The environment is our shared responsibility
Monday 30 November 2015 was the opening of the United Nations Climate Change Conference aimed at reducing CO2 emissions. Orkla works systematically to minimise its environmental footprint and is among the top 10-15 per cent of companies that have reported to CDP.
CDP is a global, independent, non-profit organisation that has the world’s largest database of corporate climate change information.
The UN Climate Change Conference (COP21) is being held in Paris from 30 November to 11 December 2015. The goal is to adopt a new international agreement on reduction of CO2 emissions, for entry into force in 2020. The possibility of reaching an agreement is greater than for many years, but it is dependent on a will to change and international collaboration.
Since 2008, Orkla has reported environmental information to the investor initiative CDP ( www.cdp.net), which has evolved into the leading system for global climate change and environmental reporting. More than 800 institutional investors stand behind CDP, including Folketrygdfondet (The Government Pension Fund Norway), NBIM, KLP, Storebrand, DNB, Nordea, SEB and Danske Bank. We have recently received the results of this year’s benchmarking of more than 2,000 companies that report to CDP. The report shows that Orkla ranks among the top 10-15 per cent of companies at both global level and in relation to the 147 Nordic companies that have reported information.
CDP’s assessment encompasses policy, climate and energy accounting, action taken and improvements. The number of companies reporting to CDP increases every year, and CDP continuously presents new initiatives to put environment on the agenda. In 2014, for the first time, Orkla participated in CDP’s forests programme. New this year, Orkla has also taken part in CDP’s water programme, which was established in 2009.
ORKLA SUPPORTS TWO CDP INITIATIVES
In line with Orkla’s environmental commitment, the Group has endorsed two initiatives launched by CDP prior to COP21. One of these initiatives, “Remove commodity-driven deforestation from all supply chains”, entails a commitment to make targeted efforts to prevent deforestation in connection with raw material production. Orkla’s policy on deforestation-free supply chains, launched earlier this autumn, describes our efforts to achieve this objective.
The second initiative, “Report climate change information in mainstream reports as a fiduciary duty”, entails an commitment to report comprehensive, reliable climate change-related information. Orkla reports on its environmental and climate change-related performance through its annual report and its disclosures to CDP, and strives continuously to improve its reporting. The Group’s environmental reporting is verified by the Norwegian advisory company CO2focus, an accredited CDP partner.
CLIMATE ADAPTATION IS PROFITABLE
Climate adaptation is profitable because it reduces energy costs. Moreover, CDP analyses show that companies with high CDP scores also generate higher returns, on average, for their shareholders. This appears to be a continuing trend, and could indicate that tomorrow’s winners will be companies that take a proactive approach to tackling the climate threat, to the benefit of society and shareholders alike.
Through its CDP reporting, Orkla can measure its performance against that of other companies in the same sector. This reporting also serves as a good tool for implementing special measures and focusing attention on Orkla’s exposure to the climate threat.
As one of the largest companies on the Oslo Stock Exchange, Orkla has reported to CDP since 2008, and was one of the first companies in Norway to commence this reporting. This year, Orkla achieved a score of 98B. This is an improvement from last year, when its score was 90B. In 2013, Orkla scored 79C. In 2015, the average for Nordic enterprises is 84C. Orkla’s good ranking means that we have a clearer climate change strategy, a better overview of our own greenhouse gas emissions, and a greater understanding of how the company is exposed to climate challenges than the average Nordic listed company. An improvement from C to B means that the company’s greenhouse gas emissions performance is improving. This is a consequence of all the various measures carried out by Orkla companies, such as energy-efficiency programmes and fossil fuel replacement.
MINIMISING ORKLA’S ENVIRONMENTAL FOOTPRINT
Orkla factories have effective control, on the whole, of environmental factors and implement improvement measures to reduce energy consumption, water consumption and food waste in production. In 2015, clearly defined targets were set for further improvement and systematic follow-up. The next step will be to continue our efforts to help reduce environmental impacts in other parts of our products’ value chain. We know that food production accounts for 25 per cent of global greenhouse gas emissions. By taking action to reduce the environmental impacts of our suppliers and in the consumption situation, therefore, we can make a substantial, important difference. Examples of key activities include monitoring our suppliers to prevent deforestation in the supply chain, developing packaging with a lower environmental impact and promoting product design that reduces food waste or makes it easier to recycle packaging.