The Wendy’s Company has announced a program to reduce greenhouse gas emissions across their global system. Improving energy efficiency by implementing U.S. Department of Energy Better Builds Initiative and upgrading equipment is justified. Purchasing energy through “clean” programs including solar generation will contribute to the goal of a 50 percent reduction in greenhouse gas emissions by 2030.
There is concern that the company intends “collaborating” with suppliers by imposing “responsible sourcing” in the supply chain. It is hoped that Wendy’s does not embark on a program of pressuring suppliers to undergo incremental capital investment and higher operating costs to improve sustainability without a corresponding increase in transfer price. A number of supermarket chains appear to be forcing suppliers to implement programs of sustainability with these retailers burnishing their environmental credentials at the expense of the agriculture sector.
At the end of the day it is seriously questioned whether customers will patronize Wendy’s over other QSR chains on the basis of enhanced sustainability. If operating costs increase and profit margins shrink, both institutional and retail investors will look elsewhere for greater returns. One outstanding sentiment at the 2023 IPPE was that “everyone wants sustainability but no one is willing to pay for it” A lot like welfare!