The 2021/2022 monetary yr (FY) was a ‘notably difficult’ one, in accordance with confectionery main Ferrero. “Struggle broke out, provide chains have been disrupted, power prices surged, and inflation grew alongside the price of uncooked supplies,” mentioned Giovanni Ferrero, government chairman of the Ferrero Group.
However the group’s ‘strong progress’ in its sustainability plans has not been affected, he burdened in Ferrero’s just lately revealed Sustainability Report. “Within the face of those challenges, Ferrero has not solely been in a position to develop, however to make robust progress with quite a lot of our sustainability targets – and, in some situations, exceed them.”
Slicing GHG emissions throughout Scope 1, 2 and three
Again in 2020, Ferrero introduced a brand new set of science-based commitments for 2030. These included a discount of Scope 1 and Scope 2 emissions by 50% from a 2018 base yr. A goal discount of Scope 1, 2, and three emissions depth by 43% per tonne of product produced, from a 2018 baseline, was additionally set.
Scope 1 emissions concern the group’s personal operations. Discount methods embody investing in energy-efficient applied sciences, growing the manufacturing of on-site renewable power, enhancing power effectivity, and aiming to make use of various sustainable fuels to generate power.
The Luxembourg-headquartered group closed the 2021/2022 monetary yr with a consolidated turnover of €14bn, marking a ten% enhance in comparison with the earlier yr.
In Scope 2 emissions (oblique emissions arising from bought electrical energy, warmth and steam), the group says it continues to extend the quantity of renewable electrical energy its factories purchase. This yr, the group is celebrating that 92% of its world electrical energy now comes from renewables – up from 84% final yr.
Scope 3 emissions at the moment account for the overwhelming majority (93%) of Ferrero’s complete carbon footprint. As a result of the group doesn’t have direct management over these emissions, addressing this a part of its carbon footprint (which incorporates uncooked materials and packaging) is probably the most difficult.
Ferrero is a member of the Ellen MacArthur Basis and signed its New Plastics Economic system International Dedication. A key goal of the pledge was to make sure that 100% of plastic packaging might be simply and safely reused, recycled, or composted by 2025.
However most signatories are dealing with challenges and a few of the key targets are usually not prone to be met by 2025. This is applicable additionally to Ferrero.
“However, we stay dedicated and are nonetheless making robust progress in designing all our product packaging to be recyclable, reusable, or compostable,” a Ferrero spokesperson informed FoodNavigator. “We at the moment stand at 88.5% of this goal.”
To speed up its progress, Ferrero is investing in R&D and new applied sciences to maximise its use of recycled supplies and looking out into compostable supplies; and dealing intently with companions to speed up the tempo of recycling infrastructure growth, convey ahead new options for hard-to-recycle supplies, and to search out alternatives to make use of packaging waste as a useful resource.
So, what progress has been made? In FY 2021/22, Ferrero’s Scope 1, 2 and three emissions really elevated 7,318,172tCO2eq (in comparison with 7,007,128tCO2eq for FY 2020/21), whereas its depth ratio has barely decreased to 4.02tCo2eq per tonne produced. The group places this right down to its manufacturing progress of 6% and enhance of mobility depth after the COVID-19 pandemic.
However the place emissions wins have been made, Ferrero attributes these to its decarbonisation programme and funding in renewable electrical energy. “This resulted in direct Scope 1 emissions remaining nearly fixed in absolute worth, whereas our Scope 2 emissions considerably decreased by 41%.”
Sourcing cocoa and palm oil, sustainably
Household-owned Ferrero sells its manufacturers, starting from Nutella to Kinder and Tic Tac, to greater than 170 international locations globally. Sourcing uncooked supplies for its confectionery merchandise (cocoa, hazelnut, palm oil and others), sustainably, is a significant goal for the corporate. And for FY 2021/22, the group is reporting ‘nice strides’ in the direction of this aim.
Cocoa, a basic ingredient of lots of Ferrero’s manufacturers, is predominantly sourced from Ivory Coast and Ghana, and complemented by Nigeria, Cameroon, Ecuador and Colombia.
This yr, Ferrero bought round 97% of its cocoa quantity from farmer teams it helps by means of sustainability programmes, of which 82% was sourced from its personal farmer teams. All cocoa was sourced by means of certifications and different independently managed requirements.
Greater than 96% cocoa traceability to farm gate degree and 100% again to origin nation was additionally achieved. “Traceability is on the coronary heart of our accountable sourcing strategy. We’re at all times working in the direction of boosting the visibility of our provide chain by means of strengthening partnerships with our suppliers and utilizing probably the most superior know-how accessible,” a Ferrero spokesperson informed FoodNavigator.
“This contains utilising a devoted, cocoa-focused platform that can present us with the visibility we have to realise our dedication to hint all cocoa again to farm degree, and to carry out further threat assessments and compliance checks.”
This yr, Ferrero additionally accomplished its four-year Cocoa & Forests Initiative (CFI) Motion Plan, reaching – or in some circumstances, surpassing – targets it set again in 2018.
“Our new plan in growth may have targets for 2025,” defined Lapo Civiletti, chief government officer of the Ferrero Group.
Palm oil additionally performs a key function in Ferrero’s confectionery manufacturing. In FY 2021/22, the group sourced round 230,000 metric tonnes of palm oil – the equal of round 0.3% of worldwide manufacturing.
A hundred percent of palm oil utilized by Ferrero is licensed segregated by the Roundtable on Sustainable Palm Oil (RSPO), which means that its sustainable palm oil is stored separate from the plantations and farms all the way in which alongside the availability chain. A complete of 99.95% of its palm oil is traceable to 146 palm oil mills and 722 plantations.
Different components
Ferrero has been utilizing 100% cage-free eggs inside the EU (representing round 93% of its complete) since 2014 and is working in the direction of 100% globally by 2025. A hundred percent of Ferrero’s cane sugar is licensed by Bonsucro. The group is engaged on traceability of different components like espresso, paper and dairy.
Highlight on hazelnuts
Hazelnut is a attribute ingredient in lots of Ferrero’s manufacturers, together with Nutella, Kinder, and Ferrero Rocher. However clear dangers inside the hazelnut provide chain exist, and are sometimes derived from advanced, systemic and ‘deeply ingrained’ challenges in producing international locations, famous the group.
For instance, Turkey, amongst different locations, attracts seasonal migrant employees who journey with their households and lack entry to varsities and childcare. This generally leads to exploitation , corresponding to bonded labour or baby labour, poor working situations and insufficient lodging. Ferrero primarily sources its hazelnuts from Turkey, Italy, Chile and the US.
The latest earthquake on the Turkey/Syria border didn’t immediately affect the hazelnut rising areas, as these are situated within the Black Sea area, a Ferrero spokesperson confirmed.
Most necessary human rights points recognized
FY 2021/22 additionally noticed Ferrero publish the ten most salient human rights points in its entire worth chain. The group will evaluate its salient points on an ongoing foundation, and perform a human rights saliency evaluation in 2024.
At this time limit, crucial problem is to make sure baby safety and no baby labour. That is adopted by compelled labour; truthful wages; working hours; variety and inclusion, no discrimination or harassment; freedom of affiliation and collective bargaining; well being and security; privateness; environmental associated human rights points; and rights referring to shopper well being and accountable advertising and marketing.
In FY 2021/22, Ferrero achieved 79% traceability for the hazelnuts it buys. Chile, Argentina, France and the US all confirmed they have been totally traceable after implementing the Sourcemap platform.
“Traceability lets us monitor not solely the place our hazelnuts come from, but additionally the situations beneath which they’re produced. It helps us to help farmers and suppliers to develop and implement higher social and environmental practices, for the good thing about the sector total,” defined the spokesperson. However this course of is ‘notably difficult’ within the hazelnut sector due to the advanced and infrequently fragmented provide chains in some areas.
One key problem is the inherent nature of hazelnut farming, which implies that in lots of circumstances, hazelnuts are grown on small family-owned orchards. “There are a number of intermediaries, completely different information processing methods, and restricted availability of know-how – making it difficult to achieve a full traceability image,” the spokesperson informed this publication. Working collaboratively, Ferrero is ‘dedicated’ to tackling this systemic supply-chain complexity.
“Regardless of this, we’re proud to have achieved 79% traceability for our sourced hazelnuts, and we’ll proceed to work intently with key companions all through the availability chain to beat the barrier to reaching 100%.”
