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EY pilot study: "True Cost Accounting"
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Food production has many hidden effects on people and the planet, including the impact on climate, water quality and soil in the form of erosion. Accountants Ernst & Young (EY) and sustainability consultant Soil & More have developed a method for small and medium size businesses in the organic industry to calculate these unseen costs with the help of a practical dashboard. The pilot study was presented on 13 June 2017 at the EAT Food Forum in Stockholm. Last week, the CEO of Eosta, Volkert Engelsman, handed over the first copy of the pilot study "True Cost Accounting for Food, Farming and Finance" to Peter Bakker, President of the World Business Council for Sustainable Development. Bakker commented: “The results of the Eosta business case illustrate the potential of True Cost Accounting to revise the definition of profit and to combat false incentives in the system. I am convinced that True Cost Accounting will have a major influence within a few years on the evaluation of companies and their access to capital."
Eosta plays a pioneer role
The pilot study, that was supported by the Triodos Bank and Hivos, investigates such issues as the impact of growing organic apples in Argentina, organic carrots in the Netherlands and in Kenya with regard to water pollution, soil erosion, pesticide contamination and greenhouse gas emissions. The impact was compared to conventionally grown crops in the same regions. The study also contains an integrated profit and loss calculation for Eosta, which makes it the first SME in the food and agriculture sector worldwide to publish these details. The International Federation of Organic Agricultural Movements (IFOAM), the Food and Agriculture Organization of the United Nations (FAO) and the World Health Organization (WHO) were major participants in the project.
Watch a video interview with Volkert Engelsman: