Luxury Champagne brands like Krug have a surprising story to tell of long-term committed action to tackle sustainability and build a climate-conscious culture with their company. Margareth Henriquez, CEO of the Krug, and President of LVMH’s Wines & Estates, here tells us why her company has a lot to share and nothing to hide when it comes to facing up to climate change.
Nick Breeze: When did you start thinking about climate change and the risk that it posed to your vineyards and business?
Margareth Henriquez: In the year 2001 I really got into the world of winemaking and winegrowing and the connection that exists between nature and the product that you have in the wine industry. You don’t have it anywhere else. There is no product that illustrates nature as much as wine does.
The first time I got confronted with the reality of the warming climate is in Argentina. I started working in 2001 in Argentina. It is there that I realised that we had been there since 1958, and Mendoza is a very dry place with just 200mm of rain, which is very poor. You really count on the snow melting but you have less and less snow.
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Even in the last 5 years, it has been very very bad but even back in 2005, we were looking at this phenomenon of temperature going up gradually and water being very scarce. So I think it was because I was in Argentina and it was my first experience in touching nature that I realised the importance of this process of warming and changing climate.
This is when I started very much to be active and I decided to apply all the sustainable principals. So it is not just about climate change but it is about what you do. You can do so much to reduce CO2, to save energy, to renew energy.
So all these kinds of initiatives we started to implement in Argentina with very limited resources but it became our culture, and this is what I really like.
Nick Breeze: Can you give examples of the actions you have taken and what the impact of those changes has been?
Margareth Henriquez: In the case of Krug, what we have seen is that you have almost 1 degree of alcohol more and almost 1g less of acidity, of freshness you see? So you have less freshness and higher alcohol.
This would worry a house like Krug a lot because our obsession and our mission is to create Champagnes that can really go through the passage of time and gain with it. This could worry us but we are not going to wait. Since long ago we started a lot of work, including working our vineyards, working with our soils, the way we fertilise, the organic treatments, and using nothing chemical. Trying to bring the most beautiful expression using the resources we have.
In addition to that, we have changed all our mechanical weeding to electric tractors, so we are sure we don’t add CO2.
Another thing is that we have become obsessive with the picking date. This is critical. We don’t decide this by analysis anymore. We do this by tasting the berries and there we make our decisions. By doing this we have actually gained freshness. By the time of the declaration of the harvest, we have started already!
So we have gained a little bit in alcohol, 0.2, but we have gained in freshness, 0.3. So we are even better in freshness than we are in alcohol. But it is all [of the processes]. When we talk about our champagnes, our reserve wines are extremely important. We have state of the art little tanks to protect our reserve wines in a very reductive environment, so we guarantee the freshness as never before.
We have never before had this kind of state of the art with 850 tanks when 20 years ago we had 60! So we have made huge progress in the way we work our vineyards and the way we work inside. We have a culture that takes in sustainability, we take care of our water with 30% usage reduction. We have [also] reduced our electricity use. This is all part of our culture of caring for the planet and for nature.
Nick Breeze: Surely we have to expect style changes in wine?
Margareth Henriquez: The truth is, I think, is that it has changed, there is an evolution. But it changes because thirty years ago this was not in the mind of anybody. There has been a change, progress in the way we work with our vineyards and in the way we deal with our wines. We have 3 times the amount of reserve wines we had in the past.
But we have been discussing a lot lately about the importance of trying to keep this balance. We would say that until today, 20 years after we realised that climate change was starting more evidently, we are able to say that we made [the changes to make this] happen. Because we are in Champagne, and Champagne is very northern, you still have a way to go.
Then when we talk about Argentina, what did we do to continue to produce beautiful wines, expressing Malbec? We had to go into new plantations. We had to go 200, 300, 500 metres up to avoid the heat and to get the freshness and the finesse. So we protect the style because we invest.
We have changed the irrigation system to dripping by block. We have reduced 50% off water consumption. We have made all sorts of electro-analysis to understand the soil. So there is a lot of precision viticultural work that has been done that compensates, in addition to new plantations and new altitude that compensates the warming process. But it is a risk. It is something that is in our mind permanently.
Nick Breeze: Especially in Champagne where you have that heritage.
Margareth Henriquez: In Champagne you are very northern and I believe there is a lot still that we can do.
Nick Breeze: It is very interesting that now, today, the wines of Champagne are absolutely amazing, it is like a golden age of champagne but the IPCC still predict continual rising temperatures. Especially where we are not tackling it fast enough, on the politics and everything else…
Margareth Henriquez: It is frightening!
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Nick Breeze: How high can we go up the mountains? How much intelligence can we filter into the processes?
Margareth Henriquez: Well [in Champagne] there is no mountain, you have the slopes, the 30 thousand hectares, and this is Champagne and nothing else! This is the main point: what happens if the world doesn’t do anything and you keep getting this warming going up and up, there is a point that you are no longer in Champagne.
To go to Champagne conditions in Mendoza, you compensate latitude with altitude. It is a very good exercise that we learn from. Yes we are in Champagne, yes we are in Cognac, yes we are in Mendoza, but we also have 7 domains in extreme places in the world, and we learn. To create Champagne conditions in Argentina 30 years ago, we were at 1100 metres. Now we are at 1600 metres. In the past, at these altitudes, everything was frozen but not anymore.
It is a call of attention to the world because the day Champagne is in a warm climate, scientists are talking about 70 years or something, at that point you will see a big dramatic problem in the world before it happens. So we have to be conscious and do something now!
Nick Breeze: Consumers seem to be more concerned about climate change. How do you communicate all this stuff that you are doing?
Margareth Henriquez: I do not think we communicate enough. As a matter of fact, it is not a subject that I normally communicate. I talk about strategy, about luxury brand building, about wines, about other things in my lectures and conferences. I have accepted to come here and it was a big challenge because my conclusion based on everything we have gone through is that we are very bad at education. We have to educate better and to communicate much more about what we are doing and, it is incredible, what we have done so far. This should be part of what we say and it is going to be part of what is shared.
This is the way. We have the Krug identity and today we are very hidden behind this Krug identity, but now I have decided we are going to put out much more information. We have nothing to hide but a lot to share!