One of the principal elements of the AAA Sustainable Quality™ Program is the relationships built with partners and suppliers, as we collectively engage to create positive impacts in farming communities. To mark 15 years since its launch, Paulo Barone, Head of AAA Operations, spoke to two suppliers who’ve accompanied us on our sustainability journey.
Juan Carlos Ardila
Juan Carlos is the Founder of Cafexport, a sustainable coffee trading company committed to strengthening coffee value chains. An entrepreneur by spirit, Juan Carlos grew up in a family of coffee farmers and continued his family’s legacy by growing and trading coffee and cocoa beans. His strong passion for the industry led to his partnership with Nespresso and the development of the retirement savings plan program in Colombia. He holds an MSc in International Management from Boston University.
Eric is a board member of SMS, Sustainable Management Services, the sustainability division of Ecom Agroindustrial Corporation. He has been responsible for the development of several public-private partnerships that bring together large numbers of farmers and global buyers. Coming from a long family tradition of land stewardship and farming, he holds a BSc in Agricultural Economics and Finance from Cornell University. He was also the recipient of the Sustainable Standard Setter Award by the Rainforest Alliance and is a Fellow of the Aspen Leadership Institute in Colorado.
Paulo: Tell us a bit about your background and your relationship with coffee
My father is a coffee farmer and I grew up in the Caldas Colombia coffee region. I’m a coffee farmer and exporter, obsessed with the creation of exceptional quality, creating prosperity for the farmers, and training the new generation that will run the coffee industry.
My parents, both French, ran a coffee “cooperation” in Central America, and I grew up spending weekends and holidays on a coffee farm called ‘la Marsellesa’ in Northern Nicaragua. I studied at Cornell University where I started a venture called La Marsellesa Importers to establish direct relationships with Roasters in the NY area – which led me to Ecom Trading, a coffee cocoa and cotton merchant that I’ve been a partner with for over 20 years now and that has been a partner of Nespresso since the early days of AAA. My link to coffee goes back over 40 years.
Paulo: In your opinion, how has the coffee industry evolved over the last two decades?
It’s seen great volume expansion and price volatility. At the same time, sensorial quality in origin and value creation at the consumer end has increased tremendously. Although on the product side we’ve seen a very positive and fast evolution, on the human side, there are still many unresolved issues for small farmers, and the impact agenda has advanced, but not nearly enough.
I’d say there has been a tremendous evolution. We used to say 20 years ago that coffee would become like wine; that it would move from generic qualities and varieties to a much richer and transparent appreciation of the coffee terroirs, the varieties, and different processes. Looking back, it’s amazing to see it has actually happened. There is a much more legitimate, educated, and profound coffee culture and understanding of coffee quality in the world today than 20 years ago.
Paulo: How did you first get in touch with Nespresso?
I met the Nespresso team through Orlando Garcia, Head of Green Coffee who I’d known since 1979, and with him and Alexis, Head of Quality, we started to work on sourcing a differentiated and stable coffee from Colombia. We had our first meeting in the summer of 2002 with the CEO Gerhard Besserbrugge, and I vividly remember discussing the Brundlandt report, sustainability, and how to set the basis for the long-term sourcing of sustainable coffee, a term we liked to use at the time.
I met Nespresso through the Rainforest Alliance. Nespresso had engaged the Rainforest Alliance to collaborate on the development of AAA and in parallel, we had also started doing our own work with them in several different geographies. It was therefore a natural fit; a match of complementary capabilities but shared ambitions of quality, accountability, and ethical values.
Paulo: What did you think about the AAA Program at first? Did it seem “crazy”?
AAA was a challenge never seen before in the coffee industry. It changed the model of relationships among all stakeholders, and I visualized it as an opportunity for doing business through value creation; AAA was the perfect solution to implement the “doing well and doing good”. I believe the program set a new standard for the industry and introduced a mentality about working together to create value for all.
As for crazy… just about everything! The concept of buying a fixed taste despite an increased output; individually following-up on improvement plans with thousands of farmers; setting such incredibly high standards; getting suppliers that have a trading-only mentality to commit and deliver sustainability results; overcoming our differences and building partnerships with NGOs that were previously attacking our counterparts; creating personalized systems of measurement with our smallholders. And of course, the simple idea of sharing value – which was extremely rare just two decades ago.
I believe all of this was possible thanks to the visionary outlook of Nespresso’s leadership team, but also through personal engagement and the individual commitment of the Nespresso team and its partners. We all took it as a very, very personal dream and challenge.
It was definitely a challenge for us.
At first, we were somewhat suspicious of the amount of information required to custom-design the AAA program to each individual country. There was an intense phase of mapping the coffee sourcing processes in each country that entailed a tremendous amount of information gathering, language checking, and parameter validation, that no-one had gone through or seen before. It felt like having a Swiss clock manufacturer wanting to understand the coffee production world in remote regions of the tropics!
But in the end, it really evolved our business. Some of the Nespresso factory managers developed a direct rapport with our mill managers in places like Mexico, Guatemala, Costa Rica and eventually elsewhere around the world.
Paulo: How would you describe the AAA Program now?
I would describe it as the Rolls Royce of coffee sustainability programs. The accuracy and consistency one finds in the capsules is no coincidence. There is no other program in the coffee world that is so demanding regarding quality, accuracy and reliability.
That’s right. The AAA Program is a model for sourcing exceptional quality. It’s a powerful mechanism for creating prosperity for coffee farmers.
It offers a pragmatic approach to generating impact with metrics; it’s results-oriented, holistic and is interconnected among stakeholders. AAA is evolutionary, adaptable and scalable and it not only promotes but demands continuous improvement.
But for me, the best feature is that it starts by demanding very high standards of quality, social, and environmental performance and then offers a support package to achieve those standards, through in-kind and cash benefits. It’s a very dignifying approach to the creation of prosperity.
Farmers need challenges and support, not charity.
Paulo: What can you tell us about the farmers’ perspectives on the AAA Program?
The first feature in a farmer’s mentality is usually price. They perceive the AAA premium as a reward that they have to earn and this starts a virtuous circle.
The second feature is technical support. Smallholders immensely value the support of the agronomists – they find in them a solid base for improvement.
Apart from the in-farm excellence program, AAA is offering out-of-farm solutions. This is truly unique and differentiating. The Farmer Future Program that includes savings for retirement and climate change resilience through crop insurance, is a game changer that is moving the industry in another direction.
Through the balance of high standards with in-kind support and innovative in-and-out of farm solutions, AAA is unique and is making a big difference in our farming communities.
I agree. The benefits for the farmers are significant.
The quality of the materials and rewards farmers get is really impressive. The training programs are both challenging and rewarding at the same time, but most importantly there is a feeling of being part of a select club that produces the best coffee in the world. There is of course a financial reward to it all, but most importantly it’s the feeling of being part of something bigger: an innovative way to grow coffee in a rewarding way both for the consumer in terms of quality and convenience, and for the farmer in terms of profitability and long-term viability.
Paulo: The AAA shared commitment is the reference document which expresses the collaboration between you and Nespresso in light of a common objective: the sustainable production of coffee. How typical is this in the sector?
It’s unique. We usually have contract terms for the trade, and rules and regulations for shipments, payments, quality approvals, but we seldom see a framed agreement with metrics, roles, responsibilities and common goals on the creation of prosperity and advancement in sustainability.
There really is no other comprehensive and deeply-articulated commitment for orderly shared action, impact, and accountability of coffee supply chain and cluster management. It’s truly a governance document that regulates all aspects of the ‘Farmer-Supplier-Nespresso’ relationship including guidelines for field investment, and project management to build trust and accountability like no other.
Paulo: What about the role of the AAA agronomists? Do you see this as a powerful engagement within the coffee sector?
The AAA agronomists are critical for the support of the many smallholders. The relationship with the AAA technicians goes beyond know-how transfer. It’s a fellowship where they find company for their challenging and solitary work.
I think the presence and engagement of the AAA agronomists is key to the successful integration of the sustainability initiatives at farm level. They’re also fundamental to communicating to HQ about the changing agronomic and climatic conditions that regularly affect the productivity, costings, and survival conditions of farmers in the different producing countries. Be it because of a changing climate, changing demographics or changing agronomic conditions, it’s not easy to be a consistent quality coffee farmer around the world today.
Paulo: In your experience, what’s the most innovative aspect of the program?
I’d say it’s the Farmer Future platform which addresses where the coffee farmer is empowered to create their own solutions. It provides resilience to challenges that happen out-of-farm like climate change.
For me it’s the concept of “qualitivity” because it proves that with proper training and support, there doesn’t need to be a conflict between quality and productivity. On the contrary, with the “qualitivity” guides developed in collaboration by Nespresso and the Rainforest Alliance, the farmers get all the necessary information to increase their income through improved productivity and quality, while at the same time respecting the environment and meeting social best practices and criteria.
Paulo: Do you have any anecdotes that illustrate the spirit of the program?
We receive hundreds of visitors every year, who come to witness this laboratory of human progress, this example that it’s possible to do business differently. They come to see sustainability in action, thanks to the fact that we silently built a story that can now be shared. The most rewarding moment for me is repeated every day when I see the human connection between our Nespresso visitors, our team, and the farmers. There are real friendships built. There is genuine mutual admiration, there is respect and good ambience everywhere. It’s a unique treasure that I will keep forever.
On a more personal note: one year my daughter Nicole had to make a school presentation describing her hero, and she chose me from a long list of personalities because of the work I do for and with the AAA Program.
Paulo: What’s your greatest achievement thanks to our collaboration?
It’s definitely the pride of our regional farmers in belonging to AAA. We managed to keep their hopes, pride and passion intact through the existence of this program. We’re also proud to create an example for others to follow. We set a dream and became pioneers but mainly achieved a lot of transformation to inspire the new coffee generations.
For me, it’s the recent launch of the Master Origin Nicaragua Black Honey coffee. It speaks to my heart, because it’s a collaborative achievement that resulted from years of research and innovation across multiple actors. The Nespresso quality team led from the sustainability, organoleptic, and flavour profile identification front, but the actual product benefitted from years of collaborative research between Ecom, CIRAD, the French research institute, the NicaFrance Foundation, and the Moringa Impact fund to develop the supply pipeline.
The coffee comes from a AAA cluster where there was significant direct impact investment made to scale the use of the Marsellesa variety in agroforestry as a rescue package for farmers hit by the Rust Disease. It’s also the first cluster where, through collaboration with the INCAE Business School we will be monitoring the long-term impact of the program via the Social Progress Index. The results over time should be tremendous as the area of impact is certainly one of the poorest in Latin America, if not the coffee world.
Paulo: If you had any advice to give to Nespresso for the future, what would it be?
Continue to inspire the youngest generation of farmers and revitalising their passion and pride for growing coffee. This can be achieved by creating the business stability and conditions to actively engage, and then connecting farmers to consumers. The connection is so powerful, that the results seem evident.
Nespresso was critical to introducing a new model at the consumer end that created so much value and engaged the youth. We should encourage the same revolution of youth involvement and value creation that occurred at the consumer end but at the farmer end.
Nespresso has developed a supply chain accountability model that is second to none and truly translates into a better product in the capsule.
I would scale the communication of the AAA Program – not only to overcome the threat of competitors with inconsistent and untraceable sourcing, but to benefit your market share and brand positioning as you continue on your growth journey as a responsible triple bottom line leader in the coffee world.