Fonterra, which holds the unenviable title of New Zealand’s biggest greenhouse gas emitter, is poised to announce targets to reduce its largest source of emissions – those that come from its farmer suppliers.
The co-operative’s 9000 farmers have been bracing themselves since Fonterra flagged its intention to set a target at its annual meeting in November last year.
Fonterra is facing pressure from overseas markets, big customers and banks to improve sustainability. While the co-operative has been reducing its Scope 1 and 2 emissions, generated primarily by its manufacturing sites and transport operations, it hasn’t yet set a target for Scope 3, which cover indirect emissions from its farm suppliers and account for more than 90% of its tally.
Fonterra is in a stronger financial position to support its farmers, having sold assets to strengthen its balance sheet over the past five years.
The co-operative has warned farmers that it risks losing customers and facing trade barriers in its overseas markets if it doesn’t meet sustainability expectations. For some of its customers, the largest component of their Scope 3 emissions are those coming from Fonterra.
Fonterra believes the approach allows it to deliver emissions reduction in line with the Science Based Target to limit global warming to 1.5 degrees, while driving efficiency and productivity with its farmers.
Stevenson says farmers want to see Fonterra deliver a premium for low emission dairy products.
Credit: stuff.co.nz
