By its own definition, Givaudan is committed to growth, with purpose. A global industry leader creating game-changing innovation in food and beverages, and inspiring creations in the world of scent and beauty, Givaudan’s heritage stretches back over 250 years. The company has a long history of creating and innovating scents and tastes, and acting responsibly.
As a company driving purpose-led, long-term growth, Givaudan’s intention is to increase its positive impact on the world by innovating sustainable solutions while showing its love for nature and leading the way to improve happiness and health for people.
Procurement, it goes without saying given its position in the broader supply chain ecosystem, plays a pivotal role in this and while sustainability is not exactly a new topic for the procurement professionals of the world, in recent years it most certainly has risen to the forefront of business strategy.
“Procurement organisations have proven that their contribution to company growth is paramount,” explains Willem Mutsaerts, CPO and CSO of Givaudan. “They’ve also proven that involving them early in the product development cycle is critical – as a business with customers at its core, we have a vital role to play here as we grow together.”
“Over the past few years, sustainability has become increasingly important for Givaudan with clear and bold company objectives. It is fully embedded in our corporate strategy and company purpose.”
One of the first things noticeable about Mutsaerts’ role is its duality. Mutsaerts sits at the executive table on behalf of both the procurement function and sustainability of the organisation. From this position, he can ensure that procurement truly influences the company’s strategic decisions while also being able to work with suppliers on their sustainability best practices and drive real lasting change.
Given the dual nature of his role, Mutsaerts’ represents something of an exception in the procurement space. “I often go to global external or sustainability meetings where people envy the positioning of procurement and sustainability at Givaudan as others sometimes depend on the chief financial officer to make a decision or they must work with the global supply chain manager to influence change,” he says.
“In my case, I have overall responsibility. Being able to see the manoeuvring and transparency on everything and being able to set the priorities and decide on that in line with the executive committee strategy is a great advantage for a company to progress and accelerate decision making. This makes a lot of sense as everything we buy (Scope 3) represents approximately 85% of our total GHG impact. So there is a clear natural overlap.”
As Willem has already noted, doing business in a more sustainable way is at the heart of the company’s purpose. Much of this is being increasingly driven by a customer base which has access to more information about an organisation’s carbon footprint and sustainable best practice than ever before. So what about the how? How is Givaudan driving sustainable best practice across its entire operation and embedding it within its global supply chain for direct and indirect materials and services?
By 2030, Givaudan will look to have cut carbon emissions across all of its operations by 70%, supply chain emissions by 20%, replacing single-use plastics with eco-friendly alternatives across its sites and operations. By 2050 Givaudan will be a climate positive business.
Focusing on the here and now, Givaudan recently introduced its Sourcing4Good programme which has been co-created with customers, specialists and internal stakeholders. “It represents a strengthening of our work in responsible sourcing as we continue to deliver on our ambitious goal to source all materials and services in a way that protects people and the environment by 2030,” he explains.
“Sourcing4Good is an important step-change in our approach as we strive to be a force for good and create for happier, healthier lives with love for nature. It is strongly tied to our purpose goals and bold ambitions to become a B Corp certified company in the years to come. As the first in the industry to have a published Responsible Sourcing policy, we have always shown leadership in this area.”
Elsewhere, Givaudan has redefined how it works with its supplier base in order to standardise sustainable best practices throughout its entire supply chain ecosystem. Through a combination of a dedicated sustainability team working on its scope 3 roadmap together with procurement, Givaudan has trained its buyers to better understand what’s at stake as well as setting defined sustainability objectives supported by a global Vendor Quality Organisation.
“Since recently, we also work with organisations like Together for Sustainability (TfS); a global sector supply chain initiative,” adds Mutsaerts. “Collaboration is essential in delivering on our bold ambitions and a transparent dialogue with our suppliers is vital to ensuring the long-term sustainability of our supply chain.
“As we take the next step in our responsible sourcing journey with the launch of our new Sourcing4Good programme, the additional knowledge and insight our TfS membership will bring will be invaluable in helping ensure we can continue to accelerate our progress as we grow together with our customers and suppliers.”
So it’s clear just how integral procurement and the supply chain really is for sustainability and for Givaudan, but this is not a dynamic that happened overnight. The evolution of procurement is a tale well told, but it’s also a tale that continues to gather pace. As organisations the world over invest in their supply chain and procurement functions, Givaudan has spent the better part of the last decade implementing the infrastructure necessary for the company to continue operating to the best of its abilities again and again. “Suppliers are also an important part of our success. For this the company has developed the Connect to Win initiative which is a dedicated platform for suppliers to work with Givaudan on its unmet needs.”
Another important activity that contributes to the increasing demand from consumers for transparency and showing love for nature is Givaudan’s Origination programme where for selected supply chains Givaudan has “feet on the ground” to assure best practice and to protect the environment and the communities.
“As the world changes, so does procurement,” says Mutsaerts. “Procurement had to evolve and adopt innovative and smarter ways to digitalise the supply chains and unlock new growth opportunities. From Procurement 1.0 (focus on price and seen as mainly a negotiator), Procurement 2.0 (focus on total cost of ownership and acting as strategic collaborator), Procurement 3.0 (focus on value and acting as a trusted advisor) and lately to Procurement 4.0 in line with Industry 4.0 with a focus on digital where procurement is seen as an innovation catalyst.”
In 2015, Mutsaerts spearheaded a new procurement direction, connecting procurement to all functions across all levels of the organisation. This strategy, which ran from 2015-2020, saw procurement move from cost control to value creation and increased collaboration. Establishing procurement as a key stakeholder involved in the market strategy, procurement needed to be an agile team that seeks alignment with internal customers and stakeholders ensuring continuous support to divisional and corporate strategies. Procurement, as we know, cannot stand still. As Mutsaerts noted, the world changes and as we speak today Givaudan has embarked on the next stages of its procurement evolution. One that will focus on 5 key pillars:
Fuelling Performance: generating value beyond savings and fuelling growth of the company by driving innovation
- People: empowered and engaged people with the right skills in the right place
- Simplification: a continuous improvement mindset
- Business Continuity: striving
not to lose business opportunities caused by supply disruptions
- Sustainability: procurement as key contributors to Givaudan’s global sustainability ambitions by leading the way in supplier engagement and scope 3
“The past cycle was our strong foundation to be well equipped to overcome the many challenges in procurement and sustainability we have to face,” he says. “Our new strategic direction takes into account the fast-moving external developments, the evolving business needs and also the lessons learned from the past. It also takes in account internal developments such as our company purpose and the corporate, divisional long term strategy as everything we do in procurement and sustainability is in response to an overarching clear business ambition and need.”
The continued evolution of digital procurement, which over the last few years has accelerated exponentially, cannot go unnoticed. While technology does not define the procurement story, it certainly enables it in a way like never before. Procurement is a function which relies on information and so technology has vastly improved the way in which an organisation both captures and understands data which for an enterprise looking to improve its environmental impact, can and very much does make all the difference. As Mutsaerts notes: “The current technological evolution is enabling data-based decision making, lower costs, enhanced faster delivery, improved level of service and increased automated processes (i.e. invoicing).”
“This is a journey, we still have quite some complexity to manage due to the challenges of the industry we are in and the complexity of the raw materials and services we buy, but we are confident that in the long run, technology can help organisations like ours be more efficient. It is key for our decision making processes to rely on data.”
He acknowledges that where procurement once found itself struggling to access the right information, it now exists in a world where information is more accessible than ever before. Over the coming years, Givaudan will continue to adapt its interfaces and simplify its processes to ‘drive adoption of new ways of working”.
“Only good adoption will allow us to fully grasp the opportunities that can come with the technological advancements we continuously integrate in our organisations,” he adds.
Looking back over the last five years, Mutsaerts has great pride in the work that he and his team have done in bringing procurement to the fore and significantly improving the way in which Givaudan operates. A humble man, Mutsaerts is a firm believer that where he and the procurement function are today is a culmination of incredible collaboration – he does not see himself as the key to any of the successes achieved. He is but a harbinger for procurement’s true value. He recalls a time where, at the start of this procurement journey, he gathered his team together in a hotel as part of a strategic exercise. “A procurement strategy has to be owned by the decision-makers and not by somebody who writes it for somebody else,” he says. “We as a team went to a hotel and said: ‘We don’t come out of here until it’s done and we’re all aligned.”
He continues: “It was tough because everybody had different ideas from people who were interested, but strangely enough, the outcome of a four-day intensive discussion was a one pager. Everybody knew exactly every word, what it meant, why it was there and why some other things were not there. It gave us a lot of clarity on decision making, what the priorities are and how we want to work together as a high-performing team and to this day,
it’s worked out pretty well.”
With procurement now well and truly recognised by its business partners, Mutsaerts and his team are shaping its maturity from version 1.0, which focused solely on price to version 4.0; utilising big data, leveraging digital processes and tools, enabling meaningful partnerships to address top line challenges, and sustainability topics as part of the company’s 2025 vision.
The duality of Mutsaerts’ role is not the only unique thing about him. Where we often hear of procurement professionals overseeing a transformation project before moving on to new chapters in their careers, he has had the luxury of working with Givaudan for more than 25 years. Over the course of that time he has worked in sales in Paris, customer relationships in Singapore and headed global operations for fragrances based in Switzerland. He is a successful example of how Givaudan grows its leaders having been exposed to many facets of the business from sales functions in various regions to leading a development center and heading global operations for fragrances. This gives a unique set of skills and credibility to bridge the business with procurement and sustainability for both divisions. As he stands today as CPO and CSO, Mutsaerts shares his passion for procurement and how it is a passion shared across his team. A passion that shows no signs of fading away.
“I really enjoy the journey together with all my team members. In both procurement and sustainability within Givaudan, you can make a real impact,” he says. “Currently we buy over 13.000 raw materials from rare natural ingredients to large bulk commodities and also a large variety of Indirect Materials and Services with increased complexity due to the many acquisitions made during the last several years. Our team of approximately 200 global category managers and procurement business partner teams based in all regions of the world and supported by our 3 Global Business Supports (GBS) centers work closely work closely together with the rest of the organisation to ensure that products are responsibly sourced and secure a stable supply to make sure that local producers and their communities truly benefit from working with us.”
“Challenges bring opportunities for us to innovate. We want to capitalise on our innovation programme (Connect to Win) to work together with a selection of our suppliers to find innovative solutions for our unmet business needs.”
Every day is different and on a daily basis you have to work with internal and external stakeholders across the globe which is really enriching. We see many opportunities; to do things differently, to push ourselves to go further and to contribute to tackling the big challenges for society. These are exciting times for us all.”