Hong Kong’s supermarkets making slow but steady improvements in sustainability efforts
The COVID-19 pandemic has taken its toll on Hong Kong’s seafood trade, but the city retains an outsized role in Asia in promoting more sustainable consumption of seafood. With the second-highest per capita seafood consumption levels in Asia (and eighth-highest globally), the city’s role as a free port and trading hub for the mainland Chinese market also makes it a prime location for changing purchasing habits in greater China.
A report on how the city’s retailers and high volume vendors of seafood, have been faring on improving their sustainable and traceable products suggests retailers are moving in the right direction – slowly.
Hong Kong’s supermarket sector has traditionally been dominated by a local duopoly of British-Hong Kong conglomerates, Jardine Matheson and CK Hutchinson Holdings.
The two big supermarket groups “have set a clearer target to introduce sustainable seafood by 2025,” said Jovy Chan, project manager for the Footprint program at WWF’s office in Hong Kong, who compiles an annual ranking for WWF titled the "Sustainable Seafood Procurement Policy Scorecard." The 2020 ranking is set to be published this spring.
“Four other [supermarket operators] have also set yearly targets to introduce more sustainable seafood,” Chan told SeafoodSource. “They are enhancing transparency step by step.”
The 2019 scorecard puts the Jardine Matheson brands MarketPlace by Jasons and the leading supermarket chain Wellcome (operated under the Dairy Farm holding firm) in sixth place. CK Hutchinson retail chains Fusion, Taste and major supermarket chain Parknshop (300 outlets) were ranked in fourth place.
There’s plenty for the retailers to work on, according to WWF. Dairy Farm stores, for instance, scored poorly (three out of 10) on in-store labelling of seafood: WWF scores on six criteria, including their introduction and sale of sustainably sourced species (and rejection of threatened species) as well as the use of detailed labeling.
“Both of them [Dairy Farm, AS Watson] have taken some actions to introduce more sustainable seafood in their outlets,” Chan said. The most recent scorecard (2019) puts the Japanese owned AEON chain, which has a handful of stores in Hong Kong, at the top of the ranking, followed by the (also Japanese) YATA chain which rose from fifth place in 2018. Third-ranked convenience-store chain 759 received the same score in 2019 as it had in 2018.
Since 2016, WWF has worked with nine major supermarket groups to “push them to formulate sustainable seafood procurement policy,” Chan said. However, the city’s retailers have traditionally focused on product safety rather than sustainability, according to Chris Hanselman, proprietor of Pacific Rich Resources, a Hong Kong seafood importer and distributor with a focus on sustainable seafood.
“In this climate, it [sustainability] is very much a distraction,” Hanselman told SeafoodSource. Efforts to improve sustainability have been put on hold at major retailers as they fight to survive the pandemic, he said.
Hanselman said the city’s retailers haven’t been supportive enough of industry initiatives like the Hong Kong Sustainable Seafood Coalition, which has aimed to push distributors and catering companies to adopt sustainability goals and best practices.
“[It’s] a wonderful, well-intended organization and I completely support it,” Hanselman said.
Even though competition has arrived in the form of deli chains and online trade through local e-commerce leader HKTV, “it has always been very hard to push ‘sustainability’ into the supermarkets,” he said.
“And even when they have taken stock, it really has been their paying ‘lip service.' In fact a subtle change towards a message of ‘health and safety’ rather than sustainability got more traction,” Hanselman said. “But now, with COVID and the tough economy, they are back to selling cheap and obtaining market share, and in most cases, any initiatives to promote ‘sustainability’ have been put on the back-burner.”
A new HKSSC initiative, the Seafood Risk Assessment, is aiming to help the city’s seafood trading and buying members better understand the sustainability risks of seafood imported into the city, but uptake has thus far been slow, Hanselman said.
“The original aim of the HKSSC – and I believe this is still the intention – was to get stakeholder ‘buy-in’ to create understanding and change. Unfortunately, there has never been any real buy-in from the major stakeholders, and I mean the supermarkets, who should be the driver entity for change. It was always intended to get these guys on board, but I think HKSSC has failed in this regard, although effort has been applied in this area,” he said.
A Hong Kong focused website, ChooseRightToday.org, funded by the ADM Capital Foundation (which also funds the HKSSC), lists the city’s retailers by the amount of certified sustainable seafood they sell. The site shows local outlets of foreign retailers like IKEA and Marks & Spencers stock only Marine Stewardship Council-certified products. But the sustainable options are “limited” at the key local chains, according to the site.
At the bottom of the WWF’s 2019 Sustainable Seafood Procurement Policy Scorecard rankings is the Kai Bo supermarket chain, which operates 91 stores in the city. The chain scored zero points out of 10, meaning the company did not share any data with the group.
“We have contacted with their senior management since our first scorecard. We had a call with him in 2016. He told us Kai Bo’s consumers only concern is about the price and food safety, so he does not think sustainability is one of its business direction at this stage,” Chan said. “We keep sending emails to Kai Bo and him every year, but we haven’t received any feedback. We can’t have any ground to evaluate Kai Bo’s performance, so we only assess this as ‘zero’ to reflect the situation.”
WWF annually sends the retailers a questionnaire to check their progress and upcoming plan every year.
“To get higher marks in the scorecard, they know they need to make progress every year. Generally, I will check their reply in details and go through it with each supermarket to ensure there’s no misunderstandings, they have committed their achievements, and they will give an updated target.”
The results of the surveys show progress has been made, Chan said.
“When the reporting began in 2016, the nine major supermarket groups did not have annual targets regarding sustainable seafood. None were listing the scientific names of seafood species or whether animals were wild-caught or farmed on pre-packaged products,” Chan said. “As of 2020, two supermarket groups have formulated time-bound action plans to enhance their sustainable seafood choices by 2025.”
Another three supermarket groups have made an annual plan to expand their sustainable seafood choices range, according to Chan.
“These actions show commitment and progress by the retail sector to improve their seafood traceability and sustainability in the future,” Chan said. “Supermarkets are adding more information on packaging or tags to help consumers make informed and sustainable seafood choices.”
However, Hong Kong retailers face unique challenges in their sustainable sourcing efforts in comparison to their Western counterparts. One particular difficulty is the wider seafood range expected by customers there.
“It will be harder to get sustainable seafood for some species, especially live seafood,” Chan said. “The continuing monitoring of supermarket progress is significant to drive retailers to move towards sustainability.”
Another challenge is the relative ineffectiveness of using sustainability as a marketing tool – grocery markets globally have used sustainability pledges to appeal to younger consumers in particular, but overall, shoppers in Hong Kong appear less enthused, according to Hanselman. Health and safety are bigger priorities in the purchasing choices of consumers in Hong Kong, he said.
“Younger [shoppers] are very much into health and safety, environmental issues, but the sustainability message tends to get lost,” he said. “The traditional domestic market really doesn’t care, although there is an increasing awareness. Purchases are generally price-point driven.”
New sustainability initiatives may be off the priority list for Hong Kong distributors like Hanselman due to the pandemic – but he said he will stick to his principles.
“At the moment, my own battle is to survive, which has required huge flexibility and versatility in how I run my business. I still maintain by ‘sustainable’ position as it is fundamental to my brand and I have spent many years building this.”
The COVID-19 pandemic may be an opportunity for the Hong Kong Sustainable Seafood Coalition to “retrench” and to use a consumer preoccupation with health and safety to get the retailers on board, “not get busy with labeling and other stuff,” Hanselman said.
“This is no easy task, but would be a great driver for change,” he said.
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