In Baking & Snack’s study “The State of the Industry: Sustainability Commitment in US Wholesale Baking,” conducted by Cypress Research, survey respondents from baking, equipment and ingredient manufacturer companies were asked to weigh in on their company’s engagement with initiatives across environmental, social responsibility and governance priorities. These findings were reported in a webinar, “State of the Baking Industry: Sustainability and the Future of Baking” that is available on demand. 

When it comes to issues of governance — managing company structure, policies and growth — most of the wholesale baking industry reported that their companies were participating and measuring its progress in these initiatives. Governance initiatives for the study included financial performance reports, clear company values and purpose, regular monitoring of company performance, cyber risks and mitigation strategies, annual reports, risk management, formal ethical standards and board diversity. 

Across all three industry sectors, more than 80% of professionals reported that their companies engaged in all initiatives, except one. Financial reports, clear company values and purpose, regular monitoring of company performance, and cyber security risks and mitigation were the top four. In some of these areas, 100% of supply chain partners reported engagement. 

Board diversity was the outlier when it came to governance initiatives. Fifty-five percent of baker respondents, 60% of ingredient suppliers and 42% of equipment suppliers reported their companies were engaged or developing their plan for this initiative. That’s compared to the next lowest percentage, which was 83% of bakery respondents reporting their companies were engaged in annual reports and formal ethical standards. It’s a significant gap, but not one that’s surprising looking at boards across all US industries. 

“I would say [diversity] is one area that many companies, manufacturing or not, for-profit and nonprofit alike, struggle to address, pushing it lower on the company priority list,” said Marjorie Hellmer, president of Cypress Research, during the webinar. 

The baking industry isn’t an exception compared to other US industries, but the fact that just more than half of baking companies and ingredient suppliers report they’re engaged in or going to be engaged to improve board diversity in the future suggests that the industry sees this as an important issue to be addressed. 

“An important role of a company board is decision-making, and each individual offers their unique ideas, solutions and strategies,” Ms. Hellmer continued. “For boards with a more diverse membership, the breadth of personal experience is wider and more comprehensive.” 

Governance saw the smallest gap between companies reporting engagement and companies setting formal, measurable targets for initiatives. However, there are still 20-point gaps between the existence of initiatives and impact metrics such as formal ethical standards and board diversity, suggesting these are opportunities where the industry can grow. 

The industry may have some marked places to improve when it comes to the three pillars of sustainability, but this research suggests that bakers and their suppliers aren’t sticking their heads in the sand. Industry professionals see the connection between sustainability initiatives and their business success and are in the process of making the commitments necessary to contribute to a healthy planet, workforces and communities.