There is no doubt that the agricultural industry is facing a period of huge change. We’ve seen significant cost price inflation, the disruption from Covid-19, new trade agreements and the post-Brexit re-focusing of UK agricultural support. Against all this, we are also continuing to see increasing focus from consumers on where food comes from and how it is produced. This manifests itself through interest in animal welfare and, increasingly, in the environmental impact of the food we eat.

As many will know, Marks & Spencer is well established in the UK, starting back in 1884, and recognised for high quality products. Today we operate in the UK and 62 other countries and have 44 different websites globally, selling a range of food, clothing and homeware. When it comes to our food business, we have around 700 UK food stores as well as our joint venture, Ocado, which has given us a strong online grocery presence. We are growing our market share through our focus on innovation and quality.

When it comes to agriculture, M&S is a long-term supporter of British farmers. We work with around 7,000 UK M&S Select Farmers that we know and trust, all of whom work to our Select Farm standards, which cover food safety, traceability, animal welfare and environmental stewardship.

The focus on animal welfare and the environment isn’t new for Marks & Spencer. We launched our eco- and ethical plan, Plan A, way back in 2007, because the leadership in the business at the time had the foresight to understand that the challenges that society was facing meant that customers and investors would have great expectation on leading brands such as M&S. We were very clear about the need to demonstrate leadership on social and environmental issues, and we’ve had several successes in these areas over time. However, late last year, we recognised the need to reset our Plan A strategy, with a real focus on climate change so that we can limit global temperature rise to below 1.5o C. We set an ambitious target of net zero by 2040 across our entire supply chain value chain.

To be clear, that includes the agricultural supply chains that serve M&S. Whether we like it or not, farming is a major contributor to carbon yet the opportunity that agriculture has is that it is also uniquely placed to be part of the solution through carbon sequestration. What we need to ensure, however, is that any work in this area is science-based, but I genuinely believe that farmers have a real opportunity in this space if they embrace change.

It is easy to be sceptical about the real impact of agriculture, with so many different points of view on the subject. But what I can share is that an independent end-to-end assessment of our own value chain – from farm to consumer – showed that 72 per cent of our total carbon emissions came from primary agriculture and 47 per cent of that came from the meat, fish, dairy and deli categories. As such, it is essential that we work together with our farmers, and particularly our livestock farmers, to address the carbon challenges we face. But, of course, we haven’t just got that to deal with now, with inflation, global conflict, Brexit and COVID-19 all impacting on how we operate today, and with significant uncertainty and change ahead.

That inevitably shapes everyone’s thinking and dealing with so much uncertainty is difficult from a personal perspective and when trying to run a farming business. But the most important thing is to recognise the opportunities that come with change, and part of that is about closer supply chain relationships and better understanding of consumer needs.

We know from our research that our customers are very clear about what they expect from us, both at store and product level. Unsurprisingly, when visiting a store, they want great quality and taste, they want value for money, they want competitive prices, and they want a good range of products. These dynamics haven’t really changed. But increasingly, customers also want to know that we’re offering food that is both healthy, sourced from livestock that are reared in high animal welfare conditions and coming from farms that are environmentally friendly. Now, you could take those last three as either a threat or an opportunity. Personally, I think there are real opportunity for UK farmers. We have some of the best animal welfare conditions in the world. And we can farm in environmentally friendly ways that should ensure that the UK industry is at the forefront of sourcing decisions.

What’s interesting is if you dive deeper into customers’ understanding of what sustainability means, consumers are confused but they do see it as a shortcut to quality and I think that’s important.

We see that more than a quarter of adult customers always seek out ethical or sustainable products and research has shown that three quarters of adults in the UK are concerned about climate change.

This is a challenge in one way, but a huge opportunity for the UK farming sector to really demonstrate the advantages it has over other industries and over food chains in other countries.

What’s also important to realise is that these trends towards transparency and interest in sustainability and animal welfare are not just consumer trends. Major brands like M&S are increasingly under scrutiny from ethical investors, who make decisions based on the sourcing principles of organisations, so this is becoming embedded in business. When it comes to carbon, it is also government-led. The climate crisis is urgent and needs urgent and co-ordinated action. It’s not something we’ve just dreamt up and it’s not based on a carbon account principle that we’ve created. Yes, we have a net zero target, and that includes so-called Scope 3, which is all the emissions that we don’t directly control. What that means is that effectively all farmers in our supply chain, and indeed most other supply chains, have a net zero target too by default.

We’ve seen red meat and dairy in the spotlight for carbon. There are several public perceptions that the industry must deal with relating to ruminant livestock, which is unfortunately seen as a problem rather than part of the solution. There are numerous calls to reduce consumption. The underlying trend towards vegan eating and the perceptions around environmental health and environmental benefits are a risk to the industry. But they’re not new. And, if we’re fact-based, and if we can demonstrate that we are acting on the issues that face us, then I think there is great opportunity. But we do need to change, and we do need to think differently.

One thing I want to stress is that at M&S we are huge supporters of British meat and British dairy we believe that both play a valuable role in a balanced diet. Whilst others are talking of reducing meat and dairy sales to address climate change, we have a very clear strategy to grow sales in both categories, so we want to sell more British meat and dairy than we do today. But we do need to focus on high quality, high welfare and carbon reduction so that we can ensure that the consumer comes to us for a great offer.

Change brings opportunities and the whole issue of carbon and carbon sequestration, and carbon trading will be an opportunity for the farming community when we understand better the platforms around trade in place. We also need to change the way we look at production methods and supply chain relationships. I’ve continually talked about how we should be looking at ways of shortening the supply chain, being more collaborative in our approaches and I really do think that that is an opportunity for us all. We should be thinking about differentiation in everything that we do. It shouldn’t be about commodity production. And I think greater collaboration along the supply chain will help us identify opportunities to differentiate products. There needs to be greater alignment, more transparency, more collaboration, and more of a common view around how we address some of the issues that have been identified.

One of the areas that I’m sure will play a part is integrating supply chains. If you were going to categorise our beef supply chain, we enjoy supply from a range of different farms – from feeder finishers, to store finishers and integrated dairy models. The reality is we want to find ways working collaboratively with all our suppliers. We want to be clear on the specifications that we need. We need to be clear on the opportunities to demonstrate improved carbon efficiency and improve quality.

One of the areas that we’ve been investing in of late is a new approach for beef production models. Our pathway farming model is a unique supply chain to Marks and Spencer and it’s a model that we can point at any one of our M&S-approved abattoirs.

Pathway has purpose-built calf rearing facilities in Surrey, Yorkshire, East Sussex and Devon. It is about developing a system that builds on some of the learnings from the more intensive pig and poultry industries and applying them to free range, less intensive systems. We’ve built in a requirement that cattle graze, as we know that’s important to customers, and then has a bespoke approach to the finishing period in a dedicated facility. It also uses the very best quality genetics that we can source, and we enjoy a great partnership with ST Genetics and Cogent, and we’re very much focused currently on Aberdeen Angus. But that focus on Angus isn’t just about breed. It’s about feed efficiency. It’s about eating quality. And it’s very much about delivering a consistent product that our consumers and our processors can enjoy.

We want to deliver beef with the lowest environmental footprint and better eating experience and improved performance year in year out. We also take account of both the market and cost of production dynamics, so that farmers working with us through this model get a fair return for their work.

This is a great example of new thinking that delivers for everyone in the supply chain. It relies on communication but provides our customers with great quality, consistent meat, great performance at a farm level, fair returns and good environmental performance, as we work closely with the farmers involved on biodiversity, improving soil health and water quality and on carbon reduction. It also makes the whole supply chain more efficient financially and environmentally and, whilst we still have a lot to do in terms of the environment and carbon, we believe this will be one of the lowest carbon beef supply chains in the country. We are at the start of this process, but we are working collaboratively and driving change which not only benefits the environment but also improves the bottom line for all involved and delivers a better product for consumers.

So yes, we face huge change and that brings uncertainty. As we look forward, we don’t know how we’ll address some of the challenges we face, particularly around carbon. Uncertainty can be scary, and the danger is that it can result in paralysis at farm level whilst we wait for clarity that may not come in time to react to it. We’ve probably never seen a period of change quite like this for British agriculture. But change isn’t necessarily negative – it also brings opportunities. We all need to think differently, and we all need to be more joined up and collaborative than ever before.

At M&S we are willing to be collaborative, and we do recognise that we will only achieve our objectives if we work together. We welcome conversations with any of our Select Farms on what we could do to be more supportive. We all need to recognise that consumers still want great quality, taste and value as well as the other deliverables around climate change.

This needs a new mindset and approach. We are proud to continue to support British agriculture and we want to work in partnership with British farmers to help address the challenges ahead. We look forward to working with you.