Sustainability Report

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1 Sustainability Report

2 Live Positively: sustainability in each drop.

3 This report was printed on recycled PET (jacket) and Vitopaper (cover and inside part) synthetic paper made from post-consumer recycled plastics. The ink used to print it is made from plant-based oils, which are less harmful to the environment. Coca-Cola Brazil s choice of these materials is designed to ensure that the publication can be, in of itself, a recyclable item, thereby minimizing the environmental impact.

4 <3.12> Contents 5 Creating Value, Promoting Well Being and Making a Difference Sustainability Report 2010/ Sustainability in Each Drop Organizational Profile and Corporate Governance Environmental Well-Being 22 The Most Precious Resource Global Water Stewardship 30 Innovation Generates Energy Energy Management and Climate Protection 36 Recycling is a Must Sustainable Packaging Reading Guidelines These symbols identify and indicate the location of the GRI indicators met, as well as the Essential Items. Example: <EN8> References in the text Social Well-Being 44 Transforming the Individual Means Transforming the World Community 52 The Value of People Workplace EN8 Label at the top of the pages Personal Well-Being 64 In Benefit to the Consumer Beverage Benefits 70 What Matters is Your Health Active, Healthy Living 76 Parameters for the GRI Report 80 Indicator Index

5 Creating Value, Promoting Well Being and Making a Difference For 70 years, Coca-Cola has been a part of Brazilians lives. We have dedicated a great deal of effort here toward developing and delivering high quality products and building a system with top professionals. Based on the 2020 Vision a set of sustainable goals that orient our decisions, our mission is to refresh the world, inspire moments of optimism and joy, create value, and above all, make a difference. Live Positively has been our sustainability platform since However, it has now earned new contours, anchored in three main areas, as well as in a value creation model that offers a common tool that can be used to evaluate all priorities: Personal Well-Being (Me), Social Well-Being (We) and Environmental Well-Being (The World). In these main areas, we have regrouped the seven pillars that make up our Live Positively platform Global Water Stewardship, Sustainable Packaging, Energy Management and Climate Protection, Community, Beverage Benefits, Active, Healthy Living and Workplace. Besides this, we also introduced new topics that have gradually gained force, such as the Economic Empowerment of Women, Hydration and Nutrition and Sustainable Agriculture. I believe that Sustainability plays a central and strategic role in our business. And that only sustainability will bring the world a virtuous cycle of development in which, indeed, everyone wins. Xiemar Zarazúa CEO of Coca-Cola Brazil

6 2010/2011 Sustainability Report Coca-Cola Brazil Organizational Profile and Corporate Governance In each drop, the focus is sustainability Adopting the concept of shared value is strategic for Coca-Cola Brazil, since it guarantees sustainable development for the businesses and a better future for its associates and consumers. The Coca-Cola Brazil 2010/2011 Sustainability Report classifies in Level C of the Global Reporting Initiative application - GRI/G3. Twelve economic, social and environmental indicators were fully met and seven were partially met. Organizational Profile <2.1> Coca-Cola Brazil has one of the <2.3> With a sales volume of 10.7 four largest operations within The billion liters in 2011, Coca-Cola Brazil Coca-Cola Company, which is present in recorded earnings of R$ 19.2 billion, more than 200 countries and offers over representing an 8.2% growth compared 3,500 non-alcoholic beverage products to the previous year and mobilizing a including four of the five most highly system consisting of 16 business groups consumed brands on the planet: Coca- responsible for elaborating the final Cola, Coca-Cola Light, Fanta and Sprite. product and distributing it to more than 1 million points of sale located all <2.5, 2.6> A major company that has over Brazil. been present in the country for more than 70 years, Coca-Cola Brazil operates <2.8> Considered strategic information here as a limited liability company for the company, the figures associated (Ltda.). Only the head unit, located in with net revenue are disclosed globally Atlanta, Georgia, has shares traded on only as opposed to specifically by the stock exchange in the United States. country. <2.8> The structure of the Coca-Cola Brazil system is maintained through the work of some 63,000 employees including direct and indirect ones. Brazil has been one of the main driving forces behind the global economy, with outstanding potential and great capacity for innovation and adaptation. For nearly eight years, the national sales of Coca- Cola Brazil products have increased consistently each six months, and the Coca-Cola Brazil System is prepared to grow together with the country. During these seven decades that it has operated in Brazil, Coca-Cola Brazil has Investments table year by year Total From 2012 to 2016 R$ 1.3 billion R$ 1.5 billion R$ 1.8 billion R$ 2.2 billion R$ 2.6 billion R$ 9.4 billion R$ 14 billion consolidated its position as a company that prioritizes sustainable growth. It plans to invest R$ 14 billion over the next five years representing a 50% increase compared to what was invested from 2007 to <2.3, 2.2, 2.7> The 16 business groups that participate in the Coca-Cola Brazil System are authorized bottlers of the brand s products, with 46 bottling plants located in all regions of the country (during the period of the report). However, it is only the Manaus concentrate bottling plant that produces the original and unmistakable Coca-Cola formula. The system guarantees the national distribution of an extensive line of nonalcoholic beverages that includes waters, nectars, soft drinks, teas, dairy beverages, sports drinks and replenishers. There are more than 150 products and extensions of the line available to consumers. <2.2> The constant expansion of the product portfolio, with the entry into new beverage segments and the recent launch of new packaging, was one of the factors of success for the growth of Coca-Cola s operations in Brazil. The actions focused on active, healthy living habits have been the highlight and the portfolio follows the proposal of offering products designed for a range of different demands and occasions. 6 7

7 2010/2011 Sustainability Report Coca-Cola Brazil Organizational Profile and Corporate Governance <2.2> Main Coca-Cola Brazil products Burn Powerade; i9 Matte Leão; Ice Tea Leão Kapo Chocolate Crystal Coca-Cola; Coca-Cola Zero; Coca-Cola Light Plus; Fanta; Kuat; Sprite; Aquarius Fresh and Schweppes Del Valle Mais; Del Valle Kapo; Del Valle Laranja Caseira ( Home-Squeezed Orange ); Del Valle Limão&Nada ( Lime&Nothing Else )/Maracujá&Nada ( Passion Fruit&Nothing Else ) 8 9

8 2010/2011 Sustainability Report Coca-Cola Brazil Organizational Profile and Corporate Governance Head Office Regional Offices Concentrate Bottling Plant Authorized Bottlers Main changes in the groups structure RJ <2.5> Map of Growth with social-environmental management operations The Coca-Cola Brazil corporate policy Coca-Cola Brazil is a global reference company has been testing out new includes principles focused on social when it comes to responsible water use. energy sources for its plants, such as <2.4> The company s head office is located in Rio de Janeiro, in the neighborhood of Praia de Botafogo. In order to provide support for the national operation, there are also regional offices in the cities of Rio de Janeiro, São Paulo, Fortaleza, Brasília, Curitiba and Porto Alegre. and environmental issues so that the company s growth in the country takes place responsibly and consciously. The company has made a commitment to protecting and preserving the environment and reducing its impacts. The efforts are concentrated on key areas in which there is greater opportunity to make a difference, such And it could be no different, considering that water is the main raw material used to produce non-alcoholic beverages. Today, the water use index is 1.91 liters for each liter of beverage produced. By 2020, the company plans to reduce this ratio to 1.5 liters per liter of beverage produced. One of the leaders when it comes to biodiesel. The distribution fleet also receives investments and is learning to use its fuel increasingly more efficiently. At the same time, Coca-Cola Brazil invests in pioneering projects to create gas refrigerators whose operation is CO2-based, with a much lower environmental impact when compared to regular equipment powered by CFCs <2.3> The Coca-Cola business unit in Brazil accounts for the company s fourth largest operation in the world and reports to the Mexico office, which centralizes the Latin American markets. Each year, an international meeting is held to approve the company s global business plan. as the management of water resources, climate protection and sustainable packaging, observing the following: Management System. Legal Compliance. Risk Assessment and Management. Trained and Committed Employees. promoting recycling in the country, Coca-Cola Brazil has had a formalized cooperative support project in place since 1996 and has contributed toward making Brazil the global champion in the reuse of post-consumer container materials more than 98% of the aluminum and 57.1% of the PET in circulation are sent and HFCs. In addition to not releasing gases that are harmful to the ozone layer, a refrigerator like this one also offers the advantage of reducing energy consumption by up to 30%. Coca-Cola Brazil also wants to become a reference in the social business Performance Objectives and for recycling. The company currently concept in the country. That is why it is Monitoring. supports more than 200 cooperatives promoting projects designed to insert Incident Management and Crisis and plans to reach 500 by youth into the job market, such as the Resolution. Coca-Cola Coletivo, which offers income Commitment to Stakeholders. The work to reduce greenhouse gas generation and professional training emissions has been constant and the programs. <2.9> 2010: <2.9> 2011: Renosa Group: total spinoff from Renosa Logística Ltda., transferring the operation and retail to the company Tocantins Refrigerantes S/A, which opened branch offices in the state of Mato Grosso to manage the operation. Spaipa Group: it created and opened the following branch offices to serve as administrative sales offices: Guarapuava (PR); Paranaguá (PR); Cianorte (PR); Ivaiporã (PR); Medianeira (PR); Catanduva (SP); Presidente Venceslau (SP); Jales (SP) and Barretos (SP). A Closed Deposit was also created in São José do Rio Preto (SP). During 2010, the Spaipa capital increased from R$ 212 million to R$ 220 million. Ipiranga Group: installation of a new PET bottling line line 08. Renosa Group: acquisition of the former Conviver, which represents the states of Alagoas, Sergipe and part of Bahia, responsible for the industrialization and operation and retail of noncarbonated products, all administered by the company CBA Cia. de Bebidas e Alimentos do São Francisco. Acquisition of CAF Cia. de Águas Funcionais do Nordeste, another company that participates in the Conviver group in the production of mineral waters. SABB Group: Change in the head office from São Paulo to Linhares, where the company s bottling plant is located. Spaipa Group: creation and opening of the following branch offices, designed to provide the combined services of office, administrative support and product loading and unloading: Campo Mourão (PR); Assis (SP); Oswaldo Cruz (SP); Andradina (SP); Apucarana (PR) and Toledo (PR). Opening and creation of a branch office to serve as the Marília Closed Warehouse (SP). Change in the address and activities of the Lençóis Paulistas (SP) unit, which began operating to provide the combined services of office, administrative support and product loading and unloading. Principles of Conduct for Suppliers <4.8, 4.12> The Principles of Conduct for Suppliers are an essential pillar of The Coca-Cola Company programs focused on human rights and responsibility in the workplace and which communicate the company s values and expectations with relation to suppliers, emphasizing the importance of responsible practices in the workplace that respect human rights and comply with, as a minimum condition, applicable environmental laws, local labor laws and regulations and fundamental international conventions. In the environmental area, these principles demand that the supplier comply with all local and national laws and conduct its business in a way that protects and preserves the environment. Among the effective actions undertaken by Coca- Cola Brazil as part of this process, we highlight the requirement of the Forest Stewardship Council (FSC) Seal for all graphic material produced for the points of sale. The initiative, which began in 2009 with awareness raising efforts and the certification of the supplier printing presses, was consolidated during the period of this report

9 Relatório de Sustentabilidade 2010/2011 Coca-Cola Brasil Organizational Profile and Corporate Governance Awards received during the period <2.10> The company s sustainability practices in the environmental, social and economic areas have earned it important distinctions from the market. Leadership: considered by the magazine Carta Capital as the Most Admired Company in Brazil in 2011 in the area of non-alcoholic beverages, Coca-Cola Brazil was also champion in the beverage sector among the Most Prestigious Companies that same year, elected by the Época Negócios 100 Yearbook. Beto Richa, Governor of Paraná, Chico Santos, Mayor of Fazenda Rio Grande, and Axel de Meeüs, President of SABB, during the receipt of the LEED certification for the Green Bottling Plant Certifications Sustainability Awarded: Coca-Cola Brazil is also proud to have been awarded for its sustainable actions with the 2011 Rio + Entrepreneur Award, promoted by the Rio de Janeiro Entrepreneurial Leaders Group (Lide Rio) in partnership with the agency Rio Negócios. Quality Guaranteed The Coca-Cola Brazil Quality System (CCQS) rules incorporate internationally recognized standards in the areas of quality, safety and the environment, in addition to establishing requirements for supplier acquisition, outsourcing and management processes. The company also uses the Supplier Maturity Continuum (SMC), a management tool for quality audits, certifications, international standards and for evaluating the bottlers satisfaction with relation to the suppliers. To face the challenge of guaranteeing a single quality standard for its processes, the company regularly conducts training with the bottling plant managers to increase qualification in the areas of quality, environment, workplace safety, occupational health and food safety. Incentive toward Excellence In the permanent quest for improvement, the Quality System seeks to meet the requirements of Brazil s National Quality Award, promoted by the National Quality Foundation (FNQ). More than just being a globally recognized award, the initiative fulfills the function for the Coca-Cola Brazil System of elevating the requirement level for the company s practices. In the same sense, the company s Quality Board has also promoted the Quality Award each year since 1998, with aims of encouraging the System suppliers to promote advances in the quality area for those products sold to the bottling plants, such as ingredients and packaging materials, as well as the market equipment or production services (co-packing). They play a crucial role in terms of ensuring the quality and integrity of the beverages. Ethical Conduct Similarly to all the other management fronts, the Coca-Cola Brazil System follows the same principles of ethics and compliance as those practiced by The Coca-Cola Company. In each country, there are Ethics Compliance Committees with global guidelines. All of the employees participate in training, in which they must follow the Corporate Code of Conduct. The SQCC rules incorporate standards that are internationally recognized for the areas of quality, safety and environment: ISO 9001 (quality management); ISO (environmental management); ISO and PAS 220 (food safety); OHSAS (occupational safety and health); ISO (process standardization). Communication: the company is among the Companies that Best Communicate with Journalists, an award launched Marco Simões, Vice President of Communication and Sustainability, and Flávia Neves, Sustainability Manager at Coca-Cola Brazil, receive the Rock in Rio Sustainability Award in 2011 by the magazine Negócios de Comunicação. The survey was conducted by the specialized consulting firm H2R with 25,000 journalists all over the country and elected Coca-Cola Brazil one of the top seven in the Food and Beverage segment. Recycling at City of Rock: Coca-Cola Brazil made sustainability one of its top priorities during its participation in Rock in Rio So much so that the company received the Rock in Rio Sustainability Award for its VIP box built with recycled and recyclable materials. To complete the process, at the end of the festival all of the material used in the Coca-Cola Brazil spaces was directed at recyclable material collectors cooperatives. Some awards received by the system bottlers <2.10> 2010: Finalist in the Management category of the Amazonas Quality Award, organized by the Amazonas State Federation of Industries (Simões Group); The 100 Most Innovative in IT Use, from the magazine Information Week Brasil (Spaipa Group); Brazil s 100 Most Connected Companies, according to the ranking of the magazine INFO (Saipa Group); 1st place in the Coca-Cola Brazil Quality Award Marília Plant (Spaipa Group); Gold Level in the Quali MT (Mato Grosso Quality Program) of the Mato Grosso State Federation of Industries System (RENOSO); Gold Medal for the São Paulo Management Quality Award (PPQG) from the São Paulo Management Excellence Institute (IPEG) located in Ipiranga

10 2010/2011 Sustainability Report Coca-Cola Brazil Organizational Profile and Corporate Governance <2.10> 2011: Bronze medal in the Management Category for the Amazonas Quality Award, organized by the Amazonas State Federation of Industries (Simões Group); Friend of Sports Entrepreneur, Award in the Dedication and Incentive category, created by the Ministry of Sports (Spaipa Group); University Student TOP of Mind Award for being the most highly recalled company by Curitiba university students (Spaipa Group); 1st place in the Coca-Cola Brazil Quality Award Maringá (Spaipa Group); Best Places to Work Award Brazilian Association of Human Resources/Jornal do Commercio-PE (Guararapes); Elected by the Great Place to Work Institute as one of the best places to work in the country (Recofarma); 2011 Supplier of the Year, Award from the Mato Grosso Association of Supermarkets - ASMAT (Renosa); Top of Mind 2011 in the Industry category National Soft Drink from the magazine RDM (Renosa); State Governor Trophy Level III for the São Paulo Management Quality Award (PPQG) granted by the São Paulo Management Excellence Institute (IPEG), located in Ipiranga; Planet Trophy awarded by Coca- Cola Indústria Ltda. (Ipiranga); 1st place for the Quality Award awarded by Coca-Cola Indústria Ltda., located in Ipiranga; Corporate Governance <4.1, 4.3> Coca-Cola Brazil works with the Senior Leadership Team, a group of leaders whose mission is to define the strategic guidelines for the company. The corporate governance model adopted attributes to the vice presidents the responsibility to conduct the businesses and make decisions. These professionals are named based on the strategies implemented and are also responsible for ensuring the quality and integrity of the legal and regulatory requirements, for the company s operations in Brazil and for the quality of the internal control and business risk administration systems. <4.4> The Senior Leadership Team holds four meetings per year with employees to share results and establish objectives. These meetings involve the participation of the company s CEO, who takes advantage of the opportunity to establish closer contact with employees. <4.2> Meet the leaders of Coca-Cola Brazil Xiemar Zarazúa: CEO. Bruno Pietracci: General Manager of the Southeast Regional. Claudia Lorenzo: New Business Director and Executive Director of the Coca-Cola Brazil Foundation. Flavio Camelier: General Manager of the Rio 2016 Olympic Games. Henrique Braun: Vice President of Operations. Jack Correa: Vice President of Government Affairs. Javier Meza: Vice President of Marketing. João Marcelo Ramires: General Manager of the Southeast Franchise. John Pinto: Vice President of Strategic Planning. Marco Antonio Araújo: Administrative and Financial Vice President. Marco Simões: Vice President of Communication and Sustainability. Michel Davidovich: General Manager of the FIFA 2014 World Cup. Paulo Dias: Director of the Northeast Unit. Pedro Rios: General Manager of the North Unit Franchise. Raissa Lumack: Vice President of Human Resources. Rino Abbondi: Vice President of Technique & Logistics. Rita Oliveira: Legal Vice President. Sandor Hagen: General Manager of New Beverages. Main stakeholders Government Consumers Bottlers Shareholders <4.14, 4.15> Coca-Cola Brazil has the practice of defining stakeholders based on each business project. The company practices the integrated management of the territories in which it operates, constantly evaluating the partners and segments affected in each activity. Furthermore, there is also the determination of the social-environmental actions to be implemented, constantly seeking dialogue and promoting the establishment of partnerships. Retail Press Medical Associations Communities Suppliers Internal Public NGOs Employers Academic Community 14 15

11 Organizational Profile and Corporate Governance Coca-Cola Brazil System codes, principles, standards and orientations Environmental policy The belief that environmental Management System: implement the performance is crucial for success is environmental management policy, part of the global culture and applies to standards and programs with aims of the entire Coca-Cola Brazil system. The leveraging the continuous improvement company concentrates its environmental of performance. protection and preservation efforts in the following key areas: management Legal Compliance: guarantee compliance of water resources in the communities with all applicable laws, regulations in which it operates; climate protection, and legal rules and with the company s with a reduction in carbon emissions; and internal requirements associated with sustainable packaging. environmental management. According to the company s Risk Assessment and Management: environmental policy, each organizational conduct periodic assessments with aims level of the Coca-Cola System must of identifying and treating environmental meet specific objectives that need to be risks, in addition to ensuring compliance coherent with the risks and circumstances with The Coca-Cola Company of each operation, as approved by The requirements and applicable laws. Coca-Cola Company. Trained and Committed Employees: establish the defined roles and responsibilities, training, communication systems and opportunities for participation to promote effective engagement by the employees at each level. Performance Objectives and Monitoring: establish and monitor the organization s environmental performance objectives and goals. Incident Management and Crisis Resolution (IMCR): manage environmental incidents so as to protect the assets of the company, employees, third parties, clients and the public. Commitment to Stakeholders: collaborate with public and private entities to promote the advance of environmental management, sustainable business and community sustainability initiatives. <4.12> Coca-Cola Brazil follows the orientations of the Atlanta head office, which has also strived to conduct its businesses responsibly and ethically, with an active participation in the United Nations Global Pact. The company respects international human rights principles, including the United Nations Human Rights Declaration and the International Labor Organization Declaration on Fundamental Principles and Rights at Work. Code of Corporate Conduct Code of Commercial Conduct Principles of Conduct for Coca-Cola Brazil System Suppliers Evolution of the Coca-Cola Quality System (evolution 3) Global Rights in the Workplace Supplier Orientation Principles Coca-Cola Brazil Quality System Expectation for Supplier Perform Environmental Management System (EMS) The company signed the National Pact for the Eradication of Slave Labor, a joint document created by the Ethos Institute of Companies and Social Responsibility, the International Labor Organization (ILO) and the NGO Repórter Brasil; the Business Pact for Integrity and Against Corruption, an initiative of the Ethos Institute, of UniEthos Training and Development of Socially Responsible Management and Patri Government Relations & Public Policies; as well as the United Nations Development Program (UNDP), the United Nation Office Against Drugs and Crime (UNODC) and the Brazilian Global Pact Committee. The principles described below reflect the values sustained by the Coca-Cola System in its own policies and what the company expects its direct suppliers to follow in order to guarantee respect for all human rights: guarantee freedom of trade union association and collective bargaining prohibit child labor, forced work and abusive work eliminate discrimination work hours and salaries offer a safe and healthy workplace environmental protection business integrity procedure in case of complaints and solution management system Sustainability Leadership The Vice Presidency of Communication and Sustainability is responsible for defining the sustainability guidelines and establishing and adapting the specific local characteristics to the Live Positively platform. The strategies established by this vice presidency are approved and monitored by the company s presidency and by the Senior Leadership Team (SLT)

12 2010/2011 Sustainability Report Coca-Cola Brazil Organizational Profile and Corporate Governance Cycle of Active, Healthy Living Dialogues Based on the Cycle of Sustainability Dialogues, held in 2009, Coca-Cola Brazil promoted the first Cycle of Active, Healthy Living Dialogues in 2011, with aims strengthening the relationship between the company and some of its stakeholders, assessing the impact of the health program and the company s product portfolio and also understanding the expectations of this stakeholder when it comes to the Coca-Cola Brazil initiatives in the area of health. Held in Rio de Janeiro and São Paulo, the cycle gathered representatives from medical associations, government and teaching institutions, as well as clients, the internal public and suppliers. Rio de Janeiro São Paulo Held on May 17, 2011, it gathered 18 participants at five debate tables: representative associations and entities; academics; government, internal public and clients. Held on May 19, it gathered 20 participants at four debate tables: representative associations and entities; academics; clients and suppliers and the internal public. TABLE 1: REPRESENTATIVE ASSOCIATIONS AND ENTITIES For this group, there is no such thing as a bad food. The problem lies in eating too much of certain things and a lack of food education. The regular practice of physical activity together with healthy eating habits are essential for achieving active, healthy living. TABLE 1: REPRESENTATIVE ASSOCIATIONS AND ENTITIES Group believes that no food should be considered bad and that balance is the key to a healthy lifestyle. For them, the strategy is to combine the consumption of the vitamins necessary for the organism with pleasure. TABLE 2: ACADEMICS They view Coca-Cola Brazil as a leader in the sector and believe that the company has the responsibility to supply information, develop research and promote joint actions with other public and private institutions. For them, there is no scientific evidence that soft drinks are harmful to health and that they are simply a beverage that provides hydration without the need to nourish. TABLE 2: ACADEMICS The group expects Coca-Cola Brazil to supply information both nutritional as well as its initiatives in the social responsibility area, and suggests joint actions for the development of research and clinical studies on the products to prevent inappropriate consumption. It believes that the company s participation in scientific conferences can be a good path for producing correct, credible information. TABLE 3: GOVERNMENT Through the Live Positively platform, the group came to know about company initiatives that were unknown until then by the authorities present. As representatives from the public health area, they believe that Coca-Cola Brazil should support programs that encourage the practice of physical activity through leisure, TABLE 3: CLIENTS AND SUPPLIERS They established the seven Active, Healthy Living pillars: Eat well, Move Around, Build Relationships, Relax, Work, Travel and Love. According to them, the moderate ingestion of soft drinks is not harmful to health and the variety of the portfolio increases the option of choices for the consumer and adds value to the brands. primarily for children and adolescents. TABLE 4: Considered it important for the company to present itself as a leader TABLE 4: INTERNAL PUBLIC They believe that Coca-Cola Brazil has a commitment to work from the inside out and that the company should create a scientific board to interfere in strategic decisions, in addition to sponsoring athletes to promote changes in society s behavior with relation to well-being and active, healthy living. INTERNAL PUBLIC in the fight against obesity and in the promotion of healthy lifestyles, reinforcing the importance of have a more encompassing vision of all company areas when it comes to the topic. According to this group, the scope of Coca-Cola Brazil favors its power as a catalyst for the discussion on obesity in the country. They also believe that the company should encourage its employees to become examples of balanced, active and healthy living. The group sees events such as the Cycle of Dialogues as important TABLE 5: CLIENTS tools for exchanging experiences and starting effective actions. They believe that the company should reinforce the individuality of each consumer in its communication, making it clear that different options exist based on each person s lifestyle

13 2010/2011 Sustainability Report Coca-Cola Brazil Timeline Timeline The post-mix machines offered consumers Coca- Coca-Cola already had 11 bottling plants in Technological innovations Cola, made right then and Rio de Janeiro, São Paulo, Minas Gerais, Bahia allowed the Company to develop there and served in cups. In 1942, only Coca-Cola was produced at the Santa Clara and Rio Grande do Sul. At the time, the slogan new packaging, such as the Advertising campaigns Mineral Water Bottling Plant in Recife (PE). In 1945, the "Isto faz um bem (roughly translated as It s medium-sized 290-ml bottle. created abroad featured Period marked by important launches: Rio de Janeiro unit began operating, producing 150 a good thing ) emerged, lasting for 14 years. In 1962, with the emergence a Brazilian touch, such as soft drink in a can, in 1981, lime- bottles per minute. With the expansion of the franchises, It highlighted the refreshing flavor of the soft of raw material suppliers, the "Isso é que é, Coca-Cola!" flavored Sprite, in 1984, in addition to the company installed Liquid Carbonic, a producer of drink and the country s political and cultural concentrate formula began to be (A non-literal translation the one way (disposable) packaging CO2, an essential ingredient for soft drinks. transformations. manufactured in Rio de Janeiro. for "It's the real thing"). and the twist-off top, in In celebration of the World Cup, there was the launch of Coca-Cola 473- ml cans featuring Pele s image. The Coca-Cola Brazil came in at first place Playing an important role in social, cultural, company also began to undertake As part of an agreement established with among all of The Coca-Cola Company sports and environmental projects, Coca-Cola a national diversification process, the Brazilian Olympic Committee (COB), the units based on the criteria of market brought the market Big Coke (2-L size), the launching non-carbonated beverages sponsorship of the artistic gymnastics, judo performance aligned with sustainability L size and the 100% recyclable aluminum for the such as water (Bonaqua), ice tea and swimming Olympic teams was designed practices. During the same year, there was entire line of products, in addition to the Super (Nestea), fruit-based nectars (Kapo) to offer support during their preparations for the launch of Coca-Cola in a 250-ml mini- Family a returnable 1.5-L plastic bottle and an energy drink (Burn). the 2004 Olympic Games can and a 200-ml glass bottle Coca-Cola launches the slogan "Gostoso é viver" ( Life itself is what is pleasurable ). Focused on emphasizing the positive moments in life, the campaign included during that same year the re-launch of the small "contour" 237-ml glass bottles, bringing the most wellknown and charming packaging back to life The company developed a plan to reuse rainwater as an 2005 alternative source during industrial processes to minimize the use of water originating from watersheds. There was also the launch of new lines of products, such as Aquarius The company launched Reinvent Active, a low calorie replenisher, The Coca-Cola Brazil Foundation is launching The company invests in bottling Yourself: Life Planning, to help Creation of Bottle to Bottle, the Kapo Chocolate, Schweppes Light the Brazilian Rainforest Water Program, which Coca-Cola Brazil plants designed under the support employees professional and packaging made partially from in the flavors Citrus and Tonic, Kuat recovers watersheds through the reforestation launched its Live sustainable concept, with personal life planning. The post-consumer recycled PET. The Zero, Nestea, Mate Light and Fanta of 3,000 hectares of riparian forests. The Positively platform, mechanisms for rainwater collection investments in the well-being of the company was able to reduce the Discovery, in addition to the arrival recently launched Coca-Cola Zero was the which translates and for reducing the energy professionals and their dependents use of water in the production of the global juice brand Minute leader among low calorie soft drinks and Laranja the company s consumption for refrigeration with totaled more than R$ 296 million, and process by 23%, and with respect to Maid to Brazil, which merged with Caseira ( Home Squeezed Orange Juice ) was sustainability the better use of the air circulation, 98% of the employees stated that they sexual diversity, it extended medical the Brazilian brand Mais. the most highly sold in the 1-L packaging. strategy. among other innovations. felt proud to work at Coca-Cola Brazil. insurance to same-sex partners

14 Environmental Well-Being Global Water Stewardship Environmental well-being Global Water Stewardship Water savings and reuse The most precious resource Coca-Cola Brazil is aiming to become water neutral by the year This is a fundamental resource for the company s activity, since it is the basic ingredient of all the beverages produced. Coca-Cola Brazil and its bottlers constantly invest in new technologies to reduce consumption and return the water used it its processes back into the environment. According to the standards and goals established on global brand platform, the company recorded over the past nine years a considerable drop in the water consumption per liter of beverage produced: a total reduction of 23%. In 2002, the company used 2.47 liters of water per liter of beverage produced, whereas in December 2011, this use dropped to 1.91 liters. However, the company is still not satisfied: the goal now is to reach 1.5 liters of water per liter of beverage produced by ,5liters of water per liter of beverage produced is the goal to be achieved by 2020 To reach this objective, the main challenge now is to reduce the consumption of the resource even with the growth in production and while following the marketing pressures to increase sales. In 2010, it used 19,978,172 m3 and in 2011, 19,655,524 m3 (see graphic on page 26), an increase of approximately 10% compared to the volume consumed in Furthermore, the company s strategic planning includes progressive production expansions by 2020, and the goal is to approximately triple the volume produced. Accordingly, it is necessary to use new technologies to achieve the desired result

15 EN8 2010/2011 Sustainability Report Coca-Cola Brazil Environmental Well-Being Global Water Stewardship Another measure adopted voluntarily by Coca-Cola Brazil promises to help the company reach its goals to save water: all of the company s new product bottling plants must receive the Leadership in Energy and Environmental Design (LEED) Certification, which guarantees the use of sustainable materials and processes for a building s construction and operation. All of the company s buildings are undergoing a process of adjustment so that they can obtain this seal. Since 2011, the administrative head office in Rio de Janeiro (RJ) has been undergoing construction work that includes energy saving measures, such as the application of films on the windows to minimize the passage of heat, and consequently, reduce the need to use air conditioning, as well as the use of vacuum-powered urinals and intelligent faucets that allow for the reduced use of water. The concentrate bottling plant, which operates in Manaus (AM), has already earned several certifications, such as the ISO 14001, ISO 9001 and ISO 22000, and it is estimated that it will also receive the LEED Certification by Following this trend, 13 Coca-Cola Brazil bottlers are currently in the process of obtaining this certification. The bottlers are replacing all of the production lines for others that eliminate the need for bottle rinsing or pre-washing. During the traditional process, the bottle was blown, rinsed with water for disinfection and then later filled with the beverage. Since 2010, the bottlers began to adopt a new line of machines, which complete the production in blocks. In other words, the production of the bottle and filling process take place in the same equipment, thereby eliminating the need to use water to rinse the packaging, which saves the resource. The system is already operating at the following bottlers: Femsa (Jundiaí), Uberlândia, Ipiranga (Ribeirão Preto), Cia. Fluminense (Porto Real), Andina (Jacarepaguá), Simões (Belém), Spaipa (Maringá) and Brasília, and is being installed at Norsa (Fortaleza) and in Guararapes (João Pessoa). Other processes designed to cut water consumption include the recovery of water from the activated charcoal filter backwashing, the reuse of water from the distiller, the replacement of the powder washer, the mapping of leakage points in the industrial area, the recovery of the water from the rinser, the replacement of pumps with waterbased cooling for air-based cooling pumps, the reuse of pre-rinsing water to wash the boxes and the use of a washer with low water consumption, with an average of 11 m3/h. Rainwater collection and storage system at SABB, located in Paraná. To the side, the sample collection point for the water returned back into the environment Water consumption and reuse Official data on the volume of water collected during 2009, as obtained after the publication of the Sustainability Report for that same year, indicated a final value of 18,010,167 m3, which, compared to the total volumes of the following years, demonstrates an increase of approximately 10% in the collection of water to supply the Coca-Cola Brazil System. However, the higher water consumption is due to the increased number of bottling plants during the period analyzed, together with the 16.9% increase in the production of beverages, which leapt from 8,784,261 m3 in 2009 to 10,269,930 m3 in Despite the increase in the total consumption, it is important to point out the reduction in the specific indicator used for monitoring water resource use, called the Specific Water Consumption index (represents the water consumed per liter of beverage produced). Due to the consumption efficiency achieved, the increase in the production volume also generated an increase in the water collected when comparing the 2009 volume with the 2010/ 2011 period. However, this was lower than predicted if there was no improvement in the consumption performance. Therefore, we generated what we call the Avoided Water Volume, estimated from 2009 to 2011 at 1.4 billion liters. In 2004, the company developed and adopted a plan to reuse rainwater as an alternative source in its industrial processes with aims of minimizing the use of water originating from watersheds. The measure further protects freshwater resources, producing benefits for biodiversity and even reducing costs associated with environmental remediation. Source Volume Collected (m 3 ) Volume Collected (%) 2010* 2011** Municipal Supply ,10 41,69 Ground Water ,47 36,47 Surface Water ,69 20,17 Rainwater ,07 0,09 Other Sources ,67 1,58 Total <EN8> The results obtained demonstrate that 13,891 m3 of rainwater were collected in 2010 and 16,826 m 3 in For the effects of calculating the EN8 indicator, the volumes of water consumed were considered *In 2010, the Bauru bottling plant was in the process of being negotiated for sale to the Spaipa Group, and for this reason, there is no history of EN8 indicator monitoring for the period. **Does not include figures from the Maceió bottling plant (Vieira), deactivated in

16 2010/2011 Sustainability Report Coca-Cola Brazil Environmental Well-Being Global Water Stewardship Total volume of water collected by the Coca-Cola Brazil System Volume collected (m 3 ) Total production (billions of liters) ,00 2,20 10,50 9,50 9,00 5,50 8, m 3 2, Specific water consumption (l/l) m , m Total production vs. specific water consumption 1, ,10 2,00 1,90 1,80 ano year Total production (billions of liters) Specific water consumption (l/l) The rainwater reuse pilot project at the company was implemented at the Andina bottling plant in Rio de Janeiro, becoming a pioneer in the planning and evaluation of the process. In 2005, the first quality analyses for the action and the program structure were presented to Coca-Cola Brazil. In 2006, the project was approved, delivered for evaluation and implemented at the Bottler Groups. The plant in Vitória, for example, installed the water reuse system in 2006 on a 7,000-m 2 rooftop area with a water collection capacity per year of 12,320 m 3. Reference in reuse The project developed by the bottler Spaipa, located in Maringá (PR), is considered a reference for Coca-Cola Brazil in terms of rainwater collection and reuse practices. The bottling plant is estimated to save some R$ 12,000 per year by collecting approximately 3,500 m3 of rainwater during the same period. The Spaipa rainwater reuse system has yet to reach its maximum efficiency. The water is collected with the help of chutes and then stored in an exclusive cistern. It passes through special filtering for particle removal. After that, it is mixed with the water from the public system and the wells to then be sent to an Effluent Treatment Plant (ETP). Then, the water returns to the plant to be used in the production processes. After that, another 13 Coca-Cola Brazil System units began evaluating the costs to adopt the system. The Coca-Cola Brazil head office has also used a rainwater reuse system since January The building, located in the neighborhood of Praia de Botafogo, Rio de Janeiro, has a 200-m 2 roof area adapted for water collection. The water has a collection capacity of up to 12 m 3 during periods of heavy rains; a rate equal to 80% the daily consumption of the building s cooling towers (air conditioning)

17 EN /2011 Sustainability Report Coca-Cola Brazil Environmental Well-Being Global Water Stewardship Forest Water Since 2007, Coca-Cola Brazil has worked to preserve one of the planet s most important ecosystems: the Atlantic Forest, which today is reduced to 7% of its original size. The Forest Water program promotes the recovery of watersheds with the reforestation of their riparian forests, which play an important role in terms of protecting the rivers. After all, they are what retains the rainwater, irrigating the water tables, as well as filtering the debris brought by the rain and preventing erosion factors that lead to the silting of the rivers. In partnership with the Atlantic Forest SOS, over recent years a total of 75 hectares have been planted with approximately 1,800 native seedlings at the Piraí River Basin (SP), recording a 100% improvement in the quality of the water at the points monitored by the project. In 2011, a new partnership was established with The Nature Conservancy, which will be responsible for planting 200 hectares along the Guandu River (RJ). In addition to reestablishing the ecosystem and populations access to clean water sources, the Forest Water project helps neutralize carbon emissions, based on international guidelines, and has an innovative methodology that has been recognized by the Clinton Global Initiative. By the end of 2012, the program plans to sequester 300,000 tons of carbon equivalent, and by 2037, this number should reach as high as 3 million tons. Our concern with water Positive advances are being made toward reaching the goal of 1.5 liters of water consumed for each liter of beverage produced by Learn more about the projects focused on the reuse, savings or more efficient use of water implemented by some of the Coca-Cola Brazil System bottlers: Production: Water Treatment Plant (WTP) Optimization of washer water consumption; Backwashing of charcoal and sand filters; Returnable container washer (after pre-rinse); Use of ultrafiltration for the WTP. Pump seals; Bottle area vacuum pumps; Others: Simple syrup cooling in new batches (applied to Reuse of rainwater; conventional treatment with hot charcoal). Use of ion exchange for simple syrup treatment; Rinsers; Closed CIP; Reuse of treated effluent for non-potable uses. <EN21> Total volume of effluents generated m 3 19,85% Clean Water Project Developed by Coca-Cola Brazil since 1995, the Clean Water Project follows the standards of the ekosystem the company s environmental management system. Through it, the bottlers achieve one of the top water reuse rates used in production. It is also due to the Clean Water Project protocols that the bottling plants return the water used in production back into the environment in better conditions than when it was first collected. To demonstrate this in practice, 16 bottling plants have lakes with fish at the exits from the Effluent Treatment Plants (ETPs) m ,15% m 3 18,97% The association of a range of different measures designed to save water guarantees the product s absolute integrity, the continuity of supply and reduction in production costs. The improved system performance resulted from a series of investments made by Coca-Cola Brazil and by the 16 bottler groups, which concentrate their efforts on reusing water during different phases of production, using the Water Treatment Plants (WTPs) as a tool. Comparison of the annual volume of effluent generation* m 3 81,03% m 3 = m 3 = 2010 Disposal at Public Effluent Treatment Plant (ETP) Launch into receiving body m 3 = 2011 * The volume of effluents generated was estimated through the following calculation: total water collection total production volume

18 Environmental Well-Being Energy Management and Climate Protection Environmental well-being Energy and Climate Improved energy efficiency Produce more, using fewer resources. This premise, which serves as the base for its sustainability strategy, is a goal that Coca-Cola Brazil pursues when it comes to energy use whether in its installations, operations or logistics system. Innovation generates energy The company has adopted measures that include the development and application of new technologies designed to efficiently reduce energy consumption and the emission of greenhouse gases along the different points of its value chain. The company has worked to reach its objective of boosting the production capacity and increasingly reducing its greenhouse gas (GHG) emission levels. Accordingly, it opened different fronts, such as solutions for bottling plant design and technology, all focused on this reduction. In order to make it possible to identify the focal points of the action and then later measure the results, the Coca-Cola Brazil Environmental Control System (ECS) calculated its Carbon Footprint (CF) in 2008, which records the GHG emissions based on an inventory of its entire value chain. The results obtained currently serve as the base for decision making. With the overview of emissions available, the company defined the main points that would receive investments and began to implement the necessary changes. One of the main points of opportunity for reducing these emissions is the investment in new technology for the network of refrigerators used at the points of sale, which began to be done in The new features used in the refrigerators helped Coca-Cola Brazil continue forward on its path toward sustainable growth

19 EN4 2010/2011 Sustainability Report Coca-Cola Brazil Environmental Well-Being Energy Management and Climate Protection Awareness when opening the door Efficient consumption Intelligent sensors Since 2011, the company has invested in an important initiative: the replacement of the R134a gas, normally used in the equipment, for CO2. Seeking to reduce its emissions increasingly more, The Coca-Cola Company signed an agreement with the Global Clinton Initiative with the commitment, starting in 2015, to ensure that all new refrigerators acquired by the Coca-Cola Brazil System will already have this new technology, which has the potential to generate energy savings of up to 30%. With this measure, the company and its bottlers will need to increase the investment in machinery production by approximately 20%. The major differential of these new devices is that they no longer use R134a, a refrigeration gas that contain hydroflourocarbon (HFC), which causes the greenhouse effect. To replace it is CO2, a gas that exists naturally in nature and which is less aggressive than HFC. However, because CO2 has smaller molecules, in order to have a refrigerating function, it requires certain changes in the entire refrigerator system, meaning that the technology must be gradually adopted. The initiative is still in its first year and may be extended after an evaluation. Today, the universe of Coca-Cola Brazil refrigerators includes 600,000 units. Another measure is the replacement of the refrigerators internal light bulbs for models that use LED technology, which generates energy savings as high as 15%, depending on the size of the refrigerator. It is estimated that the useful life of this type of light bulb is nearly 10 times greater than the traditional incandescent ones, which last from 6,000-8,000 hours. Seeking to also avoid increasing its energy use, the company periodically monitors the Specific Energy Consumption Rate, which calculates in addition to the electrical energy from the network, which is of an indirect nature those types that are direct, such as the energy generated at the plant, fuels, energy for the production of pre-molds, etc. Patented by The Coca-Cola Company, Accordingly, the refrigerator begins the EMS-55 sensor is also a new feature operating with the lights turned off and in the refrigerators. EMS- 55 has been with the temperature in Standby mode, used since 2007, and Coca-Cola Brazil s automatically returning to its operational goal is for all equipment with an internal mode (from 0ºC to 5ºC) two hours capacity of more than 250 liters, which before the point of sale opens again. corresponds to approximately 90% of the portfolio of devices distributed During the period with less movement, throughout the country, be equipped the internal temperature is slightly with this innovative technology by higher (8 C to 9 C), thereby reducing The main advantage of EMS-55 is that the energy used without affecting the this controller establishes a profile of integrity of the displayed products, the refrigerator operation, considering since the door will not be opened. The the flow of people and how much the controller also has a panel that indicates doors are opened during peak hours the equipment s internal temperature and those of lower use. Sensors help and transmits alert messages about develop the profile of equipment use, any operating errors, in addition to indicating the period during which the protecting the refrigerator compressor commercial establishment is closed. from overheating. Energy consumption in MJ per liter of beverage* 0, MJ/l 0.33 MJ/l 0.34 MJ/l 0,30 0,20 This, accordingly, prevents an increase in energy use and does not negatively affect the refrigerators useful life. <EN4> Within the operational sphere, the increase in the production and installation of new bottling plants during the years 2010 and 2011 came together with the replacement of the traditional lines for blocked lines, which are more efficient, together with the acquisition of process equipment. Because of such acquisitions, the company recorded an increase in indirect (electrical) energy consumption during the period compared to 2009, recording a peak in 2010 due to adjustments and process shutdowns, required to install the new lines. 0, * Indicator calculated based on the total energy consumption, both direct and indirect, due to the volume of beverage produced each year. <EN 4> Indirect energy consumption in GJ , , ,00 year The supply of indirect energy consumed by the Coca-Cola Brazil System comes from public utility concessionaires, which offer electricity based on the sources included in the Brazilian Energy Matrix, presented in the table below. The table presents information from the Brazilian National Energy Balance, developed by the country s Ministry of Mines and Energy with aims of documenting and disclosing extensive research and accountability each year on the offer and consumption of energy in Brazil, including the activities of primary energy resource extraction, its conversion into secondary forms, import, export, distribution and final use of the energy , year WHEN WE CARE FOR THE ENVIRONMENT, LOOK AT HOW IT THANKS US

20 2010/2011 Sustainability Report Coca-Cola Brazil Environmental Well-Being Energy Management and Climate Protection Brazilian domestic offer of electric energy by source Energy Matrix Energy Matrix Hydraulic 74,00% 75,00% Nuclear 2,70% 2,70% Natural Gas 6,80% 4,60% Coal and 1,30% 1,40% derivatives Biomass 4,70% 6,50% Wind 0,40% 0,50% Oil 3,60% 2,50% Derivatives Imports 6,50% 6,70% Source: Brazilian Ministry of Mines and Energy Website: Bottling plants with LEED certification A panel at the Green Bottling Plant, located in Rio Grande, Paraná, informs associates of all the plant s sustainable points A good example of an investment in the environmental area is the Brazilian Food and Beverage System (SABB) bottling plant, located in the municipality of Fazenda Rio Grande, near Curitiba in Paraná. It is the site for the production of the dry line for the brand Matte Leão, such as the teas for infusion. Inaugurated in 2007, the unit rigorously follows all Brazilian civil construction standards (Brazilian Association of Technical Standards - ABNT/CB-02 for Civil Construction and National Environment Board - CONAMA Standard 307), in addition to the high standards established by Coca-Cola on a global scale. In order to demonstrate the commitment of the Leão brand, the plant obtained the Leadership in Energy and Environmental Design (LEED) Certification, a distinction granted by the Brazilian Green Building Council, which guarantees the implementation of good sustainable building practices. On a 110,000-m 2 terrain, the development was constructed while thinking about sustainability in every detail. Such efforts made it the first industry to obtain the LEED Certification in the country in the New Construction category. It is estimated that the development s total energy savings come to 23%, thanks to its architectural characteristics. These include the translucent roof tiles, which make the most of natural lighting in areas such as warehouses, the shipping area, production area, as well as in the cafeteria, dressing rooms and technical rooms. Some of the plant structures, such as the public buildings, cafeteria, technical rooms and entrance, are covered by a green roof, the largest found in Latin America, which is formed by succulent plants that have the capacity to store water. This structure serves as a type of natural thermal insulator and air purifier. The adoption of other elements, such as the reduced volume discharge valves and intelligent faucets, also help reduce the consumption of this resource. Throughout the 20,000 m 2 of built-up area, the company prioritized the use of certified construction materials that cause less environmental impact in their extraction and manufacturing processes, certified woods (such as eucalyptus) and materials with low levels of volatile organic compounds (VOC). Other creative solutions, although fully aligned with environmental education and the employees engagement with the issue, are also visible around the plant, such as preferential parking spots for workers that carpool together and for those who use biofuels. In order to further reduce the need to use air conditioning near the production area, large venetian blinds guarantee natural ventilation. All of the water used in the dressing rooms and the laboratory is heated by solar panels, which are installed at the entrance of the unit. The average water consumption drops 36% with the reuse of rainwater, employed primarily in the bathrooms, for cleaning and irrigation, through outdoor faucets. In all, the rainwater collection system at this plant has the capacity to collect and store 300 cubic meters. Green Roof: Latin America s largest green roof covers all the administrative areas and the cafeteria. It promotes environmental comfort and reduces the heat island effect. The plant support plates are made from recycled material. SABB also offers chartered buses for the employees who live in Curitiba and who need transportation to Fazenda Rio Grande. Besides the Matte Leão bottling plant, another two plants are currently in the advanced stages for obtaining the LEED certification: the juice plant, located in Linhares (ES), and the liquid tea plant, located in Fernandes Pinheiro (PR). Above, the plant s Green Roof, and to the side, a special parking place for workers who carpool 34 35


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