Food With Integrity

0

In 2001 the company adopted the slogan “food with integrity” to describe its approach to sourcing and preparing ingredients. Chipotle prepared all food on-site from raw ingredients, which were responsibly sourced from producers that used sustainable, humane practices. We believe that food can be a source of inspiration, community and connection.

ADVERTISEMENT

Food With Integrity

Chipotle has grown to become a staple of fast-casual dining. This growth and loyal fan base reflects in part the company’s insistence on sticking to core values of sustainability, or sourcing food ethically and locally. At a time when social and environmental awareness is increasing, Chipotle finds itself at an advantage. By prioritizing its core values, it demonstrates ethical businesses can be profitable businesses. I recently spoke with Chipotle’s CFO, Jack Hartung, about Chipotle’s sustainable business credentials and how his company has committed to greater investment in digital technology, customer experience and employee benefits like debt-free college and tuition reimbursement.

Jeff Thomson: Sustainability was one of the biggest business concerns of last year and is set to be even bigger this year. How does Chipotle, a company long known for its local sourcing, combine concern for sustainable and ethical practices with a robust bottom line? What is the CFO’s role in doing so?

Jack Hartung: Chipotle has long been committed to “Food With Integrity,” starting when we were a much smaller, private company. So, while the movement toward sustainability has become more popular recently, it’s been part of our DNA for decades. We built our business and our brand around this ethos, and we partnered with like-minded suppliers and farmers to build a unique and efficient supply chain around Food With Integrity which could grow with us. And because raising real food, using sustainable methods, typically costs more, from the earliest days we found efficiencies in other areas of our business, like building smaller restaurants that cost less to build and maintain, spending less on marketing and retaining a focused menu made from just 53 ingredients.

So, you could say our business model was built around our purpose almost from the beginning, allowing us to pay more for our premium ingredients, while providing great value for our customers, and generating strong margins and returns for our shareholders. Very few businesses are able to achieve all three of these results at the same time.

Thomson: Digital transformation accelerated across industries during the pandemic. The restaurant industry saw exceptional changes because of closures that forced consumers to order carry-out. How did Chipotle use digital technology to better meet consumer demands and make for a better customer experience? How has this transformation laid the foundations for a more digital way of doing business even after the pandemic?

Hartung: Chipotle has been investing in digital technologies to create a more seamless and convenient experience for our customers even before the pandemic. Specifically, we invested to add digital make lines in virtually all of our restaurants, which is a second food line where 100% of our digital orders are prepared. So, when our business shifted from under 20% digital at the beginning of 2020 to over 70% digital in just a few weeks, our teams and our technologies were ready.

We also invested in a rewards program to engage with our customers on a more personalized basis, and we’ve continued to invest in our app to make sure it is a frictionless experience [from which] our customers become attached to re-ordering. We also increased access and convenience for our guests by [re-envisioning] the layout of our restaurants to ensure our mobile order pick-up shelves are conveniently placed, and more than 70% of our new restaurants feature a “Chipotlane,” Chipotle’s signature mobile pick-up lanes that allow fans to order their food ahead of time on the Chipotle app or Chipotle.com and pick up their food without leaving their cars. We also opened a new Digital Kitchen prototype, where 100% of customer orders will come through the digital channels.

Food With Integrity

Product quality is not just a marketing mantra for Chipotle Mexican Grill, but a menu philosophy tied to specific environmental and animal-husbandry mandates.

Those who sit down to a lunch, dinner or a snack at Chipotle Mexican Grill can learn a lot about what they are putting into their mouths by simply reading the short stories on cups and napkins in front of them. Indeed, instead of mere pithy slogans, customers gain valuable insight into the Denver, Colo.-based company’s supply-chain program.

One story entitled “Unchained” imparts Chipotle’s approach to sourcing ingredients printed on fountain drink cups. “Because of our size, we can influence for the better how livestock is raised,” it states in part. Other cups, meanwhile, are printed with information about individual farmers and ranchers who grow the restaurant chain’s products.

Sharing supply-chain components with consumers is a Chipotle philosophy whose cornerstone is about extending the chain’s message about the quality of its menu items. “We didn’t do it initially as a marketing strategy,” says company spokesman Chris Arnold of the hand-held marketing materials. “As we’ve sort of expanded our efforts with this whole idea of what we call ‘Food with Integrity’, it has matured and become a guiding principle of the way we do business and produce food.”

According to Arnold, consumers are not only hungry for high-quality foods, but for information about those foods. “We find ourselves part of an agrarian movement, with consumers more concerned about how food is grown and delivered to them. You only have to look at the success of places like Whole Foods, Wild Oats and Trader Joe’s and even in mainstream supermarkets, where organic food is the greatest growing section, to see that there is a greater awareness and growing sense of importance of the issues surrounding raising food,” he says.

“Food with Integrity” evolves

As Arnold notes, the “Food with Integrity” program at Chipotle began, well, rather organically.

A few years ago, after enjoying ongoing success since its founding in 1993, executives at Chipotle were looking at how to improve a particular product, the shredded pork used for company burritos, hard and soft tacos and burrito bowl salads. ”It was borne out of having a menu item that wasn’t selling well — our carnitas. In looking to make that better, we found the farmers of Niman Ranch. We happened on them through an article in a magazine that led us to try the pork,” Arnold recalls.

Chipotle chief executive officer Steven Ells made the choice personally. “Steve ordered the pork to cook with and loved it, and he visited the farm and saw what he liked. He said, ‘This is the type of thing we should be doing and supporting,’” says Arnold. What so impressed Ells, in addition to the quality of Niman Ranch pork, was the way in which the Calif.-based company raised its animals, from feeding practices to the land on which the hogs roamed.

Beyond reflecting what Chipotle considers the right thing to do from an animal welfare standpoint, such practices also correlate directly to finished product eating experience, notes Arnold. “I think it makes a significant difference. When you raise animals the way the Niman Ranch farmers are raising them, the meat ends up being better. There is more back fat on the animals to help them weather the elements and they have exercise that makes for better pork,” he says, adding, “But ultimately and more importantly, they live enjoyable lives because they are all on open pasture and deeply bedded barns where they get to be pigs. There really is something to that husbandry.”

The Niman Ranch experience was an “aha moment” with a ripple effect throughout the Chipotle supply chain, according to Arnold. “After we did that, we felt that fresh wasn’t important enough, that we have to buy ingredients that not only taste good but come from good sources, where animals are raised in a humane way. There also has to be respect for people who raise the animals and grow the product,” he remarks.

As with pork (which is also provided by other ranchers and processors, such as the Canadian supplier duBreton Farms) the manner in which all proteins on the menu at Chipotle are produced became a focus. Most of the chicken on the menu is supplied by Bell & Evans of Fredericksburg, Pa., which also supplies to natural and organic retailers like Whole Foods. Chipotle gets its beef primarily from Loveland, Colo.-based Meyer Natural Angus and Golden, Colo.-based Coleman Natural Meats, in addition to smaller processors, that can meet demand yet still provide product that is natural and raised in a humane, safe manner.

Chipotle’s “Food with Integrity” concept doesn’t end with meat and poultry items. Other animal-based products are sourced with a similar approach. “All of the sour cream we are buying is free of [recombinant bovine growth hormone] and our plan is to have the same for our cheese,” relates Arnold. “We’re concerned about any additives and are very much of the mind that not having them is better than having them.”

Meanwhile, also promoted on the restaurant’s cups is the story of how Chipotle buys organic beans and is generally helping to increase the organic bean marketplace “This year, 25 percent of the beans we buy will be organically grown. That percentage has been steadily but slowly increas­ing,” notes Arnold, adding that the company bought 750,000 pounds of organic beans last year, a 250,000-pound increase over the previous year.

The issues involved with being able to source enough organic beans are something that Chipotle grapples with across its supply chain.

“Today, all the pork we serve is naturally raised, while a little more than half of our chicken is naturally raised and 50 percent of beef is naturally raised. We are not across the board because we can’t get the supply in the way we need, but we keep growing it over time by helping current suppliers grow, identifying new suppliers and in some case working with suppliers to change practices,” Arnold explains, adding, “We are committed to taking this journey one step at a time.”

Chipotle’s influence expands

The innovative way that Chipotle Mexican Grill sources ingredients goes beyond its own menu and organization. To varying degrees, effects have been felt by its suppliers, its competitors and other processors in the meat and poultry industry.

Success has been a two-way street with Niman Ranch, for example. “When we started that relationship, Niman had fewer than 50 hog farmers participating in their program and today they have more than 500,” recounts Arnold.

Within the pork industry, meantime, what’s going on at Niman Ranch has not gone unnoticed. As Arnold points out, Smithfield Foods recently announced that the company is making changes to some of its practices. “That is an enormous step forward in the hog world,” he notes. Elsewhere in the food chain, the bean industry has felt some reverberations from demand via Chipotle, as its producers are ramping up efforts to increase the supply of organic beans.

Back in Denver, Arnold says that the company takes the role it has carved out seriously. “The more Chipotle can do with ‘Food with Integrity’, the bigger part we can play,” he observes.

ADVERTISEMENT

How do we increase food integrity?

Liz Colebrook is Mars’ Global Scientific & Regulatory Affairs Director of Food Safety; here she explores the meaning of food integrity, how Mars is driving towards a safer, healthier, more sustainable world, and how industry must progress as a whole.

supermarket
ADVERTISEMENT

There is a broad spectrum of definitions for food integrity, including one from the Department for Environment Food & Rural Affairs (DEFRA) that defines it as: “The state of being whole, entire, or undiminished or in perfect condition”. Providing assurance to consumers and other stakeholders about the safety, authenticity and quality of European food (integrity) is of prime importance in adding value to the European agri-food economy.

Professor Chris Elliot of Belfast University has also offered a definition of food integrity: “[It means] the food we produce is safe; the food we produce is authentic; it is nutritious; the systems we use to produce our food are sustainable; our food is produced to the highest ethical standards, and we respect the environment and those who work in our food industry”.

As a privately-owned company, Mars thinks and plans in generations. We are committed to helping create a safe, healthy and sustainable world for our partners and the communities in which we operate. Put simply, at Mars, we believe if it is not safe, it is not food.

[FREE WEBINAR]

Breathe easy: Reducing the effects of food dust on people, product and process safety

Join this webinar to hear from Camfil´s application specialists on how dust collection can improve process safety in your food and beverage facility by mitigating cross-contamination and protecting your employees.

You will also be able to ask our expert speakers Ross Dumigan, Food & Beverage Segment Manager, Camfil and Ulf Persson, Product Manager Air Pollution Control EMEA, Camfil questions during the Q&A session at the end of the presentation.

Integrity and trust

Integrity is about trust, and one important way to engender trust with consumers is to support robust regulation and demonstrate adherence to it.

In many countries – including the UK, USA and Australia – there are already regulations in place that prohibit the misrepresentation of food. The difficulty is that with the ever-improving testing and detection methods leading to diminishing limits of detection along with global food supply chains and e-commerce, defining food authenticity is complex and likely to become even more challenging.

That is why industry has a crucial role to play in shaping a regulatory environment that both protects consumers interests and is affordable and sustainable. One part of this involves open sharing of food safety knowledge and working together to identify risks and solutions to the long-term food safety issues impacting the global food supply chain. At the Mars Global Food Safety Centre (GFSC) we conduct original research and collaborate externally to exchange knowledge and insights in food safety to help ensure safe food for all. We currently have three key areas of focus, including food integrity, in which we have set ambitious targets for food integrity risk management, focused on developing tools and capabilities to mitigate food integrity challenges across the food industry and the global food supply chain. Programmes include developing appropriate tools and analytical methods necessary to support the prevention of food fraud and foreign material contamination risk.  

The food integrity paradox

This raises a paradox: some forms of adulteration render the food unsafe, such as the adulteration of wine with diethylene glycol; whereas adulterating wine with potable water is no less fraudulent but significantly safer: is it better to have safe but fraudulent food than no food at all?  Answering that question exceeds the scope of this discussion, but it highlights the important point that food fraud and food safety are two very different aspects of the supply chain, and both need to be considered from a regulatory perspective.  

Detection methods

Increasing globalisation has lengthened supply chains, thereby increasing the vulnerability of raw materials and products to adulteration and fraud. In order to combat food fraud successfully, the food industry, along with its regulators, are reliant upon reliable, validated and reproducible detection methods, whether these be qualitative or quantitative. 

It may be argued that the development of detection methods and their deployment should take priority over regulatory development, but detection and deployment tend to be after-event strategies and without regulation against which to hold transgressors to account, they have no ‘teeth’. Identifying and reducing vulnerabilities in supply chains maintains the integrity of supply and increases the consumer confidence that the revelation of food fraud destroys, often not only in the affected commodity, but potentially in all related items.

Regulatory development must, therefore, go hand-in-hand with the development of reliable and reproducible detection methods. Ideally, such methods would be portable, allowing them to be used ‘in the field’ as well as in the laboratory, and thus able to be deployed where they are most needed. In addition, as has been demonstrated in the world of honey, agreement on an appropriate test method is critical. In late 2019, a major UK supermarket removed product from its shelves after an enforcement authority indicated that its provenance was suspect, having used nuclear magnetic resonance (NMR) testing to authenticate the honey. Subsequently, industry experts seemed to suggest that due to the huge variability in honey, the database against which the NMR test results had been compared may not have been extensive enough. This serves to demonstrate that it is not sufficient to develop a test or detection method, but also that there must be a suitably comprehensive and robust comparative dataset in existence. 

As part of the future ‘armoury’ against food fraud, genomics is also expected to play a key role and the IBM-Mars Consortium for Sequencing the Food Supply Chain is one example of a future-focused approach that seeks to enable critical breakthroughs in food safety by helping to drive global innovation in genomics and food and agriculture.

Regulation and harmonisation

Regulators are then faced with multiple challenges: being able to respond rapidly to new developments; predicting areas where fraud is likely to become an issue in the future; and endorsing sampling and test methodologies. This presents an on-going tension, since proportionate and well-constructed regulation takes time to develop  (especially if scientific studies or opinions are required), and this can conflict with the pace of development in new manufacturing technologies and detection techniques.

It is also the case that regulation should not become a barrier to trade: global manufacturers, or even those simply exporting from one country or region to another are all too familiar with limits for additives or contaminants that vary across borders, often for no other reason than a limit was set historically that has never been challenged or reviewed. This will be of particular interest and concern to UK-based manufacturers in the coming months as the UK and European Union attempt to reach a trade deal that does not introduce unnecessary restrictions or barriers to trade.

Unless there are significant differences in consumption patterns between regions, levels that are demonstrably safe in one region should be safe in another – another reason that globally harmonised standards are required. To this end, both Codex and AOAC have initiatives for tackling food fraud: The Codex Committee on Food Import and Export Certification and Inspection (CCFICS) is discussing the development of Guidance on the Prevention of Food Fraud, whilst AOAC’s Food Authenticity and Fraud (FAF) programme focuses on identifying analytical tools to better locate and characterise the intentional and economically motivated adulteration of foods.

The future of food integrity – collaboration is key

In summary, regulators and regulations can provide the framework to increase food integrity, but only those engaged in the food industry can put the building blocks of trust and transparency in place through auditable quality systems, test methods and results.

At Mars, the world we want tomorrow starts with how we do business today. And that means a world where regulators, academia and our industry come together to share relevant data and critical insights to develop scientific capabilities that will promote trust and confidence from our consumers, and provide regulators with the science-based tools required for enforcement.

THE FUTURE OF FOOD WITH INTEGRITY: CHIPOTLE & AOF

The Future Of Food With Integrity: Chipotle & AOF
ADVERTISEMENT

Eight food-focused, growth-stage ventures selected to participate in the Chipotle Cultivate Foundation’s Aluminaries Project, to accelerate positive change in the food industry by participating in an accelerator program to take their businesses to the next level and work toward cultivating a better world.

NEWPORT BEACH, Calif., Jan. 28, 2019 /PRNEWSWIRE/ — Chipotle Mexican Grill (NYSE: CMG) today announced the first class of the CHIPOTLE ALUMINARIES PROJECT, a seven-month-long accelerator program sponsored by the Chipotle Cultivate Foundation in partnership with UNCHARTED, both nonprofit 501(c)(3) organizations. The Chipotle Aluminaries Project is part of the company’s larger efforts to invest in the future of food with integrity and will drive positive change in the food industry by offering eight growth-stage ventures the resources needed to grow and make a positive impact at scale. Each venture will receive mentorship and direct coaching from world-renowned industry leaders, participate in a boot camp, obtain a special Chipotle card with free burritos for a year, and be powered by Chipotle catering as they take their businesses to the next level.

“Since our founding, Chipotle has been committed to cultivating a better world, and we believe the best way to lead the future of food is to inspire others to come along with us on the journey and be a force for good in our industry,” said Brian Niccol, chief executive officer at Chipotle. “The eight selected companies represent the best and brightest of what’s next in the food industry, and we can’t wait to help them reach their full potential with the launch of the Chipotle Aluminaries Project.”

As a leader in the food space that prioritizes corporate citizenship, Chipotle acknowledges that no one individual or company can cultivate a better world on their own. These ventures touch all areas of the food landscape including alternative farming and growing systems; farming and agriculture technology; food waste and recovery; and plant and alternative products. The selected ventures include:

  • AGVOICE: AgVoice is the simplest way to help farmers measure good stewardship practices by using a mobile voice-interaction service that integrates with existing record-keeping apps. The service enables easy tracking of plant and animal production – at the source – to help assess positive environmental and sustainability impact.
  • AMERICAN OSTRICH FARMS: A vertically integrated producer of a better red meat, American Ostrich Farms strives to increase awareness of the resource intensity of food so consumers can make enlightened, healthy choices for themselves and the planet. Ostrich tastes like a delicious, lean filet mignon, but leaves a fraction of the environmental footprint – compared to beef, ostrich uses a third of the fresh water, one fiftieth of the land and emits less than one tenth of the GHGs per pound produced.
  • ASARASI: Asarasi produces a sustainable and renewable water that is harvested from the byproducts of maple trees, offering an environmentally friendly, organic plant-based alternative to bottled water sourcing.
  • GRUBTUBS: GrubTubs is positioned to be the nationwide solution for food waste. Its product currently allows restaurants, hotels and large cafeterias to drastically reduce what they send to landfills, helping to positively impact the environment. In addition, GrubTubs turns the food waste into insect-based animal feed, which helps farmers significantly lower food costs.
  • IMPACTVISION: ImpactVision uses hyperspectral imaging to help food businesses deliver consistent product quality, generate premium products and prevent supply chain waste.
  • NOVOLYZENovolyze develops innovative technologies to help the food industry manufacture safer food, while ensuring strong compliance with international food safety and quality standards. Its innovative approach to food safety relies on the utilization of cutting-edge microbiology solutions, combined with the latest developments in digital, internet of things and machine learning.
  • REX ANIMAL HEALTH: Rex Animal Health provides machine learning for a safer and more sustainable food supply. Using data to improve livestock health, the venture is working to reduce the 20 percent waste in animal protein production.
  • SOPHIE’S KITCHEN PLANT-BASED SEAFOOD: Sophie’s Kitchen Plant-Based Seafood creates sustainable plant-based seafood alternatives using innovative ingredients and patent-pending technology.

In March, the entrepreneurs will participate in a five-day, in-person boot camp in Newport Beach, Calif., where they will create their plans for scale and receive direct coaching from industry leaders including chef Richard Blais and entrepreneur Kimbal Musk, as well as Chipotle executives including Curt Garner, chief digital and information officer; Caitlin Leibert, director of sustainability; Laurie Schalow, chief communications officer; and Tressie Lieberman, vice president of digital marketing and off-premise.

“At Chipotle, we feel we have a responsibility and opportunity to forge a path to a more sustainable food future,” said Caitlin Leibert, director of sustainability at Chipotle. “Changing the food landscape is bigger than just Chipotle and the Chipotle Cultivate Foundation, and while we are proud of our efforts, we can’t do it alone. Together, with these ventures and the entrepreneurs of tomorrow, we know we can make a real impact.”

The ventures will have regular, one-on-one meetings with their mentors and three to four advisors committed to a minimum of six months of mentorship. In addition to investor readiness training and introductions to relevant investors, the ventures will be granted a special Chipotle card with free burritos for a year, and Chipotle catering for their office to fuel their hard work with real food made from real ingredients.

ABOUT CHIPOTLE
Chipotle Mexican Grill, Inc. (NYSE: CMG) is cultivating a better world by serving responsibly sourced, classically-cooked, real food with wholesome ingredients without added colors, flavors or other additives. Chipotle had more than 2,450 restaurants as of September 30, 2018 in the United States, Canada, the United Kingdom, France and Germany and is the only restaurant company of its size that owns and operates all its restaurants. With more than 70,000 employees passionate about providing a great guest experience, Chipotle is a longtime leader and innovator in the food industry. Chipotle is committed to making its food more accessible to everyone while continuing to be a brand with a demonstrated purpose as it leads the way in digital, technology and sustainable business practices. Steve Ells, founder and executive chairman, first opened Chipotle starting with a single restaurant in Denver, Colorado in 1993. For more information or to place an order online, visit WWW.CHIPOTLE.COM.

ABOUT THE CHIPOTLE CULTIVATE FOUNDATION
Chipotle Mexican Grill established the Chipotle Cultivate Foundation in 2011 to extend its commitment to creating a more sustainable food future. The foundation is dedicated to providing resources and promoting good stewardship for farmers; promoting better livestock husbandry; encouraging regenerative agriculture practices; and fostering food literacy, cooking education, and nutritious eating. Since its inception, the foundation has contributed to likeminded organizations committed to cultivating a better world through food.

ABOUT UNCHARTED
Uncharted is an organization using the DNA of an entrepreneurial accelerator to tackle major social problems like urban poverty and food deserts. Uncharted partners with corporations, foundations, and governments to launch entrepreneur-led initiatives targeted at solving unsolvable problems. Uncharted has helped social entrepreneurs raise $252 million, create impact in 96 countries, and benefit 37 million lives.

Leave a Reply

Your email address will not be published.

Like
Close
TheSuperHealthyFood © Copyright 2022. All rights reserved.
Close