Charoen Pokphand Foods

Sustainability strategy

Charoen Pokphand Foods stands out as one of the most transparent companies in the benchmark in regard to its sustainability reporting and company-wide policies. Unlike many of its peers, the company’s sustainability report contains a robust mix of both social and environmental goals and targets, tracking progress towards each one on an annual basis and setting forward-looking targets and objectives for 2020 as well as 2025. Two examples of commitments that increase the company’s accountability on important stakeholder issues are its Sustainable Packaging and Animal Welfare policies.

Traceability

Charoen Pokphand Foods’s traceability policy requires fishmeal suppliers to provide information about the factory name, fish species, catch area, vessel name and catch method, in addition to the relevant certification standard. The company also states that it will only acquire products from processing plants that are either Global Standard for Responsible Supply (IFFO RS) certified or participating in the IFFO RS Improvers Programme. By 2018, the company reports that 100 percent of its fishmeal was successfully sourced from the by-products fishmeal of an IFFO certified processing plant. Furthermore, the company collaborates with the IFFO to improve the sustainability of fisheries in South and Southeast Asia by developing criteria to assess their progress.

Responsible sourcing

Charoen Pokphand Foods sets high thresholds for its sourcing of ingredients. The company intends to solely use responsibly sourced ingredients for aquaculture feed production by 2020. In 2018, the company reports that 82 percent of these raw materials were responsibly sourced, including both marine and terrestrial ingredients.

Environmental footprint

Charoen Pokphand Foods is reducing its environmental footprint across a number of important metrics. In 2018, compared to 2015 baseline figures, the company reports that it reduced its water withdrawal per production unit by 32 percent, its scope 1 and 2 greenhouse gas emissions by 8 percent and its plastic bag use by 62 percent across its food division, resulting in 6,200 tonnes less plastic used. The company also discloses the mechanisms used to do so, such as reusing and recycling treated water to process its seafood products, reducing withdrawals from external sources by 28 million cubic metres, and installed solar panels on 34 feed mills, cutting emissions by 28,000 tonnes of carbon dioxide equivalent.

Human and labour rights policies

Leading in this measurement area, Charoen Pokphand Foods stands out with its commitments towards improving human rights and working conditions through strong policies and due diligence mechanisms covering both the company’s operations and supply chains. It’s human and labour rights policies are in line with international standards such as the United Nations Guiding Principles on Business and Human Rights and the ILO Core Labour Standards. Moreover, the company publicly discloses that in any instance of reported human rights violations in its operations, Charoen Pokphand Foods provides remediation in a timely manner through its Labour Voices Hotlines, setting the company apart from its peers.

Aquaculture operations

Although Charoen Pokphand Foods has received ASC and BAP certifications, it shares few details about how the company manages diseases, implements treatment strategies or prevents escapes in its aquaculture operations. Furthermore, several other aquaculture feed producing companies assessed in the benchmark are more transparent about their feed composition, while the exact breakdown of Charoen Pokphand Foods’s aquaculture feed ingredients is unknown. The company could be more transparent about its aquaculture and aquaculture feed production activities.

Support for local communities

Charoen Pokphand Foods demonstrates support for local communities by providing capacity building activities and setting targets to improve employment prospects and the quality of life for smallholder farmers and small entrepreneurs in areas where it operates. Nonetheless, it is unclear whether these approaches also cover the company’s seafood operations and how Charoen Pokphand Foods assesses the impacts of its activities, as well as the extent to which it respects the rights of local communities.

Food loss and waste

To begin implementing practices to reduce food loss and waste, Charoen Pokphand Foods states that it has joined the Food Reform for Sustainability and Health (FReSH) programme, led by the World Business Council for Sustainable Development (WBCSD) and EAT Foundation, and plans to disclose its progress in late 2019. However, the company has not yet disclosed any goals, targets or quantitative data to support the claim that it is indeed reducing food loss and waste within its operations.