Stonyfield Farms: A Case Study of Sustainable Development in Business Today

In our modern industrialized world driven by economics, businesses hold a powerful role

in determining how resources are managed and consumed. If businesses start promoting

sustainable development, part of the ecological challenges our planet faces may be helped. The

World Commission on Environment and Development defines sustainable development as,

“development that meets the needs of the present without compromising the ability of future

generations to meet their own needs”. Given this definition, it may be difficult to understand

how a business could act sustainably and remain economically successful when its focus is to

increase profits. In this essay I will analyze Stonyfield Farms, a leading organic yogurt producer,

to demonstrate how a business can increase profits by promoting sustainable practices.

This case study will explore Stonyfield Farm’s sustainable business model by analyzing

the company’s background, ecologically focused mission statement, external practices, and how

they all contribute to the company’s success. The report will illustrate how certain values and

world-views expressed in the field of Environmental Ethics are applied, and contribute to the

company’s overall success. By the end of the case study, I will successfully demonstrate that a

company that adopts an ecological approach towards business can be both profitable and

sustainable.
Overview of Company:

Stonyfield Farm is a leading organic yogurt producer that has adopted a sustainable business

model, which has led to the success of the company. In 1988, the company moved to

Londonderry, New Hampshire in the United States where they remain today. The company has a

legacy of environmental stewardship and profitability. The business is one of the largest in New

Hampshire, and supports the local dairy farming industry. Stonyfield Farms has received many

environmental awards for its sustainable business practices, and CEO Gary Hirshberg is

internationally recognized as a successful eco-entrepreneur and advocate for responsible

business.

Company Background

The formation of the company was extremely influential in shaping its approach to

sustainable business. Stonyfield Farm began as an organic farming school called the Rural

Education Center, which taught sustainable agricultural practices. Current CEO Gary Hirshberg

and Chairman Samuel Kaymen founded the school, and started producing and distributing

organic yogurt to help fund the school. As the business grew, both realized that a successful

yogurt company could serve sustainable agriculture and the environment better than their school

could - so both decided to shift their focus to growing the business instead.
 Both the company’s founders came from ecology-focused backgrounds. Kaymen was a

specialist in organic and bio-dynamic agriculture, and former Director of the Bio-Dynamic

Farming and Gardening Association. Hirshberg was an environmental activist, windmill-maker,

and formally served as the executive director of The New Alchemy Institute – a research and

education center dedicated to organic farming, aquaculture, and renewable energy.

Before the company even began, both founders were passionate about educating and

spreading knowledge about sustainable agriculture. The academic background of both the

founders is important because it established their deeply seeded ecological world-views prior to

entering the business. One would not aspire to open an agriculture school unless they saw

intrinsic value in the environment and nature. The ecological thinking of both founders is

important because it laid the fundamental framework of Stony Field’s approach to sustainable

economic development. Their background also provides awareness to what sustainability from

an ecological perspective means, and how it could be achieved. Overall, the ecological thinking

of both founders laid the groundwork for a successful and sustainable business model.

Mission Statement and Business Processes

William Rees promotes a type of strong sustainability, where society ought to use the

interest from the planet, rather than the planet’s resources. Although not entirely followed, the
business strategy that Stonyfield Farms subscribes to is relatively close to the type of sustainable

development that Rees promotes. An examination into the company’s mission statement provides

a holistic approach on how their business acts in a manner that does not use up its capital but at

the same time provides benefits to its investors and the greater society.

Mission Statement for Stonyfield Farms:1

• To provide the very highest quality, best tasting all natural and certified organic products.

• To educate consumers and producers about the value of protecting the environment, and of supporting

family farmers and sustainable farming methods.

• To serve as a model that environmentally and socially responsible businesses can also be profitable.

• To provide a healthful, productive and enjoyable work place for all employees, with opportunities to

gain new skills and advance personal career goals.

• To recognize our obligations to stockholders and lenders by providing an excellent return on their

investment.

In order for any business model to be successful, it should be economically viable. The

business model that Stonyfield Farm has pioneered is not only economically viable, it has turned

1
Taken from company website: http://www.stonyfieldfarm.com/aboutus/OurStory.cfm
the company into today’s leading organic yogurt producer in the world. Their products are sold

across the world and compete with recognized brands such as Yoplait and Kraft. The company

has enjoyed a compounded annual growth rate of more than 26 percent for 13 straight years,

while the yogurt category as a whole has grown at a much slower pace of 6-8 percent. So in the

eyes of corporate America, the Stonyfield Farm is a success. But from an ecological perspective,

merely being profitable is not an indicator of sustainable success. Rees would argue that a

company is acting sustainably if they preserved the resources and only profited from the interest

of the capital. The founder’s ecological thinking considers this concept because the company is

not only profitable, it also acts in a manner that does not negatively impact the land or

environment. On the company’s website, it “recognizes, as a corporate priority, the health of our

planet and the interdepence of human activity with all natural systems”. This statement is a

reflection of the company’s adoption of deep ecology.

In regards to their treatment to the land, Stonyfield Farm’s products are certified organic,

which means there are no pesticides or chemical fertilizers used in production. This means that

all the negative consequences from pesticide use are prevented, and the nutrients of the land is

preserved in its natural state. In regards to an environmental ethic, the conscious preservation of

the land indicates that the company intrinsically values nature. If it did not intrinsically value

nature, they would use chemical fertilizers and pesticides to increase production and thus profits.
 In keeping with its mission of protecting the environment, the company looked into its

energy use. In 1997, Stonyfield Farm became the first US manufacturer to offset 100% of its

facility energy use through wind energy, farm methane recovery, and reforestation carbon offsets.

The company also worked on making its factory energy efficient by investing in heat recovery

technology, installing energy efficient motors and lighting, implementing energy efficient

building practices, refrigeration system changes and fuel switching. Not only do these

improvements save the company money through their reduced energy use, it also portrays an

ecological perspective of conservation.

In regards to packaging, the company is using the concept of cradle-to-cradle design to

decrease its impact to the environment. In 1999, Stonyfield Farm commissioned a study by the

University of Michigan's Center for Sustainable Systems to perform a life cycle assessment of

Stonyfield Farm's product delivery system. The assessment considered all packaging involved in

the process - ranging from the actual containers to the shipping boxes. The outcome was a

configuration of the ideal size of the cups, and type of recyclable plastic used for the cups and

lids. Again, this action reveals that the company has adopted an ecologically focused strategy in

its business development.

The company also holds a non-anthropocentric attitude, as demonstrated by their ethical

treatment of its cows. All livestock adheres to the USDA standards such as access to the
outdoors, shade, shelter, exercise areas, fresh air, and direct sunlight. The company also publicly

opposes the use of Bovine Growth Hormones - a chemical designed to rapidly increase milk

production in cows.

Through its actions, Stonyfield Farm proves that the company takes the concept of

sustainability seriously. The company comes very close to Rees’ concept of living off of the

interest of the planet’s resources rather than depleting it.

External Practices

In addition to producing its products sustainably, Stonyfield Farms also contributes to the

greater society and community. The company donates 10% of its profits to organizations and

innovative environmental projects and organic programs. In 2007, the company donated

$1,947,109 to ecological focused initiatives. The company also supports local farmers rather than

industrial farmers. Stonyfield Farmers belong to the Organic Valley Farm Cooperative, an

organization of small farmers with a profit sharing model that ensures farmers and employees are

properly compensated.

The company also actively promotes sustainable business practices to other businesses.

Hirshberg recently wrote a book called “Stirring It Up” that educates individuals on how to build

a successful and environmentally responsible business. The CEO has also spoken at several
corporate social responsibility conferences and at leading business schools and universities

around the world. Stonyfield Farm is one the largest businesses in New Hampshire. New

Hampshire is a swing state when it comes to voter allegiance, making the company a focus on

many politicians’ campaign trail. The company vocally supported President Barack Obama for

his environmental policies, and publicly opposed George W. Bush’s lack of attention to

environmental issues. Stonyfield Farm also uses its products as a vehicle to inspire change by

printing political messages on its yogurt lids. In 2001 the lids campaigned against drilling for oil

in the Arctic national wildlife refuge. Other milder messages range from facts about global

warming to gun control.

Through these actions, we can see that Stonyfield Farms is using its weight as a

successful business to advocate for sustainable business practices, in addition to following what

it preaches. The company is creating a sense of community and proving that businesses can be

successful while be sustainable. This is inline with what many environmental philosophers write

of when encouraging society to spread and adopt a new environmental ethic. The only difference

being that Stonyfield Farm’s environmental ethic is geared towards business.

This case study explored the world’s largest yogurt producer, Stonyfield Farm, and its

successful business model for sustainable development. The case study examined the company’s
sustainable business model by analyzing the company’s background, ecologically focused

mission statement, and external practices. The report illustrated how certain values and world-

views expressed in the field of Environmental Ethics were applied, and have contributed to the

company’s overall success. This case study will have successfully demonstrated that a company

that adopts an ecological approach towards business can be both profitable and sustainable.