a certification unit to weed out products that are attempting to or deemed to greenwash.
Two of your key areas of expertise are Sustainable Finance and ESG Risk. Could you tell us a little about both of these and how they can drive a significant change in the way companies can make a positive contribution to society?
Kavickumar Muruganathan: These two areas are interlinked in some ways but both are loaded with content and discourse as they have come closer to the core of businesses over the years. I believe that in the next 5-10 years, sustainable finance will become the norm for any financial institution. The challenge would be to ensure that this form of finance trickles to all hierarchies of society. As for ESG risk, it is constant flux. Companies will take a deeper dive into ESG issues, which will play a more mainstream role in their business decisions and investments.
How can the agrifood sector in low- and middle-income economies implement circular agriculture as part of an approach to facilitate the sustainability of the food system? What impact would it have on the environment?
Kavickumar Muruganathan: I see circular approaches more feasible and implementation-worthy in low- and middle-income societies primarily in the way they create value for them. Value is subjective. Agri-food supply chains generate a tremendous amount of waste and by-products where value can be captured. Governments, industries, and civil society actors can work together to put in place levers to enable circular agricultural approaches to take off.
What has your experience been like with traceability systems in the agroecosystem? What kind of difference is it making to smallholder livelihoods in different parts of the world?
Kavickumar Muruganathan: There has been a plethora of traceability systems and tools flooding the agribusiness sector. While it has created more transparency and visibility in agri supply chains, the multitude of tools have left businesses in a quandary over which to use. Traceability systems and toolkit providers have to collaborate better to ensure their solutions are more scalable, intuitive, and cost competitive. They have to provide more value to end-users, predominantly in terms of creating positive impacts in agri supply chains.
One of the primary challenges for smallholder farmers seeking financial support is that they are often considered too small for institutional investors and too large for microfinance organizations. In addition, the risks involved in agriculture make it even more difficult for them to secure financial aid. Considering that these farmers are key to ensuring food security, how can this particular challenge be addressed?
Kavickumar Muruganathan: This requires a fundamental transformative shift in mindsets relating to traditional banking and financial products and services. Until this happens, smallholder farmers will continue to face difficulty in securing capital to take their business to the next level. We are seeking a general dearth in financial investment for replanting efforts, crop disease mitigation, and, more importantly, climate change resilience. A change will not only ensure food security but also combat climate change.
“Seeds of Thought” is our thought leadership series, where we interact with opinion leaders in the field of agriculture and related sectors to gather their insights on agricultural developments and prospects in their region.
The views and opinions expressed in the interview above are solely those of the individual involved and do not necessarily represent those of CropIn Technology Solutions or of any entity that the individual is or has been affiliated with.