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Our reporting principles, future legislation and materiality assessment

Reporting scope, boundaries and principles

Data in our Sustainability report 2021/22 cover the accounting period from 1 October 2021 to 30 September 2022 to the extent possible. Some of the data included in the report are approximate figures based on calculations for slightly different periods.

Data from all legal entities where we have operational control are included in the report. Under the operational control approach, a company accounts for 100 per cent of greenhouse gas emissions from operations where it or one of its subsidiaries has operational control. Operational control is determined by majority ownership, and/or specific contractual agreements. Two organisations where we have majority ownership are not included as these are purely interest organisations (Danish Bacon and Meat Council and ‘Svineslagteriernes Varemærkeselskab ApS’). These entities do not have any material impact on our sustainability performance. For joint ventures, where we own exactly 50 per cent, the data are included or excluded based on contractual agreement. See our Annual report 2021/22 for a full description of inclusion principles and a complete list of companies.

Entities acquired or established during the reporting period are included in the data from the date of acquisition or establishment. Entities divested or wound up are included in the data until the date of divestment or winding up. The date of divestment is the date when control of the enterprise passes to a third party.

The basic principles for data management and reporting are unchanged relative to last year. Material changes relative to prior years’ reported data or to calculation principles or methods are described in the data definitions.

Production - Indicator overview

IndicatorUnit2021/222020/212019/202018/192017/18
Slaughtered animals*'000 animals19,81119,71418,87219,87920,735
Pigs*'000 slaughtered pigs18,68318,58117,76118,67419,561
Sows*'000 slaughtered sows310295226264274
Cattle*'000 slaughtered cattle762785828868839
Lambs*'000 slaughtered lambs5653577361
Hereof organic, free-range and/or raised without antibiotics'000 animals1,008840846786724

* New indicators

Slaughtered animals

Slaughtered animals is the total amount of slaughtered animals within the Danish Crown group. It is measured in number of animals. The number of slaughtered animals in the indicator overview is also shown by type of animal.

Organic, free-range and/or raised without antibiotics

Animals refers to the total amount of animals slaughtered which were raised organically, as free-range and/or without antibiotics. Measured in number of animals.

Others - Indicator overview

IndicatorUnit2021/222020/212019/202018/192017/18
Countries of operation*Number of countries26----
Entities in Europe*Number of entities130----
Entities outside Europe*Number of entities34----

* New indicators

Countries of operation

Countries of operation is the number of countries in which the Danish Crown group operates one or more entities. The entities can include abattoirs, processing plants, sales offices or warehouses.

Entities in and outside Europe

Entities in and outside Europe refers to the number of entities the Danish Crown Group operates within or outside Europe. Measured in number of entities.

Energy consumption and emissions - Indicator overview

IndicatorUnit2021/222020/212019/202018/192017/18
Environment
Energy consumption'000 MWh1,2981,2591,2481,2631,129
Energy consumption per outputkWh per tonnes produced453446459441333
Green electricity*Per cent8.77.9---
Emissions
Scope 1 emissions'000 tonnes CO2e161170172177149
Scope 2 emissions (market-based)'000 tonnes CO2e218175236248275
Scope 2 emissions (location-based)'000 tonnes CO2e166165186211191
Scope 3 emissions**'000 tonnes CO2e-11,47511,601--
Total emissions (market-based)**'000 tonnes CO2e-11,82012,009--
Total scope 1, 2 and 3 emissions (location-based)**'000 tonnes CO2e-11,81011,959--
Emissions per output (market-based)**kg CO2e per kg output produced-4.124.24--

* New indicators
** Given the high complexity and dependensy on third-party data for scope 3 emissions, 2021/22 emissions will be made available in spring 2023.

Energy consumption

Energy consumption in MWh is the total consumption of fossil and renewable energy sources including the following: natural gas, gas oil, fuel oil, gasoline, other fossil fuels, diesel, petrol, electricity, district heating and steam, liquefied and compressed gas, biomass energy, other alternative energy and own production of renewable energy.

Energy consumption in kWh per tonne produced is calculated by dividing the total energy consumption (MWh) by volume of produced output in tonnes. We have corrected our historical data for energy consumption due to a double-counting reporting error.

Development

In the past three years, energy consumption per produced volume has been stable, as both total energy consumption and our produced volume has increased slightly. Part of the increase in total energy consumption comes from new sites, which mainly use renewable electricity and biogas as energy sources. In addition, consumption of diesel, electricity and gasoil has increased, while consumption of gas has decreased. Going forward, we expect our energy consumption per produced volume to remain stable, though the mix of energy is likely to change, as we expect to use less gas and increase our consumption of alternatives to gas.

Green electricity

Consumption of externally purchased 100 per cent renewable electricity and district heating as well as actual consumption of own produced renewable electricity. Can include geothermal, wind, solar, hydro or biomass. Consumption is defined as actual consumed electricity and district heating. It is measured in per cent of our total electricity consumption.

Development

In 2021/22, the share of green electricity increased to around 8 per cent. To base our entire electricity consumption on renewable energy is a top priority, whether from our own production or external procurement.

Scope 1 emissions

Scope 1 emissions is the amount of direct greenhouse gas emissions from primary energy at our production sites, including fuels used in stationary installations on site (natural gas) as well as mobile installations (diesel). Emissions related to dry ice and CO₂ used as anaesthesia as well as the global warming potential of purchased refrigerants are also included in Scope 1. All impact is converted and measured in ‘000 tonnes CO2e. We have revised our historical data for scope 1 CO2e emissions in light of new and more precise calculations, including more disagreggated fuel types.

Development

In 2021/22, our scope 1 emissions decreased. The decrease was spurred by a decrease in our consumption of natural gas. However, this was partially offset by an increase in diesel and gasoline consumption. Our consumption of sustainable biofuels, mainly biogas, also increased in 2022.

Scope 2 emissions (market-based)

Scope 2 emissions is the amount of indirect CO2e greenhouse gas emissions from secondary energy, mainly electricity. The market-based method quantifies scope 2 emissions based on greenhouse gas emissions emitted by the generators from which the reporter contractually purchases electricity bundled with instruments, or unbundled instruments on their own (GHG Protocol, “Scope 2 Guidance”, Glossary, 2015). Measured in ‘000 tonnes CO2e.

Development

In 2021/22, our market-based scope 2 emissions increased. The increase was primarily driven by an increase in electricity consumption, but also by higher greenhouse gas emissions related to purchased electricity. This development highlights the need to establish a green electricity procurement programme going forward.

Scope 2 emissions (location-based)

Scope 2 emissions is the amount of indirect greenhouse gas emissions from secondary energy, mainly electricity. The location-based method quantifies scope 2 greenhouse gas emissions based on average energy generation emission factors for defined locations, including local, subnational or national boundaries (GHG Protocol, “Scope 2 Guidance”, Glossary, 2015). Measured in ‘000 tonnes CO2e.

Development

In 2021/22, our location-based Co2e emissions remained stable. Going forward, we expect our location-based scope 2 emissions to decrease as a result of ongoing decarbonisation and a larger share of renewables in national electricity grids.

Scope 3 emissions

Our scope 3 emissions are emissions that we indirectly impact through our value chain. Our scope 3 emissions have been calculated for 2019/20 and 2020/21. Given the high complexity and dependency on third-party data, scope 3 emissions 2021/22 will be made available in spring 2023. The calculation of scope 3 emissions follows the methodology outlined in the GHG Protocol (Corporate Value Chain (Scope 3) Accounting and Reporting Standard). Of the total 15 categories of scope 3 emissions, Danish Crown has measurable climate impact in 10 categories: 1. Purchased goods and services, 2. Capital goods, 3. Fuel and energy related activities, 4. Upstream transportation, 5. Waste generated in operations, 6. Business travel, 7. Employee commuting, 8. Upstream leased assets, 10. Processing of sold products and 12. End-of-life treatment.

All farm-level greenhouse gas emissions are included in the category 1 Purchased goods and services. This category accounts for the majority of our scope 3 emissions and includes the full value chain emissions from animal production. The calculation of farm-level greenhouse gas emissions is based on data from our attributional life cycle assessment (LCA) model (see the definition of life cycle assessment). Measured in ‘000 tonnes CO2e. Scope 3 activities of DAT-Schaub and ESS-FOOD are not included.

Development

Overall, our scope 3 emissions declined marginally between 2020 and 2021. Our overall aim is to lower our scope 3 emissions going forward and to reach our 2030 emission reduction target.

Total emissions per output produced

Full value chain emissions (Scope 1, 2 and 3) divided by total output produced and measured in kg CO2e/kg output.

Development

Our total climate impact per produced output declined between 2020 and 2021, due to a decline in our absolute greenhouse gas emissions as well as an increase in our produced output. Our overall aim is to lower our greenhouse gas emission per produced output going forward and to reach our 2030 emission reduction target.

Water and waste - Indicator overview

IndicatorUnit2021/222020/212019/202018/192017/18
Water
Water consumption1,000 m310,57410,60410,23810,46010,379
Water consumption per outputm3 per tonnes produced3.73.83.83.73.5
COD in wastewaterkg per tonnes produced6.66.57.07.39.9
Waste
Total waste*Tonnes30,78031,802---
Waste suitable to incinerationTonnes18,15714,845---
Waste directed to recoveryPer cent2525---

* New indicators

Water consumption

Water consumption is the withdrawal of water at our production facilities from all sources: Groundwater, surface water, (including collected rainwater), sea water, water from municipal facilities and other external vendors, own wells or water collections. Bottled water purchased for drinking is not included. Measured in 1,000 m3. Water consumption in m3 per tonne produced is calculated by dividing the total water consumption (water withdrawal) at our production facilities by volume of produced products in tonnes.

Development

Our water consumption (water withdrawal) per tonne produced has been stable over the last couple of years. We expect our water consumption per tonne produced to decline going forward as we work towards our 2030 reduction target by improving data and increasing employee awareness of good water management at our facilities, etc.

COD in wastewater

Chemical Oxygen Demand (COD) in wastewater is the total volume of COD in wastewater at our production facilities divided by the total volume of products produced. Measured in kg per tonne produced.

Development

Since 2017/18 the amount of COD emitted has declined from nearly ten kg per tonne produced to below seven kg in both 2020/21 and 2021/22.

Total waste

Total waste is the actual weight of total waste generated in tonnes at our production facilities. This includes both waste directed to recovery and waste directed to incineration, landfilling, hazardous waste, etc. It does not include animal by-products, biomasses to biogas or effluents.

Development

We reduced the total amount of waste from our production facilities in 2021/22 compared to the year before.

Waste suitable to incineration

Waste suitable to incineration is the actual total weight of waste from our production facilities suitable for incineration but not suitable for recovery.

It is usually directed to incineration or landfilling. Incineration is controlled burning of waste at high temperatures and can be carried out with or without energy recovery. Landfilling is final depositing of solid waste at, below or above ground level at engineered disposal sites. Measured in tonnes.

Development

The volume of waste suitable for incineration increased in 2021/22 even though we managed to reduce the total amount of waste from our production sites. The increase is due to the employment of real rates. Previously we included the full amount of waste sent to recovery as recovered, but now we take into consideration that it will often not be possible to recover 100 per cent of the waste sent to recovery. The increase was therefore expected, and we still aim to meet our 2030 target.

Waste directed to recovery

Waste directed to recovery is the actual total weight of waste that has been recovered in tonnes at our production facilities. This includes preparation for reuse and recycling but not energy recovery.

Development

The share of waste sent to recovery was stable in 2021/22, even though we have started to use real recycling rates. This indicates that we have in fact managed to increase the share of waste sent to recycling compared to 2020/21, when we did not use real recycling rates.

 

Packaging - Indicator overvieuw

IndicatorUnit2021/222020/212019/202018/192017/18
Packaging volume*kg per tonnes produced-28---
Recyclable packaging materials*Percent-88---
Packaging material from post-consumer recycled content*Per cent-33---
FSC-certified fibre packaging*Per cent-99---
Harder to recycle materials*-0.4----

* New indicators

As the packaging targets and indicators have only recently been established, we currently only have validated data for our baseline year, 2020/21.

Packaging volume

Packaging volume is the total amount of packaging materials which has been purchased during the financial year, excluding pallets. Packaging data includes the following business units: Danish Crown, Beef and KLS. It is measured as kg per tonne produced.

Recyclable packaging materials

Recyclable packaging materials are defined as mono materials, in accordance with the definition provided in the design guide “Reuse and recycling of plastic packaging for private consumers” by the Network for Circular Plastic Packaging. Metal and fibre-based material must consist of only one material structure to be considered recyclable. It is measured as a percentage of our total volume of packaging.

Packaging material from post-consumer recycled content

Packaging material from post-consumer recycled content is material that has been reprocessed from recovered materials and made into a final product or product component. The indicator only includes post-consumer materials. It is measured as a percentage of our total volume of packaging.

FSC-certified fibre packaging

FSC-certified fibre packaging is the share of fibre packaging with FSC, FSC MIX or equivalent certification as for example the Programme for the Endorsement of Forest Certification(PEFC). It is measured as a percentage of our total volume of fibre packaging.

Hard to recycle materials

Hard to recycle materials to be phased out are the following materials: polyvinyl chloride (PVC), polyvinylidene chloride (PVDC) and expanded polystryrene (EPS). It is measured as a percentage of our total volume of packaging.

Biodiversity - Indicator overview

IndicatorUnit2021/222020/212019/202018/192017/18
Biodiversity
Use of certified soy (Denmark)*Per cent20----

* New indicator

Certified soy

Certified soy in this report refers to all deforestation-free soy. It includes soy that has been verified as originating from deforestation-free areas as well as soy that has been certified and segregated. The indicator Use of certified soy (Denmark) refers to the percentage of certified soy bought by feed companies supplying the feed to our Danish suppliers of slaughter animals. The soy has been verified as coming from deforestation-free areas and the stated percentage is based on the mass balance model. The percentage of certified soy for 2021/22 is the percentage used at the end of calendar year 2021.

Climate track - Indicator overview

IndicatiorUnit2021/222020/212019/202018/192017/18
Danish pigs on the Climate Track*Per cent100100100--
Danish Cattle on the Climate Track*Per cent100100100--
Danish free-range cattle on the Climate Track*Per cent100----
Swedish pigs on the Climate Track*Per cent65----

* New indicator

Suppliers on the Climate Track

Suppliers on the Climate Track is the percentage of our suppliers who have joined the Climate Track by the end of the financial year. Measured as a percentage of suppliers out of the total amount of suppliers of the given animal type in the country in question. For animals and countries where implementation has started but is not yet 100 per cent, it is measured as a percentage of slaughter animals covered by the Climate Track.

Development

In 2021/22, we continued the rollout of the Climate Track. In 2022/23, we expect to focus on continuing the enrolment of Swedish and German pig producers and to enrolling producers of Swedish and Danish dairy cattle.

Social - Indicator overview

IndicatorUnit2021/222020/212019/202018/192017/18
Social
Full-time employees (FTEs)Number of employees26,64125,91822,99623,05221,769
Safety first
Lost time accidentsNumber of accidents per 1,000 FTEs4337272841
Absence due to lost-time accidentsDays of absence per accident1718222217
Noise exposure (Denmark)*Per cent of employees with noise exposure above 82 dB(A)42----
Social responsibility
Employee turnoverPer cent27231820-
ApprenticesNumber of people304278253242-
Women in senior leadership positions
Excecutive Vice PresidentsPer cent140---
Senior Vice PresidentsPer cent88---
Vice PresidentsPer cent2120---

* New indicator

Full-time employees (FTEs)

The average number of FTEs during the reporting period is calculated as the number of FTEs in each of the 12 months in the reporting period.

The calculation of FTEs is based on normal fulltime employment in each country. Employees include all who receive any form of compensation directly from Danish Crown for their services, including full-time, part-time, temporary employment etc.

Lost time accidents

Lost time accidents is the number of work-related accidents divided by the number of full-time equivalent employees (FTEs) measured in thousands. An accident is recorded when it occurs during working hours and causes at least one day of absence after the day of the accident. Accidents during travel to/from work are generally not included. Both permanent and temporary employees at Danish Crown are included. Employees working for and managed by Danish Crown’s contractors and subcontractors are not included.

Development

In 2021/22, the number of accidents per 1,000 FTEs increased despite our efforts to reduce accidents. Part of the reason for this is a higher turnover rate. Furthermore, increased focus on accidents can lead to better registration, and that we

will therefore get a more complete picture of our accidents as we continue to strengthen systematic registration across our production facilities. The number of accidents varies between our sites and countries of operation. We believe that this can be both a reflection of continued differences in the registration approach and of differences in approaches to accident prevention. To reduce accidents going forward, we will focus our efforts on the sites with the most accidents per 1,000 FTEs and work to share best practice for both systematic registration and prevention.

Absence due to lost-time accidents

Absence due to lost-time accidents is the total number of workdays lost due to accidents excluding the day of the accident divided by the number of lost-time accidents. If an accident causes several periods of absence, all days of absence are included. Absence within the reporting period due to accidents in previous periods is not included.

Development

In 2021/22, absence due to lost-time accidents remained stable despite our efforts to reduce the number and severity of accidents. As for the number of accidents per 1,000 FTEs, we see differences across our sites and countries of operation. Going forward, we will focus our efforts on the sites with the most absence due to lost time incidents and work to share best practice for both systematic registration and prevention.

Noise exposure (Denmark)

Noise exposure is the percentage of production employees in Denmark exposed to a daily noise level above 82 dB(A). The actual measurement of exposure levels at the production facilities took place between February and September 2022.

The percentage for our production facility in Ringsted is estimated based on similar production facilities. We have gathered this data and established the baseline shown in the indicator overview. We will use the baseline to focus on reducing noise levels for the employees who are the most exposed. Going forward, we therefore expect to reduce the number of production employees in Denmark who are exposed to daily noise levels above 82 dB(A).

Employee turnover

Employee turnover is the total number of resigned employees, including due to retirement, voluntary redundancies, holiday relief, dismissals, etc. divided by the number of FTEs. Measured as a percentage.

Development

Employee turnover has been increasing over the past two years, and in 2022 we decided to change our previous target of a 10 per cent reduction per year from 2021 to 2026 to a more realistic target focusing on maintaining the average employee turnover level for production and office employees from 2021/22.

Apprentices

Apprentices refers to the number of people employed by Danish Crown as part of their business education. Their education is completed by an apprenticeship test.

Development

Attracting apprentices is a challenge, but we managed to increase our global intake in 2021/22. However, in Denmark, which is the country with the most apprentices, we experienced a decrease in the intake due to the current situation in the Danish labour market. Nevertheless, we are on track to meet our target to increase the global intake of apprentices in production and technical divisions by 20 per cent in 2025 relative to 2018.

Women in senior leadership positions

Women in senior leadership positions is the share of women that hold a position as Executive Vice President, Senior Vice President or Vice President. The indicators are measured as the share of women in these positions out of the total number of managers in these positions.

Development

The share of women in senior leadership positions has been stable in 2021/22. We will continue to work towards our target of increasing the share of women in senior leadership positions.

Recalls - Indicator overview

IndicatorUnit2021/222020/212019/202018/192017/18
Recalls*Number of public recalls26---

* New indicator

Recalls

Products which have been delivered to our customers and sold to consumers, and which have subsequently been recalled because the products pose a potential risk to food safety or do not comply with legislation.

Methodology of our materiality assessment

The materiality assessment conducted in 2022 is an updated version of the 2020 materiality assessment and represents a high-level groupwide assessment covering primary material topics across our value chain. It is based on input received through ongoing dialogue with internal and external stakeholders within our sphere of influence, external frameworks and benchmarks as well as internal analyses and reports. We have also taken hard and soft law into consideration and have evaluated our policies, values and external commitments.

The 2022 assessment did not identify any new material sustainability issues, but in the resulting list of material issues, we have categorised the issues as either environmental, social, governance or sector specific.

This update is the first step in our process towards working with double materiality, as required by the upcoming EU Corporate Sustainability Reporting Directive (CSRD). The concept implies that a sustainability issue can be material from either an impact perspective (inside-out) or a financial perspective (outside-in), or both.

Our work on materiality assessment going forward

Going forward, we will strengthen our work on double materiality. As the standards for materiality assessment develop over the coming years, we will work towards applying the full framework for materiality assessment to ensure compliance with the CSRD. Among other things, this means a more systematic approach to all three levels of the materiality assessment: input gathering, the assessment process and the results. We will use a stepwise approach, moving our assessment closer to full compliance each year.

Meeting future legal reporting requirements

The legislative requirements for sustainability reporting will be significantly strengthened by the EU Taxonomy and Corporate Social Reporting Directive. In addition, we experience increasing expectations from customers, consumers and other stakeholders to implement measurable progress with respect to sustainability. We also need to ensure that we meet the targets we have set, such as our recent emission reduction targets submitted to the Science Based Targets initiative for scope 1, 2 and 3.

Given these increasing expectations, we have initiated a groupwide project to improve our overall setup for data gathering, validation and disclosure. In this project, we will work intensively to narrow the gap between the data points we currently collect and the data points that will be required in future. In addition, we will have a strong focus on ensuring high data quality across our business units and countries of operation. We will develop uniform and clear data definitions and systematic validation processes for our data points. We expect this to be a stepwise process, adding new datapoints and improving our validation process each year.

Another expected outcome is new and adapted policies, action plans and targets. This is already an ongoing focus area for Danish Crown.

Our efforts are not only to ensure that we meet future legal requirements, but also to drive solid decision making and to strengthen our communication and value creation towards our customers and consumers. Part of our ambition is therefore to build dashboards which will allow employees across the organisation to follow our progress in key sustainability areas on a regular basis.

This Sustainability report is largely inspired by the Global Reporting Initiative (GRI) standards, but without meeting the in accordance criteria. In addition, we have begun work on the draft European Sustainability Reporting Standards (ESRS) exposure standards with regards to materiality assessment.