Exploring incentives to move up the Food Waste Hierarchy: case study of the Australian cheese manufacturing sector

Food loss and waste (FLW) is a global challenge, with one-third of all food produced being lost or wasted. The United Nations' Sustainable Development Goal 12.3 aims to halve FLW by 2030 due to significant environmental, social, and economic implications. To address FLW, various definitions and frameworks have been developed including the circular economy (CE) and the Food Waste Hierarchy (FWH), which provide structured approaches to prioritise management practices by focusing on reducing, reusing, recycling, and recovering materials throughout the food production and consumption stages. Governments and firms often use the FWH to set targets and develop strategies to reduce FLW.

There are multiple types of motivators that can incentivise behaviour change. The importance of motivators for firms to change their FLW behaviour has not been systematically examined nor has how these motivators differed as firms move up the hierarchy. This study uses the cheese manufacturing sector as a case study to explore multiple motivators for firms to change management practices according to the alignment with the FWH. Interviews were conducted with 42 cheese manufacturers in Australia, which represent 31% of Australian firms across states and production scale. Using a 100-point allocation question, participants were asked to identify the relative importance of six motivators, plus an optional ‘other’ category. Participants’ responses were grouped and compared based on predominant whey management behaviour.

Relevant motivators include coercive (profit maximisation, government regulation and buyers’ expectations), normative (society’s expectations and protecting the natural environment) and mimetic factors (keeping up with practices used by others). The most important driver for change relates to finding an alternative practice that maximises profit, followed by firms’ desires to protect the natural environment and adhere to government regulation.

Currently, whey management issues motivate little behavioural change in buyers’ waste management practices. Generally, there is a lack of differences between factors that are affecting to change their behaviour between hierarchy-levels. These results indicate there are not strong enough (dis)incentives for firms to move up the hierarchy towards human food products or animal feed, which the federal government is seeking to address going forward. Overall, the study contributes to understanding the motivators that drive firms to engage in circular business models and provides insight into their relative importance and variations across hierarchy levels, and how government agencies may do better. The findings offer areas where change can be made to reduce FLW, which can be explored in future studies. For example, increasing the awareness of whey management issues and alternative uses of whey to consumers, which could drive expectations of cheese manufacturing processes back through the supply chain. It could also drive the demand for whey-based products (e.g., alcohol products) and other full-utilisation practices.