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0409 PD: I-29 Dairy Conference discusses sustainability

Loretta Sorensen Published on 25 February 2009

Increasing U.S. and global pressures are creating a need for individuals involved in animal agriculture to successfully build and communicate an ethical foundation for their operation and engage in value-based communication with the public that builds trust and protects their freedom to operate.

That’s the central message Charlie Arnot, president of CMA, brought to the 4th Annual I-29 Dairy Conference in Sioux Falls, South Dakota on Jan. 29.

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Arnot’s company is a leader in issues management, public relations, strategic facilitation and marketing communications specializing in food and agriculture. He said growing questions about production systems and practices are making it imperative for dairy producers to provide clear, positive answers to questions about animal welfare, sustainability, pre-harvest food safety and immigration issues related to their dairy operation.

“Until the late 20th century, we produced food using an agrarian model,” Arnot said. “Millions of producers sold commodities to local buyers who then aggregated loads, took them to a packer or processor, and that processor then sold them to a regional or local brand. That model made it difficult to get an efficient market signal to the producer because so many different people were involved in that process. The only way an activist group could change producer behavior was through legislation.”

In the current system, an industrial model, the link between activist groups and producers is much more direct. The top 50 dairy cooperatives produce 79 percent of the country’s milk. Adoption of technology, consolidation and integration have dramatically changed how the food system operates and is perceived by consumers. Non-governmental organizations (NGOs) such as Greenpeace and The Humane Society of the United States (HSUS) are utilizing market-based campaigns in addition to legislation and litigation to achieve their objectives.

“If livestock production practices are perceived to be a threat to sustainability or environmental integrity, organizations like Greenpeace can be expected to exert market pressure as well as legislation or litigation to change those practices believed to threaten environmental sustainability,” Arnot said. “HSUS is one of the most respected and effective NGOs impacting animal agriculture. Their adopted strategies appeal to the rational majority, and they distance themselves from radical groups like PETA in an effort to attract and maintain mainstream support. The result is a membership base of 10 million and a 2008 operating budget of $138 million.”

California’s recent adoption of Proposition 2 is an example of HSUS influence. The legislation received more support than any of the state election’s other 12 ballot initiatives and was supported by two-thirds of California voters. In 2008, HSUS promoted animal-related legislation in 28 states using mainstream messages.

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Because of the activity of groups like HSUS, animal law courses are developing and growing in more than 90 colleges and universities. Branded food companies around the globe are listening to NGO messages and investing millions of dollars to defend their brand and reduce or eliminate practices that put their brand at risk.

“Companies who sell products derived from food animals have a vested interest in a consistent, safe and affordable supply,” Arnot said. “Research indicates consumers want to continue to consume meat, milk and eggs. They also want permission to believe the products are produced in a responsible, humane manner.”

Arnot noted that dairy producers, as part of their overall operation, must develop and implement activities that maintain their social license. Social license is defined as the privilege to operate with minimal formalized restriction based on maintaining public trust by doing what’s right.

“You are granted social license when you operate in a way that’s consistent with the ethics, values and expectations of your stakeholders,” Arnot explained. “Your stakeholders include customers, employees, the local community, regulators, legislators and the media. If we don’t operate in such a way that the public does put their trust in our practices, social license will be replaced with social control. We’ll see more and more regulation, legislation and litigation designed to compel us to perform to expectations of our stakeholders.”

Arnot pointed to Enron as an illustration of how an industry loses its social license. Prior to the Enron debacle, the accounting industry relied on the Financial Accounting Standards Board to regulate CPA activities. Following Enron’s implosion, Congress replaced the industry’s social license with the Sarbanes-Oxley Act, which requires extensive reporting and verification of financial information by publicly traded companies.

“The recent collapse of the sub-prime lending sector is likely to cost the home mortgage industry its social license,” Arnot said. “We won’t know the exact level of social control until Congress enacts new laws, but costs to the industry, home buyers and society is likely to be substantial.”

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With financial support from the National Pork Board, Arnot’s company partnered with Iowa State University to develop a model that food animal producers can use to build trust. Three key elements identified in the study include confidence, competence and influential others.

“Confidence is four or five times more important in building a relationship with consumers,” Arnot said. “Competence is based on scientific facts that demonstrate that producers are operating the way they should. We don’t want to abandon science. We need to be competent. At the same time, we have to understand that values and ethics are the foundation for trust. Consumers want to know that we share their same values. They don’t care how much you know until they know how much you care.”

Arnot pointed out that many consumers’ perception of the agriculture industry is based on what they experienced as children. They believe farming operations today should look much like they did in the 1950s.

“They don’t recognize current production methods, and they’re not sure they should like them,” Arnot said. “The lack of understanding that exists provides a vacuum that’s filled with misinformation. We must help our consumers build trust in contemporary farming systems.”

Other speakers at the conference included Jason Brockshus of Brockshus Dairy in Ocheyedan, Iowa; Dennis Haubenschild of Haubenschild Farm in Princeton, Minnesota; Dennis Johnson of West Central Research and Outreach Center; Rick Naczi of American Dairy Association and Dairy Management, Inc.; Jim Salfer and Jim Paulson of University of Minnesota Extension; Alvaro Garcia of South Dakota State University; and Donna Moenning of Midwest Dairy Association.

Brockshus discussed activities he and his family have used on their dairy to practice stewardship and build community relations. He noted that sustainable dairies add stability to their community, provide a good work environment for employees and add value to neighboring farm businesses and the community in general.

Haubenschild shared information about the manure digester he and his family have maintained on their farm for the past 10 years. He is currently testing the durability of a fuel cell and using bio-gas from the digester to fuel a farm pickup.

Johnson offered insight on the characteristics of sustainable dairies that will survive an uncertain future. He noted that three central characteristics of successful dairies include the fact that they are profitable, environmentally friendly and build community.

Naczi provided some dairy facts that helped farmers understand how sustainability activities impact the dairy industry and discussed some of DMI’s current research projects. Salfer and Paulson provided a presentation discussing the relationship between economics and sustainability, and Garcia offered some practical ways producers can reduce energy use. Moenning provided presentations on the value of strong relationships, industry resources and community interaction. PD

Sorensen is a freelance writer in Yankton, South Dakota.

Loretta Sorensen

Freelance Writer

Yankton, South Dakota

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