ESG: The Nexus of Food, Climate and the World Around Us, with Candace Laing

A sustainable climate is the top priority for Nutrien Ag Solutions as it continues to lead the ag industry in efforts to mitigate climate change and protect the environment.

But, from a corporate perspective, there's more to the company's ESG (Environmental, Social and Governance) strategy than that.

So in this episode, we're joined by Candace Laing, Nutrien's Vice President of Sustainability and Stakeholder Relations, to discuss how the company's ESG strategy intertwines climate protection with other important issues, like equity, diversity, inclusion and safety—and why that's important for stakeholder relations. She also recalls growing up as a rural farm girl, and how women have come to play a larger role in the business side of agriculture throughout her lifetime.

Plus, Tom and Sally unpack the 2021 whole acre solution projects in carbon pilots to see what insights they can take away as the company continues to expand these critical, forward-looking initiatives.

Episode Transcript

Candace Laing:

We have, as Nutrien, a challenge that is actually one of the globe's biggest challenges, and that is to crack this nut we have around this critical nexus between food and climate.

Dusty Weis:

Welcome to The Future. Faster, a sustainable agriculture podcast by Nutrien Ag Solutions, with our very own Tom Daniel, Director North America, Retail and Grower Sustainable Ag, and Dr. Sally Flis, Senior Manager, North America, Sustainable Ag in carbon. This is your opportunity to learn about the next horizon in sustainable agriculture; for growers, for partners, for the planet. To us it's not about changing what's always worked, it's about continuing to do the little things that make a big impact.

Dusty Weis:

On this week's episode, Candace Laing, vice president of sustainability and stakeholder relations at Nutrien, joins us to discuss why sustainability is a top priority in the company's environmental, social, and governance reporting, how ESG is important for long-term success, and how these big picture reporting metrics are intertwined within the field practices. But if you haven't yet, make sure you're subscribed to this podcast in your favorite app. Also make sure you follow Nutrien Ag Solutions on Facebook and Instagram.

Dusty Weis:

I'm Dusty Weis, and it's time once again to introduce Tom Daniel and Sally Flis. Tom and Sally, we've got a whole list of really interesting things to discuss today, but first, I just have to ask you, how cool was it to see The Future. Faster podcast logo on the back of a NASCAR at Daytona?

Sally Flis:

Dusty, I haven't watched NASCAR since I was in high school, so it got me to watch NASCAR again, and almost got my husband to buy a bigger television so we could see the race better. It was exciting. We watched both weekends, and our driver didn't win but he is leading the points so that's pretty awesome.

Dusty Weis:

Boy, it'd be pretty cool to see that thing up on a podium or something. What do you think, Tom?

Tom Daniel:

Yeah. Well, in that particular race at Daytona, he was, what, did he finish, second, and he led most of the last laps, so there was a lot of hope there that we were going to see that Nutrien Ag Solutions car up on the podium at the end, but very exciting to see it, and obviously to have our little old podcast put on a NASCAR is kind of a big event right now I would think.

Dusty Weis:

One of the more surreal moments that I've had so far in what has definitely been a surreal year to say the least, but onto business here. You and the team are wrapping up the 2021 whole acre solution projects in carbon pilots. What are we learning from that process of kind of going back over and looking at everything that we accomplished?

Sally Flis:

Dusty, as we've touched on many times, the data is always a challenge. And in the last two months, we've spent a lot of time checking the quality and accuracy of all the data that we've collected through the year so that we can actually get to these verified credits and outcomes for reducing nitrous oxide emissions. The challenge is when we have low quality or missing data, we have to drop acres from the project. So we went from a pretty high number down to about 16,000 acres because of the QA/QC process for the data that we had in our submittal to the Climate Action Reserve for nitrogen outcomes this year.

Sally Flis:

So lots of stuff we learned, which is why we do the pilots, right? Lots of stuff we learned about the different steps we need to have as checkpoints and making sure we have the right data collected and that it's high value, high quality data. Tom, what are some of the points that you've seen in working on farms or retail locations where we lose that quality in data and that we can help our growers and our crop consultants improve data collection?

Tom Daniel:

Sally, one of the key things I see is that we still have a lot of growers that are not using some type of digital platform to store data. So they don't have just great access, especially when we start looking at historical data. We're going back three years, five years in looking at data from the past, and growers may just not have easy access to that information or they may just not have kept that information in a good format. They are not keeping enough information that gives us confidence in some of the numbers that we may look at, so it requires us to go back and do quality checks on all that type of stuff.

Tom Daniel:

I think one of the key components is that maybe growers may trust digital data just a little bit more than they should, and they're not going back and double checking on that data. So one of the questions I've got back to you, Sally, is, we get to collecting data on these projects. It's usually at the end of the season after everything's done, and then growers will pull all this data together and send it to us, but really, good data should be collected through the season as we complete different stages and different processes from planning to fertilizer applications. All of those things each passed across the field should be entered somewhere into a data collection point. How can we improve data quality as we go through the growing season rather than waiting to the end of the season to collect?

Sally Flis:

Yeah, that's a big thing we've been working on trying to solve this year, going into our 2022 work. A couple of things we've added is we've added our customer success team who's going to be kind of following up with those growers through the season. We've also added some automation to our side of the system so that growers and crop consultants will get reminders on a more regular basis of, this is the next piece of data that you need, or, hey, it looks like in your region corn planting should be done, have you entered your corn planting data. So really trying to help automate and remind the growers, because we all get busy and forget that these pieces of data need to be in. I think I've got 800 unread emails in my inbox right now. And so we all get busy on these things, but trying to build in some mechanisms to get the data coming in through the year so we can start checking data as we go.

Sally Flis:

One of the big shifts for us this year is we're paying growers on that nitrogen outcome, we're not paying them for the nitrogen practice change, so the quality of the data is even more critical going into these 2022 programs because we need to be able to actually generate that credit to make a payment to growers. Tom, you mentioned digital sources of data, should we trust that anymore, and how much do we need to check those digital sources of data as we look at those as what comes in from growers, or as growers look to prepare for using those digital yield monitors or other equipment sources going into this growing season?

Tom Daniel:

So Sally, one of the big things that I see around data that's coming off of the use of equipment are yield monitors, or even our application monitors, or planning monitors and those type things is, are we recording the data accurately through the process? One of the key things I know you're struggling with is that we may have our Echelon precision ag format that we use in Nutrien today, does it match up with field names and field acres and all the boundaries drawn incorrectly? What is the sourcing for truth on what a particular field is? And that seems to be a common problem.

Tom Daniel:

So as growers are planning or are getting ready to plant the 2022 crop, in fact, we've already started in the deep south, but in 2022, are you entering in the information into that monitor that's actually going to attract for the whole season? Are we putting in a field name that's accurate and is being recognized in our Nutrien Echelon program? Are all those things synced together where we're actually tracking that information all the way through the system? Same thing in our farm management software, are those fields being identified the same in all the different platforms that we go through? If we're not doing that, then that's where we create all the confusion when we try to pull this data together.

Tom Daniel:

And I think, Sally, you and I have said more than once, everything that we're moving to over the next few years is going to be data driven. If we don't have accurate data that's easily trackable, there'll be a lot of revenue opportunities we probably, as a farmer, won't have the opportunity to participate in. So I'll ask you this question, from what you've seen so far in the pilots this year, have you seen some sources of data that are really more reliable than others?

Sally Flis:

Unfortunately, no, not really. I mean, we've got our customer success team, we talk probably three to five times a week, depending on what we have going on. They had data come in from a grower that was handwritten on a notepad, and they said that was some of the easiest data to deal with and enter and understand versus trying to pull some of the stuff out of some of these farm management softwares that growers give us some access to, where they had one grower that had a field with four planting events of four different types of crops and four different types of acres, all geo located to the same general geography.

Sally Flis:

So there really isn't, at this point, a more reliable source of data than any other from what we're seeing. It's just that attention to detail, I think, is the important part. If we're going to get two validated credits that can really be bought and sold on an open marketplace, it's got to be high quality. It doesn't matter where it comes in from.

Tom Daniel:

And I totally agree with that. If it's junk in, it's junk out, right? So it's got to be high quality data. I'll say one other thing, Sally, and I think you're running into this, it's got to be verified. So if a grower, we enter his data into one of these platforms and protocols, there is an opportunity they could be audited somewhere down the line, right? And so the growers that we're working with, we're going to have to be sure that they know or have access to the data points that may be audited in a process. So it's not just putting some numbers into a system and watching them go through, these are verified credits that we have people purchasing in the marketplace today and they want to know that these are real. And so there is an opportunity for audits and growers need to be prepared for that. So I'll ask you one other question, how can growers and crop consultants help ensure digitally collected data is high quality?

Sally Flis:

I think it goes back to some of those fundamental things that nobody really likes to do but needs to happen every season, you know, calibrating your equipment, checking your signals, checking your data. Making sure when you change product, or change seed, or change crop as you're entering a field you're making those changes in that tracking equipment so that you've got the right pass recorded there. Calibration of equipment is one of the things that probably gets overlooked because people get busy. They want to get out in the field. I was in Missouri this week and it was 70 degrees, and now growers want to get rolling on stuff, right? So taking the time to make sure you're correctly calibrated not only plays into this but plays into the efficiency or the use of all the products that you're going to put out there.

Sally Flis:

What are you really seeding? Are you really getting the application rates of any product, whether it's fertilizer, or herbicides, or pesticides that you thought you were getting all plays into your return on investment for using those? So taking the time to really service, and calibrate, and pay attention to the data that's going into those systems will help us on the back end, and help the growers and crop consultants make better decisions going forward.

Dusty Weis:

Well, and certainly we're at a phase here where it's still a learning process for a lot of folks, but it's about time to get that process worked out because, as Tom said, there are potential revenue opportunities, and if your data is in order, you could miss out on those. And so quality and accuracy of data, it's certainly important at a field level, it's certainly important in helping drive sustainable outcomes, but we don't want to overlook how important it is as well when Nutrien reports annually in the environmental safety and governance report. And so coming up next, we have Candace Laing, the vice president of sustainability and stakeholder relations at Nutrien. She's going to talk about just exactly what that ESG report is all about. That's coming up in a moment here on The Future. Faster.

Dusty Weis:

This is The Future. Faster, a sustainable agriculture podcast by Nutrien Ag Solutions. I'm Dusty Weis, along with Tom Daniel and Sally Flis, and we're joined now by Candace Laing, vice president of sustainability and stakeholder relations at Nutrien. Candace, thanks for making time to join us.

Candace Laing:

Pleasure to be here, Dusty. Thanks for having me.

Dusty Weis:

So Candace, we talk each week on this podcast with Tom and Sally about field level focus on sustainable ag. Can you give us a quick description about what your team focuses on as it pertains to our corporate sustainability? What do global stakeholders have to say about climate change and biodiversity, and why is it important for the company to be involved in these discussions?

Candace Laing:

Well, I think this really starts with looking at how sustainability has changed over the last five years. And now you almost hear the term ESG used interchangeably with sustainability, and that stands for environmental, social, and governance topics. And the big shift in focus of our team corporately for Nutrien is really looking at the integration of these longer term dynamic risks that impact our business, and ultimately our customers. And it's more today focused on corporate sustainability than sharing stories about what we're doing good and really shifting to how do we ensure that we are factoring in longer term risks and maintaining the long-term viability for the company and meeting those needs of our customers as well.

Candace Laing:

So with your comment about climate, I would say we're in a zone now where it's climate first. Our team looks at all of our topics across environmental issues, social issues, governance issues, but really this integration into the business of sustainability has a climate first focus. So our job really corporately is to look at our risks and opportunities across all of our ESG topics but we are heavily focused right now on how climate change will impact our business and ultimately in the longer term our grower customers as well.

Sally Flis:

So Candace, I know as a larger team, both your team and some of our retail sustainability staff, we spend a lot of time working on the ESG report. I know just for the couple little sections, where we've got some numbers included, it was at least a six-week long process to get it written the way we want it and know what numbers we were going to have there and make sure we have the data to back up that those numbers actually exist and happen in the field. So the question would be, when we put this out, who is looking at it besides us, and how does that impact an investment group's decision to either invest in us or look at somebody else?

Candace Laing:

That is a great question, Sally, and it also relates to the shift that I was just talking about. So we used to, a few years back, put out, I would say, a very general sustainability report showcasing really great things we're doing as a company, and it was really for all stakeholders. And now we've shifted to an ESG report, and we really hope all stakeholders still look at it and find good information there, that it is structured and aimed directly at providing decision-useful information for investors. And that's because we're getting new questions from investors, not only on our financials quarter by quarter and the value we're returning to shareholders in the short-term, but very specific questions about our climate risks, opportunities, and longer term implications on the value and longer term returns for investors with our company. As well as other ESG topics: environmental incidents, equity, diversity, and inclusion, safety, governance, we report on all of these topics because investors want to know and factor those in to their decisions.

Candace Laing:

Just to unpack that a little further, it's probably helpful for people to know that, if you're a sell-side analyst scouring through our ESG report, some do that directly, but not all can afford the time probably to do that on their own, so then they are leaning on these ESG ratings agencies, and they might just take the information put together. And that's why we focus, and you see in the ESG report, even a summary of our ESG performance and kind of a slate of our ratings and rankings, because sometimes sell-side analysts don't do the research themselves they go directly to these agencies to get that information, but ultimately it does impact our business in a big way because these ESG performance factors and all that information is now factored directly into investment decisions. And more so every day we're just seeing an increase in the full on integration of ESG factors into investment decisions.

Sally Flis:

So for somebody who only looks at the stock price in just a really general sense of where we're at, when we release something like this, how does that impact anybody's stock price as they roll out an ESG report?

Candace Laing:

I think it's in a number of ways. Part of our performance from an ESG perspective is, do we make it on certain ESG indices, and then those play a role in passive funds. But ultimately, Sally, it's about the integration of non financial factors alongside financial factors into investment decisions broadly, which can really impact those decisions; do you stay in and out of our stock, or if you're staying in our stock, are we acting and taking enough action and making enough progress on the key issues now that are being seen to impact our business.

Tom Daniel:

So Candace, kind of a follow up question to that. Our job on the sustainable ag team is field interaction every day, and that field interaction impacting our growers and how they are doing things in the field. How do we tell the story of what growers are doing from the sustainability point of view and ladder that up the system? So the sustainable practices that our retail crop consultants and growers have, how does that ladder up into the metrics in an ESG report?

Candace Laing:

I would actually, yes, that most people working in the field don't appreciate how big of an impact the work we're doing in sustainable and productive agriculture has in terms of, not only our ESG report, but how we framed up an overall strategy, which we call Feeding the Future, which really looks at, we need to solve some big issues globally, and that includes the continued evolution of agriculture.

Candace Laing:

And so I think when you look at climate change and the challenges around that, sometimes we focus a lot, and maybe too much on the transition risks and the physical challenges. We get asked, I think you had Eric Snodgrass on a podcast recently, about the long-term impacts on different growing regions from climate change. But really there's a great story here and we get asked this by investors all the time on the opportunities, because there is a lot that we can capitalize on bringing solutions from agriculture to the global challenges around climate change and we have a lot of interest from investors on that.

Candace Laing:

So I don't know that everybody in the field could connect. We're making a plan with the grower to bring more sustainable practices to the field, how that actually just ladders right up into what we are being asked for globally and from our investors directly in terms of the continued evolution and transitions we are supporting in agriculture.

Dusty Weis:

You know, Candace, on this podcast our focus is very much rooted in the dialogue that leads to positive environmental impact, but that's only the E in the ESG social impacts, or a key pillar of this report as well. And as we observe Women's History Month during March, we wanted to learn a little bit more about your experiences in this industry. You've been at Nutrien for about 10 years now, and so what do you love about agriculture and why have you decided to make your career in ag, and why is it important for companies like ours to continue to a focus on these social goals?

Candace Laing:

Well, yes, I've been in Nutrien for 10 years but I've been a farm girl for 45 years. So I'm going to back that up just a few more decades and talk about my experience in ag. On the farm, my role was the gopher. I would gopher everything, and that meant going to town for parts. I remember, Dusty, going once, and taking my city boyfriend along with me, and I went up to the counter to get the parts, and the guy looked right past me to my city boyfriend who knew nothing about what we were doing there, and I was just overlooked. And I think that's the challenge we have sometimes in ag, whether that's a full partner you have as a woman on the farm sometimes being just looked over and not seen as a full partner on the farm.

Candace Laing:

So that's to me the challenge we need to continue to help overcome, and that was definitely part of my experience, but I'm really excited to be part of Nutrien and help shaping ways we can have an impact on more equitable outcomes in our sector, and I think then impacts the globe more broadly. So with Nutrien, we look at opportunities to support more equitable outcomes. We have employment opportunities, supply chain opportunities. We work directly with growers.

Candace Laing:

But one thing I'm really excited about is there's more ways to participate in ag than just farming, and that's innovation in ag tech. And we have a really exciting project coming up later this year with an inclusion challenge, where we're specifically looking to support women, black, indigenous, people of color, innovators, and entrepreneurs in ag tech bringing on what they can to our sector. And it's not a fun fact, it's a sad fact that venture capital funding, there's very big gaps when it comes to underrepresented innovators in ag and their access to capital and the networks to really bring their technology into the industry. So really excited about that challenge coming into play later this year.

Dusty Weis:

You know, Candace, your story about going to get parts and just getting overlooked, it actually reminds me of a conversation I had about four or five years ago with Mary Andringa. She is the former president of Vermeer Corporation in Pella, Iowa. They're an ag forestry equipment manufacturer. And she told me about a time back in late '80s, early '90s, when she was the president of the company, and a big customer called up angry about something and demanded to speak with the president, and she picked up the phone and said, "No, I didn't want the president's assistant, I wanted the president." This was obviously a pretty upsetting experience for her but she took in stride. Women, again, always having been in agriculture but as they've continued to move into the business side of things, becoming less the exception and more the rule here. Mary Andringa told me how important mentorship was for her, both being a mentor and having a mentor. And so I guess my question for both you and Sally is, what role has mentorship played in your career to date and why is it important to you?

Sally Flis:

I think for me mentorship, Dusty, has been more, how can I help other women move forward in roles in agriculture. When I finished up my PhD work... The first time I went to the Agronomy crops and soils meeting in 2005, I was pretty overwhelmed at the difference in male versus female attendance there. And then when I took my first job at a small ag retailer, in a 25-year company history, I was the first time that they had to figure out how to handle maternity leave.

Sally Flis:

So I really have tried, as I've moved up in different positions, to help the females, and the whole team, you don't want to just focus on one group, but help the women on our teams find the resources they need and provide that support for them going forward, because there weren't a lot of people for me to look up to or to have as a female mentor as I moved up through different positions. At The Fertilizer Institute, we had a strong female group there as well, and just kind of after being in those roles, leading from the examples that were set to me as to how to help females move forward in roles and positions and find those opportunities.

Candace Laing:

I think for me, Dusty, mentorship has really come down to these critical nudges that I've benefited from really at every point where I've advanced in my career. And by a critical nudge I mean someone telling me, and these are both men and women mentors telling me, you can do it, you can go for it. And we see in some of the data that there are differences that women might hold back applying for a role because they don't feel they are... For me I want to be 200% qualified for a role whereas my colleagues beside me who are male might go for it if they meet some of those qualifications. So those critical nudges, I've needed and then benefited from. And I think it's really important for men to know they have such an important role they can play there, because sometimes I think it's maybe hard for men to feel comfortable or knowing how they can best engage in helping advance women in agriculture, but that's a really easy way and one that has definitely had a huge impact for me.

Tom Daniel:

So Candace, I'm going to ask this question. We get into a lot of discussions, or at least for me, the first time I heard the phrase, science-based targets, that was new to me. I've only been in the sustainable ag team here for around two years and that's the first time I really heard that phrase. Give me an idea why it's important that we as a company are working towards science-based targets and what does that have to do to impact the overall climate initiatives, not only for us but multiple organizations that are stakeholders in agriculture today.

Candace Laing:

For sure, Tom, and you need to know you're not alone in feeling fuzzy about what science-based targets means. I had to learn that too when I got into this area. Fundamentally, a company's climate target around greenhouse gas emissions is deemed to be science-based if it aligns with a level of ambition that will hold the earth's warming to 1.5 degrees. So that's what we're after, is a level of ambition with our targets that's good enough to hold the global warming to 1.5 degrees. There are pathways for that, and we're working on ours for agriculture and fertilizer in particular. And for most companies that means getting to net zero by 2050. We are still building our pathway of what that looks like between now and 2050 because we are a hard to abate sector and we have some challenges.

Candace Laing:

One of our biggest challenges, and as a farm kid I never knew or understood this about fertilizer, but we have a big issue because when you apply nitrogen in the field, the microbial conversion produces nitrous oxide, and that greenhouse gas is 298 times more heat-trapping than it's equivalent unit of CO2. So just imagine that, like one unit of nitrous oxide, basically 300 times more heat-trapping effect than one unit of CO2. This is why we see such a global focus on emissions from agriculture and why we focus so much on working with growers at the field level on reducing emissions from fertilizer application.

Candace Laing:

But then we also hear a lot about the opportunity we have around soil carbon sequestration. And thinking about our soils or thinking about the Corn Belt as a carbon sink is a really exciting opportunity, and that's why we have so much focus on our carbon programs right now and a lot of interest and questions about them because there's a huge potential there.

Sally Flis:

So Candace, building on that a little bit, around sustainability, both within Nutrien and in agriculture in general, what keeps you up at night as you look into the future, and what do you think, from a Nutrien perspective, is really mission critical for us concerning sustainability going forward?

Candace Laing:

We have, as Nutrien, a challenge that is actually one of the globe's biggest challenges, and that is to crack this nut we have around this critical nexus between food and climate. So we can no longer talk about just food security in the absence of addressing the urgency around climate impacts and climate change. And the flip side is also true, we cannot solve for climate change in a way that would threaten global food security. I see this as one of the big challenges is very complex because unlike on the production side of our business when we're looking at emissions, now we're dealing in a biological system in soils, and it is very difficult, and so we have a lot of things to figure out.

Candace Laing:

And ultimately, a lot of education around stakeholders and ensuring those stakeholders understand what it means to have impact in soil in a biological system in a way at the farm level where we are sustaining productivity as we're solving for some of these sustainable issues as well. So keeping me up at night, Sally, is this challenge we have of solving for both people and planet, and at the heart of it is ensuring all stakeholders understand what that means for farming and what that means ultimately for our grower customers.

Dusty Weis:

Well, Candace, we certainly like to talk about the big picture on this podcast, and it doesn't get any more big picture than ESG, the environmental, and the social, and the governance. You've got a lot on your plate. So Candace Laing, vice president of sustainability and stakeholder relations at Nutrien, thank you so much for taking time out of your busy schedule to join us on this episode of The Future. Faster.

Dusty Weis:

That is going to conclude this edition of The Future. Faster, the pursuit of sustainable success with Nutrien Ag Solutions. New episodes arrive every other week so make sure you subscribe in your favorite app and join us again soon. Visit futurefaster.com to learn more. The Future. Faster podcast is brought to you by Nutrien Ag Solutions, with executive producer, Connor Irwin, and editing by Larry Kilgore III. And it's produced by Podcamp Media, a branded podcast production for businesses, podcampmedia.com. We are Nutrien Ag Solutions. Thanks for listening, I'm Dusty Weis.