Maple Leaf Foods Inc

The company has set a science-based Target in line with the well-below 2°C scenario. It has committed to reducing absolute Scope 1 and 2 emissions by 30% by 2030 from a 2018 base year and reducing Scope 3 emissions intensity by 30% per tonne of product by 2030 from a 2018 base year. It has set a science-based target to reduce Scope 3 intensity by 30% by 2030 from the 2018 baseline.

In November 2019, the company set Science-Based Targets in line with a well below 2°C scenario. It has committed to reducing absolute Scope 1 and 2 GHG emissions by 30% by 2030 from a 2018 base year. It has also committed to reducing its Scope 3 emissions intensity by 30% in the same timeframe. It has become carbon neutral since 2019 and continues to maintain this status. However, it has not yet set a net-zero target.

The company has partnered with Nutrien and Indigo Agriculture to improve the carbon outcomes of its supply chain. Nutrien engages with the company's entire Canadian supply chain to enable future carbon improvement by adopting practices that will enhance soil health. The Indigo Agriculture partnership involves purchasing verified offsets through Indigo Carbon, including regenerative supply chain sourcing.

The company is employing no-till direct seeding systems and cover cropping. However, it is unclear whether the practice applies to all company operations.

The company recognises that emissions from manure are its most significant sources of Scope 1 and 2 emissions and is taking steps to mitigate this source through anaerobic digestion, which converts organic matter. It has also invested in the Coast Environmental Chemainus Composting project, an anaerobic digestion project. However, it does not disclose any innovative projects specifically aimed at reducing or mitigating emissions directly from active animal farming.

The company discloses that during 2022, Scope 1 emissions were 278,292 CO2e tonnes, Scope 2 emissions were 31,268 CO2e tonnes, and Scope 3 emissions were 11,477,279 CO2e tonnes.

The company has included animal and manure management emissions in the calculation of Scope 1 emissions, which account for 2.1% and 4% of the company's Scope 1 emissions, respectively. It discloses its Scope 3 emissions, which include emissions from animals raised at third-party contracted producers. This makes up 17.8% of the company's total emissions. It also discloses the methodology and breakdown of GHG emissions. Its Integrated Sustainability Report states that 23.7% of its total emissions are linked to feed and crop production.

The company responded to the CDP Climate Change questionnaire in 2022 and supplies information for its operations in Canada and the US. KPMG Canada has audited the GHG emissions data.

The company discloses an increase in absolute total emissions of 2.13% (Scope 1+2+3) from 1,749,424 in 2021 to 1,786,839 in 2022, which is attributed to the start of four new facilities/expansions located in Ontario, Manitoba and Indiana. It discloses a quantitative decrease in emissions arising from feed from 416,039.13 tons of CO2e in 2021 to 350,115.12 tons of CO2e in 2022. The calculation of emissions from feed is done manually using the percentage of emissions from feed and crop production, which is 23.7% in 2022 and 27.4% in 2021, respectively. These values are then multiplied by Scope 3 emissions to get emissions arising from the feed.

The company states in its CDP and Sustainability Report that it conducted a physical climate risk assessment and climate scenario analysis, working with an independent third-party consultant. Through this, the company aims to improve understanding of the climate-related risks and potential impacts on its livestock, assets, supply chain, and operations.

The company identified extreme temperatures, freeze-thaw, water stress, and extreme wind and rainfall as most relevant to the business. It states that one of the main potential physical risks to its business includes all regions in which it operates that have a medium to high risk of water stress due to temperature rise and increased drought risk, which can impact the availability of feed and water resources for sanitation. It also reports some current mitigation plans such as diversifying its sourcing regions, maintaining temperature-controlled barns, maintaining contingency plans and protocols for extreme weather and transportation of livestock, insurance of assets and reducing water consumption as part of its environmental footprint reduction goals. It conducted a physical climate risk assessment and climate scenario analysis in 2020. It identified that an increase in extreme temperature days across the company's Canadian locations, particularly in Manitoba and Ontario, may have severe implications for processing and livestock health. To mitigate risk, the company mentions diversifying its sourcing regions, maintaining temperature-controlled barns, maintaining contingency plans and protocols for extreme weather and transportation of livestock, insurance of assets, and reducing water consumption as part of its environmental footprint reduction goals. However, it states there is no guarantee that these risk mitigation efforts will be practical. It is already subject to the Canadian Federal Carbon Charge. However, it says that provincial and federal carbon taxes and regulations still present a risk to its operations as part of its climate risk assessment. It discloses that to ensure compliance with and anticipate further regulation, it has also developed an internal carbon price for its operations, which it uses as part of its capital decisions and operations practices.

The company has implemented internal carbon pricing. This includes a carbon calculator tool that factors the carbon cost into all capital expenditure requests and returns on net assets calculations. This carbon price factors into all capital decisions and operating practices. It is also carbon neutral, using offset credits for emissions it cannot directly mitigate. Since it is committed to maintaining this, the internal carbon price will have a tangible influence on capital expenditure decisions, equivalent to a commitment.

The company sources feed and feed ingredients, including soy and corn, from the provinces of Saskatchewan, Manitoba, Ontario, and Quebec in Canada. It states that it sources its feed and feed ingredients from North America. Although North America has a low risk of deforestation, the company does not explicitly discuss how it manages deforestation risks linked to soy, and it is not clear whether this includes the feed used by independent producers and contract growers.

The company references deforestation and biodiversity in its Supplier Code of Conduct, stating that it will not procure soy from suppliers which source these commodities from areas of high risk for deforestation and biodiversity loss. However, the company does not disclose further information on how it engages soy suppliers on deforestation risks.

The company commits to conducting a deforestation risk assessment by the end of 2024. The company does not disclose the process through which compliance is monitored. The consequence for supplier non-compliance with the company's Supplier Code of Conduct is removal from the company's Preferred Vendor list and, depending on the severity of non-compliance, potentially removal from the business.

The company is investing in regenerative agriculture practices within the supply chain, which helps reduce soil disturbance and maximise crop diversity. In alliance with Nutrien, the company has expanded the program to 100,000 acres of farmland within the supply shed from where feed ingredients are sourced. The programme provides farmers with incentives and information about practices that are anticipated to positively influence their land, such as reducing their input costs, utilising fertiliser, increasing crop yields, and strengthening the soil's ability to withstand adverse weather conditions.

The company discloses that it conducted a risk assessment in 2017 and found that some processing facilities operate in high-water stress areas. However, the company does not disclose information about low-water stress area operations. The water risk assessment covered its owned/leased farms and facilities and sourced feed and feed ingredient locations in Canada. The assessment determined that the organisation had not directly caused or contributed to negative water-related impacts on environmentally sensitive watersheds. However, some farms were identified as being located in areas with high threats to fresh water and overuse of water. Additionally, the company's physical climate risk assessment and climate scenario analysis enabled the company to determine that all regions in which the company operates have medium to high risk of water stress due to temperature rise and increased drought risk. However, as the company has not undertaken an assessment in the last two years, it has not been awarded points as the findings may longer be accurate. The company states that it continues to explore ways to reduce its absolute water consumption and use water more efficiently. Since 2015, it has completed approximately 193 water conservation/reuse projects across facilities and has been progressing towards the water intensity reduction target of 50% by 2025. In 2022, the total water consumption was reported by the company.

Every facility has committed to reducing its water intensity by 50% by 2025 (2014 baseline). The company discloses it has achieved a 20.9% reduction in water intensity since 2014.

The company discloses its water consumption figures by source for 2022. KPMG Canada has audited the company's water consumption data. Maple Leaf Foods discloses an increase in water consumption in 2022. The company does not disclose the volume of water withdrawn in its 2022 integrated report, and as such a comparison cannot be made.

The company owns five feed mills that produce animal feed for its pigs. It also sources North American grains for its animal feed. However, the company does not disclose information relating to water scarcity risks in feed farming. It discloses information relating to the implementation of regenerative agriculture to grow feed crops. However, improving water use on feed farms does not seem to be a goal for the company in this context. The company has partnered with third parties to implement and monitor regenerative agriculture in its feed supply chains. Although these partnerships do not seem to target improved water use management, the company has undertaken a risk assessment with a third-party consultant which was used to prioritise where the company should focus its physical risk mitigation efforts.

The company discloses that the regions where it sources feed are exposed to medium to high risk of water stress due to temperature rise and increased drought risk. However, the company does not disclose the proportion of feed sourcds from water-stressed areas. Maple Leaf Foods reports that in 2021, it had 20,000 acres of crops which employed regenerative agriculture, and this year the area has been increased to 100,000 acres.

The company states that some of its farms are located in areas with a high threat to fresh water and the overuse of water. However, the company does not disclose the proportion of animal protein commodities produced and/or sourced in water-stressed areas. It states that its water risk assessment has helped to inform the strategies integrated across its operations to reduce water use at facilities and its supply chain. However, it does not provide details of these measures in its disclosure.

The company mentions undertaking a climate-related risk assessment including water stress risks that may impact its livestock operations. The company states that this information has been used to inform its strategy to reduce these risks.

The company discloses zero instances of non-compliance with water quality permits, standards, and regulations in the reporting year. In 2017, the company worked with a third-party consultant and WWF Canada to conduct a water risk assessment of its owned/leased farms and facilities which included water quality and pollution. The company mentions it was determined that it had not directly caused or contributed to any negative water-related impacts on environmentally sensitive watersheds. However, it seems the company has not conducted any recent risk assessment, and the findings from the previous risk assessment might have changed over time.

The company does not disclose information regarding an audit of wastewater data.

The company discloses that it converts animal manure, organic waste, food waste, and wastewater into renewable natural gas (RNG). However, the company does not disclose converting animal by-products from processing effluents into fertiliser and/or biogas.

The company is investing in regenerative agriculture within its feed supply chains. One of the regenerative practices the company discloses is proper nutrient management and reduced synthetic fertiliser use. It partnered with Nutrien, a provider of crop inputs, to expand its work in regenerative agriculture. The program incentivises and educates farmers to lower fertiliser use and guides farmers to the management practices that reduce nutrient run-off.

The company is investing in regenerative agriculture. Part of the focus is to promote soil management practices that increase soil carbon sequestration, e.g. proper nutrient management, no-till direct seeding system, increased crop rotation practices, cover cropping and intercropping, and reduced synthetic fertiliser and pesticide use. In 2022, the company scaled the program to 100,000 acres of farmland within the supply shed, where the company sources feed ingredients in Manitoba and Saskatchewan.

The company discloses that in 2022, its owned and leased hog barns recycled 1,456,317,429 litres of manure from storage lagoons by applying it to fields as fertiliser, 100% of which was applied with a site-specific nutrient management plan developed by a certified agrologist.

The company recognises that good manure management is essential for minimising GHG emissions. However, for the animal proteins the company sources from third parties, it does not disclose whether it only purchases animal proteins from farms with a nutrient management system in place. Maple Leaf Foods utilises certified agronomists who develop site-specific nutrient management plans for manure application. All application plans are registered with the Province of Manitoba for approval.

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 prohibiting the growth-promotional use of medically important antibiotics across all species and supply chains. Its antibiotics policy encompasses monitoring, reduction strategies and animal care protocols, in alignment with relevant governmental and veterinary regulations. The company promotes animal welfare through advanced housing systems and employee training on animal care practices, advanced management, and specialized feed and vaccination programmes, reinforced by biosecurity measures. Nevertheless, it has not provided clear information concerning the prophylactic use of antibiotics across operations.

The company reports a significant 99.1% reduction in antibiotic usage across its hog production operations since 2014, averaging 31.5 mg per kg of pork produced in 2022. A downward trend is noted, as usage decreased from 39.0 mg in 2021. However, this data is limited to the company's own raised hogs and does not cover the entire supply chain. The company does not disclose antibiotic usage for poultry or provide third-party audit information specifically for antibiotic quantities.

The company commits to the Five Freedoms for Animal Welfare and mandates annual animal welfare training for employees. It employs 37 experts certified by the Professional Animal Auditor Certification Organization (PAACO) to monitor daily operations. The company has a structured investigation process for incidents that could lead to disciplinary actions or supplier contract terminations. It is a member of multiple animal welfare organisations, plays significant roles in relevant committees, and sponsors research in swine welfare at the University of Saskatchewan.

The company commits to avoiding close confinement and adheres to Canadian animal welfare standards, including the implementation of Advanced Open Sow Housing. It also commits to reducing physical alterations, notably through immunological castration, and to minimising transport times to less than eight hours. The company ensures humane slaughter practices and provides enriched environments for animals, with 5% of broiler chickens and 39% of pigs in its global supply chain having access. However, physical alterations in poultry are permitted for long-term flock welfare, tail docking is still practised, and the percentage of animals with access to environmental enrichments is limited.

The company commits to prioritising animal welfare and maintains high compliance rates with animal welfare assurance programs of 90% to 100% across different species in farms, operations, and suppliers. It also supports research and regulatory reforms to improve industry standards. No information is provided on third-party auditing for animal welfare. The company discloses that its pork operations are certified by multiple programmes: Canadian Pork Excellence PigCARE, Canadian Quality Assurance Animal Care Assessment, and North American Meat Institute Animal Care and Handling Guidelines. The company discloses high compliance with the Chicken Farmers of Canada Animal Care Program, certifying 99.8% of its broiler chicken operations. Additionally, 4% of operations hold Humane Raised and Handled and Certified Organic certifications.

The company regularly reports on animal welfare metrics and addresses non-compliance or audit failures.

The company has transitioned to open housing for owned sows and eliminated surgical castration in these barns. It commits to environmental enrichment in pig operations and adheres to the National Farm Animal Care Council (NFACC) Code of Practice, with 51% of broilers at or below 31 kg/m². Controlled atmosphere stunning is implemented in new plants, and enrichments are in place on Certified Humane and Certified Organic farms. However, gestation crates are still used by some third-party suppliers, and tail docking on piglets persists. Slower-growing poultry breeds are not yet integrated. Only 19% of chickens are processed using controlled atmosphere stunning, and enrichments account for just 5% of the broiler population.

The company discloses that human rights adherence is embedded in its policies on conduct. However, it does not publicly discuss adhering to international human rights standards, such as the core ILO conventions.

The company mentions that it has yet to review or assess human rights risks in its operations but expects to complete one by 2024. Furthermore, the company does not disclose whether it monitors human rights risks.

The company does not disclose whether it has identified any human rights risks in its operations through human rights due diligence

The company commits in writing to prohibit child labour, discrimination, forced labour and harassment and expects suppliers to do the same. However, it does not commit to promoting fair wages or state if it undergoes audits covering the selected policies.

The company has established a grievance mechanism that employees or suppliers can use to report complaints or raise issues publicly. A third-party agent will confidentially record every concern and pass it to the appropriate authority in the company for further investigation. The company reports that it received one incident of discrimination in 2022 that came via the ethics line. However, the company must state that this was the only grievance received during the reporting year, and the total number of grievances received is unknown.

The company discloses that workplace occupational health and safety (OHS) is a top priority and aims to achieve zero occupational injuries. The company has also worked with a third party to monitor OHSAS 18001 requirements and measure OHS performance. The company has various certifications, ensuring its OHS management system meets regional standards. These include the Government of Alberta's Certificate of Recognition for its sites in Alberta and the Ontario Workplace Safety and Insurance Board's (WSIB) Health and Safety Excellence Program for its locations in Ontario. Furthermore, the company's laboratories are ISO/IEC 17025 accredited and audited annually. In addition, the company discloses that all of its sites have a Joint Health and Safety Committee comprised of management and employees.

The company discloses its total recordable incident rate (TRIR) per 100 full-time workers was 0.40 in 2022, demonstrating an improvement from the TRIR of 0.48 reported in the previous reporting year. The company also discloses zero work-related fatalities for the past decade. In addition, the company disclosed that its employee turnover rate was 41% for the reporting year, but it does not disaggregate this by seniority level.

The company states that it respects its employees' right to freedom of association and that approximately 60% of its employees are represented by a union. Also, the Supplier Code of Conduct states that all suppliers are expected to allow their employees the right to freedom of association. That said, the company does not provide evidence of actions to support freedom of association and collective bargaining.

The company discloses that it has approximately 8,000 employees covered by 21 collective agreements in Canada, representing approximately 61% of the workforce. Regarding employee contract types, the company discloses it has 14,000 employees, of which 13,720 are permanent, full-time, and 280 are part-time employees. However, no data for subcontracted workers is disclosed.

The company discloses that 100% of fresh and prepared meat production facilities are audited by third-party auditors that follow either the BRC or SQF standards. Both are GFSI-recognised schemes. The plant-based protein facilities in the US are either certified to BRC or are still on the certification journey. All raw material suppliers must have their facilities certified to a GFSI benchmarked standard. It has actively tracked adherence to this requirement since 2015 and has discontinued business with several companies that could not meet the needs. For the reporting period, 100% of co-manufacturers, 99.5% of raw meat suppliers, 99.2% of non-meat ingredient suppliers, 94.7% of non-meat, food-contact packaging suppliers and 87.5% of food-contact packaging suppliers are certified. Additionally, among the plant-protein suppliers, by the end of 2022, 100% of co-manufacturers, 88.9% of food-contact packaging suppliers, 94.6% of non-meat ingredient suppliers, and 72.7% of non-food-contact packaging suppliers had been certified to a GFSI standard.

The company discloses that it conducts annual internal food safety and third-party audits. These audits follow the BRC Global Standard for Food Safety, which is GFSI-recognised. In 2022, it had 30 regulatory non-compliance warnings issued by the Canadian Food Inspection Agency (CFIA), resolved and closed. The top three reasons were the Standard Inspection Process, Sanitation, and Poultry Slaughter. Once a warning is issued, the facility conducts a deep root cause investigation to determine appropriate corrective and preventative actions. The Corrective Action Plan is submitted to CFIA for approval, and all actions taken will be reviewed. It discloses it uses a Modified Atmosphere Packaging (MAP) technology, "Halopack", to preserve quality. However, it does not discuss whether it is implementing a consumer-facing traceability technology for food safety.

The company discusses its product recall protocol, which follows the CFIA process for identifying and addressing recalls. In 2017, the company launched the Food Safety Incident Rate (FSIR) and the Quality Incident Rate (QIR) metrics. These metrics measure recalls, near misses, pathogen failures, repeat non-conformance on internal audits, regulatory non-conformance, CFIA correct action requests and consumer complaints for food safety-related issues. The metrics are measured quarterly, and these metrics rank plants across the company. In 2022, it had one food safety recall and zero voluntary quality-related product withdrawals due to products that did not meet the company's standards. It issued a recall statement reporting 175g packages of Cappola Genoa Salami were incorrectly labelled, and allergens were undeclared; as such, they were immediately recalled voluntarily. However, it does not disclose detailed information on corrective and preventative actions.

The company reported no food safety or quality-related market bans in 2022.

The company's Safety and Sustainability Committee of the board of directors oversees sustainability-related strategies, performance and reporting. In addition, the company conducted a materiality assessment and publicly disclosed the outcomes of the assessment. It identifies various material topics under five dimensions: better food, better care, better communities, better planet and business and governance. It plans to conduct a refreshed materiality assessment in 2023. The company does not explicitly mention whether the board is involved in the assessment. The company has board-level expertise in sustainability, food safety and innovation.

The company only provides non-monetary incentives to its executive officers for achieving sustainable outcomes. The company engages with several public policy officials and trade/civil associations on issues ranging from alternative proteins to climate change, animal welfare and reducing antibiotics use. The company also provide details of trade association memberships. However, it does not discuss aligning its policy-engagement strategy to restrict global temperature rise to 1.5°C.

The company is active in innovation on animal welfare best practices via innovation in the transportation of animals, new product development, plant protein innovation, packaging innovation and biosecurity. It is also increasing its pace of innovation within its alternative protein brands. It has created the Maple Leaf Centre for Action on Food Security, which has an innovation fund that invests in innovative food security initiatives. The company also discloses that it has received a 2nd tier ranking on the Business Benchmark on Farm Animal Welfare (BBFAW). However, this only includes animal welfare, and it is not clear whether the company benchmarks itself against peers on other sustainability and innovation topics.

The company's CDP Climate 2022 questionnaire states that climate change considerations, including emissions associated with its meat protein business, may create reputational risk and challenge its ability to maintain market share for its meat protein products if consumers seek alternative, lower-carbon proteins. Its mitigation strategies include its expansion into the growing plant protein space. However, it has also publicly stated that the growth of this space will be more modest than initially predicted and has modified its strategy accordingly. In 2022, plant protein sales were $169.3 million compared to $184.1 million the previous year, representing a decrease of 8% driven by lower retail product volumes. This more than offset growth in food service volumes and pricing action implemented in the third quarter of 2020 to mitigate inflation and structural cost increases. Further, it is pivoting its strategy for the Plant Protein Group, setting a new goal to deliver neutral or better Adjusted EBITDA within the latter half of 2023. It seems to have dropped its ambitious goal, established in 2019, to achieve approximately $3 billion in sales in the Plant Protein Group by 2029 (assuming a market size of roughly $25 billion), given new and lower estimates for the overall plant protein market. The Plant Protein Group sales were $37.4 million as of the first quarter of 2023, and Adjusted EBITDA improved by 60.9% year over year to a loss of $12.0 million. The current estimates suggest that the category will grow at an average annual rate of 10% to 15%, making it a $6 billion to $10 billion market by 2030, to achieve the target within the latter half of 2023.

The company has a wholly-owned plant-based protein subsidiary, Greenleaf Foods, based in Chicago, which manages the plant-based brands Field Roast and Lightlife Foods. Lightlife provides vegetarian and vegan foods, whereas Field Roast Grain Meat Co. offers vegetarian “meats” made from grains, vegetables and spices. In late 2021, it announced it was re-evaluating its investment thesis for the Plant Protein Group after a reported market slowdown in growth. It took steps to materially reduce the size of its plant protein division as it believes the development of the plant protein category will slow to more modest rates of about 10%-15% a year (making it a $6 to $10 billion market by 2030). Despite this, it continues to invest and position itself for growth in plant protein demand and improve the division's performance. For example, it expanded its tempeh production capacity by acquiring and building a 118,000-square-foot facility in Indiana, which has been fully operational since 2022. It also discloses that in 2022, its Lightlife and Field Roast plant-based protein brands continued to build leadership in the plant protein space by increasing organisational and operational capacity.