Fonterra

Lobbying
Fonterra provides a list of trade associations of which it is a member.

Stakeholder engagement
Fonterra discloses an overview of the issues raised during its stakeholder engagement activities and the channels it uses to engage with its stakeholder groups. Furthermore, its stakeholder engagement encompasses nature, including biodiversity, nutrition and social issues.

Sustainability strategy and accountability
Fonterra discloses its process for identifying and prioritising its most relevant sustainability impacts as well as the outcome of this process, in relation to its sustainability strategy. The company has set group-wide targets on key sustainability topics for the most material parts of its value chain and reports consistently against all its targets. Furthermore, it provides evidence of linking performance criteria in senior executives’ remuneration policies to targets and objectives which cover nature, including biodiversity, and social issues and provides evidence that its highest governance body has expertise with respect to the company’s most material sustainability topics.

Ecosystem conversion and restoration
Fonterra discloses some activities to minimise ecosystem conversion. Furthermore, the company is committed to restoring ecosystems, and shares information about ecosystem restoration projects in areas that have been impacted by its operations or its suppliers. Additionally, it goes beyond its own operations or suppliers and discloses efforts related to ecosystem restoration, such as compensation or offset mechanisms.

GHG emissions
Fonterra has targets to reduce its scope 1 and 2 emissions and reports against these targets. Additionally, the company discloses reduction for its scope 1 and 2 emissions compared to previous year.

Invasive species
Fonterra discloses any introduction of invasive alien species (IAS) that may occur as a result of its own operations or value chain. Additionally, the company shares its processes for both preventing the introduction of IAS and managing any IAS that have been introduced due to its own operations.

Resource exploitation and circularity performance
Fonterra actively discloses its efforts to enhance soil health and agrobiodiversity through its production or sourcing practices. It also sets targets for improving soil health and consistently reports on its progress towards achieving these targets.

Solid and air pollution
The company demonstrates commitment, partakes in activities, and discloses quantitative data related to plastic use reduction and transitioning towards sustainable packaging.

Water
Fonterra discloses the process to track the quality of discharged water and it discloses that it use DAF system to treat the quality of water before discharging it into environment. It reports how much water is withdrawn for its own operations in water-stressed areas. The company provides a publicly available policy statement committing to improve the water quality. Further, it discloses that commenced a TDS surveillance testing program to check the quality of water at New Zealand operations.  Fonterra has targets to reduce water pollution and reports progress against them. The company also has a commitment to respect the right to water.

Indigenous Peoples’ and land rights
Fonterra discloses its processes to identify and recognise the rights of Indigenous Peoples when activities in its own operations may impact their rights, and describes how it obtains Indigenous Peoples’ free, prior and informed consent.

Act ethically
Fonterray has a policy prohibiting bribery and corruption and a grievance mechanism for stakeholders to raise concerns and complaints regarding bribery and corruption. Furthermore, it identifies bribery and corruption risks by means of audits and specifies that it does not make political contributions. Also, the company discloses a public commitment to protect personal data.

Provide and promote decent work
Fonterra has a publicly available policy statement in which it commits to respecting the health and safety of workers and discloses how it monitors the health and safety performance of its business relationships.
Also, the company publicly states that all overtime work must be consensual and be paid at a premium rate and discloses the proportion of its total direct operations workforce for each employee category by age group.
In terms of gender equality, the company discloses the proportion of women in its total direct operations workforce for each employee category and the ratio of the basic salary and remuneration of women to men in its total direct operations workforce for each employee category, by significant locations of operation. Furthermore, it discloses a target to increase the female representation by 50% in senior leadership by 2022 and has 36.36% women on the board.

Respect human rights
Fonterra has a publicly available policy statement committing it to respect the ILO core labour rights in its operations and supply chain and human rights. Also, it indicates that it has a human rights grievance mechanism accessible to all workers and external stakeholders who may be adversely impacted by the company.

Lobbying
The company has an opportunity to disclose a clear and detailed framework for assessing alignment of its trade associations with its sustainability targets and to report (potential) misalignments.

Ecosystem conversion and restoration
The company does not publicly commit to minimizing ecosystem conversion or ensuring zero conversion. Moreover, the company does not disclose its efforts to establish conversion-free supply chains, nor does it have any specific targets or timeframes for achieving this.

GHG emissions
The company should set time-bound targets to reduce its scope 3 greenhouse gas emissions as well as report progress against them. Crucially, all its scope 1, 2 and 3 targets need to align with a 1.5-degree trajectory.

Impact and dependencies assessment
The company discloses a Farm Environment Plan aimed at improving soil health, water quality, and freshwater biodiversity, with 71% of its farmer owners in New Zealand having a tailored plan in 2022, aiming for 100% by 2025. However, there’s no evidence that the company assesses its impacts on nature within its operations, particularly outside New Zealand. The company does not disclose assessments of its impacts in the supply chain nor its dependencies on nature either within its own operations or in upstream business relationships.

Invasive species
The company has not identified any activities that could lead to the introduction of invasive alien species in its own operations.

Key areas and species
The company has an opportunity to disclose locations within or adjacent to areas important for biodiversity, both in its own operations and its supplier locations. It could also disclose existing species populations existing in or adjacent to both its own and its suppliers’ locations, as well as the conservation status of species identified at its own sites according to national and international lists.

Resource exploitation and circularity performance
Although the company provides some information on its packaging, there is an opportunity for them to fully disclose all input details in compliance with international standards. Currently, the company does not offer a quantitative report on its group-wide circularity performance.

Solid and air pollution
The company does not disclose relevant information related to pollution in its operations or supply chains.

Water
The company has an opportunity to set water withdrawal targets for all operations. The company does not disclose its processes for implementing preventive and corrective action plans for identified specific risks to the right to water and sanitation in its own operations.

Indigenous Peoples’ and land rights
The company does not show if it is committed to respecting Indigenous Peoples’ rights or land rights of local communities.

Safe, clean, healthy and sustainable environment
The company has an opportunity to commit to respecting local communities’ right to a safe, clean, healthy and sustainable environment, and to zero tolerance for acts of violence, threats, intimidation or judicial harassment committed against land and environmental rights defenders. Moreover, it should track its actual or potential negative impacts on the health of local communities.

Act ethically
The company has an opportunity to include anti-bribery and anti-corruption clauses in its contracts with business relationships.
Furthermore, while the company outlines its lobbying approach in a policy, it has an opportunity to outline its political engagement approach in a policy too. Furthermore, it could disclose its expenditures on lobbying activities and add a requirement for third-party lobbyists to comply with its lobbying and political engagement policy.

Provide and promote decent work
While the company expects its suppliers to support the ethical standards set out in the code of practice regarding workplace health and safety, it has an opportunity to set stronger expectations for them to commit to respecting the health and safety of their workers.
Furthermore, the company has an opportunity to disclose a time-bound target for paying all workers a living wage or indicate that it has achieved this. Also, it could disclose how it determines a living wage for the regions where it operates and how it works to support the payment of a living wage by its suppliers.
Lastly, while the company has a statement on gender equality, it has an opportunity to disclose a public commitment to women’s empowerment.

Respect human rights
The company indicates that it has undertaken human rights due diligence and describes the process to identify its modern slavery risks. However, it could describe the process to identify its human rights risks and impacts in specific locations or activities covering its own operations and through relevant business relationships.
Also, while the company discloses its key modern slavery risks, it has an opportunity to disclose what it considers to be its salient human rights issues and the process for assessing them.
Lastly, after disclosing the salient issues, it could describe a global system to take action to prevent, mitigate or remediate these risks, or provide an example of the specific conclusions reached and actions taken or to be taken on at least one of its salient human rights issues as a result of assessment processes.