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Whole Foods blazed the trail of the organic food movement 35 years ago with its first store in Austin, Texas. Over the decades, it has successfully convinced many Americans that going organic is worth the extra cost. Even as the earnings it reported this week disappointed Wall Street, the company "first and foremost, stands for the highest quality," co-CEO John Mackey told analysts.
The organic industry grew to nearly $40 billion in U.S. sales last year, according to the Organic Trade Association. Demand has ballooned, and so have supplies, creating challenges for the USDA organic certification process.
At the same time, Whole Foods has added another layer and another label to fresh produce with the Responsibly Grown program, which allows conventional, nonorganic growers to be recognized for good practices.
"Responsibly Grown is a program that we rolled out over the course of the last year to help us add an additional level of transparency," said Matt Rogers, global produce coordinator at Whole Foods.
The program is aimed at getting into aspects of agricultural production not covered by the USDA's certified organic program, he said. "We're asking suppliers a series of questions about a range of topics: soil management, pesticide use and pest management, water conservation, energy use and greenhouse gases, topics like farmworker welfare."
Suppliers who want to be recognized as Responsibly Grown have to pay a fee to subscribe to a Whole Foods website and fill out a questionnaire. Whole Foods then follows up with more questions before determining what rating, if any, a supplier will get. Those who qualify are graded as good, better or best.
Certified organic growers get automatic points in the Responsibly Grown program. Still, Rogers said, "It's rare, but possible, for a conventional supplier, a nonorganic supplier, to achieve a very high rating in Responsibly Grown by performing very well on all of those topics."
For example, Whole Foods has come up with a list of pesticides that conventional growers can't use in order to be considered for the program.
Even foreign producers can apply. "We're looking for opportunities to recognize good work in the supply chain on topics that are important to our customers, that impact human health and the environment, regardless of where the food is grown," Rogers said.
When Whole Foods first rolled out the program last year, some organic growers reportedly bristled at facing another certification process. The company has taken pains to say Responsibly Grown is not a replacement for certified organic, but a complementary program. "Certified organic is really still the gold standard in terms of sustainable agriculture practices," Rogers said.
That standard has been questioned by some, as there are 24,000 certified organic producers in the U.S., and even more overseas that export food into the United States, but only about 80 accredited agencies that can certify them for the USDA.
Farmers and regulators agree that to a large extent, the system depends on farmers being honest.
That is also the case with Responsibly Grown. Rogers said produce on store shelves has not been tested to see if it has residue from banned pesticides, and the company has yet to do any on-site inspections with suppliers to validate their practices in person. However, he said the company is planning to do a limited number of supplier inspections, and some suppliers have already had their Responsibly Grown ratings "adjusted" after the validation process.
"We don't need to parachute an inspector into every farm to validate everything that we're talking about," Rogers said. "We can use modern technology; we can have conversations with suppliers about what they are doing and review documents."
He said on-site inspections would be costly and redundant, given all the other programs many suppliers are involved in, such as certified organic. "Ultimately, our food supply chain has to be built on some amount of trust between us and producers," Rogers said. "You cannot inspect every single claim from every single farm across the supplies."
Rogers said the program is evolving as Whole Foods gets feedback from customers and growers. Tweaks are expected in January. "We recognized there are more and more topics that relate to human health and the environment and how our food is produced that customers are interested in," he said.