Kraft Heinz

Sustainable development strategy
Kraft Heinz has a sustainable development strategy organised around environmental stewardship, responsible sourcing, healthy living and community support. Within each of these categories, multiple time-bound targets have been set, covering most of the issues identified as most material by Kraft Heinz’s materiality matrix and covering all three pillars of this benchmark. These issues include food safety and quality, human rights, water use, greenhouse gas (GHG) emissions, packaging, animal welfare and sustainable agriculture as well as consumer trends and innovation, business ethics and compliance, and transparency.

No leading practices were identified for the company in the environment measurement area.

Availability of healthy foods
Kraft Heinz discloses its global nutrition guidelines establishing upper limits on calories, sodium, sugar and saturated fat. It commits to achieving 85% compliance with these guidelines by 2025, which includes reducing total sugar in its products by more than 60 million pounds across its global portfolio. The company reports progress against its target.

No leading practices were identified for the company in the social inclusion measurement area.

Governance and accountability for sustainable development strategy
Kraft Heinz has an environmental, social and governance (ESG) team responsible for the ESG strategy. The team is a constituent of the ESG Steering Group, which is accountable to the board of directors. However, there is no evidence of the company’s remuneration policy being linked to sustainability-related outcomes.

Stakeholder engagement
Kraft Heinz engages with stakeholders to inform its sustainability strategy process. The company discloses a list of stakeholders (including investors, suppliers, customers, employees, non-governmental organisations, industry associations, regulators, consumers), channels of engagement (e.g. calls, meetings, surveys, collaborations) and the topics discussed with each group, covering all three pillars of this benchmark. However, the company does not disclose the frequency of engagement, nor explain how it identifies stakeholders to engage with. Moreover, local communities along the supply chain are notably missing from the list.

Scope 1, 2 and 3 greenhouse gas emissions
Kraft Heinz reports to procure energy from renewable sources, which is targeted to be at 100% by 2025. Despite that and other efforts, the company’s GHG emissions have increased since 2015. The company does not disclose quantitative evidence to demonstrate that it is reducing its scope 3 GHG emissions.

Protection of terrestrial natural ecosystems
Kraft Heinz reports that, in 2019, it achieved 100% sustainable palm oil, with 99.3% of palm oil traceable to the mill and 84% of palm oil certified by the Roundtable on Sustainable Palm Oil. It further states that 40% of its over 300 external manufacturers had sustainable sourcing policies in place. However, other high-risk commodities that are relevant for Kraft Heinz had no disclosures of this kind. Regarding soy, the company states it is still assessing the situation, while beef is not included in its 2020 ESG Report.

Water use
Kraft Heinz has a target to reduce water use by 20% across Kraft Heinz manufacturing facilities in high-risk water areas and by 15% across all manufacturing facilities by 2025, with 2020 as the baseline year. However, despite a previous water intensity reduction target set in 2016 to be reached by 2020, water use slightly increased in 2019 and 2020, and the company’s supplier code of conduct does not mention water conservation.

Food loss and waste
Kraft Heinz has a target to reduce food waste by 20% across all Kraft Heinz manufacturing facilities by 2025, against a 2020 baseline. The company states that its considerations in this regard include sourcing, production, transportation, shelf life and end-of-life. The company mentions packaging improvement, beneficial land application and product donations as examples of ways to avoid food waste.

Plastic use reduction
Kraft Heinz discloses a target to use 100% recyclable, reusable or compostable packaging by 2025. The company states that in 2019, 70% of its packaging was recyclable, reusable or compostable. The company could improve by setting a target to reduce plastic use in its own operations.

Animal Welfare
Kraft Heinz has an animal welfare policy in place that covers multiple species across multiple topics and geographies. In the United States and Canada, suppliers must follow specific guidelines regarding dairy cattle handling, and regular audits occur. The company is transitioning to 100% free-range egg procurement globally by 2025 after attaining that target in Europe in 2020. Quantitative data is also disclosed regarding welfare of pigs, while policies for broiler chickens are being planned. Efforts related to the welfare of fish are not company-wide. Kraft Heinz could improve by setting targets for all species globally and performing audits on them.

Accessibility and affordability of healthy foods
While Kraft Heinz has a target to provide 1.5 billion meals to people in need by 2025, it has an opportunity to develop commercial activities designed to make healthy foods more accessible and affordable for vulnerable groups.

Clear and transparent labelling
While Kraft Heinz commits to using front-of-back labelling, such as Facts Up Front in the United States, Multiple Traffic Lights in the United Kingdom and Health Star Rating in Australia and New Zealand, it does not disclose a commitment to provide nutritional information on all its products through back-of-pack labelling.

Responsible marketing
While Kraft Heinz commits to many responsible marketing regulations and voluntary pledges around the world, such as the Children’s Food & Beverage Advertising Initiative in the United States, the Canadian Children’s Food and Beverage Advertising Initiative, the Netherlands Code of Conduct on Kids Marketing, New Zealand Children and Young People’s Advertising Code and the Australian Responsible Children’s Marketing Initiative, which avoid negative impacts of marketing to children, the company does not disclose activities or campaigns geared towards the promotion of healthy choices. Neither does it have a specific plan to do so.

Workforce nutrition
Through its LiveWell programme, Kraft Heinz offers biometric screenings to its employees in Canada and the United States that inform height, weight, body mass index, blood pressure, blood cholesterol and blood sugar. It also offers healthy options at canteens. The LiveWell programme is expanding globally but is not global yet.

Food safety
Kraft Heinz requires all ingredient suppliers to undergo audits performed by Kraft Heinz itself or by bodies certified by the Global Food Safety Initiative (GFSI). It also requires all suppliers only to purchase foods from others that also comply with GFSI standards and pass audits. The company requires all suppliers to follow hazard analysis critical control points (HACCP) principles to minimise food safety risks systematically. It is a member of the GFSI Steering Committee. However, it does not demonstrate that 100% of its own operations and, where relevant, 100% of its suppliers are certified to a GFSI-recognised food safety scheme.

Child labour
The company does not disclose a commitment to prohibit child labour in its operations nor in its supply chain.

Forced labour
While the company commits to prohibiting forced labour in its own operations and supply chain, it has an opportunity to disclose a requirement that prohibits its suppliers from retaining workers’ personal documents or by restricting workers’ freedom of movement.

Living wage
The company does not disclose that it pays its workers a living wage or requires its suppliers to do the same. Neither has it set targets to do so in the future.

Health and safety of vulnerable groups
The company does not disclose that it specifically recognises the health and safety risks to vulnerable groups, such as migrant and temporary labourers, women and young farmers.

Farmer and fisher productivity and resilience
Kraft Heinz discloses programmes to support coffee farmer productivity in Honduras in 2015, and tomato farmer productivity in Poland in 2018. However, no evidence was provided of more recent activities to support farmer productivity and resilience. Therefore, the company does not have a commitment or examples of activities to support the resilience, productivity and access to markets for farmers, fishers and/or small-scale producers in its supply chain.

Land rights
Kraft Heinz states that it adheres to the principle of free, prior and informed consent, that it complies with all applicable laws relating to the rights of land and natural resources, that it understands there are instances where local law and the human rights standards outlined in its human rights policy do not intersect, and that in such cases, it will seek to follow the higher standard. However, the company does not codify the same requirements in a supplier code of conduct.

Kraft Heinz is on track to corporate best practices regarding human rights, lacking only saliency assessments and remediation policies. The company commits to respecting human rights, includes human rights in its due diligence practices, engages with multiple stakeholders actively and provides grievance mechanisms accessible to all, with the choice of being anonymous or not.

While Kraft Heinz commits to the health and safety of its workers and along its supply chain, it does not guarantee the payment of a living wage, does not disclose its approach to supporting freedom of association and collective bargaining practices, nor does it show commitment to improving diversity in the company.

Kraft Heinz has a global, company-wide tax strategy that commits to compliance with legislation but lacks country-by country information. It prohibits bribery and corruption and has a whistle-blower channel but lacks disclosure on how associated risks and violations are identified and dealt with. Finally, the company does not have a policy on lobbying and political contributions to guarantee ethical political engagement.