Building sustainable resilience in the face of challenge
A critical test of any business with an ambitious strategy for sustainable growth is how it handles an unexpected challenge. In 2022, that challenge appeared on 24 February when Russia invaded Ukraine – the beginning of great suffering for the Ukrainian people and the catalyst for a global energy crisis and surging inflation.
Corporate responsibility updates
At Arla Foods Ingredients, we share the same overall sustainability ambitions as our parent company, Arla Foods. However, the nature of our business sometimes requires an adapted approach to achieve them. In 2022, we launched a new roadmap for achieving our sustainability goals as we grow our business and for delivering into the sustainability commitments of the Arla Future26 Strategy.
Our contribution to the global goals
The 17 UN Sustainable Development Goals (SDGs) are a source of inspiration, setting the direction for the continuous improvement of our operations and long-term growth of our business. During 2022, we took a fresh look at where we believe our company can make a meaningful contribution to the SDGs. On that basis, we will highlight activities in relation to the following eight goals in this update.
Over the past year, we have also begun mapping our impact in relation to the SDGs, using the business indicators set out in the SDG Compass. Although this work is still at an early stage, we expect it to provide fresh insights that will strengthen future waves of our sustainability strategy.
Powerful, responsible nutrition for the worldVideo02:32
Get an insight into our sustainability journey and focus areas.
A new roadmap for sustainability in our business
The roadmap builds on three pillars. Two of them – Stronger Planet and Stronger People – have been central to our corporate responsibility reporting for a number of years. The third and new pillar is Stronger Partnerships, which runs across the activities of the other pillars. Here, the emphasis is on co-creation of sustainable value propositions with customers; capability and knowledge-sharing through external partnerships; and the nurturing of our sustainability mindset. Reporting on Stronger Partnerships will be integrated in Stronger Planet and Stronger People.
Preparing our plants for sustainable growth
The Stronger Planet pillar of our sustainability strategy highlights two key priorities for becoming a sustainable growth company. One is the adoption of circular bioeco- nomy principles to ensure we continue to reduce, reuse and recycle resources at our production sites. The other is to replace fossil fuels with renewable energy sources as a means to achieving the Arla Science-Based Targets for scope 1 and 2 emissions.
We have a good starting point for both objectives. On the one hand, our business has circular origins, rooted in our primary raw material – the whey side-stream of cheese processing. On the other, we are already committed to our group-level target to use 100% renewable electricity by 2025 in our European operations. The use of biogas at our Danish production sites further reduces our reliance on natural gas.
Over the past years, we have worked continuously to optimise our use of resources. In line with EU law, our plants are also required to document their use of the best available techniques for protecting the environment from all types of emission.
Nevertheless, there is still much to be done. To target our efforts, in 2021 we established four workstreams for energy, water, packaging and food waste.
Here you can read about the primary initiatives and challenges within each workstream during 2022. Detailed performance figures are available in the Ambitions & Progress Data section.
We recognise our responsibility to minimise our environmental footprint. Through 2022, we have focused on the three Rs – reduce, recycle and reuse – and our gradual transition to carbon-neutral energy.
Our circular bioeconomy vision
Our vision for a circular bioeconomy at Arla Foods Ingredients is about moving from the linear model of take, make and dispose to the circular model of reduce, reuse and recycle.
The goal is to work towards a resilient system that increasingly decouples business from the consumption of limited resources, benefiting the planet, people and profits.
In practice, we aim to:
Create maximum value from all com- ponents in our whey and milk raw materials.
Reduce our energy consumption by recycling and redistributing surplus heat.
Minimise use of well water by reusing water extracted from raw materials and recycling wastewater.
Partner with suppliers to optimise packag- ing and eliminate fossil-based virgin plastic.
Eliminate waste for disposal and incineration.
Science-based targets for climate action
Our group-level absolute reduction target for scope 1 and 2 emissions is 63% by 2030, against a 2015 baseline. In 2021, the Science-Based Targets Initiative (SBTi) approved the target as consistent with the Paris Agreement ambition to limit global warming to 1.5°C. Arla Foods Ingredients will deliver into the target by driving the green transformation at the three fully-owned production sites.
With regard to scope 3 emissions, our group- level target of a 30% reduction by 2030 is under revision following the publication of new SBTi guidelines for Forest, Land and Agriculture (FLAG) in late 2022. During 2023, we will participate in a global Arla project to achieve the updated scope 3 target for land-based emissions, in line with the FLAG guidelines.
Workstreams - Stronger planet
The collaborative road to better health and wellbeing
Our ambition to support health, wellbeing and sustainable, nutritious diets depends on continuous innovation and broad collaboration with partners whose capabilities extend beyond our own. Through these efforts, we strive to create new opportunities to make a positive impact on people’s lives.
The Stronger People pillar of our new sustainability strategy guides initiatives in pursuit of this ambition. In the strategy’s first wave from 2022 to 2023, we will both continue our existing affordable nutrition partnership projects and redefine the scope and goals of our work with lifelong nutrition.
Like our parent company, we are inspired by the UN Food and Agricultural Organization’s definition of sustainable healthy diets – that they should promote all aspects of the individual’s health and wellbeing, have low environmental impact and are accessible, affordable, safe and culturally acceptable.
Over the past year, our scoping activities included a review of our affordable and lifelong nutrition activities in relation to the UN SDGs. Guided by tools and business indicators from the SDG Compass, we have mapped our current high-impact areas as a means to setting the strategic direction for future steps. In 2023, we will revise our focus areas within lifelong nutrition based on this work.
Stronger People is, naturally, also about ensuring the health, safety and wellbeing of our colleagues in Arla Food Ingredients. The development of our workplace culture is an ongoing priority as our business grows.
Through our business activities and in our workplace, we want to make a positive difference in people’s lives.
Strong partnerships enable progress.
Focus areas - Stronger people
Ambitions and progress
This year’s global energy crisis underlined the urgency of transitioning to sustainable energy sources, while volatile markets placed added pressure on quality and food safety management. In this chapter, you can read how we performed in 2022 and our priority actions for 2023. For information about policies and key environmental, social and governance (ESG) metrics that apply to the entire Arla Foods group, please see the Arla annual report.
Here you can read how we performed in 2022 and our priority actions for 2023
For information about policies and key environmental, social and governance (ESG) metrics that apply to the entire Arla Foods group, please see the Arla annual report