Introduction to Environment Pillar
CIRCULARITY AND | Caring |
ENVIRONMENTAL | |
PROTECTION |
T | GETHER |
At F&N, we acknowledge and embrace the significant responsibility our business bears in safeguarding the environment and are fully aware of the pivotal role we play in preserving and nurturing our natural surroundings for the benefit of current and future generations.
Within our operations, we prioritise and champion circularity and environmental efficiency by effectively managing energy, water, and waste resources. Shifting towards a circular economy not only opens prospects for enhancing business value but also serves as a means to mitigate environmental consequences.
We recognise the interaction of the F&B sector with biodiversity and are committed to sourcing ingredients with respect of their impacts on the ecosystem.
Operational Eco-Efficiency | |||||||
• | Energy and Climate Change | ||||||
• | Water Stewardship | ||||||
• | Waste Management | ||||||
Value Chain Impacts | |||||||
• | Packaging | ||||||
• | Biodiversity | ||||||
Contributing to SDGs | |||||||
Primary | Secondary | ||||||
2025 SUSTAINABILITY TARGETS AND FOCUS AREAS
ENERGY AND CLIMATE CHANGE
- Reduce the Group's energy intensity ratio at our plants (from a 2020 baseline) by 8% by 2025
- Reduce the Group's GHG emissions intensity ratio at our plants (from a 2020 baseline) by 8% by 2025
WASTE STEWARDSHIP
Reduce the Group water intensity ratio at our plants (from a 2020 baseline) by 8% by 2025
WASTE MANAGEMENT
Reduce the solid waste sent to landfill (from a 2020 baseline) by 30% by 2025
PACKAGING
25% of beverage and dairy packaging to contain recycled materials by 2025
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OPERATIONAL ECO-EFFICIENCY
F&N recognises that our company creates environmental impacts through energy, water and resource consumption. To reduce our impacts on the environment, we are committed to explore avenues to improve our manufacturing processes, through innovative initiatives and resourceful strategies, to optimise eco-efficiency to minimise our environmental footprint and align our operations more closely with sustainable practices.
Details on how we approach each environmental impact are elaborated in the following sections:
- Energy and Climate Change
- Water Stewardship
- Waste Management
Environment, Safety and Health Policy
F&N implements environmentally sustainable business practices aligned with our core values and the circular economy principles. Our operations are guided by the ESH Policy. It serves as a framework for all F&N's decisions concerning the environment across our value chain - production operations, business facilities, products, distribution and logistics, and management of waste. We work with local communities to protect and preserve the environment and strive for zero waste and zero pollution.
OUR ENVIRONMENTAL SAFETY & HEALTH POLICY
All of our operations in Singapore, Malaysia and Thailand
are guided by the following principles, to:
Comply with applicable environmental, safety & health, legal and other requirements and also work with relevant statutory bodies to provide and maintain a safe, green working environment
Develop review and carry out Environmental Impacts and Occupational Risk Assessments to take appropriate control measures for prevention of pollution, injury and illness
Foster communication with shareholders. employees, customers, suppliers and local communities to protect the environment and to have hazard free condition
Provide and maintain relevant training, instruction, information, resources and supervision to our employees about our commitments and encourage their involvement in Environmental, Safety & Health Programmes
Ensure continual improvement in the
Environmental, Safety and Health
Management system and standards
Strive for Zero Waste, Zero Pollution and Zero Accident through continual improvement in our management systems and processes
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OPERATIONAL ECO-EFFICIENCY
ENERGY AND CLIMATE CHANGE | SDGs | ||||
GRI Index: | |||||
GRI 302-1, GRI 302-3, GRI 305-1, | |||||
GRI 305-2, GRI 305-4 | |||||
GHG emissions from our business operations contribute to climate change. In turn, the effects of climate change also affect F&N. The ripple effects of climate change places pressure on production processes and poses climate-related risks, such as price fluctuations of raw material commodities, and the access to water resources, for F&N. At the same time, it also provides climate-related opportunities, such as cost savings, and alignment with consumer expectations. For a more detailed focus on climate change risks, refer to the 'TCFD and Climate Risk Management' chapter of this Report.
F&N is committed to reducing the energy and GHG emission intensities of our plants, as per our 2025 sustainability targets. We assume the responsibility to minimise our carbon footprint across our value chain. To further highlight this commitment, and to support the efforts to mitigate the effects of climate change, we would also be declaring a 2040 target for the net-zero of Scope 1 and 2 GHG emissions.
Approach
F&N'S APPROACH IS GUIDED | |||||
BY THE FIVE PRINCIPLES OF | |||||
THE ENERGY AND CLIMATE | |||||
CHANGE STRATEGY: | Reducing | ||||
carbon | |||||
in our value | |||||
chain | |||||
Renewable | |||||
energy | |||||
sourcing and | |||||
generation | |||||
Energy efficiency in our operations
Route
planning
Operations'
exposure to climate change risks
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2025 Target
Target
Reduce the Group's energy intensity ratio at our plants (from a 2020 baseline) by 8% by 2025
Target
Reduce the Group's GHG emissions intensity ratio at our plants (from a 2020 baseline) by 8% by 2025
Performance
In FY2023, our energy intensity ratio increased by 2% from 2020, due to the lower production volume at some of our plants.
Performance
In FY2023, our GHG emissions intensity ratio decreased by 6% from 2020, due to the increased use of renewable energy at our plants.
Performance
GRI 302-1
Energy consumption within the organisation
GRI 302-3
Energy intensity ratio
GRI 305-1
Direct (Scope 1) GHG emissions (CO2e)
GRI 305-2
Energy Indirect (Scope 2) GHG emissions (CO2e)
GRI 305-4
GHG emissions intensity
See 'Performance Summary' section in this Report on pages 102 - 103
See 'Performance Summary' section in this Report on pages 102 - 103
See 'Performance Summary' section in this Report on pages 102 - 103
See 'Performance Summary' section in this Report on pages 102 - 103
See 'Performance Summary' section in this Report on pages 102 - 103
Initiatives
ENERGY EFFICIENCY IN OUR OPERATIONS
Improving energy efficiency in our operations makes just as much business sense as it is to reduce our environmental impacts. F&N continues to scale up on our GHG reduction projects by improving the energy efficiency in our operations and supply chain.
1 | Thailand | 2 | Malaysia |
F&NDT - | Innovative Heat Recovery System | F&NHB - | Reduced Energy Used for PET Bottle Dry Blowing |
Continuous and Batch Sterilisers are natural gas intensive and generate a significant amount of heat waste. By installing an innovative heat recovery system to recover heat waste from the cooling water, the 70°C sterilisers in many areas transfer
heat waste for use in utilities and at the production line to heat up reverse osmosis water, processed water and soft water from 30°C to 60°C, reducing the amount of natural gas consumption. This reduced F&NDT's natural gas consumption by up to 6%, created cost savings of about THB 5.4 million (about SGD 208,000 per year), and resulted in reductions of around 650 MT CO2e GHG emissions per year.
By updating the current compressed air PET bottle drying process with Paxton blowers at our Shah Alam plant, there has been a reduction in electricity consumption by about 228,000 kWh annually. This means an estimated cost savings of around MYR 81,000 (about SGD 23,100), and a reduction of GHG emissions by around 133 MT CO2e per year. The added benefit is that the Paxton blowers also generates a lower level of noise.
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OPERATIONAL ECO-EFFICIENCY
Initiatives
RENEWABLE ENERGY SOURCING AND GENERATION
Renewable energy sourcing and generation initiatives will be key for our progress toward our 2025 Energy and GHG reduction sustainability goals.
1 Singapore, Malaysia and Thailand
FNFS, TPL, F&NHB and F&NDT - Installation of Solar Panels
Across the Group's operations in Singapore, Malaysia and Thailand, solar panel are being progressively installed across the rooftops of selected plants. It is expected to provide cost savings of over SGD 2.4 million, and an estimated 13,000 MT CO2e in GHG emissions avoided, each year. The solar photovoltaic system reduces the amount of electricity usage by about 23 million kWh annually, significantly reducing F&N's energy offtake from the grid by our switching to renewable energy for daily operations.
Initiatives
ROUTE PLANNING
Optimal route planning can help reduce GHG emissions. In the last few years, we have continued to streamline our distribution networks.
1 Singapore, Malaysia and Thailand
FNFS, F&NHB and F&NDT - Automated Storage and Retrieval System ("ASRS")
F&N has strategically decentralised its distribution network to curtail GHG emissions. This decentralisation aligns with the principles of Total Supply Chain Management (TSCM) and extends to logistics management.
One key technological advancement is the ASRS, which is fully operational in integrated warehouses located in plants in Singapore, Malaysia and Thailand. This system has revolutionised our operations by automating processes, allowing for the handling of more loads. As a result, forklift usage is optimised and substantially reduced, by up to 40%, saving both time and energy by cutting down on trips down storage aisles. Another notable benefit of implementing the ASRS is a reduction in the need to rent external warehouses. As a result, a remarkable reduction of over 15% in transport annually had been achieved. This saves time and energy and contributes significantly to reducing GHG emissions.
This system drives improvements through:
More accurate stock management
Elimination of product damage caused by mishandling
In-sourcing of break bulk activities
Reduction of time spent by workers at the warehouse
Improvement in warehouse safety
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Initiatives
LOW CARBON PRODUCT
1 Thailand
F&NDT - CARNATION Extra Non-dairy Half Creamer for Cooking and Baking
The CARNATION Extra Non-dairy Half Creamer for Cooking and Baking (385g) is F&NDT's first low-carbon product certified by Thailand Greenhouse Gas Management Organisation ("TGO"). The product's carbon footprint of 295g CO2e successfully meets the requirements of the TGO Carbon Footprint Reduction Label scheme.
F&N is working towards having more products certified by TGO under the Carbon Footprint Reduction Label scheme.
Initiatives
OPERATIONS EXPOSURE TO CLIMATE CHANGE RISKS
The increasingly visible impacts of climate change around the globe are disrupting societies and businesses. F&N too is vulnerable to such climate-related risks, from extreme temperatures to floods and drought, which have the potential to halt our operations and disrupt our supply chain.
1 Singapore, Malaysia and Thailand
Group - Climate-Related Risks and Opportunities Assessment
To better understand our position, last year, F&N had conducted an inaugural qualitative climate-related risks and opportunities assessment to identify the potential material climate-related physical and transition risks and opportunities. This year, to gain more insight into the potential business impacts of the identified climate-related risks, we had built upon last year's work and conducted a quantitative climate-related risks assessment on three physical and transition risks. The outcome would be integrated into the organisation's overall ERM framework for monitoring in order to drive strategic decisions for managing them.
For details on the climate-related risks and opportunities assessment, refer to the 'TCFD and Climate Risk Management' chapter of this Report.
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OPERATIONAL ECO-EFFICIENCY
WATER STEWARDSHIP | SDGs |
GRI Index: | |
GRI 303-3, GRI 303-4, GRI 303-5 |
Water is an important resource for F&N because it is used extensively in our products and operational processes. The success to our business depends on a reliable supply of water and effective water management. Through our climate-related risks and opportunities assessment, there are key sites in areas with medium to high exposure to water
scarcity - where demand of good quality water exceeds the availability. With climate change expected to intensify the severity of flooding and water-stress in the near future, we are committed to responsible water stewardship by managing our water use to safeguard the availability of clean water for the local communities, in the markets we operate.
Approach | ||
Guided by the F&N ESH Policy and the principles of circular | • | F&N conducted a quantitative climate-related risks |
economy, F&N has organised initiatives to increase water | assessment to determine the potential business impact on | |
security and reduce water consumption. Water-related | key sites that had been identified as having medium to high | |
risks and opportunities are identified and addressed by | exposure to the climate-related physicals risks of water | |
collaborating with relevant stakeholders to create shared | scarcity, and flooding. | |
value projects. | • | The sustainability team utilises publicly available tools |
To reduce risks towards our water supply, we utilised a range | such as the World Resources Institute Aqueduct and World | |
Wildlife Fund Water Risk Filter to evaluate water-stress | ||
of internal water assessments and have deployed action | ||
areas. | ||
policies in all our facilities: | ||
• | F&N has an established system within all operations for | |
systematic daily and monthly tracking and monitoring of water consumption and effluent quality.
2025 Target
Target
Reduce the Group's water intensity ratio at our plants by 8% from a 2020 baseline by 2025
Performance
In FY2023, our group water intensity ratio increased by 5% because of a lower production volume at some of our plants.
Performance | ||||
GRI 303-3 | See 'Performance Summary' section in this Report | |||
Water withdrawal | on pages 102 - 103 | |||
GRI 303-4 | See 'Performance Summary' section in this Report | |||
Water discharge | on pages 102 - 103 | |||
GRI 303-5 | See 'Performance Summary' section in this Report | |||
Water consumption | on pages 104 - 105 | |||
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Initiatives
WATER STEWARDSHIP IN OUR OPERATIONS
F&N implemented various water saving initiatives this year to further improve our water efficiency. Our plant engineers look into closing the loop for our water systems - through treating wastewater from our plants and using the recycled water for general cleaning and cooling purposes. We also collaborate with stakeholders in our value chain to develop water management strategies.
1 | Thailand | 2 | Malaysia |
F&NDT - | Innovative Water Recycling System | F&NHB - | Sustainable Sugar Manufacturing |
F&NDT has been actively focusing on implementing a robust water recycling system at the Rojana plant. This system involves treating effluent water to a level where it meets the quality standards of drinking water and can be channelled back into the utility system. The recycling process itself Ultra Filtration combined with Reverse Osmosis membrane technology to achieve the required water quality. The treated effluent is then sent to the Evaporative Condenser and Cooling Tower for further use. The concentrated wastewater, separated from the treated effluent during the recycling process, serves a practical purpose as it is used for watering the plants in the garden or transferred to the Rojana industrial park's wastewater treatment plant for further treatment. It is estimated to reduce water consumption by over 83,000m3 each year, achieving annual cost savings of over THB 1.6 million (over SGD 61,600).
F&NHB has collaborated closely with the local community and established a partnership with our liquid sugar manufacturer, spanning over two years, to address
a significant challenge in the sugar manufacturing process - the substantial water consumed during the sugar crystallisation stage. To mitigate this environmental impact, F&NHB had implemented a filtration resin method, effectively transforming the sugar into a liquid form.
This innovative approach eliminates the need for large quantities of water traditionally required for the sugar crystallisation process.
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OPERATIONAL ECO-EFFICIENCY
WASTE MANAGEMENT | SDGs | |||
GRI Index: | ||||
GRI 306-1, GRI 306-2, GRI 306-3, GRI 306-4 | ||||
GRI 306-5, GRI 306-6 | ||||
Our commitment lies in shaping a future devoid of waste, and we actively translating this commitment into action by adopting the circular economy approach. Circular economy aims to minimise waste and promote a sustainable use of
natural resources by repurposing it as input for other processes. Proficient waste management strengthens our capacity for resource efficiency and also diminishes our environmental footprint, resulting in potential cost savings for the business.
Approach
Waste generation occurs at various points within the production process, spanning the supply chain and our own operational activities. F&N focuses on efficient waste management by minimising and redirecting our operational waste. We extend our dedication beyond our immediate operations and collaborate with stakeholders along our supply chain. Together, we identify opportunities to embrace circular practices in their operations, working with them to achieve resource-efficient practices.
F&N aspires to achieve 'zero discharge, zero waste and zero landfill'. Our manufacturing teams seek to improve efficiency in our operations by applying innovation and discovering new opportunities to close the loop in the material cycle.
We prioritise environmentally responsible practices for different types of waste. Non-hazardous waste is predominantly recycled to maximise resource utilisation and minimise environmental impact. Those which cannot be recycled are directed towards power plant waste-to-energy facilities, where possible, to contribute to energy recovery and reduce waste to landfill. Our hazardous waste, though minimal, is properly disposed by licensed waste contractors, adhering to stringent regulatory standards. This approach underscores our commitment to sustainable waste management practices across all waste categories.
Under our ESH Policy, we promote employee awareness on responsible consumption and the importance of effective waste management across our business activities.
CIRCULAR ECONOMY
AND WASTE
FACTORIES
Waste-to-Energy | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Engaging Employees | ||||||||||||||||||||||||||||||||||||||||||||||||||||
in Waste Reduction | ||||||||||||||||||||||||||||||||||||||||||||||||||||
POST- | Waste | |||||||||||||||||||||||||||||||||||||||||||||||||||
CONSUMPTION | ||||||||||||||||||||||||||||||||||||||||||||||||||||
CONSUMERS | Waste Management | Value-Added | AGRICULTURE | LIVESTOCK | ||||||||||||||||||||||||||||||||||||||||||||||||
PACKAGING | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Activities | ||||||||||||||||||||||||||||||||||||||||||||||||||||
MANAGEMENT | PRODUCTS | |||||||||||||||||||||||||||||||||||||||||||||||||||
Responsible Waste Disposal | ||||||||||||||||||||||||||||||||||||||||||||||||||||
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2025 Target
Target
Reduce the solid waste sent to landfill (from a 2020 baseline) by 30% by 2025
Performance
In FY2023, the total solid waste sent to landfill increased by 4% from a 2020 baseline year due to the transition from our Pak Chong to Wang Muang plant.
Performance
GRI 306-3 (2020)
Waste generated
GRI 306-4 (2020)
Waste diverted to disposal
GRI 306-5 (2020)
Waste directed to disposal
See 'Performance Summary' section in this Report on pages 104 - 105
See 'Performance Summary' section in this Report on pages 104 - 105
See 'Performance Summary' section in this Report on pages 104 - 105
Solid Waste Intensity Ratio (kg/MT) | Solid Waste Recycled, Reused or Recovered |
1.94 | 100% | 96% | |||
86% | |||||
0.38 | |||||
0.00 | |||||
Singapore | Malaysia | Thailand | Singapore | Malaysia | Thailand |
Initiatives
OPTIMISING WASTE REDUCTION THROUGH INTERDEPARTMENTAL COLLABORATION
F&N collaborates across departments, partnering with supply chain heads, to enhance product demand and planning. This effort aims to enhance the precision of product quantity forecasting, reducing the occurrence of unsold products, and ultimately, waste generated. To support this initiative, strategic investments has been made in software tools to facilitate the tracking of return SKU, improve forecast predictions, and offer opportunities for continuous enhancement in demand planning. In addition, F&N seeks support from the sales teams to actively contribute their insights and feedback to refine the forecasting process. This collaboration serves to validate and verify the accuracy of the forecasted numbers.
Initiatives
TRANSFORMING MARKET RETURNS INTO COST-EFFECTIVE SOLUTIONS
90% of FNFS general waste originates from unrecyclable market returns. To address this issue, FNFS is exploring an initiative to combine these market returns with okara and repurpose it as feed for black soldier fly larvae. Black soldier fly larvae can convert the waste into a by-product known as frass, which can be used to substitute or supplement commercial fertilisers in agriculture and can also be used in animal feed formulations for poultry and aquaculture diets. This approach is a dual-pronged strategy that minimises waste disposal costs while contributing to an environmentally responsible and sustainable solution.
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Fraser and Neave Limited published this content on 21 December 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 02 January 2024 08:31:35 UTC.