FrieslandCampina

Sustainable development strategy
The company’s sustainability strategy, Nourishing a Better Planet, has six thematic areas. These cover topics across all three benchmark dimensions (environment, nutrition and social inclusion). Furthermore, the company reports on both its own operations and value chain and sets time-bound targets in all areas.

Stakeholder engagement
FrieslandCampina discloses a detailed stakeholder engagement approach, highlighting the various stakeholders it engages with and key issues raised by each group. Furthermore, the company reports that it analysed the outcomes of these activities and incorporated these into the development of its strategy, as well as highlighting how it identified and prioritised its key stakeholders.

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

Availability of healthy foods
FrieslandCampina demonstrates a leading commitment towards increasing the availability of healthy foods. The company exceeded its 2020 target for 70% of products to meet its Global Nutritional Standards (based on the World Health Organization Global Action Plan and developed in consultation with governments and nutrition and health experts) and has increased this figure by 18 percentage points since 2015. Furthermore, it discloses quantitative evidence demonstrating an increased number of products that meet its regulations on salt, sugar and trans-fat content, although the company has not updated this data since 2019 and hence has an opportunity to do so.

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

Governance and accountability for sustainable development
The company states that oversight of different aspects of its sustainability strategy lies within multiple board committees, thus demonstrating that accountability lies with the company’s highest governance body. FrieslandCampina could strengthen its governance by highlighting how the remuneration of executive and management-level employees is influenced by sustainability-related key performance indicators.

Scope 1, 2 and 3 greenhouse gas emissions
The company has a 2030 target to reduce scope 1 and 2 greenhouse gas (GHG) emissions at production facilities and in transport to production facilities by 40%, and by 33% at member dairy farms, in comparison to 2015. It reports progress against both of these targets. However, FrieslandCampina lacks similar disclosure on its scope 3 emissions and has further scope to strengthen its commitment by aligning its targets with a 1.5-degree warming trajectory.

Water use
FrieslandCampina reports that reducing water consumption is a company priority. It accompanies this with a target to reduce consumption by 25% by 2030 in comparison to 2018 levels. The company demonstrates progress against this target over the reporting period. However, it has an opportunity to tackle this issue more holistically by engaging and collaborating with suppliers, particularly those who operate in water-stressed regions.

Animal welfare
The company addresses animal welfare through various programmes and membership of external bodies such as the Sustainable Dairy Chain, although it is unclear as to the global applicability of its practices related to animal welfare. While the company reports on multiple welfare issues, FrieslandCampina could further strengthen its performance by setting related time-bound targets.

Protection of natural terrestrial ecosystems
FrieslandCampina recognises the high-risk commodities that it sources, reporting that it strives to source 100% of its cocoa, soya and palm oil from sustainably managed sources, stating that the proportion of such commodities increased 13% between 2019-2020 and overall traceability reached 91%. While the company discloses geographic information related to the palm oil mills it sources from, it has an opportunity to disclose similar information for its sourced soya and cocoa.

Protein diversification
The company does not disclose that it is diversifying its protein portfolio, for instance, by increasing the proportion of plant-based proteins and other alternatives such as plant-based dairy options.

Accessibility and affordability of healthy foods
The company demonstrates its commitment to increasing the accessibility and affordability of healthy foods through its Broadening Access to Nutrition programme. Alongside several commercial activities focused on lower income countries and consumers with a higher risk of undernutrition or micronutrient deficiencies, the company discloses three targets relating to increasing the accessibility and affordability of healthy foods in its lower income markets of Nigeria, Pakistan, Ivory Coast, Indonesia, Vietnam and Philippines. The company’s activities would be considered a leading practice if not for the fact that the company has not reported progress against these targets since 2018.

Clear and transparent labelling
FrieslandCampina discloses a corporate standard for nutritional information as part of its nutrition policy, in doing so confirming its compliance with back-of-pack labelling regulations. For front-of-pack, the company reports that it places the guideline daily amounts (GDA) energy icon (outside the European Union) or reference intake (RI) energy icon (within the European Union) on all relevant packaging labels. FrieslandCampina also had a 2020 target that 100% of its consumer packaging would show the RI energy icon as an indicator for the number of packages that have implemented its corporate standard. Despite achieving 83% compliance in 2018, the company has not disclosed an update since.

Responsible marketing
The company discloses both a Corporate Policy for the Marketing of Infant Foods and a Corporate Standard for Responsible Marketing Communications, in addition to disclosing a commitment to the European Union pledge code of conduct for European food companies formulating voluntary agreements about responsible marketing focused on children. FrieslandCampina has an opportunity to disclose activities in support of this and further information related to the proportion of marketing budgets spent on responsible marketing.

Child and forced labour
The company commits not to use child and forced labour in its own operations. However, it has an opportunity to strengthen its requirement for suppliers to meet the same standard. Furthermore, the company could improve its performance by disclosing that it verifies the age of workers and prevents suppliers from retaining workers’ documents or restricting workers’ freedom of movement.

Farmer productivity and resilience
FrieslandCampina’s Dairy Development Programme (DDP) is a strong example of supporting the productivity, resilience and market access of farmers, with the programme rolled out and supporting small-scale dairy farmers across eight countries in Asia, Africa and Eastern Europe. While the company reports on the number of farmers reached and states that the programme increases productivity, it has an opportunity to disclose data and quantifiable information to demonstrate the impact it is having through this programme.

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.

Land rights
The company does not commit to recognising and respecting the legitimate tenure rights related to the ownership and use of land of local communities.

FrieslandCampina commits to respecting human rights and the core ILO labour rights, with a strong focus on assessing its human rights salient risks and impacts in high-risk countries in which it operates, including Indonesia, Thailand, Pakistan and Nigeria. The company also has a grievance mechanism which is accessible to employees and external stakeholders. However, it could improve its score by disclosing further details on its process for engaging with potentially affected stakeholders.

The company publicly commits to respecting the health and safety of workers and outlines similar expectations for its supply chain. It also reports that 64.7% of its workers are covered by a collective bargaining agreement and reports on metrics related to gender equality and women’s empowerment, including the gender ratio of senior management and the board of directors. However, it lacks disclosure on working hours fundamentals.

The company meets all indicators relating to acting ethically in terms of commitments, but it could improve its score by disclosing more supporting evidence. FrieslandCampina discloses a global tax policy and moreover publicly commits to protecting personal data, prohibiting bribery and corruption and undertaking responsible lobbying and political engagement. However, it does not disclose lobbying expenditures or taxes paid per tax jurisdiction.