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Beam Sustainable Agriculture and Water 2014

Resolved: Shareholders request that the Board of Directors adopt a comprehensive policy to require the Company's key agricultural suppliers to disclose their performance relative to best management practices for irrigation and fertilizer and pesticide application, and include a summary of this information as part of its annual sustainability report to shareholders (prepared at reasonable cost and excluding proprietary information).
 
Whereas: Global estimates from the Food and Agriculture Organization of the United Nations indicate that agriculture accounts for roughly 70% of all water withdrawals.  In the United States, water pollution from agriculture is the number one cause for impaired waterways, according to the Environmental Protection Agency (EPA).  As populations increase, dietary choices diversify, and climate change negatively affects yields, sustainable agricultural supply chains are becoming even more important. 
 
Whereas: Companies like Beam, Inc. that rely on agricultural inputs including corn and other grains, molasses and grapes  should ensure that the growers in their supply chain practice sustainable agriculture in order to conserve and protect water resources, manage fertilizer use responsibly, and reduce soil erosion. A number of initiatives, including Field to Market and the Beverage Industry Environmental Roundtable, of which Beam is a member, have emerged to increase industry collaboration to reduce risk and scale solutions.
 
Whereas: Current trends point to increased price volatility of commodities, closer linkages between resources, and environmental constraints that begin to make resource scarcity an economic reality . Leading companies such as Unilever have already adopted comprehensive sustainable sourcing policies for agricultural products. Recognizing that sustainable sourcing helps it “manage a core business risk by ensuring security of supply for the long term,” Unilever will sustainably source 100% of its agricultural raw materials by 2020. 
 
Whereas: According to the Union of Concerned Scientists, sustainable agriculture often results in less pollution and reduced greenhouse gas emissions, more fertile soil that fares better during droughts and floods, and an increase in biodiversity in the surrounding ecosystem(s), which reduces the risk of crop losses from pests and diseases.  Sustainable agriculture also increases the likelihood that farms will remain productive in the mid to long term. Agricultural producers that are not operating responsibly may pose risks to their watersheds.
 
Whereas: We believe that comprehensive reporting through CDP Water on agricultural supply chain, production processes and downstream impacts such as discharges to local waterways, along with establishing targets and goals for water management, is critical to the company’s long term business planning. 
 
Supporting Statement: In determining performance evaluation criteria, we recommend the company consider using the US EPA’s guidance on best management practices for nutrient management, pest management, and irrigation, such as:
  • Nutrient management: regular soil tests, manure tests, conservation tillage, improved timing.
  • Pest management: Integrated pest management (IPM), pesticide selection, timing, sprayer calibration, consideration of alternatives, avoidance of sensitive areas
  • Irrigation: Minimize water use, irrigation efficiency, apply at rate the soil can absorb, uniform irrigation, provide good drainage.