Using Science to Do Our Part in Greenhouse Gas Reduction at Hershey

CARLY GREENBERG, Associate Manager, Environmental Sustainability & ESG Reporting

SOURCE: The Hershey Company

DESCRIPTION:

Climate change is predicted to increasingly pose a risk to our planet and to our business. Extreme weather events and heat will make it harder for our key agricultural commodities to grow, increase the difficulty of getting our finished goods to market, and create difficulties in our consumers’ abilities to get to stores and even our own employees’ ability to get to work (think of shopping or commuting during a blizzard or hurricane or even how the present-day COVID-19 pandemic has changed our world).

Hershey has been working to reduce our greenhouse gas emissions (GHG) for a decade now as part of our broader belief in reducing our impact on the planet. More recently, Hershey committed to the Science Based Targets Initiative (SBTi) in January 2019 to develop a science-based greenhouse gas reduction goal by January 2021. SBTi is a non-profit led by CDP (formerly the Carbon Disclosure Project), the World Resources Institute, the World Wildlife Fund and the United Nations Global Compact that verifies whether corporate greenhouse gas reduction commitments are “science-based” or not.

What is a science-based GHG reduction target (SBT)?

A science-based GHG reduction target is a corporate goal that uses climate science to specify how much and how quickly the company needs to reduce its emissions in order to align with the recommendations of the Paris Climate Agreement to hold global temperature increases to well below 2°C. In addition, for a company like Hershey, a science-based goal would cover our whole value chain including direct emissions from our plants and offices (Scope 1 emissions in carbon accounting parlance), emissions associated with purchased heat, electricity and steam from utilities (Scope 2 emissions), and indirect emissions generated upstream and downstream from Hershey due to our business (Scope 3 emissions). Scope 3 is broadest category and presents both challenges and opportunities in our sustainability journey. Included in Scope 3 is the carbon footprint associated with farming and production of our ingredients and packaging before they end up at Hershey’s plants, transportation and distribution of our raw materials to our plants and finished goods from our plants to our customers, employee commuting and business travel, treatment of waste generated by our company, and end-of-life treatment of our product packaging. Based on the experiences of our food and beverage peers, we estimate that Scope 3 will account for approximately 90% of our total GHG footprint.

How is this different from what we are already doing?

Our current “25-by-25” commitment (reduce GHG emissions by 25% by 2025 on a 2015 baseline) was not set considering a broader global context and ignores what the world needs for Hershey to contribute in order to avoid a global climate crisis. Our 25 by 25 commitment also only focuses on our direct operations and does not incorporate the global footprint of our value chain.

How are we going to deliver on this?

The first step is to develop an accurate baseline against which we can measure future years’ progress. Hershey’s EHS team has been tracking our Scope 1 and Scope 2 emissions for several years, but we have never comprehensively measured our Scope 3 emissions before. And unlike Scope 1 and 2, Scope 3’s data is aggregated across different departments, data owners and data systems. To measure our Scope 3 emissions, Hershey’s sustainability team has been working with several parties throughout our enterprise to learn more about what goods and services we purchased (weight and sourcing location all matter to get an accurate emissions estimate), what data we have on employee commuting and travel, info on product and ingredient transportation (weight transported over how many miles), and so on.

Once we have a reasonable baseline estimate, the next step is quite simple. We evaluate what we are emitting today, consult the science on what we should be emitting in the future and form our target from there. To give you a sense of where we are going, for a 1.5°C goal, the science promotes companies to be carbon neutral (amount emitted is balanced by amounts sequestered) by 2050. With a long-term vision in mind, our goal will focus on the medium term, such as from now till 2030. I know this sounds complex – and it is—but it’s extremely important if we are going to protect our future.

The final step is to collaborate. Our Science-Based target will be a full-Hershey-team effort, and contributions from every employee is both welcomed and needed. During the 10-15 years that Hershey will have to achieve its SBT, our enterprise will have to continuously keep an eye out for how we can achieve carbon savings. This could include partnering with key suppliers to improve their sustainability, changing how we contract with certain suppliers to champion vendors with more sustainable practices, investing in clean energy and energy efficiency, participating in industry-wide initiatives to reduce the climate impacts of key ingredients, and continuously asking ourselves “is there a change we can make that can help us achieve our sustainability goals?” The rigor of our new environmental sustainability commitments has also inspired us to engage all Hershey employees in our efforts in a way we have not yet done before and makes this ambitious goal a true team effort! On Earth Day 2020, Hershey launched Green Teams, which are a group of passionate Hershey employees from all levels that come together out of a shared interest in environmental sustainability and in improving sustainability at Hershey and in the communities where we operate.

Science-based targets are not about what Hershey can do for the world and are instead about what the world needs from Hershey. We are at a key crossroad for our company’s sustainability journey. Now is the right time to take stock of our impacts and co-collaborate on solutions to future-proof our growth and ensure we are around for the next 125 years.

Tweet me: .@HersheyCompany has been working to reduce its GHG emissions for a decade now. More recently, it's committed to the Science Based Targets Initiative to develop a science-based greenhouse gas reduction goal by January 2021. Read more here: https://bit.ly/3kXNv6a

KEYWORDS: NYSE:HSY, hershey, GHG, Carbon Emissions, Science based targets

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