Kroger is one of the world's largest food retailers. It was founded in 1883 and incorporated in 1902. The company operates, either directly or through its subsidiaries, 2,757 supermarkets under a variety of local banner names, of which 2,270 also operate pharmacies. Kroger owns 35 food production plants, primarily bakeries and dairies, and in total serves an estimated 11 million customers across 35 US states. The brand Kroger represents most of the company's private-label items, with other popular store brands including Big K, Check This Out and Heritage Farm.
Kroger ranks ninth among food retailers in the benchmark, leading most of its segment peers yet a reflection of its mixed performance across the four benchmark measurement areas. The company is in the top five in both governance and strategy, where it ranks fifth among its peers, and environment, where it ranks fourth, but falls behind in nutrition and social inclusion. Among other food and beverage processors, Kroger ranks 35th, close to its overall benchmark ranking.
Stakeholder engagement The company discloses how it identifies key stakeholder groups, the primary engagement methods its uses to liaise with them and outcomes of the engagement with each group. It also details how the issues raised by stakeholders are identified and prioritised within its materiality assessment and subsequent setting of its sustainability strategy.
Sustainable fishing and aquaculture Kroger sets multiple targets related to sustainable seafood and aquaculture, in 2020 aiming to source 100% certified wild-caught seafood (Marine Stewardship Council), shelf-stable tuna (International Seafood Sustainability Foundation) and farm-raised seafood (Best Aquaculture Practices 2 star or greater, Aquaculture Stewardship Council or Global GAP). The company met its shelf-stable tuna target and is 96% of the way to achieving its farm-raised target. However, the proportion of certified wild-caught seafood decreased from 74% in 2017 to 71% in 2019, offering the company the opportunity to further demonstrate leadership by once again progressing towards its target.
Protein diversification The company discloses that it increased the sales of plant-based products significantly between 2018-2019, with a 11% increase in the fourth quarter alone, while sales of Kroger’s own-brand plant-based products increased 13% over the reporting period. Kroger could further strengthen its position by setting a sales-based target for its plant-based products as a proportion of total sales.
Food loss and waste The company has a 2025 time-bound target to achieve zero food waste and reports a reduction in food waste over its 2017-2019 reporting period. Kroger also demonstrates that it is addressing this challenge outside of its own operations, joining the World Resources Institute’s (WRI) 10x20x30 initiative as a retail partner and engaging 20 suppliers as part of WRI’s Target, Measure, Act process to halve global food waste by 2030.
Sustainable development strategy Kroger discloses time-bound targets across its most relevant sustainability topics, identified and prioritised through its materiality process which identifies topics on a three-tiered basis in terms of importance to the company and its key stakeholders. The company has an opportunity to strengthen its performance by also setting targets relevant to topics in the social inclusion measurement area.
Governance and accountability for sustainable development strategy Kroger 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. Kroger could strengthen its governance by highlighting how the remuneration of executive and management-level employees is influenced by sustainability-related key performance indicators (KPIs).
Scope 1, 2 and 3 greenhouse gas emissions Kroger has a target to reduce scope 1 and 2 greenhouse gas (GHG) emissions by 30% by 2030 against a 2030 baseline, disclosing progress against this target between 2016-2019. While the company also discloses a reduction in scope 3 emissions between 2018-2019, it does not accompany this with a target. Kroger could also improve its performance by aligning its emissions targets with a 1.5-degree warming trajectory.
Protection of terrestrial natural ecosystems The company recognises that it sources high-risk commodities, setting deforestation-free targets for the palm oil, soya, beef and coffee that it sources and reporting against them. However, it does not set a similar target for its sourced cocoa. It also lacks disclosure on the proportion of commodities it currently sources that are from deforestation-free supply chains.
Animal welfare Kroger discloses an animal welfare policy that covers all of its relevant species (in addition, its aquaculture sourcing is covered by its sustainable seafood sourcing policy) and requires its suppliers to provide evidence of an annual animal welfare audit. The company also addresses multiple welfare issues for its key species but could further improve its performance by disclosing targets for all of its key species.
Accessibility and affordability of healthy foods Kroger has a commitment to increase the accessibility and affordability of healthy foods through its Zero Hunger Zero Waste social impact plan. It demonstrates commercial activities in support of this, including the Zero Hunger Mobile Market in partnership with the Dare to Care Food Bank in Louisiana, a single-aisle grocery store on wheels that brings affordable fresh fruits, vegetables and pantry staples to underserved neighbourhoods in Louisville. The company could improve its performance by disclosing targets alongside these activities.
Clear and transparent labelling The company commits to providing consumers with clear and transparent labelling through its OptUP nutrition rating system. OptUP aims to simplify the process of selecting foods by rating products on a scale of 1-100, where higher ratings equate to more nutritious food. Kroger could improve its performance by disclosing the proportion of its own-brand and sourced products to which the system has been rolled out.
Availability of healthy foods Kroger does not provide evidence of improving the nutritional quality of its products and of proportionally increasing the sales of healthy and nutritious foods.
Responsible marketing While the company has a commitment to market its products responsibly, particularly to children, it has an opportunity to disclose qualitative or quantitative evidence reflecting this commitment.
Child and forced labour Kroger does not commit to prohibiting child and forced labour in its human rights statement, only stating this explicitly in its vendor code of conduct. Furthermore, it has an opportunity to disclose a requirement that prohibits its suppliers from retaining workers’ personal documents, in addition to a statement confirming that it verifies the age of workers.
Farmer productivity and resilience The company demonstrates a commitment to support livelihoods and communities in the United States through its partnership with Fair Trade. However, it has an opportunity to disclose details on activities to accomplish this, alongside the impact of said activities.
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.
Core social indicators
The core social indicators are part of the social inclusion measurement area. These indicators assess societal expectations of business conduct that companies should meet if they aspire to be part of a system transformation that leaves no one behind.
Kroger discloses a commitment to respect the human rights of its workers and has a grievance mechanism that is accessible to both employees and external stakeholders. However, the company lacks disclosure on how it identifies, assesses and takes action to address its human rights salient risks in both its own operations and supply chain. Similarly, although it discloses its main stakeholders, it does not identify those whose human rights have potentially or actually been impacted.
Kroger publicly commits to respecting the health and safety of workers and expects the same of its business relationships. The company discloses that 66% of its associates are covered by collective bargaining agreements and, although it lacks a public commitment to gender equality and women’s empowerment, it does disclose the gender diversity of its board. Kroger could improve its score by disclosing commitments and time-bound targets related to paying its workers a living wage and expecting the same from its suppliers.
Kroger has a policy prohibiting bribery and corruption and an associated grievance mechanism. It also includes clauses in contracts with business relationships addressing the issue. Although the company does not disclose a global tax strategy, it does report federal, state and local tax paid in the United States, its only tax jurisdiction. Similarly, it lacks disclosure on its approach to lobbying and political engagement, including specifying that it does not make political contributions, but does disclose its lobbying expenditures.