The ChainLetter: Volume 9 Issue 5

Dear Colleagues, The 2011 Frankfurt conference is shaping up to be an outstanding international congress. The Forum will focus on how sustainable global food chain practices lead to new business opportuni-ties. Sector experts will conduct concurrent breakout sessions following the keynote present-ers. These sessions will involve all attendees in a spirited dialog of give-and-take. Several opportunities will be provided for industry attendees to interact with students through a breakfast and lunch interchange. The Symposium will feature scholars presenting their latest research and several opportunities to observe both Harvard Style teaching and research cases. A conference update follows on page 2. Frankfurt 2011 will be the leading Food and Agribusiness conference of the year and you will learn new information which can be applied to your future planning.

New initiatives are making progress. Chapters are being formed in Atlanta, New Mexico, Guelph and others are in the development stage. The first strategic alliance is functioning with Produce Marketing Associa-tion (PMA) and this will lead to increased membership, involvement with more agriculture growers, and help in the development of the Human Capital Program for IFAMA. Mike Boehlje is Chairing a Committee on Sus-tainability and Eluned Jones is Chairing a Committee on Global Economics for PMA. Discussion Forums are a new offering by IFAMA and can be found on our web site under “Get Involved.” Perhaps you are interested in joining or leading a focus group in the Bio-tech Forum or Women in Agriculture?

IFAMA publications are gaining worldwide attention. Readership of IFAMA’s journal, The International Food and Agribusiness Management Review is now nearly 12,000 and many of the authors are providing innovative video introductions which have received many favorable comments. The selection of topics and the quality of the writing has been excellent, as the Journal continues its commitment to building scholarship.

Thank you for your support of IFAMA. Your Board, Executive Committee and IFAMA staff are committed to making this organization forward looking and useful to you in your profession. Please send any suggestions or comments you have to Russell Garrett in the IFAMA Busi-ness Office and we will discuss them in our weekly conference call.

IFAMA has changed the membership fees making it easier to join. The new annual membership dues are provided below. For information on corporate and institutional memberships please visit our websitehttps://www.ifama.org/membership/MembershipFees.aspx

New Membership Fees

Effective October 1, 2010, IFAMA is offering new fee categories for professional, young professional and student membership levels:

Individual Professional Annual Membership FeesIncome level greater than US $75,000 -------------US $150Income level between US $25,000 and $75,000 ---US $75Income level less than US $25,000 -----------------US $25

Young ProfessionalIncome level greater than $25,000 US Dollars -----US $75(Limit to three years after joining IFAMA and under 30 years of age).

Student Annual Membership FeesFull-time student -----US $25

IFAMA President ReportPaul T. Jasper, CEO Covered Logistics Transport, LLC

November 2010Volume 9, Issue 5

The ChainLetterInternational Food & Agribusiness Management Association Newsletter

IFAMA’s President’s Report.........................................................................12011 Conference Update........................................................................2-3Tapping a Growing Global Dairy Market............................................. 4Thank You 2010 Conference Sponsors................................................. 5Sustainability Initiatives Across the U.S. Agri-Food Supply Chain By R. Brent Ross................................................................................. 65th International European Forum (Innsbruck-Igls).........................72010 FEP Trip and Local IFAMA Chapters Update..............................8Executive Interview: Jukka Kola By Ligia Kawano-Williams........................................................ 9LEEDing by Example ( A Sustainability Story) By Lauren Turk............................................................................11

Inside This Issue

2011 Conference Update

Frankfurt, Germany - June 20-23, 2011

Conference Co-Chairs : Josef Haber, BASF and Gerhard Schiefer, University of Bonn

IFAMA is pleased to announce that Josef Haber, Value Chain Manager for the Agricultural Products Unit at BASF, Germany and Gerhard Schiefer from the International Center for Food Chain and Network Research at University of Bonn are the 2011 conference Co-Chairs. The theme of 2011 has shifted from financing food and agribusiness in uncertain times to how business opportunities of the future can be found through taking the lead in ensuring a sustainable global food chain.

This conference will highlight sustainability as a business approach and showcase some of the long-term thinking and strategies that leading food and ag finance companies are employing for the future. Other topics will include the issues of volatility and commodity prices, private standards, and ethics in sustainability, value creation and innovation.

The second day of the conference will explore sustainability as a policy and governance issue through the challenge of globalization-small and medium stakeholders, food safety, land management and efficiency. The Food and Agriculture Organization (FAO) will again offer a compelling presentation for 2011 that builds upon a topic they introduced during the 2010 IFAMA conference in Boston. How are small and medium firms dealing with the same supply chain management, logistical, quality assurance and innovation challenges faced by European and North American firms but on a smaller scale and in a business climate that makes it difficult to complete on supply price alone?

Jose Antonio Boccherini, Director of the Agribusiness Department at the Instituto Internacional San Telmo, Spain, will present a HBS style case study during a concurrent Forum session. Both days of the Forum will utilize concurrent breakout sessions for greater audience participation and feedback facilitated by sector experts following keynote presentations. Drawing on the vast expertise of conference participants, these sessions are designed to stimulate small group discussions and further solution oriented problem solving and application. This approach has proven to be both stimulating and engaging for conference attendees.

The Symposium has received nearly 200 scientific paper proposals to date and is extending the deadline until November 29th. For more details see, the Symposium update.

Building upon the success of 2010 conference, Novus International will host a Student-Industry breakfast and lunch during the 2011 conference. Students will receive a case/problem two weeks prior to the event in which they can research the issue, the firm and prepare for group discussions. Informal discussions will occur during a hosted breakfast and a formal discussion will ensue on the mini-cases during a Tuesday lunch. More information will follow.

The conference venue is at the Frankfurt Marriott. Additional information on Symposium paper submissions, Student Travel Grants and Student Case Competi-tion can be found on our website: https://www.ifama.org/events/conferences/2011/Default.aspx. Speaker information, session descriptions and conference registration will be available early January 2011.

The Road to 2050

Sustainability as a Business Opportunity

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Co-Chairs: Melanie Fritz , University of Bonn and Jay Lillywhite, New Mexico State University

IFAMA invites the submission of proposals for participation in the 21st Annual World Symposium until November 29, 2010.

The Symposium utilizes paper presentations, discussion sessions and poster displays to provide an intellectual foundation for discussions that take place during the Forum.

The Symposium program is structured for paper submissions judged on quality and relevance to managers and executives in the food system. It will include a “Best Paper” competition in conjunction with the IFAMR, IFAMA’s academic journal, as well as, poster sessions and case studies.

Special Call for Harvard Style Teaching Cases

Co-Chairs: Jose Antonio Boccherini, Instituto Internacional San Telmo and Melanie Lang, University of Guelph

The Symposium will again offer a Case Conference track. The extended deadline for Research Cases is November 29, 2010.

The Case Conference is directed at a broad audience of professionals who are interested in developing effective agribusiness cases and using them as learning tools, as well as those interested in specific case topics.

IFAMA is extending a special call for teaching cases which utilize the Harvard style teaching case format. The Symposium will showcase four unique cases in a hands-on session, each covering one teaching case.

The deadline for Harvard Style proposals is December 22, 2010. Submit-ters of Harvard Style proposals will be notified by January 31st if their case has been selected for the showcase. The Case Conference Co-chairs will work with the authors to develop the case. The cases will be available for review prior to the sessions. Authors not selected for the showcase will still have an opportunity to present during the case conference.

Please visit our website for complete details and submission instructions.

Student Travel Grants

Student travel grants are available to help undergraduate and graduate stu-dents defray registration and travel costs to attend the 21st Annual Forum and Symposium in Frankfurt, Germany.

Candidates must be able to demonstrate a professional interest in food and agribusiness and must be currently enrolled as a full-time student in an agricultural program, or related field of study.

Student travel grants are awarded on a competitive basis. The total number and dollar amount of awards depends on sponsorship funding received by IFAMA. Conference registration fees will be deducted from the grant and the remainder provided in US Dollars on the last day of the conference. Travel grant recipients must attend two mandatory meetings at the conference and complete a student project during the conference to receive their funds.

More information and applications can be found by visiting our website. Please submit completed applications to the IFAMA Business Office: [email protected]

Student Case Competition

IFAMA is now accepting applications for participation in the 2011 Student Case Competition. The competition is part of the IFAMA Annual World Symposium, which will be held in Frankfurt, Germany on June 20-21, 2011.

The Student Case Competition provides students an opportunity to showcase their skills to industry participants and gives universities a venue to show-case their students. The competition consists of teams who simulate a fast turn-around analysis and presentation to a senior management team on a corporate hot topic. Teams are limited to 4-5 participants. The deadline for team registration is March 1, 2011. For more information and an application, please visit our website: https://www.ifama.org/events/conferences/2011/Default.aspx

The Chain LetterNovember 2010

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TRAVEL GRANT

APPLICATIONS DUE

January 19, 2011

DEADLINE EXTENDEDSymposium Submissions

November 29, 2010

Symposium Update2011 Conference Update-Continued from Page 2

“There has been a convergence of milk prices globally since about the year 2000, and especially since 2007,” says Campbell (see farm gate milk price chart). “We are now in a global marketplace. The marginal consumer and marginal producer can be anywhere in the world. Barriers to world dairy trade are falling. There are fewer regulatory issues and lower internal supports.“

“It is really a different situation from 15 years ago. For instance both EU and U.S. dairy stocks have declined,” he says. That’s one reason why the volatility of world milk price has increased as much as seven-fold since the end of 2006 compared with the previous decade or so.

This means milk supply will be more closely linked to demand, but on a global scale rather than a local one. Fonterra is proactively seeking to be “the source of dairy nutrition for everyone everywhere everyday,” says Campbell. New Zealand, at 15 billion liters and the eighth largest producer, is quite small, but it exports 95% of its milk production, he says.

As a result, “Fonterra is taking a very long-term view to create sustainable cooperative performance for the next generation,” he says.

“We are focusing on creating lasting customer partnerships everywhere in the world –and particularly in our ingredients business. Where it makes sense, we are sourcing milk from producers outside of New Zealand.”

Fonterra also has developed trusted consumer brands in New Zealand, Australia and Asia. Campbell believes the United States, which has traditionally been more focused on its own domestic market will become a more significant player in the world dairy mar-ket. “The U.S. can respond quickly to rising demand because of its feed base,” he explains.

“Countries that rely more on pasture, such as New Zealand, are not able to push production as promptly.”

Tapping a Growing Global Dairy MarketBy Linda Smith, Markets Editor, DTN

Global milk production is about 680 million metric tons, with the EU-27 the leading producer at 150,000 tons followed by India, which produces 105,000 tons of cow and buffalo milk; and the United States at 85,000. Below that level of production there is a quite large gap to the next tier.

Global Milk Production

Source: Fonterra

“We expect global demand for milk to grow,” says Paul Campbell, general manager of strategy at Fonterra, a large dairy cooperative in New Zealand that markets globally. “Gross domestic product and dairy consumption are linked, especially in developing countries where people seek to add protein. Asia has continued to be a tremendous growth market. There are several countries with very wealthy populations.

Farm Gate Prices Paul Campbell

The Chain LetterNovember 2010

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Confidential to Fonterra

World Milk Production (2009) – 680 Million Tonnes….

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

Global Milk Production (,000 t)

The Chain LetterNovember 2010

Page 5However, as the world market integrates, “there will be tremendous opportunities for both Southern and Northern Hemisphere producers to capitalize on their different seasonal production cycles.”

Managing Volatility

Every step in the supply chain requires new efforts to manage the new market volatility, Campbell says. Farmers must pay close attention to their balance sheet and are seeking new ways to stabilize their farm income. Co-operatives are using price pooling and forward contracting; developing more diverse product mixes; spreading sales and even sourcing geographically. Customers looking to manage their margin volatility are also spreading purchases geographically and adopting more complex forward purchasing strategies, in addition to hedging nondairy inputs.

Fonterra is a dairy co-operative, 100% owned and controlled by its farmer suppliers, with an individual farmer’s ownership based on that farmer’s quantity of supply. Fonterra’s co-operative heritage goes back to the formation of the first farmer-owned and controlled dairy co-opera-tive in New Zealand (1871). On formation (2001), the capital structure of Fonterra evolved from that of its legacy companies in that the value of its shares were based on a fair market valuation rather than valued nominally. In 2010, Fonterra’s farmer owners voted to move to a share that was tradable between farmers-maintaining 100% farmer ownership and control of the co-operative.

Linda Smith is Markets Editor for DTN. You may contact her at : [email protected].

Fonterra at a Glance

4 $12 billion revenue 4 3,000 customers in 140 countries4 10,500 farmer owners (in New Zealand)4 20 billion l/year milk (14 billion New Zealand)4 23% of New Zealand’s export income4 Strong consumer brands in New Zealand, Australia, and Asia

[ Note: this is USD]

Thank You 2010 Conference Sponsors and Supporters

Growing Global Dairy Market-Continued from Page 4

Sustainability Initiatives Across the U.S. Agri-Food Supply ChainThe Chain LetterNovember 2010

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R. Brent Ross, Michigan State University

Increasingly, many major U.S. agri-food companies are joining their Eu-ropean counterparts in incorporating sustainability initiatives into their overall global supply chains. There are many reasons why companies may choose to implement these initiatives. For some, these initia-tives might be viewed as the necessary costs of securing a “license to operate” in a particular market or of protecting a brand that represents as much as 60% of market value of the company. For others, adopting sustainable practices may simply be the “right thing to do”. In these cases, companies may be trying to manage the trade-off between acting environmentally and socially responsible while maintaining profitability.

A growing number of agri-food companies, however, don’t view sustainability and profitability as trade-offs. Companies such as Nestlé, The Coco-Cola Company and Sysco Corporation instead have imple-mented sustainability practices as part of their core global supply chain strategies. For these companies, sustainability is seen as an important source of competitive advantage and profitability both for today’s ultra-competitive marketplace and for long-term success.

Whatever the motivation, it is clear that there has been a dramatic increase in the number of sustainability activities that have been undertaken by U.S. agri-food companies over the past few years. Descriptions of these initiatives can be found in the annual corporate social responsibility (CSR) reports of these companies. The remainder of this article provides a review of the sustainability initiatives that have recently been reported by selected agri-food companies across the supply chain. The results of this review are summarized in the table below and provide several interesting insights about the nature of sustainability at U.S. agri-food sector.

The first insight is that, for the most part, the focus of sustainability initiatives has been towards environment concerns (pollution-reduction, resource minimiza-tion, etc.), employee issues (compensation, work environment and diversity) and charitable donations. Less prevalent have been initiatives directed towards supply chain governance, food safety and supplier diversity. It is interesting to note that each company participates in at least four of the focus areas, while most have implemented programs in six or more.

What is unclear from these CSR reports is how these activities are linked to the competitive strategies of their respective companies. This is not uncommon. In fact, studies in other industries have reported that the typical approach has been for companies to select sustain-ability initiatives in a ‘hodgepodge’ manner without consideration to the link to their company’s competitive strategy. The result has been that such companies are unable to create (or reinforce) a competitive advantage from their sustainability activities and ultimately, the deci-sion whether to implement these initiatives has become a cost-benefit analysis with distinct trade-offs or is viewed as a necessary cost of doing business. This approach would appear to be consistent with the CSR programs that many of these select agri-food companies have implemented. Furthermore, this would also indicate that there are opportunities for some of these agri-food companies to capture ad-ditional value from their sustainability programs.

Key Sustainability Initiatives Mentioned in the CSR Reports of select Top Agri-Food Companies

PepsiCo Coca-Cola Cargill ADM Tyson Smithfield Walmart Kroger

Environmental Concerns* (GHG emissions, water, waste) x x x x x x x x

Food Safety* x x x

Responsible Sourcing* (no child labor, animal welfare) x x x x x x x x

Diversity Suppliers x x x x x

Employee Benefits/Health and Safety* x x x x x x x x

Diversity Employees* x x x x x x x x

Community - Charity x x x x x x x x

Governance x x x

* indicates categories where they are significant laws and regulations

Sustainability Initiatives US-Continued from page 6

The Chain LetterNovember 2010

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Another way to analyze sustainability initiatives is to break them down by two types: 1) codes and standards, or 2) value chain innovations. Examples of codes and standards include: Global GAP, Rainforest Alli-ance Certification and Wal-Mart’s Global Responsible Sourcing Initiative. The codes and standards approach mechanism provides incentives for upstream players to adopt specific sustainability practices. These incentives may take the form of price premiums paid to suppliers who adopt certain practices or penalties such as the exclusion from the sup-ply chain for those that fail to implement required programs. As such, codes and standards may lead to the redistribution of costs and risks to upstream players.

The review of the CSR reports indicates that codes and standards are common among these select agri-food companies. Codes and stan-dards were generally used for initiatives focused on all three pillars of sustainability – environment, labor and social conditions, and economic viability – but were also used for food safety initiatives. Also notewor-thy is that these categories tend to have significant laws and regulations associated with them as well.

Value chain innovations such as The Coca-Cola Company’s manual distribution centers in Africa were less prevalent. These sustainability initiatives often took the form of downstream partners providing exper-tise and training as well as sharing market knowledge with upstream partners in return for a constant supply of sustainably produced inputs. This approach was commonly used to solve governance issues in agri-food supply chains and to ensure a constant, safe supply of inputs from

a diverse set of suppliers (or a stable market for food products). In this way, sustainability initiatives that utilize value chain innovations are often seen to create shared value which allows a company to build a sustainable competitive advantage.

Another observation relates to the level at which the sustainability initiatives are implemented. This review indicates that the majority of the initiatives that were adopted would be implemented indepen-dently either by the agri-food company or its supply chain partners (e.g. employee issues, charitable donations, environmental practices). Those category of initiatives that require a more systemic (i.e. supply chain) implementation and where shared value is mostly likely to be created, most notably food safety and governance, were noticeably absent from most of the portfolios reviewed here.

A final observation concerns the measurement of the social impact that these select agri-food firms have delivered. Amongst the reviewed CSR reports, it was common practice to report measures of the time and effort that the company had put into the program (e.g. # of initiatives, voluntary hours, dollars spent, etc.). Few of the selected companies measured or reported the actual outcomes of their activities. This may reflect the difficulty in measuring sustainability. However, reporting the outcomes of sustainability initiatives rather than time and effort allocated would allow for a more explicit representation of the value created by these initiatives.

R. Brent Ross is an Assistant Professor of Food Industry Management at Michigan Sate University, USA. You may contact him at: [email protected]

System Dynamics and Innovation in Food Networks

The 5th annual International European Forum is scheduled for February 14-18, 2011 in Innsbruck, Austria. The forum is a joint initiative by agri-food groups of leading European and international universities and business schools providing a discussion platform for the European and international scientific community. The forum features presentations and discussions in a mountain venue designed to foster creativity and new ideas for in-novative and interdisciplinary research.

An interactive focus session: Scenario Dynamics - Challenges Ahead is planned for Friday, February 11.

This session follows a format utilized in three previously successful programs: “The Challenge of Transparent Food” (2010);

“Science Meets the World of Regulations” (2009); and “Science Meets Industry”(2008).

Although the deadline for abstracts submissions has passed, there are still a few slots for registration and participation available, For more information, please contact: [email protected] Website: www.fooddynamics.org

5th International European Forum (Igls-Forum) February 14 - 18, 2011

Innsbruck-Igls, Austria

The Chain LetterNovember 2010

Page 82010 Faculty Exchange Program TripIFAMA completed its twelfth year as a co-sponsor of the annual Faculty Exchange Program this month. The field study seminar was a 16-day agri-business training field trip across the Southwestern United States sponsored by the Foreign Agricultural Service, USDA. The tour was initiated by a grant from the USDA for participants from the Ukraine and Kazakhstan with backgrounds in agricultural economics or related fields. The group has a unique opportunity to take part in exclusive, hands-on visits through a wide variety of California food and agribusiness operations and com-municate with top management. The program is structured as a class with specific objectives and a full range of topics covered.

The 2010 FEP graduates include: Natalia Grabko, Odessa State Agrarian University; Hanna Antonyuk, Lviv National Agrarian University; Sergiy Kalinichenko, Khakiv National Technical University of Agriculture; Vasyl Shukalovych, Zhytomir National Agroecological University; Roman Bezus, Dnipropetrovsk State Agrarian University; and Ainur Yesbolova, South Kazakhstan State University.

Tour leaders were Dr. William Gorman from New Mexico State University and Russell Garrett, Business Manager for IFAMA.

This year the tour included more than 15 stops to food and agribusiness firms including: Sysco Las Vegas, Los Angeles Kern County Farm Advisory Service and Water Agency, Paramount Farming Company and Paramount Farms, Grimmway Carrots and Premier Packing, Hollywood Farmers Market. Port of Long Beach, Los Angeles Wholesale Produce Market, NH3 Service Company demonstration of GPS, D’Arrigo Brothers of California, Watsonville Berry Coop, Woolf Enterprises, Sunmaid Growers, Stanilaus County Farm Bureau, San Joaquin Equipment Company, Unified Grocers, Foster Farms Milk and Ice Cream Plant, Diamond of California, American Ag Credit in Turlock, and San Francisco Wholesale Flower Market.

IFAMA Local Chapter UpdateIFAMA’s program of chapters is becoming a reality. Jim Nutt of U.S. Bank, along with a committee of IFAMA members are in the process of forming a chapter in Atlanta, Georgia. Troy Lapsys of Incitor, Inc. in Albuquerque, New Mexico, along with Professor Bill Gorman of New Mexico State University in Las Cruces are in the initial stages of putting together a chapter in New Mexico. At the University of Guelph, Canada, Professor Francesco Braga has been instrumen-tal in organizing a chapter. All of these are in the preliminary stages but should hold their first events in the first half of 2011.

Other IFAMA members have indicated interest in starting chapters in cities in Argentina, Brazil, Mexico and South Africa. IFAMA has also identified Chile, The Netherlands, Spain, Poland, India, China, Australia, and New Zealand as likely locations for city and university chapters and is looking for members who would be interested in starting chapters in those countries. For information on how to go about starting a chapter, please see the IFAMA website (www.ifama.org) or contact Michael Lapsys of IFAMA at [email protected].

For those anyone who would like more information on Atlanta, Georgia, USA, please e-mail [email protected]; for New Mexico, USA, e-mail [email protected]; and for Guelph, Canada, e-mail [email protected]

Pictured from left to right: Gimmway host: Damon Corey, Sergiy Kalinichenko, Hanna Antonyuk, Grimmway host: Bill Paulk, Vasyl Shukalovych, Natalia Grabko, Ainur Yesbolva, Roman Bezus and Bill Gorman.

The Chain LetterNovember 2010

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The Role of Education

Q: How can smaller countries with natural and labor resources disadvan-tages, such as Finland, compete with countries such as the U.S., which has a plentiful amount of resources?

A: Smaller countries must stay ahead of the competi-tion by creating and exporting innovative products and concepts of service. In order to do so, these countries must concentrate on education. Finland, for example, has achieved great economic growth by investing in the education of its population.

Q: How did Finland succeed in building an education system that allowed the country to achieve economic growth?

A: By offering quality education to all—from kindergarten through university. Due to high taxes paid by the people, the government is able to offer free services, such as education, to the entire population. The good results are confirmed by international PISA evaluations. To teach any grade, teachers must earn a Master’s or Bachelor’s degree; among other things, they learn about the stages of development and how to teach at each age. Moreover, they continue to study teaching throughout their career. Because the teachers are so well qualified, they have the ability to decide what teaching methods to employ in their classrooms. Teachers are given a lot of freedom, although the learning goals are common in primary and secondary education. Emphasis is placed on problem-based learning and stimulating creativ-ity, which is an important factor for creating innovative products and concepts of service. At the University of Helsinki, we strongly cherish the principle of research-based teaching.

Q: This educational system has worked well for Finland. Should all countries seeking to become economically competitive adopt it?

A: Countries are different in size, culture, composi-tion of the population, economic development, and government type. So it may not be feasible for cer-tain countries to adopt the Finnish educational sys-tem. Additionally, there are different systems, such as the Japanese and South Korean models, which are also successful. Some basic aspects, however, should be applied to all; e.g. a quality university education for teachers of all grades.

Q: What challenges and/or opportunities does this provide for producers, food companies, and possibly agriculture in general?

A: Producers have the opportunity to raise different animals. For instance, a dairy farmer raising Holsteins can switch to raising water buffalo. The challenges then would be knowledge of genetics, bi-products.

A Vehicle for Knowledge Transfer

Q: Are extension services important for economic growth and competitiveness?

A: The transfer of knowledge and expertise developed at the university level to the farmer level, occurs through extension services. Land grant universities have been very successful in implementing such services. In today’s world, though, the biggest gains and real impact of exten-sion services is felt in emerging countries, where farmers really need to apply this knowledge for productivity and economic development, since farmers in developed countries are most often already very up-to-date with modern agricultural technology.

Q: How should extension services be implemented in emerging countries?

A: We should advise and educate emerging country farmers, so they can implement the technology and reap the benefits themselves. In other words, emerging country people who go to developed countries

Education a Competitive Advantage in Finland An Executive Interview with Professor, Jukka Kola, University of Helsinki, Finland By Ligia Kawano-Williams

Dr. Jukka Kola is Professor of Agricultural Policy at the Department of Economics and Management, and Vice-Rector at the University of Helsinki. Until this year, he was the Dean of the Faculty of Agriculture and Forestry, and prior to that he served as the Head of the Department of Economics and Management, University of Helsinki. His major fields of research and teaching are agricultural and rural policy, the new political economy and welfare economics of policies, supply and demand analysis (econometrics), and the multifunctionality of agriculture. Dr. Kola has been awarded several “Teacher of the Year” awards and an Eino Kaila award (for best teacher) at the University of Helsinki.

The Chain LetterNovember 2010

Page10Jukka Kola-Continued from page 9

to study and conduct research should return to their country of origin, at least for a period of time, so they can transfer the acquired knowl-edge to their country’s farmers. This is sustainable development. Or if developed countries’ researchers, educators and extension advisors decide to go to an emerging country, they should advise the farmers about the new techniques/technologies that most appropriately fit those conditions. This can bring economic growth, so the farmers can apply them by themselves.

Public vs. Private Sector Roles

Q: Who is responsible for economic development, the private or the public sector?

A: The most sizeable and rapid results are seen when the public and private sectors cooperate for economic development. For example, when private sector invests in communities where they operate, mak-ing the lives of their workers and customers better. Looking at the infrastructure—private sectors contribute with funds while the public sector is responsible for building the infrastructure.

Q: Does this partnership exist in emerging economies?

A: This partnership is not going well enough in emerging economies, e.g. in some parts of Africa, because the public sector is not effective enough and the private sector cannot or will not wait. If the two sec-tors work together, there will be a steadier development.

Q: What about environmental issues?

A: Sometimes the private sector only focuses on short-term profits, so the public sector must intervene through regulation to protect the environment and ensure the health and quality of life of its population. Business companies need concrete and comprehensive plans and pro-grams for sustainable development, wherever they operate. The real progresses are seen, then, once the private and public sectors partner to solve environmental issues.

Q: In what type of research should the private sector focus?

A: For long-term competitiveness, the private sector should also focus on basic research. Nowadays, there is too much focus on applied research because it produces fast results. However, applied research will cease to produce results in the future if an investment in basic re-search is not made today. For example, there is plenty of investment in biotechnology, but without strong, continuous basic research in biology, chemistry and microbiology, for example, the biotechnology research is not sustainable.

Q: Why is there a reluctance to invest in basic research?

A: Basic research does not produce immediate results and is very ex-pensive. Therefore, it is easy to understand why companies’ who focus on short-run profits may be reluctant to invest in it. This is also an issue of economies of scale and size, and sometimes scope, too. For sustainability, though, basic research investment is essential. It is the only way to create real innovations and breakthroughs, sometimes in the fields and phenomena that we did not even know to exist.

For more information about Dr. Kola, please visit: http://www.mm.helsinki.fi/mmtal/mae/jkola/

This interview was conducted as part of IFAMA’s Student Travel Grant Program during IAMA’s 2010 World Forum and Symposium in Boston, USA. Ligia is working on her Master of Agribusiness degree the Depart-ment of Agriculture Economics at Texas A&M University, USA. You may contact her at: [email protected]

The Chain LetterNovember 2010

Page 11LEEDing by Example The private and public sector celebrate accomplishing green goals cost effectivelyBy Lauren Turk

Not a single residence hall renovation has occurred at the University of Illinois at Urbana-Champaign in more than 40 years—until now. Despite a period of economic downturn, the University proceeded with a master redevelop-ment plan to replace residence halls at Ikenberry Commons with new LEED® Silver standard buildings. Constructing the Student Dining and Residential Programs Building (SDRP) and Nugent Hall, a connecting residence hall, ful-filled the plan’s first phase. In with the new meant out with the old—and the Peabody and Gregory Dining Halls had to go. Scarce funds meant careful budgeting; with the lowest bid among competitors, Robinette Demolition Inc. got the job. They recycled more than 97 percent of debris from the Sum-mer 2010 demolition, a voluntary standard of excellence celebrated by both Robinette and the University.

Breaking Ground

The University of Illinois employed Turner Construction Company as the Construction Manager of the project, while Robinette’s lowest bid of $1.4 million, won them the job of the demolition. “It’s what we call a hard money bid. They won it with the lowest price and still recycled this much.” said Elizabeth Stegmaier, Capital Construction Project Manager in Facilities and Services at Illinois. Robinette, a leader in safety in the demolition industry, consistently wins awards for their safety program, including the Outstand-ing Subcontractor Award in 2005 and 2008 for separate projects with Turner Construction, and awards from the American Subcontractors Association for the last eight years. After extensive engineering work, Robinette came down from Oakbrook, Illinois, to start the job in Champaign. Both buildings were cleared and the University of Illinois Housing Department coordinated the donation of furniture and other reusable items to state agencies. Six different heavy equipment demolition machines rolled on site on May 28, 2010. Work ended on July 28, 2010, nine days ahead of schedule.

Recycling: A Worthwhile Investment?

Typically, the design team and Owner specify how many LEED® points they count on from the demolition, and the General Contractor must meet these waste diversion goals. Exceeding them can attain even more LEED® points, bumping the standard of excellence up to the next level. The LEED® building process and certification procure extensive savings for the Owner throughout the building’s life cycle, creating incentive to meet the best standards possible.

However, for the Demolition Contractor, recycling debris often translates into more work and higher costs upfront. Facilities that sort and recycle the

various components of debris are the minority—extensive research must be conducted to find facilities for different materials. Depending on jobsite location in proximity to recycling facilities, this means higher hauling costs. Additionally, such facilities charge either an additional amount per ton to sort and grade materials, or a flat fee for providing documentation. Some charge both.

So why bother? Up front costs may often be higher, but long term payback is greater. Green building and LEED® certification continually gains priority and demand in the demolition industry while markets for interior debris expand as further uses for materials are found. Robinette’s capability to divert waste with high efficiency leverages Robinette’s contractual avail-ability and competitive advantage for bidding and successfully carrying forth sustainable projects. Not to mention the indisputable benefits of decreasing demands on natural resources and reducing the impact on landfills. In the words of Traci Edwards, Robinette’s Total Building Division Manager: “We be-lieve in recycling and green building. It’s not always an upfront cost benefit for us but we’re running out of room in landfills—the more we can recycle the better it’ll be for everybody.”

Numbers Worth a Thousand Words: The demolition of Gregory and Peabody produced 12,695 tons of debris. That’s greater than the 10,000 tons of total waste stream produced by the University annually! Of this 12,300 tons were recycled, leaving fewer than 400 tons sent to landfills. The average rate of waste diversion for the two buildings was more than 97 percent.This exceptional accomplishment surmounts standard requirements. With the LEED® standard minimum for waste diversion at 75 percent, Robi-nette Demolition aims even higher. According to Traci Edwards, “Robinette Demolition takes pride in our ability to perform and manage LEED® projects

Editor’s Note: The following article is an example of how a “green” approach benefits the public welfare. While this example took place at the University of Illinois, which is a public institution, it provides some detail on the mechanics involved and the payoff to the public good. It is likely that regulation of land fills will force increased recycling efforts in the future and executives and decision makers in both the pubic and private sectors will have to seek alternative ways of meeting environmental and sustainability standards imposed through strict regulations.

Debris Broken Down a9423.09 tons of inert material

a267.51 tons of wood

a2118.89 tons of metal

a289.35 tons of drywall

a111.1 tons of asphalt

a92.12 tons of carpet

a392.92 tons of non-recyclables

The Chain LetterNovember 2010

Page 12and currently averages between 90-98 percent recycling. Projects without LEED® requirements constantly meet 80 percent or higher. Specifically with regard to the demolition of Gregory and Peabody Dining Halls, we made the decision to recycle the project as if it were LEED®, given the fact that the University of Illinois and Turner Construction share our involvement and interest in green building and protecting the environment”. Meet the Ikenberry Icon

The new Student Dining and Residential Programs Building (SDRP), replaces the Peabody and Gregory Dining Halls. The Ikenberry Dining Hall, contained within the SDRP, boasts the largest dining center in the United States and connects with Nugent Hall, providing housing for 150 students. This entire area, now called Stanley O. Ikenberry Commons enjoys a greener future as well as a name change. Pursuant to the Illinois Climate Action Plan, signed and adopted on May 15, 2010, to guide the goal of carbon neutrality by 2050, the University will meet LEED® Gold standards for all new campus construction and renovation. The 139,000 square feet of SDRP & 58,000 square feet of the new residence hall, Timothy J. Nugent Hall, both expect to achieve LEED®Silver status independent of energy credits from the waste diversion rate of Peabody and Gregory Dining Halls.

Greener Skies

Even during an economic period plagued by scarce funding and defaults, the private and public sector possess common attainable interests that complement one another. Companies likes Robinette that make environmental practices both a priority and price competitive, will enjoy higher profits as sustainability takes flight as the wave of the future. Concurrently, public institutions with tight budgets like the University of Illinois can maintain progressive and sustain-able values by utilizing a company like Robinette—creating benefits sustained by all.

Lauren Turk is a graduate student in the office of the Vice Chancellor of Public Engagement and is pursuing a Masters degree in European Union Studies at the Univer-sity of Illinois. You may contact her at: [email protected]

LEEDing by Example -Continued from page11

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Ikenberry Dining Hall