Kerry Group 2024 Leaders & Newsmakers

The past 12 months have seen a number of milestones for Kerry Group. From the perspective of our taste business, we have seen significant investment, new product launches in key areas, and important third-party recognition of our sustainability credentials.

CEOs Edmond Scanlon and John Savage (Taste) join the Leaders & Newsmaker issue to discuss the company’s key strides over the last 12 months, artificial intelligence's impact on innovation, and the main company focuses in the months ahead.

Kerry Group

Kerry, Ireland

2023 sales: €8.0 billion

Can you share three key company highlights for the last 12 months?

Edmond Scanlon, CEO Kerry Groupcourtesy of Kerry Group

Edmond Scanlon [ES]: The past 12 months have seen a number of milestones for Kerry Group. From the perspective of our taste business, we have seen significant investment, new product launches in key areas, and important third-party recognition of our sustainability credentials.

June 2023 saw the opening of a new taste production facility in Karawang, Indonesia. This investment is emblematic of our strategy to bring our capabilities closer to the markets we are serving, particularly in high-growth regions globally.

Indonesia, and South East Asia more generally, is such an exciting market, and it is wonderful to be extending our presence there. We are seeing such a rapid pace of consumer-product innovation in those markets – they are hugely dynamic and are providing great opportunities for new product launches and product development.

Stepping back and taking a more global view, we are seeing some important trends gaining momentum; specifically those with a general consumer health lens, and salt reduction in particular. We are seeing greater cut-through in the message that we need to do much more with regard to sodium reduction in our foods and beverages. Despite the significant strides that have been made in this regard in a number of markets over the past few years, globally, we are still consuming twice as much salt as should be in our diets day-to-day, and this excess consumption is driving millions of excess deaths a year, according to the WHO. I’m proud to say that the scientific experts at Kerry have developed an excellent range of tools to help address this challenge, and these have been added to this year by an extension in our portfolio to include Tastesense™ Salt; the next generation of our sodium reduction technologies, that have the capability to reduce salt levels in key food categories by as much as 50%, while still retaining excellent taste and functionality. This could be a game-changing product for many categories and is one of a number of product areas that Kerry is working on to support healthier product formulation.

Sustainable nutrition is at the heart of what we do as an organization, whether that is in taste, or across our wider portfolio. Sustainable nutrition focuses on a full spectrum of considerations, encompassing dietary and environmental sustainability issues. We have been working hard to advance our objective of reaching 2bn people with sustainable nutrition solutions by 2030, and I am committed to realizing that objective. It has been gratifying, over the last year to see our sustainable nutrition reach grow to positively impact over 1.25bn people around the world last year. In addition to this, our wider sustainability efforts have seen third party recognition, via the World Benchmarking Association, which placed our sustainability performance amongst the top 10 of the most influential companies in the food and beverage sector globally in 2023, and via the Financial Times, which has recognized Kerry to be amongst ‘Europe’s Climate Leaders’ in their special 2024 report on that topic, for the positive steps we have taken to reduce emissions, relative to revenue. These are positive public recognitions of progress we have been making on our sustainability journey, which reflects the passion and commitment of our team.

John Savage, CEO, Taste, Kerrycourtesy of Kerry Group

What are the major influencers for innovation in 2024 leading into 2025?

John Savage [JS]: You could potentially summarise the major innovation influencers across three categories: consumer trends, health requirements, and industry needs.

As always, the changing patterns of consumer taste and trends continue to drive exciting and interesting product innovations. Kerry’s Taste Charts look to map these developing trends each year, giving a global and regional picture of what is happening, and providing comparability on evolving patterns from one year to the next. One of the most interesting trends I have noted, and which is covered in the taste charts, relates to the continued fusion and exchange between global cuisines. Filipino and Peruvian dishes and flavors, for example, are rising to global prominence, and fusing with other culinary traditions to provide interesting inspirations. Staying on top of the constantly evolving trends in consumer tastes is no doubt one of the most interesting aspects of the industry, and innovating in this space is something we really enjoy at Kerry.

Alongside the more transitory trends in taste, we are seeing the strengthening of a more permanent dynamic driving innovation, and that is the healthfulness of formulations.  The industry has been on a long path to reduce sugar, salt, and fat levels in products, and to remove other unwanted ingredients, and this will only grow in importance. Significant progress has been made in this area in many cases, at country and category levels, and in some areas, we have reached a point where big reductions have been made but further, and more difficult to achieve reductions are still required. Kerry are significantly engaged in this area, and has a very strong portfolio and capability offering in place to address customer needs. We recently launched Tastesense™ Salt.  By leveraging our fermentation, extraction and cooking expertise, we developed a toolbox of solutions that deliver on salt and umami taste while significantly reducing the amount of sodium in a product.

Beyond consumer trends, and health requirements, there is another major factor driving innovation in the current market – and one which we have seen in many guises before, relating to shortages in essential taste commodities. Cocoa and orange are both experiencing shortages globally, with a particular crunch being faced in the case of cocoa. Crucial supplies from West Africa have been severely hit, with prices soaring as a result. A resolution to the issue appears to be a long way off.

Brands are of course being forced to look at formulation options that will get the very most out of the reduced and costly supplies of material available in the market. Kerry have been working with customers to address these needs and have a suite of products available which seek to maximize cocoa taste experience while enabling reduced reliance on the commodity in an overall recipe. Achieving this has been a challenge, but we, and our customers, have been very happy with the results achieved. More generally, we can see that product shortages, in various areas, often driven by environmental pressures and climate change, will continue to be a pressing feature driving the need for innovation in the years ahead, with the need for more long-term, sustainability-focused initiatives to mitigate environmental conditions becoming ever more evident.

Another important area in innovation is artificial intelligence (AI), this has an increasingly important influence on how we work and innovate in Taste. We are very excited about the potential AI has for our business in 2024 and beyond.

What are your main company focuses and/or goals for the next 12 months? 

JS: From a Taste business perspective, over the next 12 months, we will continue to pursue our growth strategy, and extend our reach in sustainable nutrition.

We see exciting growth opportunities across a wide number of global markets, and we will be placing a particular emphasis on opportunities in the Asia Pacific, Latin America, Middle East and African regions.

Healthfulness of product formulations will remain a top priority for many, so we envisage significant, ongoing work on this agenda with customers, alongside product innovations to address evolving consumer trends.

Within this, enabled by our strong vertical integration across several key areas we will be assisting customers in managing cost-related issues in the supply chain. Shortages in supply of specific commodities, as referenced above, will continue to drive the need for cost-optimized solutions in certain taste profiles, even if the more general inflationary pressures we have seen in the supply chain over the past number of years continue to subside. Affordability will remain a very key issue for consumers around the world, and one which food producers will necessarily be keeping front of mind.

As always, we’ll continue to evolve our broad portfolio to keep up with consumer and market trends, with a number of new product launches forthcoming in areas such as savory taste, and within our range of natural botanical extracts – both of which offerings will enable compelling consumer product innovations.

The next 12 months will be an exciting year, characterized by investment, growth and innovation.