Q&A: The Ferrero Group’s sustainability story

This article first appeared in Convenience & Impulse Retailing, authored by Tom Oakley-Newell

The impacts of climate change are being felt and seen around the world in devastating measures, from flooding in India, droughts in Europe, to bushfires here in our own backyard.

With concern growing about how to not only manage, but prevent, these catastrophes, companies are under increasing pressure to reduce their impact towards climate change.

The Ferrero Group elaborates on its sustainability commitments and how it plans to meet the targets set.

Could you outline the key commitments that The Ferrero Group has made as part of its sustainability roadmap?

Ferrero: Ferrero’s sustainability goals are aligned to four key pillars: protect the environment, source ingredients sustainably, promote responsible consumption and empower people. Ferrero has also begun to define new commitments and targets that will drive further progress across the period leading up to 2030.

One of Ferrero’s ambitious new targets is to significantly reduce the Group’s carbon footprint by 2030. These are science-based carbon targets, validated by the Science Based Targets initiative (SBTi) in December 2020, using 2018 as the base year:

Ferrero will reduce absolute Scope 1 and 2 emissions by 50 per cent globally by 2030.

Ferrero will also reduce Scope 1, 2 and 3 emissions intensity by 43 per cent per tonne of product produced at a global level.

The first target covers 100 per cent of Scope 1 and 2 emissions for our plants, warehouses and head office. The second target covers the whole value chain – including our key ingredients such as dairy, palm oil, hazelnuts, sugar, flour and cocoa; packaging; upstream logistics; and fuel and energy-related activities.

How will The Ferrero Group go about living up to these commitments?

Ferrero: As a family-owned company, values such as respect, integrity and innovation have been built into our culture for generations. Ferrero’s current sustainability strategy reflects these values and drives us to raise our ambitions and deliver our promises to impact positively people and the planet.

Ferrero reached a number of its sustainability targets in 2020; achieving its goal of sourcing 100 per cent sustainable cocoa beans through independently managed schemes and 100 per cent certified cane sugar through Bonsucro and Altromercato. Ferrero was one of the first global companies to achieve a 100 per cent RSPO-certified palm oil supply-chain in 2015 and maintains 100 per cent RSPO certified palm oil as segregated for Ferrero products and the acquired company, Thorntons.

In 2019, Ferrero announced a commitment to make 100 per cent of its packaging to be reusable, recyclable or compostable by 2025, as part of its support for the circular economy. As of 2020, we have achieved 82.9 per cent and we continue with our strong commitment to fulfilling this journey.

How are you measuring your progress?

Ferrero: Ferrero’s annual Sustainability Report provides updates on its progress towards its sustainability goals, bringing together our challenges, our actions and our vision for the future.

What are the biggest challenges to creating a more sustainable food supply chain?

Ferrero: Reliability and transparency are important to ensure sustainability. When sourcing, we prefer to establish direct long-term commercial relationships with producers and suppliers of raw materials, based on dialogue and transparency. We require all suppliers and collaborators to adhere to our Codes (such as the Code of Business Conduct and Supplier Code) and to comply with our non-negotiable high standards.

Has implementing new sustainability measures effected revenue?

Ferrero: Ferrero Group closed the 2020 financial year with an increased turnover of +7.8 per cent compared to the previous year. As we continue to grow our business responsibly, we ensure sustainability is fully embedded by considering our impacts and opportunities along the value chain – from raw materials to end of life.

Are you seeing a consumer trend towards purchasing “greener” products?

Ferrero: Consumers are voting with their wallets so as a company it’s not enough just to sell products. A company needs clear commitments and activities on sustainability.

How important is creating a more sustainable food system to The Ferrero Group?

Ferrero: Ferrero connects all its Group sustainability commitments to the United Nation’s Sustainable Development Goals (SDGs), to support the accomplishment of the SDGs by 2030.

Is there anything else you’d like to mention about The Ferrero Group’s sustainability roadmap and its achievements to date?

Ferrero: Ferrero Executive Chairman, Giovanni Ferrero has outlined direction for Ferrero’s new sustainability framework and commitments to 2030: “The global leadership team has renewed its commitment to the United Nations Global Compact. We have strengthened our sustainability governance with the creation of a Sustainability Operative Committee. It brings people together from across the group to drive the sustainability agenda as we look to the coming decade.”

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