How does a vegetable processing company go green?

For KBC Commercial Banking, the food industry is one of eight priority sectors for sustainability. The sector has its own specific challenges and is looking for sustainable solutions to enable it to secure food production for generations to come. Two operators in this sector are among the KBC Commercial Banking customers that have already made great strides towards achieving this: Ardo and Agristo, Belgian global players in frozen fruit, vegetables and herbs, and frozen potato products, respectively.

Ardo:

• The result of a merger of two companies from one family, founded in Ardooie, Belgium, in 1960 and 1968, respectively
• Has 20 branches in nine countries
• Exports to some 100 countries
• Has 4 000 employees and 3 500 growers
• Processes nearly 1 million tonnes of fruit, vegetables and herbs a year
• Recorded turnover of 1.2 billion EUR in 2022.

Agristo:

• A family business founded in Harelbeke, Belgium, in 1985
• Has five branches in Belgium and the Netherlands, one branch in India
• Has 12 sales outlets worldwide
• Has 680 customers in 145 countries
• Has 1,200 employees, potatoholics
• Produces 850 000 tonnes of finished products per year
• Recorded turnover of 900 million EUR in 2022.
   

Food processing companies thus face a major challenge: drastically reducing their own climate impact, encouraging their suppliers to do the same and, in addition, dealing with the negative impacts of climate change. And they should preferably do all this without sacrificing profitability. How do they do that?

Ardo and Agristo do not see sustainability as an isolated objective, but rather as something that is embedded in their overall business strategy and leadership. They also interpret it more broadly than simply making their production greener: just as important is raising awareness among their employees, for example. Anthony Wallays, founder of Agristo: ‘Sustainability is part of our DNA. ‘We come from farming families and we were taught from an early age to look after nature and to treat it with respect.' Ardo published a sustainability report long before this was mandatory. So sustainability is a wide-ranging narrative for both companies; for the moment, though, we will focus on the particular challenges facing their sector.

The challenge here is to consume less water, reuse more water, and tap into alternative sources. For instance, the companies reuse treated wastewater for cooling. Ardo has a water basin measuring some 150 000 m² at its site in Ardooie, with surrounding farmers using the plant's treated water for irrigation. Agristo uses treated water from the River Lys at its Wielsbeke site and discharges it back into the river after treatment. ‘And in Tilburg, we cooperate with other companies for water treatment,’ says Antoon Wallays. ‘This is more efficient because our wastewater is complementary due to a difference in waste materials. That opens the way for are even more partnerships.’

The challenge is to consume less gas and electricity and maximise the use of green energy, self-generated or otherwise. Emilie Haspeslagh, Sustainability Director at Ardo: ‘There are around 5 000 solar panels floating on the surface of our water basin, but that’s nowhere near enough to enable a major consumer to become energy-neutral.’ Ardo has invested in two plants that convert residual waste such as vegetable peelings into bio-methane to generate energy. They use the residual heat to heat their offices. They plan to replace their energy-guzzling production lines with new, more economical systems.
Agristo recovers heat from process water and extracts energy from the combustion of non-recyclable wood waste, using a heat network it built in partnership with another company. For the future, the company is looking among other things at hydrogen, heat pumps and wind power. There are still some hurdles to be overcome for those solutions, though, says Ward Claerbout, External Relations Manager at Agristo: ‘Industrial heat pumps aren’t quite there yet. And what about wind energy? The procedure for obtaining a permit for a wind turbine is often so complex that companies don't both.’

There’s also room for experimentation. For example, Agristo is thinking about carbon farming, in which carbon is stored in the soil on farmland, as a way of helping agriculture to be part of the solution, not just part of the problem. Ward Claerbout: ‘A lot has changed already, including things we thought were impossible a few years ago, such as the ban on certain preservatives. We can’t change the whole sector, but we can launch pilot projects and work with sector federations.’ Gabrielle Kalkwijk also adds a caveat: ‘Food that is grown more sustainably is usually more expensive. Our experience is that neither retailers and consumers are sufficiently willing to pay that higher price yet.’

Waste from vegetables and potatoes is inevitable, but it need not go to waste. Both companies process the peelings into animal feed. Agristo is looking to go a step further and process potato leftovers into potato flakes and, in the near future, into potato flour, both for human consumption. The company is also exploring whether proteins from potatoes could be used to create for plant-based meat substitutes, for example.

The foregoing describes some of the concrete solutions that are being explored to help create a more sustainable future. Companies are also required to report on their sustainability efforts, and Europe sets the bar high in this regard. With the CSRD (Corporate Sustainability Reporting Directive), since last year there has been an extension of the reporting requirement that already existed for large listed companies. From 2026 - and in some cases from as early as 2024 - large companies will have to report on their impact against environmental, social and governance (ESG) criteria, as well as the impact of ESG standards on their business. This has implications for virtually all companies, since they will all have to provide information. How do the people at Ardo and Agristo view this? Emilie Haspeslagh: ‘There is still some ambiguity; a clearer definition would be welcome. Reporting is necessary, but mustn’t be made too complex. We’re able to free up people for that, but what about SMEs?’ According to Ward Claerbout, the reporting duty is positive in that it makes you think. ‘On the other hand, there’s a danger of being overwhelmed by the deluge of legislation and reporting requirements. that’s something the government needs to think about. Reporting on its own doesn’t make anything more sustainable; the time spent compiling reports could also be used for things that actually contribute something concrete.’

Any final tips for fellow entrepreneurs? Emilie Haspeslagh: ‘The United Nations has defined 17 Sustainable Development Goals (SDGs). Don't try to tackle them all; choose your battles.’ Ward Claerbout: ‘Seek out partners and partnerships, as we did for our alternative water sources. We’re chip-makers, not water experts.’ (laughs)

Gabrielle Kalkwijk and Emilie Haspeslagh (Ardo) and Antoon Wallays and Ward Claerbout (Agristo) were the speakers at one of the events organised by KBC to inspire and challenge its customers by sharing the experiences, passions and achievements of fellow entrepreneurs.