Back in 2008, Danone Group decided to address its environmental impact by significantly cutting its CO2 emissions. The first step it took was to measure the emissions under both its direct and indirect responsibility. To tackle indirect responsibility, an impact reduction plan was set up in association with the group’s milk producers. This has achieved a 10% reduction in CO2 emissions per kilogram of product sold since 2008. Regarding direct responsibility (factories, packaging, distribution and end of life), Danone chose to think big and made a crazy commitment to cutting its carbon intensity* by 30% in five years. It has been five years now, and the group just announced that the target has not only been attained but actually exceeded: carbon intensity has been reduced by 35.2%.
Everyone, everywhere in the chain, got on board
This achievement has been made possible by the total integration of the reduction efforts: all the links in the chain have been addressed, in all of Danone’s business units, across all the company’s functions: marketing, finance, operations, etc. From packaging to the end of life, including of course factories and logistics, multiple aspects of product manufacturing have been re-thought: recycled, plant-based or lighter packaging has been adopted, all plants worked hard on energy reduction plans, two of them even switched to biomass power, losses were significantly reduced throughout the chain, sourcing routes were optimised, recycling was made easier and more systematic, etc. (For more details, have a look at this infographic.)
This integrated approach also meant that everyone had to get on board to make it happen. From R&D to marketing, from logistics to sourcing, thousands of Danoners played an active role in meeting the -30% goal.
In fact, meeting such an ambitious objective also meant monitoring the action plans very closely: at CBUs level, more than 2,000 reduction plans were defined, along with very precise objectives for each of the five years. 110 “carbon masters” have been in charge of applying these plans and measuring the results, and 1,400 managers across the group saw their bonuses tied to achieving the reduction goals. Unity makes strength, so they say.
To go even further, a measuring tool was co-created by Danone and SAP (a business management software, solutions and services provider) to monitor the carbon footprint of each and every one of the company’s 35,000 products. This tool is now being rolled out worldwide and will help the company make carbon measurement more accurate and efficient.
We are now at the start of 2013, and achieving a reduction in excess of 35% is turning out to be the beginning rather than the end of the story: the efforts to curb carbon intensity* will continue, particularly upstream with raw materials from agriculture (milk, dairy ingredients, fruit, etc.) which are the new frontiers for the coming years at Danone.
Carbon is a key pillar of the group’s Nature strategy, but exciting projects are also underway regarding water, packaging, agriculture and biodiversity. Stay tuned…
* Carbon intensity: CO2 equivalent emissions per kilogram of product sold