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Case Study Polarbröd: The Two Tiers of Sustainability

by Anna Borgeryd on 27th November 2012

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Editor’s note: In this article Anna Borgeryd of Polarbröd gives her perspective on what it would mean for the Swedish bread company to become truly sustainable – in a world with limits to growth. Any reader who has visited Sweden is likely to have seen or eaten the company’s characteristic round flatbreads, which are available at most grocery stores.

Growing up in the family business Polarbröd, now the third largest bread company in Sweden, and providing our customers with the typical breads of Northern Sweden, I learned a lot about creative disagreement. My mother and father –both intensely engaged in the task of making use of the opportunities and solving the problems that constantly faced them– rarely started out in agreement about what path to take. But when they finally agreed on a plan of action, it was usually a good one, and if it did not work out, this solid process left them with an ability to quite quickly identify the second best option. With a childhood like that, and with an inclination towards strategic thinking in an effort to help humanity, it was quite natural that I developed a keen interest in problem solving and went on to university and a PhD in conflict management. Now, as Chairman of the Board, I’m part of the fifth generation at the helm of Polarbröd.

Working in food supply, we have come to understand a distinction at the heart of the problems we face today. It concerns sustainability efforts. What I call Tier 1 sustainability is when what’s good for the bottom line is also good for the environment. Tier 2 sustainability, however, means that there is a short-term incompatibility: we have to choose between economic success and the environment.

Polarbröd has a long tradition of juggling many goals. Profit is important, yes, but we regard it as a means towards other ends – spreading the bread culture of Northern Sweden, maintaining integrity and long-term thinking, and providing local jobs.

When my sister Karin and I assumed principal ownership of the company, we commissioned The Swedish Institute for Food and Biotechnology (SIK) to investigate our impact on the environment. This was around the time that Al Gore told us all the Inconvenient Truth about global warming. We hardly dared to tell our mom that we wondered whether it was ethically defensible to bake bread in Norrland and then sell most of it to customers hundreds of kilometers to the south. For her, providing local jobs in the North was always the highest value.

SIK conducted a life cycle analysis for us, and its conclusions were reassuring:

  1. Food production is a necessity
  2. Bread is one of the very best foods (only root vegetables and apples have lower climate impact).
  3. Polarbröd’s efficient hydro-powered bakeries, where we freeze the bread directly after baking to maintain quality and reduce waste, and the way we transport our bread to market using return freights – when possible by rail – offset the environmental impact of our distance-to-market.  All of these factors meant that Polarbröd’s climate impact on a par with other bakeries.

So can we conclude that all is well? My family has been baking for 133 years. Do the results of the SIK study mean that Polarbröd is sustainable for at least another five generations?

Unfortunately, no. It only means that we are in the essential bread business, and that we are good at resource efficiency – that is, making as much as possible with the resources we have.  This is what I call Tier 1 sustainability. It is the easy part – when the prevailing economic logic is in harmony with ecology.  This is what people mean when they say that “it is profitable to be environmentally friendly.” But today, we are reaching the absolute limits to growth as set by nature. In this situation, it is very clear that Tier 1 sustainability is not enough.

A mere one hundred years has fundamentally changed western societies and created unprecedented purchasing power.  This graph depicts shares of spending on different goods and services in Finland, beginning in 1900 and ending in 2005.

graph of goods and services                  Fig. 1: Statistikcentralen, Finland
Categories from left to right: Food, beverages, clothes & shoes; Housing, household items; Communications; Recreation and leisure time; Other expenses

 

As late as 1920, people were spending as much as 70% of their income on food and clothing. In 2005, people in most industrialized countries needed to spend less than 20% of their incomes on these goods, leaving them with plenty of income to spend on other things like housing, communication, and recreation.

This has been possible thanks to the industrialization of agriculture. Unfortunately, this system of food production is unsustainable – it has slowly but surely been undermining itself. Agriculture is the main driver behind all of the most serious transgressions of our safe space for development – including the release of greenhouse gasses and the eutrophication of water. Because 40% of the earth’s land, and much of its freshwater, is devoted to agriculture, it is also the main driver of biodiversity loss.

safe operating space for humanity

Fig. 2: Johan Rockström et al, A Safe Operating Space for Humanity, Nature, Sept. 2009.

Because our wealth-producing agriculture is environmentally unsustainable, it is beginning to crumble. Food yields are threatened by global warming and overuse of land and water, and food reserves are soberingly low. We urgently need to tackle Tier 2 sustainability – that is, we need to remodel the way we provide for ourselves so that we do not inflict more harm on the biosphere. This seems obvious and urgent. And yet – undertaking this transformation is not profitable. For instance, it will for cost a lot more to grow our food sustainably.

When we asked researchers in agriculture what science considers to be sustainable, we were surprised to hear that it is in the eye of the beholder, different people mean different things by “sustainable agriculture”. So our first task was to define what we mean by those words. On the basis of a report written by our analyst Cindy Kite, the board of Polarbröd concluded that we should take four aspects of agricultural production into consideration when we source our inputs: closed systems thinking, protection of ecosystem services, fossil-fuel independence and carrying capacity. Some say that this ambition is unattainable, but what is the alternative? We are now in the process of asking our suppliers what wheat, for example, we can buy with these criteria in mind and at what price.

Another area in which we are active is greater efficiency in transports, for instance keeping a larger share of our bread frozen all the way to the remotest grocery stores, so that we need fewer miles on the road per ton of delivered bread.  Together with partners we will also be testing distribution by electric truck in the city of Uppsala and working to increase the share of bread distributed by rail, even if it may be more expensive than the present distribution system.

However, Polarbröd is small, and the problems of the world are huge. If humanity is to implement the costly Tier 2 sustainability adjustments in time and on a sufficient scale, urgent political decisions are needed. We need new laws to protect the biosphere’s capacity to support life. When goods and services are produced in a sustainable way, they will cost more, and we will thus be forced to consume less. Industrial productivity and economics of scale will have to be weighed against higher distribution costs when our modes of transportation are entirely powered by renewable energy. But I’m sure that there are many of us, in business too, who realize that this is the best way forward. And, these laws will be particularly welcomed by those who can provide for basic human needs in the most efficient and eco-friendly ways.

I believe that Polarbröd can be sustainable in a world in which there are no unpaid external costs, but I realize that no one can know for sure. What if, in such a world, we can’t transport food from the south of Sweden to Norrland – let alone bananas or coffee from much farther away? In that case, there will be no return freights to fill with our hydro-power produced, freshly frozen bread. Polarbröd, like any other human enterprise, will be able to truly answer the question of whether or not it is sustainable only when prices reflect true costs, and we compete in a market economy aligned with the biophysical laws of nature.

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avatar Anna Borgeryd is a creative strategist with a PhD in conflict management, and as Chairman of the Board she is part of the fifth generation at the helm of Swedish family business Polarbröd. Growing up in the intensely entrepreneurial home that helped put the typical breads of Northern Sweden on the food map, she went on to academia. Her university life included a fruitful year at the Institute for Conflict Analysis and Resolution at George Mason University in Virginia, and the publication of her doctoral dissertation Managing Intercollective Conflict. Now working in the family business, she continuously takes an interest in global issues and systemic problem solving, now focusing on prevailing economic structures and how to secure our systems of food and energy supply. She is often asked to lecture on sustainability. Visit her online at annaborgeryd.tumblr.com

Anna has written 1 posts on Post Growth Institute.

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