Jason Clay

Dialogues on the Environment: Q&A with Jason Clay

In this ongoing series, I talk with thought leaders about ideas in my book Nature’s Fortune and trends in the environmental movement.

Next in the series is my conversation with Jason Clay, Senior Vice President, Market Transformation for World Wildlife Fund.

Mark Tercek: Your title at WWF is Senior Vice President, Market Transformation. Tell me about the kind of transformation you are working toward. How is that effort going? What’s next?

Jason Clay: As environmentalists, if we don’t get how and where we produce food and fiber right, we can turn off the lights and go home. There won’t be any biodiversity left to protect. We are living beyond the carrying capacity of the planet today with 7 billion people. The projections are that by 2050 we will have 9+ billion and they will consume twice as much per capita. So, even impacts that are acceptable today will not be in less than 40 years. Just to put this proposition in sharper focus, over the next 40 years we will have to produce as much food as we have in the last 8,000 years, and if we don’t freeze the footprint of food, agricultural sprawl will accelerate as the biggest threat to biodiversity and ecosystem services.

WWF works with some of the biggest companies in the world to create a global marketplace based on more sustainable production of key raw materials. We help companies evaluate their supply chains and shift their demand to raw materials produced using better practices that produce positive, measurable results on the ground. We have signed agreements with 55 of the world’s 100 largest food and fiber companies, and we’re making progress. We work on their internal impacts as well as the risks and opportunities along their value chain. Most of the work is on supply chain management, but we also focus on water, GHG emissions, waste and packaging.

Looking ahead, we need to work with groups of companies rather than just one by one so that we can improve the environmental impacts of their supply chains even more quickly. After all, sustainability is a precompetitive issue — every company depends on raw materials; it is not something that should be used to brand a product on a shelf. And we need to align these efforts with governments. Business can help raise the bar on sustainability, but we need government to push the bottom with the right policies and regulations.

Mark Tercek: You argue that big brands can help save biodiversity. How do you see that happening?

Jason Clay: To halt deforestation we need to address the threats to forests, not just build fences around them or document the losses. The single largest source of deforestation comes from food and fiber — in fact, four crops (beef, soy, palm oil and pulp) in four countries are responsible for half of deforestation globally. We have to become more strategic.

Becoming more strategic means looking at the opportunity for companies to be part of the solution. Big brands have the ability to transform markets. About 100 companies touch 25% of all 15 of the commodities for which production is growing most significantly through the expansion of the area used as well as the inputs (e.g., water, fertilizer, and pesticide) and GHG emissions. These companies have a business incentive to be more sustainable. Reputational risks are one issue, but if they want to meet growing global consumer demand for their products on a finite planet they need to insure access to the supply of raw materials. When companies like Walmart or McDonald’s make commitments to sustainability, their supply chains follow-suit. When we can get Walmart, McDonalds and the other 100 most influential companies to pool their commitments to sustainability, then we can shift entire markets. One quarter of demand will pull up to 40-50% of production towards sustainability as producers compete to sell into those markets. That’s the essence of market transformation.

Mark Tercek: You’ve led the effort to convene roundtables to identify and reduce the social and environmental impacts of products such as salmon, soy, sugarcane and cotton. How are the roundtables going? What kind of challenges do you face, and how do you overcome them?

Jason Clay: WWF is working to transform global markets for 15 food and fiber commodities whose production harms the places we seek to protect. We do this by convening multi-stakeholder groups that include the major players that produce and trade those commodities as well as retailers, brands, researchers and NGOs. Our goal is to build consensus on the most significant environmental impacts, identify the best measurable indicators of improvement and then agree on performance based standards that define acceptable impacts.

The Forest Stewardship Council (FSC) and the Marine Stewardship Council (MSC) were two of the early efforts to do this. More recently we’ve been involved in developing standards for palm oil, cotton and sugar, to name a few. By defining where we want producers to go, we can make more progress getting there. In just four years, 14% of global palm oil has been produced against Roundtable on Sustainable Palm Oil standards. More than 22% of global whitefish is produced against MSC standards.

But, this is not easy. We can’t work on everything. And, we can’t eliminate impacts, but we can reduce them to more acceptable levels. The biggest challenge is boiling down all the impacts a given industry has and agreeing on the four to six key ones.  To do this, you must ensure that a diverse, representative sample across the value chain is at the table. When we began the work on salmon aquaculture standards in 2004, three of the eight founding institutions were suing each other. Still, eight years later we were able to create the best standards that exist for the industry.

Mark Tercek: You began your career working with refugees and famine victims. Is there overlap between that work and what you do now?

Jason Clay: Actually, I began my career as a farmer living on less than a dollar a day. When I was 15 my father was killed in a tractor accident on the farm, and I had to help my Mom manage it. The more I have tried to get away from farming, the more I am brought back. Most famine victims and refugees are farmers, albeit farmers living on the edge. What most people don’t realize sufficiently at this time is that we are all farmers living on the edge of the planet’s resource base. We have pushed it to the limits and in many cases beyond. What I know from my own childhood and have seen around the world, is that if people don’t have other options, the environment doesn’t stand a chance. If it comes down to saving a tree or feeding your child, the tree will lose every time. We need to insure that there are other, better choices.

So, there is a significant overlap between my past and what I do today — though the road has not necessarily been a very straight or obvious one. By managing our planet more effectively, we can help improve standards of living.

This is long overdue in many parts of the world. In Africa, if we don’t find ways to produce more food with less land, less water, and less inputs, much of the forest and grassland that wildlife depend on will be converted to feed an increasingly crowded and hungry world. One way WWF is working to meet this challenge is to improve the productivity of crops Africans depend on most for food. Together with NEPAD, Mars and the Beijing Genomic Institute, we are identifying the 100 most significant food crops in Africa, mapping their genomes, placing the information in the public domain and training 90 plant breeders annually to get better planting materials to farmers. This is just one example in a suite of strategies that need to be pursued simultaneously to scale up food production and maintain the planet.

Mark Tercek: We clearly agree that business can be a constructive ally to the environment. What can we do to fully leverage that potential?  

Jason Clay: To fully leverage that potential, NGOs like WWF and TNC need to work collaboratively to show companies how their operations impact the planet and how they can work with partners along the value chain to improve those impacts. It’s one thing to show them the problem; it’s quite another to roll up our sleeves, take them to the field and show first-hand how their demand for palm oil, beef, soy, pulp, paper and animal protein more generally is fueling deforestation and habitat destruction. We need to demonstrate how more sustainable production not only reduces reputational risks, but increases efficiency and the long-term supply of raw materials that they need if they want to stay in business. Such an approach drives change for both the environment and the private sector.

But here’s the thing, what is needed now is not just change in the private sector, but also change in NGOs. How many NGOs are “fit for purpose” to solve 21^st century problems? Most have become good at solving 20^th century problems, but we’re not in the 20^th century any more. The speed of life, as exemplified by the growth of the BRIIC economies, is moving faster than the response of environmental NGOs. Going forward, 15,000 projects will not solve our problems. The need now is to transform systems so that they are more sustainable. We can start with the private sector, because more than any other sector it has a long-term, vested interest in getting this right. Eventually, however, we need to engage government to move the bottom in order to manage the entire planet more sustainably.

Mark Tercek: I argue in Nature’s Fortune that focusing on nature as investment opportunity can build more support for conservation, provide a source of capital and an opportunity to scale up. What risks and opportunities do you see in this approach?

Jason Clay: Well, it’s a finite planet. I don’t see another one, and as the old saying goes land is always a good investment because they’re not making any more of it. There is tremendous opportunity in putting a monetary value on nature. This is not only true of the resources that we buy and sell like fish, timber and minerals, but also the resources like land and water that we use to produce other products. As incomes and consumption increase, the price on such resources will increase. In fact, pricing water, like land, would insure that we begin to use it more efficiently than we do today where it currently takes about one liter of water to make one calorie of food. However, we also need to begin to put a price on environmental externalities too, e.g., GHG emissions, soil erosion, bioaccumulation, pollution, etc. This would allow us to address the actual costs of production, not just the raw materials that are currently bought and sold along the supply chain.

All of this is a good start — and it would be better than what is happening today. But it is not enough. And, we can’t manage biodiversity, protected areas, wildlife corridors and riparian areas with current market mechanisms. We can’t manage ecosystems and landscapes on a farm by farm basis. We will need other solutions to address those issues, but the journey we are on is heading in the right direction — efficiency, more with less, productivity, measuring what matters, engaging the private sector and beginning to find market mechanisms to price environmental externalities, working with government to illuminate illegal products and support land use planning and sustainable trade.

As the saying goes, if you don’t know where you’re going, any road will get you there. We have a pretty good idea of where we need to go and what the timeline is. We can do more, for sure, but better is better.

Read Mark’s interview with Gretchen Daily about natural capital.