76,000 farmers reap benefits of Mondelēz cocoa scheme
More than 76,000 farmers have seen a significant increase in their income and cocoa yield as result of a global sustainable sourcing programme launched by Mondelēz International. The world’s largest chocolate company, responsible for Cadbury, Kenco and Oreo, has released the first progress report on its Cocoa Life sustainability programme, which will see it invest $400 million over the next ten years to fund sustainable cocoa production across the globe, aiming to empower 200,000 cocoa farmers and reach over one million community members by 2022. These farmers have seen their income triple, while yield production has increased by 37 percent in these areas, compared to other controlled farming communities. 21 percent of Mondelēz International’s cocoa was sustainably sourced as of the end of 2015, but the company aims to source 100 percent of its cocoa from sustainably verified regions. (edie)
Governance
Sweett Group becomes first to be convicted under UK Bribery Act
Sweett Group, the UK’s only listed quantity surveyor, has been ordered to pay £1.4 million after becoming the first company to be convicted under the UK’s Bribery Act, which took effect in 2011. Sweett Group was also told to pay a confiscation order of £851,000 and costs to the Serious Fraud Office (SFO) of £95,000. The company pleaded guilty in December for failing to prevent £680,000 in bribes to be paid through a subsidiary, Cyril Sweett International, in order to win and retain a contract related to the building of a £63 million luxury hotel in Dubai. In sentencing the company, Judge Martin Beddoe said he was taking into consideration that “corrupt payments were made under that corrupt agreement for no less than 18 months” and that the company deliberately tried to mislead the SFO after the agency had opened an investigation. (Financial Times*)
Responsible Investment
Apple is first US tech-company to issue green bonds
Apple’s has issued $1.5 billion in green bonds to pay for a wide range of environmental initiatives, in a “first” for Apple and the tech industry at large. The issue is the largest ever to be undertaken by a US company. Apple will use the Green Bond Principles established by a group of financial institutions including BlackRock and JPMorgan Chase & Co. The company has earmarked its green bond issue for investments in renewable energy sources; energy efficiency projects and upgrades across its facilities, products and supply chain; water efficiency projects; research and development into “greener materials” and projects focused on recycling and materials recovery. Apple has committed to reporting about the allocations on an annual basis. “Following the historic climate agreement in Paris last month, it’s more important than ever that corporations like Apple take strong action to protect our planet,” Apple said in documents supporting its securities filing. “With everything we do, we want to show what’s possible and pave the way for others to follow.” (GreenBiz; Reuters)
Report: ESG risks in Southeast Asia
A new report highlights the environmental, social, and governance (ESG) challenges and risks posed by industrial development on the Mekong region’s fragile ecosystems and traditional communities. Data gathered by RepRisk shows that utilities is the sector most exposed to ESG risks in Cambodia, Laos, and Vietnam; in Thailand, it is the second most exposed sector after food and beverage. Most of the criticism of the utilities sector in the four countries revolves around plans to construct hydroelectric power plants in the Lower Mekong region. The food and beverage is the most controversial sector in Thailand, mainly due to allegations of slavery in the Thai seafood industry. Thailand’s mining sector is exposed to ESG risks due to repeated accusations of human rights abuses and severe environmental degradation. The construction and chemicals sector are the second and third most exposed sectors in Vietnam, while in Cambodia, it is the food and beverage and forestry sectors that are most exposed. (RepRisk)
Corporate Reputation
Mars issues voluntary product recall
Mars has issued a sweeping recall of Mars, Snickers and Milky Way bars, after a piece of red plastic was found by a customer in one of its chocolate bars. The company, which holds quality as one of the five key principles in which it prides itself, said that the recall was voluntary and included its Celebrations and Mini Mix brands. The plastic was traced back to its factory in the Netherlands, where it was determined that the piece came from a protective cover used in the manufacturing process. Analyst Neil Saunders said he believed the recall to be “significant” with financial costs running into “tens of millions of dollars”. “That said, by acting swiftly, openly and comprehensively, Mars has likely limited long-term reputational damage,” he added. (Guardian, Financial Times*)
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