Coffee major Phuc Sinh wins $634,000 non-refundable grant from Dutch fund

Dutch Fund for Climate and Development (DFCD) has awarded Phuc Sinh Group a non-refundable grant of €575,000 ($634,363), the largest it has ever given to a company in Vietnam.

The grant aims to support the company's environmental, social and governance (ESG) and sustainable development initiatives.

DFCD is a Dutch non-governmental organization managed by the Netherlands Development Bank (FMO), the Netherlands Development Organization (SNV), the World Wildlife Fund in the Netherlands (WWF-Netherlands), and the Climate Management Fund (CFM).

The grant was a recognition of Phuc Sinh's efforts in implementing ESG initiatives and promoting sustainable development, as well as making other contributions to society, a DFCD statement said.

Phan Minh Thong, chairman of the board of directors of Phuc Sinh Group, noted that the company has had a longstanding relationship with the Netherlands. "Although it may not be large compared to other European countries, many of Phuc Sinh's significant projects began there," he said.

"In 2008, we collaborated on sustainable development with a prominent Dutch import company. They insisted that by 2015, all their products must be certified, and they encouraged us to pursue sustainable development certifications. This marked the beginning of Phuc Sinh's journey into sustainable development 16 years ago”, he recalled.

Thong also said that after the group had invested about VND5 billion ($201,860) and worked with thousands of farming households, they faced setbacks in 2012. After reassessing their approach, they persisted and ultimately succeeded.

In 2014, Phuc Sinh became the first enterprise in Vietnam to receive certification from the Rainforest Alliance (RA). To date, the company has garnered over 20 certifications related to sustainable development in various provinces, including Ba Ria-Vung Tau, Lam Dong, Dak Nong, Dak Lak, and Son La.

Phuc Sinh's ESG initiatives have garnered recognition from the international community, particularly from NGOs. Recently, in mid-August 2024, the company secured a $25 million investment from the Netherlands' &Green to promote sustainable agriculture.

Thong said the DFCD non-refundable grant will enable Phuc Sinh to expand its sustainable development projects, including anti-deforestation activities and broader ESG initiatives that meet international standards.

Specifically, Phuc Sinh will focus on four areas: developing certified sustainable products; investing in extensive training programs for farmers and Phuc Sinh staff; developing a traceability system; and complying with European anti-deforestation regulations.

The group planned to increase the number of households involved in producing products certified for sustainable development, such as Rainforest Alliance certification, which aims to protect forests and the environment.

“Receiving funding from DFCD not only enhances our ESG initiatives but also provides significant encouragement to the entire Vietnamese agricultural sector in its pursuit of sustainable development.

“Phuc Sinh aims to become a leading company in sustainable coffee, focusing on sustainable business expansion while addressing climate adaptation challenges and the needs of vulnerable local communities,” he said.

Albert Bokkestijn, project manager of SNV-DFCD, said: “Today, climate change is a global challenge that demands urgent action from both the public and private sectors. Vietnam's coffee production areas, particularly in the Central Highlands, are highly vulnerable to climate change, and many smallholder farmers are ill-prepared for its impacts. Engaging farmers directly in sustainable production will secure Phuc Sinh's supply chain and by adhering to the management measures required by RA, will enhance farmers' resilience to climate fluctuations and market changes.

"Phuc Sinh is a leading private coffee and pepper processing and trading company, ranking among the top 10 exporters in Vietnam. The company has been at the forefront of RA certification in the country. Therefore, DFCD is proud to support Phuc Sinh in achieving its goals.”