Hormel Foods Corp

The company is committed to setting a science-based emission reduction target. The target is in the process of being approved. In 2022, it mentioned that it is on track to have an approved science-based target by 2023.

The company has set an interim target to reduce absolute GHG emissions by 1% per year and improve GHG emissions efficiency by 1% per year. The company's commitment to reduce its greenhouse gas emissions applies to the entire Group and includes 100% of emissions in Scope 1 and 2. It states that it worked on Scope 3 GHG emissions analysis in preparation for submitting its preliminary goal to the SBTi. It does not have a separate target to reduce Scope 3 emissions.

The company has already submitted its target to the SBTi for validation. It mentions that it is on track to have an approved science-based target by 2023.

The company discusses that it seeks to do business with suppliers who share their commitment to reducing the environmental impact of business operations, which includes air emissions. It states it collects climate change and carbon information from suppliers annually to better understand its suppliers' position on GHG management in the CDP report. However, it has no strategies for promoting emission reduction from agriculture directly.

The company is part of a collaborative programme that helps farmers explore sustainable farming practices across 50,000 acres in Minnesota. It states that the pilot programme is part of the Ecosystem Services Market Consortium's (ESMC) effort to launch a nationwide agricultural carbon and water credit marketplace in 2022.

The company does not engage in innovative projects to reduce or mitigate emissions from animal farming

The company reports Scope 1 emissions to be 668,817 metric tons of CO2e and Scope 2 emissions to be 21,364 metric tons of CO2e in FY2021. It reported Scope 3 emissions in 2021. The company's response to the 2022 CDP Climate questionnaire is limited to Brazil, China and the United States. It also operates in the Philippines, Japan, Australia and Canada. However, this is not covered in the CDP Climate Change disclosure.

The company discloses the Scope 1 emissions by greenhouse gas type, including CH4 and N2O. However, it does not mention animal farming specifically. It does not disclose the CO2 equivalent emissions, specifically from feed. However, it reports that it sources feed ingredients from suppliers. On Scope 3 emissions, it has reported emissions from purchased goods and services and from the use of sold products. However, this does not include all emissions from feed production as it does not include the feed it purchases from contracted feed grain growers.

The company responded to the CDP Climate questionnaire in 2022.

The company mentions absolute emissions remain similar to the previous reporting year. It says a decrease in emissions intensity due to a reduction in Scope 1 and 2 emissions combined with an increase in total revenue from the previous year.

The company has not conducted a scenario analysis. While it states that it anticipates using qualitative and/or quantitative analysis in the next two years, it is unclear if this is a commitment to conducting a climate-scenario analysis.

The company uses futures contracts to manage the risk of increasing feed prices. However, it indicates this only concerns its short-term exposure to price fluctuations and does not discuss the projected impacts of physical dangers on feed ingredients' availability and price volatility. It discloses that changes in global economic conditions may cause adverse effects, such as energy availability and costs. However, it does not mention any mitigation plan directly related to the issue.

The company does not disclose its commitment to align capital expenditures with its GHG targets.

The company mentions that 10-20% of its revenue is dependent on soy. It has conducted a high-level evaluation of its soy supply and mentions that it is comparatively low risk as it is primarily sourced domestically, i.e. from the US. However, the company does not explicitly mention the % of soy sourced from the US.

The company commits to following SBTi’s Forest Land and Agriculture (FLAG) Guidance and discloses that it must finalize this commitment by 31 December 2024. However, the commitment only covers its primary deforestation-linked commodities and is not currently in place.

The company discloses information to CDP Forests.

The company discloses that it sources cattle from the USA, Australia, Brazil, Canada and Uruguay, some of which are locations with a high risk of deforestation. It states that it has assessed risk in the cattle products supply chain as part of an established enterprise risk management framework. However, it does not explain its methodology for analysing and identifying deforestation risks and does not explicitly disclose the high-risk locations it has identified through the assessment.

The company mentions that it aims to source beef from suppliers who follow the principles and criteria of the Global Roundtable for Sustainable Beef (GRSB). It discloses a target to source 100% of cattle sustainably by 2025, which includes deforestation as a major criterion.

The company responded to the CDP Forests questionnaire in 2022.

The company requires all suppliers to acquire land rights and operations legally and to protect high conservation value areas, high carbon stock forests, rainforests and peatlands. However, the company does not explicitly refer to soy-related deforestation.

The company has conducted a high-level evaluation of its soy supply. It mentions its soy is primarily sourced from low-risk areas, but the company does not disclose the exact percentage.

The company is investing in regenerative agriculture, targeting improvements in soil health. Alongside this, one subsidiary has started to produce 100% grass-fed beef, thereby reducing reliance on soy.

The company explicitly states it is not working with smallholders, or tertiary suppliers in this area.

The company states that to ensure compliance with its requirements, all beef suppliers have monitoring systems for farms supplying cattle, which use satellite images and geo-referenced maps of farms, deforestation data and information from public agencies regarding embargoed areas and human rights. The company also requires and reviews independent audits of the environmental monitoring systems of its suppliers. Hormel has only partially mapped its value chain, so monitoring cannot extend to indirect suppliers. It mentions that if a supplier is found to violate its sourcing principles, the company will require the supplier to implement corrective actions. If reasonable/appropriate corrective actions cannot be agreed to, the company will suspend or discontinue purchases from the supplier. In 2019, it disclosed that 100% of its cattle are traceable to the finishing farm. However, the same information is missing in the current reporting period. The company states that traceability is monitored but does not substantiate its claims.

The company works directly with first-tier suppliers to manage and mitigate deforestation risks. The company is also investing in regenerative agriculture.

The company has conducted a water-risk assessment of its operations using the World Resources Institute's Aqueduct Water Risk Atlas. It identified three manufacturing facilities in regions defined as overall high risk, and access-to-water risk remains low at all domestic manufacturing locations. However, it does not disclose exact locations. It has disclosed its total water consumption for the last year. The company also discloses information on various projects to reduce water consumption.

The company had set a target to reduce absolute water consumption by 2% per year and improve water efficiency by 2% per year. The target year was 2021, and the company mentions it exceeded 106% of its target in 2020 when combined with progress since 2012. It does not mention any new targets at the time of writing. The company measures and monitors water withdrawals. However, it has not set a time-bound target to reduce total water withdrawals.

The company discloses that in 2021, it withdrew 84% of its water from groundwater sources and 14% from surface water. It reports that 1-10% of water is withdrawn from areas with water stress. The company discloses that its water-related CAPEX has increased by 3% yearly, and its water-related OPEX has increased by 3%. It responded to the CDP Water questionnaire in 2022. The company reports that it reduced water use by over 42.2 million gallons and improved its annual water efficiency by 14% in 2021.

The company’s Sustainable Agriculture Policy states that it expects suppliers and feed grain growers to improve their water use efficiency. However, this is just an expectation rather than a strict requirement. The company mentions that it engages with growers in high-risk water regions to identify areas for improvement that will lower water risk and improve water quality. However, it does not provide more details about the specific actions to support farmers. To strengthen the water management aspects in its sourcing strategy, the company completed a high-level water risk assessment for its top suppliers in partnership with the AgWater Challenge.

The company discloses that it does not know the proportion of soy sourced from water-scarce areas but will obtain this data within the next two years. It is currently assessing regenerative agricultural projects, including pasture-raised beef on regenerative grasslands. However, it is unclear if it is investing or scaling these projects currently.

The company primarily engages in the production of poultry and pork. It discloses that poultry production does not occur in water-stressed areas and that about 1-10% of pork production originates from sites with water stress. The company also sources poultry and pork from third-party contract growers. The company discloses that none of its poultry is sourced from water-stressed areas, and about 11-25% of its pork is sourced from water-stressed regions. Its Sustainable Agriculture Policy states that it expects suppliers to improve water use efficiency; however, this is not a strict requirement.

To strengthen the water management within in its sourcing strategy, the company completed a high-level water risk assessment for its top suppliers in partnership with the AgWater Challenge. It is also committed to advancing its water stewardship efforts through initiatives in the top six priority watersheds. In 2021, it assessed several potential projects designed to help achieve its goal.

The company was subjected to five cases of fines, enforcement orders or other penalties related to water regulatory violations. The fines reported were related to discharge events above permitted levels. It conducts an annual water risk assessment with a third-party consultant. This assessment includes water quality. The company aims to achieve a 10% reduction of organic matter discharged from its processing facilities by 2030. However, it does not disclose specific actions linked to that goal. The company mentions that it is currently evaluating wastewater-loading reduction and treatment-improvement opportunities and will provide additional updates in future reports.

The company mentions it measures discharged water quality parameters. However, it does not disclose the results. It disclosed wastewater discharge for the reporting year and reported a decrease from the previous year. The company mentions it is actively considering auditing its water information reported to the CDP within the next two years. It responded to the CDP Water questionnaire in 2022.

The company disclosed wastewater discharge in the reporting year. It reports the decrease in discharged volumes is attributed to increased product and evaporative loss from the incoming water withdrawals.

The company has a sustainable agricultural policy for feed grain growers that states the importance of developing a nutrient management plan specific to their conditions. The policy is meant to "eliminate runoff linked to improper fertiliser, pesticide and herbicide use". The policy lists various steps for contract animal producers and feed grain growers concurrently. Hormel Foods and Target, along with MBOLD, have joined together to support an innovative agriculture pilot project for farmers to adopt soil health practices to improve water and air quality. These practices include cover cropping, reduced tillage and nutrient management. The goal is to enrol up to 50,000 acres. The company is also a founding member of the Cedar River Watershed Partnership, a public-private partnership designed to further the implementation of sustainable agriculture best practices.

As part of the regenerative agriculture pilot project, farmers will use cover crops. The company states it will provide $1.7 million in partnership with Target for this project.

The company expects its animal producers to implement agricultural best practices, which include the proper storage of manure and policies and procedures to ensure the proper management of organic solid waste. However, the company does not explicitly state that it converts manure to fertiliser. It discloses that it assesses risk in direct operations concerning water quality at a basin/catchment level. However, it does not disclose the locations found to be at risk.

The company expects contract animal producers to evaluate their operation and develop a nutrient management plan specific to their conditions. However, the company does not provide details of the consequences of non-compliance.

The company does not integrate nutrient management performance into incentive schemes for farmers. It does not discuss innovation in manure or provide evidence of a community engagement plan in relation to pollution.

The company commits to the responsible use of antibiotics, adhering to US FDA guidelines that prohibit the use of medically important antibiotics (MIAs) for growth enhancement. It promotes antibiotic stewardship through veterinary oversight, adopting preventive strategies, and employing alternative solutions such as biosecurity programmes and targeted vaccines.

The company discloses the quantity of medically important antibiotics used in some of its operations and supply chain.

The company commits to respecting the Five Freedoms for Animals and provides role-specific training to employees at hog farms and processing plants. It has a zero-tolerance policy towards animal abuse and neglect and incorporates a speak-up policy in its business code of conduct. The Supplier Code of Conduct allows for suspension of purchases from non-compliant suppliers. It also operates a facility focused on animal welfare and is innovating its hog and turkey handling processes. However, there is no statement on employee training for poultry operations.

The company details its animal welfare standards for hogs and eggs, stating 100% cage-free eggs and group sow housing for hogs. It also commits to broiler chicken welfare through its Applegate subsidiary, targeting stocking densities in line with GAP. Additionally, all hog producers participate in the Hormel Foods Quality Assurance Program. Commitments extend to a controlled atmosphere stunning for turkeys and supplier engagement for improved broiler chicken welfare. However, it does not disclose cattle information, lacks details on animal health during transport, and does not mention natural behaviour facilitation such as outdoor access. By 2026, it aims to adopt chicken breeds with improved welfare outcomes.

The company's subsidiary Applegate, producing organic beef, is certified by Good Agricultural Practice (GAP) and Certified Humane. The company's subsidiary Applegate, specialising in organic pork, is certified by Good Agriculture Practices (GAP) and Certified Humane. The company's subsidiary Applegate is certified by Good Agricultural Practices (GAP) and Certified Humane for its organic chicken production. It commits to extending GAP certification across its entire supply chain by 2024. The company commits to high-tier animal welfare through alignment with Global Animal Partnership (GAP) for its broiler chicken operations. Its subsidiary, Applegate, is certified by GAP and Certified Humane. However, the company does not clarify if any assurance certifications are active in the current reporting year, as its broiler chicken commitments are forward-looking statements.

The company does not disclose information in relation to animal welfare certifications or assurance programs for its beef operations.

The company transitioned to group sow housing in its hog farms, and all designated suppliers' hogs are housed in group pens. It also commits to improved poultry environments, including better lighting and litter quality. However, the company does not address maximum transport times, effective stunning, or dehorning in beef production. Additionally, there's no disclosure on maximum stocking density, water bath stunning, or the use of higher welfare breeds in poultry.

The company commits in writing to respect human rights per the International Bill of Human Rights and the core ILO conventions.

The company conducts due diligence and assessment processes to monitor modern slavery and review the next steps of action in its supply chain. However, these do not seem to cover all human rights. Furthermore, the company does not disclose how it would identify the next steps of action it would take if it identified human rights risks in its own operations. Regarding risk mitigation, the company states that team members are trained on policies and procedures concerning aspects of human rights that are relevant to its operations. However, it does not disclose sufficient information to determine how identified risks in its supply chain are mitigated or how stakeholders are remediated.

The company does not disclose if it identified any human rights risks during the reporting year.

The company commits in writing to prohibit child labour, forced labour, discrimination and harassment and requires suppliers to do the same. The company states that to ensure adherence to these policies, it has established a compliance program led by its audit committee, designed to uphold accountability through reporting, tracking and investigating possible violations.

The company's compliance program also aims to ensure adherence to the supplier code of conduct. The supplier code of conduct requires adherence to the prohibition of discrimination, abuse, child labour and forced labour. The company has established a hotline number and website, operated by a third party, to facilitate anonymous employee feedback and address concerns should employees observe anything that does not comply with the code of conduct. The company also has an anonymous grievance mechanism for its suppliers. However, the company does not explicitly disclose the number of grievances reported via the whistleblowing hotline for the reporting year.

The company commits in writing to uphold a safe work environment for all employees. The company has a corporate safety steering committee for all its business units and subsidiaries. Further, whilst it does not disclose the percentage of facilities with worker representatives, it states that its safety committees comprise more than 1,000 hourly and salaried employees. The company does not disclose a health and safety certification.

The company's total case incident rate (TCIR) per 200,000 hours worked was 2.3 in FY2021, demonstrating an increase from the previous reporting year's TCIR of 2.6. The company reports zero fatalities in FY2021 but does not disclose the number of fatalities in last years. The company discloses that the turnover rate for the fiscal year 2022 was 11% for employees with an annual salary and 44% for those paid by the hour. Still, the company does not disaggregate further by seniority level.

The company commits in writing to uphold its employees' freedom of association and collective bargaining. It discloses that trade unions represented 20% of its employees worldwide in 2022. The company also expects suppliers to respect their employee's rights to freedom of association and collective bargaining.

The company discloses that 20% of the employees are covered by collective bargaining agreements through trade union membership. Also, the company states that in 2021, it had 81% of employees working hourly, 19% of employees as salaried, 1% as part-time, and 6% as temporary.

The company has disclosed that 26 of its sites are certified by a GFSI-recognised programme. As per the corporate website, it has 40+ manufacturing facilities. Hence, the certified site proportion is unclear. It states that it ensures suppliers comply with the GFSI-recognised standards. However, it is not clear whether suppliers are explicitly required to be GFSI-certified, and the proportion of suppliers certified with GFSI is not disclosed.

The company discloses that it conducts internal and external food safety audits. In 2021 it disclosed that it conducted an additional eight food safety supplemental audits. However, it does not disclose the total number carried out. If suppliers are found to be non-compliant, appropriate action is taken, including termination. However, there is no mention of corrective action rates associated with its own facilities' non-conformances. It mentions a traceability process that goes from the ingredient suppliers to the production plant, the finished product, and finally, to each customer. This system relies on electronic systems and records to provide visibility into the company's supply chain. The detailed and thorough approach to traceability lets the company know the farm of origin for each hog processed daily at plants throughout the country. However, it is not clear whether this traceability system is consumer-facing.

The company mentions that there is a communication channel for consumers to report food safety cases. However, it does not have a product recall system in place. It had one voluntary Class II recall in 2022 for a limited number of jars of SKIPPY® products. It discloses one case of a product recall in the current reporting period. It mentions that a limited number of pots may contain a small fragment of stainless steel from a piece of manufacturing equipment in SKIPPY® products. The recall is being conducted with the knowledge of the US Food and Drug Administration.

The company does not disclose market bans and no market bans found in media screening.

The company discloses that the governance committee of its board of directors has formal oversight of its ESG issues. Also, the company has conducted a materiality assessment to identify topics most relevant to its business and stakeholders. It lists the key topics, including products, supply chain, environment, people and community, air emissions, climate change and environmental compliance. It does not be made clear whether the board oversees the assessment. The company discloses board-level expertise in food safety and innovation but not sustainability.

The company discloses that direct and indirect incentives are provided for managing climate-related issues. However, it does not reveal the percentage of variable compensation linked to achieving related targets. The company engages in an ongoing dialogue with elected officials and community members about various sustainability-related issues. Within its CDP disclosure, the company states that it indirectly engages, through trade associations, to influence policy, law, or regulation that may impact the climate. However, it does not be clarified what stance the company takes on climate change when engaging on topics unrelated to climate resilience in supply chains. The company also provides details on trade association memberships. However, it does not discuss aligning its policy-engagement strategy to restrict global temperature rise to 1.5°C.

The company holds an annual summit for team members involved in innovation and has an Innovation Steering Committee that meets quarterly to review the company’s innovation progress. It discloses that one of its goals for the 20 by 30 challenge is to develop more sustainable packaging. However, the company does not disclose how it benchmarks itself against peers in sustainability and innovation.

The company acknowledges protein diversification as a material business issue driven by consumer appetite for plant-based proteins. It has set a goal to achieve 15% sales from new products each year and discloses annual progress. However, it has not yet set a timebound target to diversify protein sources, nor does it report revenue/sales linked to alternative protein sources.

The company has a wide array of plant-based protein brands such as SKIPPY® peanut butter, Justin’s nut butter and Happy Little Plants. Hormel's subsidiary, Burke Corporation, launched a set of alternative plant-based products in 2020. Powered by pea protein, these include fully cooked crumble and uncooked ground products. It also expanded its range of plant-based proteins through the acquisition of the Planters® snack nuts business in 2021, which includes the Planters®, NUT-rition®, and Corn Nuts® brands. Further, it also entered into an exclusive partnership with The Better Meat Co. in 2021 to bring new mycoprotein and plant-based protein products to the marketplace.