COEDO Beer's Challenge: Monetizing Biodiversity

One reason biodiversity is gaining attention is that its loss threatens the sustainability of natural capital—such as water and raw materials—essential for corporate activities. Biodiversity is closely linked to business risk, yet addressing it can also reveal new business opportunities.

This time, we interviewed Shigeharu Asagiri, President of COEDO Beer. COEDO Beer is a popular craft beer brand representing Kawagoe City, Saitama Prefecture, and has engaged with biodiversity since its founding. We explore hints for turning biodiversity into business.

We also introduce COEDO Beer's action of "regenerating an artificial turf soccer field into a barley field," along with the "Butterfly Check" method for visualizing the impact of biodiversity on business, and a creative approach for generating business opportunities based on the Butterfly Check. The interviewer is Yuka Sawai from Dentsu Inc.'s Sustainability Consulting Office.

<Table of Contents>
▼Why is COEDO Beer committed to protecting biodiversity?

▼What actions contribute to biodiversity, as measured by the Butterfly Check?

▼Integrating biodiversity into regional and global business

Why COEDO Beer is Committed to Protecting Biodiversity

"I think it's important to be aware that agriculture sacrifices biodiversity."

President Asagiri uttered these unexpected words while looking at his company's barley fields, then continued:

"Even here, we've forcibly turned this into a barley field for our own convenience. That inherently goes against biodiversity. That's precisely why we need to shift our focus first toward the environment and organic farming 'for biodiversity,' not just 'for humans.'"

While agriculture involves nurturing and managing nature, it often involves large-scale monoculture cultivation driven by efficiency, which can threaten biodiversity. This damages specific ecosystems and makes it difficult for diverse species to coexist. Agriculture can contribute to biodiversity conservation, yet it is also a primary cause of biodiversity loss. That's precisely why I sensed President Asagiri consciously seeks coexistence with nature and approaches agriculture with sincerity.

COEDO Beer is produced by Kyodo Shoji, based in Kawagoe City, Saitama Prefecture. Their craft beer production utilizes local agricultural products, and many may recognize their craft beer "Beniaka," made with locally sourced irregularly shaped sweet potatoes.

In fact, Kyodo Shoji's primary business is as a specialized produce trading company. Back in the 1970s, they pioneered efforts in organic farming and pesticide-free/reduced-pesticide cultivation—innovative approaches for the time—building a background of working closely with local farmers and the environment.

Additionally, unusually for a Japanese craft brewery, a biomass generator is installed alongside the brewery. Not only does it generate renewable energy from beer byproducts, but this commitment extends even to the spent liquid.

President Asagiri explained the biomass power generation system: "Wastewater from the brewery isn't dirty per se, but it contains nutrients, so it doesn't meet discharge quality standards as-is. Typically, microorganisms are used to break down these nutrients, but this produces large amounts of microbial waste. Microorganisms contain phosphorus and nitrogen, so this waste can't be discharged directly.

That's why we use methanogenic bacteria. We create optimal environmental conditions for these bacteria to thrive, utilizing the resulting biomass gas—which contains methane as a byproduct—for power generation. We sell the electricity produced, generating revenue. Additionally, residual contaminants are broken down by bacteria, phosphorus is removed from the wastewater, and sterilization ensures the water meets discharge standards."

What are the actions contributing to biodiversity measured by the Butterfly Check?

In December 2023, COEDO Beer conducted a pilot test of the "Butterfly Check," jointly developed by Dentsu Inc. and Think Nature, which visualizes outcomes for biodiversity and business.

What is the Butterfly Check?
This service measures the impact of a company's nature-related activities on both biodiversity and business. By presenting this impact as a single image resembling a butterfly's wings, it provides an overview, enabling analysis of the seemingly disjointed relationship between biodiversity and business. This helps identify areas for improvement and further business opportunities ( release here ).

COEDO Beer transformed an artificial turf soccer field adjacent to its brewery into an organic barley field. Using barley harvested from this field, they brewed craft beer sold at music events, launching various initiatives stemming from this conversion. They then participated in a Butterfly Check pilot project to measure the impact of this series of actions.

Analysis revealed that converting the artificial turf field into a barley field generated approximately nine times the positive effect in terms of species and ecosystem increase/decrease. Positive effects were also observed primarily in water-related ecosystem services, such as improved water regulation function due to enhanced water retention capacity of the farmland.

On the business side, it was also found to contribute to brand image and recruitment, making it clear that it enhances business value.

Regarding these results, President Asagiri stated: "While we had confidence in our longstanding commitment to agriculture, we lacked quantification. The Butterfly Check scientifically proved this activity contributes to nature positivity. We were also pleased to see our beliefs valued by customers. We can now see results in both 'nature' and 'business' dimensions, and areas for improvement have become clear."

Bringing Biodiversity to Regional and Global Business

Furthermore, this time, President Asagiri and Mr. Makoto Tanabe, who oversees the beer division, held a session themed "How to Develop Biodiversity and Business," based on the Butterfly Check analysis results. Alongside that session, we introduce methods for developing business ideas.

First, prepare A1-sized printouts displaying the Butterfly Check results and spread them out on the conference room table.

Step 1: Focus on the center and left wings to consider ways to improve and develop biodiversity and the natural environment
First, while looking at the measured values, share ideas on how to increase positive impacts on species and nature.

Step 2: From the left wing to the right wing. Converting Nature Effects into stakeholder value
Once nature-related ideas emerge, next discuss how to translate them into stakeholder value on the right wing.

Consider each stakeholder's perspective: Is our commitment to agriculture resonating with customers? Could the evidence on the left wing appeal to overseas partners? Can we secure local community cooperation? Assess the current situation, identify gaps, and generate actions or ideas to bridge them.

Step 3: Bottom-Up Approach. Linking to Symbolization and Enhancing Corporate Value
Finally, we'll take a bird's-eye view of the right and left wings of the Butterfly Check and discuss whether the above actions can lead to enhanced corporate value.

We consider whether the ideas generated so far can be consolidated into actions for this wheat field project, transformed into something more symbolic that resonates more deeply, or if other new goals might emerge. We also explore whether we can elevate the discussion further to enhance corporate value.

Ultimately, 28 ideas emerged during the 90-minute session.

Starting from the Butterfly Check, actions and ideas emerged across various layers—from concrete improvements related to nature, to marketing initiatives like new product development and overseas PR, and even extending to corporate branding.

After the session, President Asagiri spoke with anticipation:

"What was fascinating during the session based on the Butterfly Check results was how nature, business, and the company organically connected and became one cohesive entity. Building on this, while our own evolution is certainly important, I hope Japan as a whole becomes a society that coexists with nature, creating a positive cycle."

Through interviewing COEDO Beer President Asagiri and conducting this session, we were reminded of the importance of linking biodiversity and business. We aim to contribute positively to embracing Nature Positive (nature restoration) and supporting the steps toward corporate renewal within society and the broader economy.