Sector News

Ferrero reaches 100% sustainable sugarcane sourcing

July 31, 2021
Consumer Packaged Goods

Ferrero has reached its goal to source 100 percent of its refined cane sugar sustainably. As global sugarcane production increases, it brings a range of socio-economic challenges, such as poor working conditions, low wages and poor health and safety.

The supply chain can also have negative environmental impacts, including loss of biodiversity and pollution of land and water.

Path to sustainability
Collaboration has been a vital driver of Ferrero’s sustainability journey, and the company has developed long-standing partnerships with trusted suppliers. Over the years, the team has systematically evaluated available certification schemes to understand their robustness, environmental impact, resource and cost efficiency to expand its sustainable sugarcane supply chain.

Ferrero became a Bonsucro member in 2010, and in 2014 it was awarded Bonsucro’s inaugural leadership award for its active participation in the development of a sustainable sugarcane industry.

Initially aiming to reach 100 percent sustainable cane sugar by the end of 2020, Ferrero reached its target a few months ahead of schedule last year. The group favors purchasing Bonsucro certified cane sugar and Altromercato, an Italian organization supporting smallholder cane growers in Mauritius through a Fairtrade supply chain.

Leading by example
As one of the biggest chocolate-producing companies globally, Ferrero aims to drive improvement at many different sugarcane origins.

“Ferrero has worked with its suppliers for many years to drive Bonsucro certification,” says Rafael Seixas, Bonsucro’s membership manager.

“Its long-term commitment and effort were critical, not only to achieving its sustainable sourcing goals but also to promoting continuous improvement in the social, environmental and economic performance of sugarcane supply chains, which include for example workers’ health and safety, carbon emissions, water use and agrochemical use.”

Time for change?
As upcoming regulations in developed countries bring stricter requirements for the supply chain due diligence and human rights, it is more urgent than ever that other Consumer Good Manufacturers follow suit.

“Whereas supply chain sustainability was the best business practice years ago, it will become mandatory, and companies need to be ready to adapt and to engage their supply chains in positive change,” says Rafael.

With the climate crisis already taking a toll and food systems accounting for one-third of global carbon emissions, responsible sourcing of all commodities is an urgent matter for both the planet and business. Earlier this year, a report by CDP revealed environmental supply chain risks could cost companies US$120 billion by 2026.

There is also a growing spotlight on social and labor issues in global supply chains, with a greater expectation for transparency. Besides legal compliance, working with suppliers toward sustainability has significant reputational benefits as well as helping to build longer and more robust business relationships, which ultimately impact business resilience and performance.

Last month, Ferrero’s palm oil charter included updated targets to generate environmental, economic and social benefits across the value chain.

Edited by Elizabeth Green


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