Sustainable Resource Management: A Report on Monsanto's Sustainability Approaches

This report is based on the sustainability approaches of Monsanto, a global modern agriculture company. It outlines the various social and environmental issues faced by the company and the initiatives taken by the company to handle them. The report also provides recommendations on how to address the triple bottom line.

Sustainable resource management

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Contents
Abstract................................................................................................................................... 2
Introduction about MONSANTO................................................................................................2
Stakeholders............................................................................................................................. 3
Issues and actions..................................................................................................................... 6
Triple bottom line or MSDG goals..............................................................................................7
Social and environmental issues using the GRI index....................................................................8
Recommendations: How do they address Triple Bottom Line?.....................................................12
SWOT and TOWS analysis......................................................................................................13
Strategies, approaches and ethics..............................................................................................13
Bad Publicity.......................................................................................................................... 14
Conclusion............................................................................................................................. 15
Appendix............................................................................................................................... 16
References............................................................................................................................. 20
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Abstract
This report is based on the sustainability approaches of the company named Monsanto which
is the leader of producing the agricultural products and tools for the farmers and suppliers.
This report outlines the various social and environmental issues faced by the company and
the initiatives taken by the company to handle all these issues. The sustainability report of the
year 2016 has been reviewed to analyse the sustainable development goals of the company
and the approaches used by the company to gain the sustainable competitive advantage. At
the end of the report, some of the recommendations to address the triple bottom line as well
as to address the ethical approaches have been given.
Introduction about MONSANTO
Monsanto is a global modern agriculture company and it is an American based multinational
agricultural biotechnology Corporation having its headquarters at St. Louis Missouri. This
company basically help the farmers all around the world to grow their crops by effectively
utilizing the energy, water and land.
The company believes that innovation has the great potential to bring a balance between the
human beings and sources of our planet. However, the company believes in three core values
which are integrity, respect and transparency. In this company, more than 20000 employees
are working across the world and it is providing its facilities in 69 countries. The company is
committed to a carbon neutral footprint by the year 2021. This company was founded by John
Francis queeny in the year 1901.The company started as manufacturer business
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chemicals,and then in the year 2000 to 2009, the company started focusing on the agricultural
field by introducing Chemicals for the agriculture sector. There are many types of products
offered by the company such as crop seed, glyph sate herbicides and row crops. Monsanto is
the first Agriculture company across the globe that introduce the second generation
biotechnology create products and the revenue of the company is around dollar $ 14.64
billion(Mayes, 2010).
Stakeholders
Stakeholders are playing a very important role in running the business successfully. These
stakeholders are affected by the actions of the company. Stakeholders of the Monsanto
Company are customers, investors and shareholders, employees, competitors, suppliers and
government agencies. However, Monsanto Company maintains the ethical culture that
respond to the primary as well as secondary stakeholders. Moving ahead, the marginal,
overlooked and the underestimated stakeholders also identified. Marginal stakeholders are
those which are highly affected by the firm's actions such as employees, investors and
farmers(Monsanto, 2017). Talking about overlooked stakeholders, then there are three types
of stakeholders includes internal stakeholders, customers and external stakeholders. On the
other side, underestimated stakeholders are those which are highly neglected by the company,
but they are important for the actions of company. Some of the stakeholders of Monsanto
Company are mentioned as below:
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1. Investors or stockowners:
The below list is the list of top 10 investors of the Monsanto company with the percentage of
the stock and origin. The maximum percentage of the stock is held by the Fidelety
management and research i.e. 9.01%.
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2. Competitors
Competitors are also the major part of the Monsanto company and major competitors
analysed for Monsanto Company includes multinational giant Dow chemical
Company(DOW), agricultural genomics firm Evogene Ltd., and seed and chemical supplier
Syngenta (SYT), based in Switzerland.
3. Customers
Monsanto Company has the direct relations with the consumers. The company’s direct
primary customer is the Farmers and agricultural product traders.
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Issues and actions
Monsanto Company worked with the business for Social Responsibility (BSR) in order to
identify the sustainability levels exist in the company. There are many social and
environmental issues faced by the company such as climate change, integrity and
transparency, food security, use of the less natural resources, and less focus towards the work
and society, and decrease in the food availability and access. Modern agriculture is the
sustainability approach of the company that provides support to the farmers by providing
them some digital tools and the company believes in the fact that “growing better together”.
This sustainability approach involves the three main goals or approaches for the company,
which is better planet, better life, and better partner(Grant, 2005).
According to the report of sustainability of the company 2017, various facts and figures have
been identified that explains the contribution of the company towards handling various social
and environmental challenges. The company adopted sustainability approaches towards the
various social and environmental issues faced by the firm. The environmental issues that
faced by the company includes climate change, natural disasters and less protection for the
animals and birds. The company took a lot of initiatives to handle these kinds of the issues.
Looking at the facts and figures from the sustainability report, the company has taken the
following initiatives:
 Established more than 70% habitats for monarch butterflies
 Company invested more than US $5 million on the Honey Bee health research,
 Building strategies towards at the achievement of carbon neutral food front by the
year 2021
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 Continued to help the farmers use one by third here resources for unit and
 Company improved its overall irrigation water application efficiency to 77%.
 Also, to handle the environmental issues the company can initiate to manage the 89%
of the waste from landfills.
Moreover, social issues that company faced are related to the food availability and impact of
the company on the society and towards the life of farmers. In order to tackle these
challenges, the company is:
 Providing training to the more than 2.5 million smallholders farmers,
 Helping 5 million resource poor farmers’ families and
 Improving the food quality and increase the availability 1.5 million people.
 Targeting the 100K farmers across the 400 village in India.
Triple bottom line or MSDG goals
This is true with regard to the company that it refers to the Triple bottom line or Modern
sustainability development goals (MSDG). These sustainability approaches or goals are
agreed upon the 2030 development agenda of the United Nations, UN global compact, and
sustainable development goals. The company and its work are contributed to each of the
sustainability development goals. There are six Sustainability goals have been identified
through the extensive mapping process out of which the company identified the three main
MSDG goals which are found more significant and the relevant to the business of the
Monsanto(Lengreth, 2009).
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1. Better planet: The Company has the aim to make this planet better by handing all the
environmental issues. The company is taking actions against the climate change and
the natural disaster issues faced by the company.
2. Better lives: The second MSDG goal of the company is to make the lives of the
farmers and society better. The company is focusing to provide the food availability
facilities to the farmers and the society by providing training to the smallholders’
farmers, by helping resource poor farmer families and by improving the food quality
and increase the availability to millions of people in a year.
3. Better Partner: The most important sustainable goal of the company is to work with
the integrity and transparency by undertaking the clean water, hygiene and sanitation
projects.
Social and environmental issues using the GRI index
The sustainability report of Monsanto Company is prepared in accordance with the GRI
index which is a global reporting initiative that includes the various elements important for
the organizational reporting. There are many issues related to environment and social has
been faced by the organization and the company took initiatives in order to handle these
risks. All the important aspects of the environmental and social category have been described
in the following table which show the indicators of the global reporting initiative (GRI).
Environmental issues:
 Climate change: Climate change is the biggest challenge faced by the company as it
has a direct impact on the agriculture as well as on the humanity. Monsanto Company
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is totally dependent on the agriculture industry, so it is better to take care of this
challenge as it will lead to some of the effects such as drought, extreme heat, rise in
the sea levels, flooding and the changing weather conditions.
 Water: Ensuring the access and usage of clean and fresh water is the other
environmental issue faced by the company.There are around 70% of the water is
consumed by the human beings in the production of crops and other agricultural
activities. There are many areas in the world facing the scarcity of the water due to
the greater demand and because of the growing population(Monsanto Limited, 2001).
 Biodiversity:The term biodiversity is defined as the variations in the life on this
earth. There are millions of the plants, animals and the other species which are
essential for the growth and the feeding of the increasing population. The company
facing challenges as there is very low protection and preservation towards the
biodiversity.
 Greenhouse gas emissions:The change in the climate also leads to increase the
percentage level of the gas emissions such as it increases to 24% of the carbon
dioxide in the environment. Therefore, the goal of the company is to reduce the
greenhouse gas emissions by 22% during crop production. By the year 2016, the
company still focusing on to reduce the levels.
 High wastage:During the production of the food and working towards various
projects, the company faced a high wastage of the products. The company need to
control the food waste, pesticide waste, fuel waste for the healthy life and
environment.
Social issues
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Social issues that company faced are related to the food availability and impact of the
company on the society and towards the life of farmers. In order to tackle these challenges,
the company is providing training to the more than 2.5 million smallholders farmers,helping
5 million resource poor farmer families and improving the food quality and increasing the
availability 1.5 million people. According to the category of the GRI Index G4, the social
issue category includes the following aspects(Singh, 2010).
Labour practices: there are many issues have been faced by the company related to the
employees and their safety. The employees are the assets of the company and their health and
safety is on the highest priority. Some of the challenges faced by the company include the
high rate of injuries, poor performance of the employees because of the low rewards and the
carelessness of the employees.
Food quality: the food quality is highly affected because of the excessive use of the
pesticides for the production of crops and plants. However, it leads to affect t the health and
well-being of the employees in a negative way.
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From the above table, we have compared the environmental and social aspects of the two
companies: Monsanto and Dow Company. The data is compared on the basis of the
environmental aspects such as energy consumption, emissions of gases and waste
management initiatives taken by both the companies. This data has been derived from the
sustainability reports of 2016 of Monsanto Company and Dow Company.From the
comparison of the two companies and its Global reporting initiatives G4 index, it is clear that
the company is successful in handling all the social and environmental issues(Hague, 2017).
The company is fulfilling its responsibilities towards the society and environment. The above
data shows that the Monsanto Company and its initiatives are better than the Dow Company.
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Category: Environmental Monsanto DOW company
Total energy consumption 24,900 Million GJ 51,330 Million GJ
Water use 18,000 millions of Ml 3,060 millions of Ml
Emissions 267 millions 301 millions
Waste and effluence 2.27 millions Treatment of 1.6 million
metric ton
Category : Social Monsanto Dow Company
Employment 20,000 10338
Occupational health and safety Severe injury rate down from
48% in 2011 to 4% in 2016.
34% reduce the rate of
injury in 2015 and 22%
reduce in the year 2016
Diversity and equal
opportunity
64% males and 36% females 15% females and 85%
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Recommendations: How do they address Triple Bottom Line?
Triple bottom line is the accounting framework that basically focusing on the three main
dimensions which are social, environmental and financial. This framework is also known as
the framework of 3P’s includes people, planet and profits. After analyzing the sustainability
report of Monsanto Company, it is analyzed that the company focuses on people, planet and
partners. In the Sustainability report of Monsanto Company, financial part has been ignored.
Company doesn't mention anything about the capital required to take initiative towards the
social and environmental issues. There are many ways to improve the sustainability report
structure. The company can add financial part as well as the cost incurred on the initiatives
taken by the company. Some of the recommendations to address the triple bottom line are
given as below:
 Triple bottom line is basically an accounting framework so it is important to add
the information related to the business capital income, cost and another financial
measure that company have.
 To address the triple bottom line, it is very important that company should
compare its financial performance with the industry in order to calculate the
difference the initiatives. The comparative analysis will help to analyze the
current company situation and the future goals. On the basis of the current
situation, the company can set the goals for the future and continued to work
towards initiative.
 The company should elaborate some more economic measures that can be taken
to deal with the bottom line such as income expenditure, Taxes, employment and
other business diversified sectors. Some of the elements that need to be included
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in the sustainability report are personal income, cost of employment, revenue by
sector, employment distribution by sector(Howell, et al., 2009).
SWOT and TOWS analysis
It has been analyzed that some of the strengths of Monsanto Company are its strong research
and development capability, leading the market in the production of agricultural seeds,
efficient supply chain network, strong brand portfolio and strong alliance with BASF. The
weakness found for the company is that it has the limited market share because of stiff
competition. Moving to the opportunities and threats for the company, then the company
have the opportunity to focus on Soybean and Corn seeds also and have the growth
opportunities in the Asia Pacific and African regions. Some of the threats for a company are
its increased competition as well as the environmental regulations that prohibit the customers
to use certain products of the company(Grant, 2009). TOWS is the another tool which is also
used to analyze the strengths, opportunities, weakness and strength, but it involves the
strategies which can be made by utilizing the strength and weaknesses of the company. There
are four types of strategies which can be built by combining all the factors such as SO
strategies, WO strategies, ST strategies and WT strategies. (Refer appendix 1 and 2)
Strategies, approaches and ethics
Ethical theories, approaches and strategies are found on the priority in the company.
According to the report, there are three main approaches identified as a priority in the
company which are better planet, better life and better partners.Monsanto Company also
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focuses on the code of ethics to address the critical issues. There are many strategies which
can be used to gain a sustainable competitive advantage some of the strategies are:
 Effective supply chain management of the company need to be expanded and should
focus more numbers of suppliers and farmers.
 The company should also adopt the advertisement strategies to promote the company
strengths,create awareness among the people, suppliers and farmers about the services
provided by the company. The company has the option to use social media as one of
their strategy for the promotion of the products of the company(Team, 2017).
 Other strategy recommended for the company is to expand the business in the Asian
and African region because of the greater potential of growth for Monsanto Company.
Bad Publicity
The bad publicity with regard to the company involves various ethical and unethical aspects.
Monsanto company also been in the news because of many reasons and some of them reasons
are its food safety, corporate responsibilities and quality of seeds. There was a news highlight
related to the company and that reflect as that “Monsanto seeds are evil”. This is a bad
publicity as it spoils the image of the company which is the unethical practices(Then, 2013).
For instance, there are many complaints has been also received from the people and also
government found this industry as a harmful effect on the people and their health. In France,
the company imposed a ban on the company because of the customer complaints, low quality
of the products.
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Conclusion
Monsanto Company worked with the business for Social Responsibility (BSR) in order to
identify the sustainability levels exist in the company. There are many social and
environmental issues faced by the company such as climate change, integrity and
transparency, food security, use of the less natural resources, and less focus towards the work
and society, and decrease in the food availability and access. Modern agriculture is the
sustainability approach of the company that provides support to the farmers by providing
them some digital tools and the company believes in the fact that “growing better together”.
This sustainability approach involves the three main goals or approaches for the company,
which is better planet, better life, and better partner.
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Appendix
SWOT matrix
Strengths (S)
S1. Strong research and development
capability
S2. leading the market in the production of
agricultural seeds,
S3. Holds the dominant position in the
industry
S4. Strong brand portfolio and
S5. Strong alliance with BASF
Weaknesses(W)
W1. Limited market share
W2: high cost of the production
W3. Supply chain of the company is very
weak
W4. Negative and false advertisement in the
countries like France
W5. Poor decision making under the political
pressure affecting the performance of
company
Opportunities(O)
O1. Company have the opportunity to focus
on Soybean and Corn seeds
O2. Growth opportunities in the Asia Pacific
and African regions.
O3. Strategic acquisitions can increase the
cash flows.
O4. Expansion of the company in the Latin
America and India to enhance revenues
because of the highly agricultural oriented
Threats(T)
T1. increased competition
T2. Environmental regulations
T3. Government rules and regulations
T4. Imposing of ban on the crops
T5. Demands for the reforms from the
department of agriculture.
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places.
O5. Enhance and improve the chemicals and
procedures in the area of biotechnology.
TOWS matrix
Internal factors
External factors
Strengths (S)
S1. Strong research and
development capability
S2. leading the market in the
production of agricultural
seeds,
S3. Holds the dominant
position in the industry
S4. Strong brand portfolio
and
S5. Strong alliance with
BASF
Weaknesses(W)
W1. Limited market share
W2: high cost of the
production
W3. Supply chain of the
company is very weak
W4. Negative and false
advertisement in the
countries like France
W5. Poor decision making
under the political pressure
affecting the performance of
company
Opportunities(O)
O1. Company have the
opportunity to focus on
SO strategies
SO1. Enter and establish the
WO strategies
WO1 Establish strong
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Soybean and Corn seeds
O2. Growth opportunities in
the Asia Pacific and African
regions.
O3. Strategic acquisitions
can increase the cash flows.
O4. Expansion of the
company in the Latin
America and India to
enhance revenues because of
the highly agricultural
oriented places.
O5. Enhance and improve
the chemicals and procedures
in the area of biotechnology
brand name in Asia pacific
and African regions. (S4,
O2)
SO2: Start production of the
Soybean and corn seeds. ( S1
and O1)
SO3. Bring some change in
the production procedures
and chemicals ( S1, O5)
network of supply chain
WO2 Acquire the strategic
planning to manage the cash
flows
WO3 improve or refine the
sales marketing approaches
in the Asian countries.
Threats(T)
T1. increased competition
T2. Environmental
regulations
T3. Government rules and
regulations
T4. Imposing of ban on the
crops
T5. Demands for the reforms
from the department of
ST strategies
ST 1: organize strong
marketing and advertisement
campaigns to stay
competitive in the market.
ST2: increase focus on the
sustainability and innovate
new products to meet
demands of the reforms
WT strategies
WT1: Improve the supply
chain and procurement to
handle the competition.
WT2: Monsanto should also
focus on the government
rules and regulations to
control the bans and bad
publicity.
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agriculture. ST 3 Alliance with other
companies or government
bodies also to handle their
rules and regulations.
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References
Grant, 2009. An exclusive focus on sustainable agriculture, Available at:
https://www.usasean.org/sites/default/files/uploads/aboutus/csr/members-reports/
Monsanto.pdf
Grant, H., 2005. 2005 Pledge Report: Seeding values, Available at:
http://www.monsantoglobal.com/SiteCollectionDocuments/CSR_Reports/
MonsantoPledgeReport-2005.pdf
Hague, T., 2017. International Monsanto Tribunal Advisory Opinion, Available at:
http://www.monsanto-tribunal.org/upload/asset_cache/189791450.pdf
Howell, V., Gleklen, J., Letzler, K. & Aguilar, D., 2009. Competition and Innovation in
American Agriculture, Available at:
https://www.justice.gov/sites/default/files/atr/legacy/2010/03/09/254997.pdf
Lengreth, R., 2009. The Planet Versus Monsanto, Available at:
https://www.forbes.com/forbes/2010/0118/americas-best-company-10-gmos-dupont-planet-
versus-monsanto.html#230ca40f10dc
Mayes, R., 2010. Monsanto company: buy recommendation, Available at:
https://fisher.osu.edu/supplements/10/9160/2010-winter-monsanto.pdf
Monsanto Limited, 2001. Monsanto company: 2001 annual report, Available at:
https://bib.kuleuven.be/files/ebib/jaarverslagen/Monsanto_2001.pdf
Monsanto, 2017. Annual report: A limitless perspective, Available at:
https://monsanto.com/app/uploads/2017/05/2016_monsanto_annual_report.pdf
Singh, T., 2010. Monsanto: from a strategic perspective. Business Strategy Series, 11(2), pp.
90-99, Available at: https://www.emeraldinsight.com/doi/abs/10.1108/17515631011026416
Team, M., 2017. Growing better together: sustainable report, Available at:
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https://monsanto.com/app/uploads/2017/12/Monsanto_CSR_2017_Executive_Summary.pdf
Then, C., 2013. Analysis of the data submitted by Monsanto to the Indian authorities on
genetically engineered maize MON89034 x NK603, Available at:
http://www.greenpeace.org/india/Global/india/report/MON89034_x_NK603_application_Ind
ia3.pdf
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