2018 SUSTAINABILITY REPORT - Chocolats Halbachocolatshalba.ch/files/chocolatshalba_2012/downloads...2018 Sustainability Report | Chocolats Halba/Sunray 5 At a glanc e Reporting methodology

2018 SUSTAINABILITY REPORT

About this report

This sustainability report covers the 2017 and 2018 financial years. It is the fourth report of Chocolats Halba – and the first joint Chocolats Halba/Sunray report. It provides information on the economic, social and environ-mental impacts of our operational activities. The report presents the most important areas of progress, their associated figures, and the goals we have set ourselves within our sustainability strategy for the years 2016 to 2020. This strategy is based on the three pillars of “procurement”, “manufacturing and production” and “marketing and sales”.

PUBLISHING DETAILS Published byChocolats Halba/Sunray, a Division of CoopSalinenstrasse 704133 Pratteln

ResponsibleAnton von Weissenfluh, Head of Chocolats Halba/Sunray

Editing and designHanspeter Huber, Chocolats Halba/SunrayAnnina Böhlen, Chocolats Halba/SunrayAlexander Brunner, Chocolats Halba/SunrayPetra Heid, Chocolats Halba/SunrayFarner Consulting AG

LayoutFarner Consulting AG

Publication dateOctober 2019

Contact Chocolats Halba/Sunray, a Division of CoopSalinenstrasse 704133 PrattelnE-mail: [email protected].: +41 (0)61 825 91 44

TABLE OF CONTENTSAt a glance 4

Reporting methodology 5

Key figures for 2018 6

Interview with our CEO 8

Dynamic agroforestry 9

Company 11

Chocolats Halba and Sunray 12

Facts and figures 13

Organizational structure 13

Sustainability strategy 14

Procurement 16

Management approach and

multi-year objectives 17

Raw materials 19

Certifications and standards 23

Fairtrade premiums 25

Projects 26

Production 29



Energy 32

Packaging 34

Safety 35

Employees 36

Sales 39



Quality 41

Product safety 41

Labels 41

Customer satisfaction 42

SDG index and key figures 43

SDG index 44

Procurement 45

Production 46

Employees 47

Sales 48

AT A GLANCE

At a glance 4

Reporting methodology 5

Key figures for 2018 6

Interview with our CEO 8

Dynamic agroforestry 9

2018 Sustainability Report | Chocolats Halba/Sunray 5

At a glance

Reporting methodology

The United Nations Agenda 2030, which was adopted in September 2015, is a global action plan for sustainable development. At its heart are seventeen Sustainable Development Goals (SDGs) which provide the blueprint for sustainable development encompassing economic, social and environmental dimensions. Our business activities are making a positive contribution to eleven of these goals (see above). How our sustainability actions relate to these SDGs is shown in the matrix on page 44 of this report. In addition, our sustainability reporting closely follows the Global Reporting Initiative (GRI) guidelines and those of the International Labour Organiza-tion (ILO).


At a glance

Key figures for 2018

SALES OF SUSTAINABILITY-LABELLED PRODUCTS

SHARE OF RENEWABLE ENERGY IN TOTAL

ENERGY CONSUMPTION

PROJECTS FOR SUSTAINABLE MIXED CULTIVATION (AGROFORESTRY)

84%

2,669,080

5

160

3,179tonnes of cocoa butter

98%certified

100%certified

7,995 tonnes of cocoa beans

in CHF m

Chocolate products: 80%

Shares oftotal sales: 56%

in Ecuador, Ghana, Honduras, Madagascar, Peru

2018

79

2014

PROCUREMENT

in CHF

FAIRTRADE PREMIUMS FOR COCOA


At a glance

33%

133 treesper day

AWARD FOR EXCEPTIONAL COMMITMENT

32 m

100%

2

24 h

Since 2011: 389,145

TREES PLANTED FOR CLIMATE PROTECTION

REPRESEN-TATION OF WOMEN IN MANAGEMENT

NUMBER OF CARBON-NEUTRAL

CHOCOLATE PRODUCTS SOLD

CARBON-NEUTRAL PRODUCTION

Swiss Ethics Award 2018

1


At a glance

Mr von Weissenfluh, what does sustainability mean for Chocolats Halba/Sunray?For us, sustainability means a number of things: conviction, identity, daily motivation, and not least a key success factor. Our customers value transparency, trustworthiness and quality. Thanks to our sustainability strategy spanning our entire value chain, we are able to live up to these high expectations to an extent unrivalled in our industry. Over the course of the last four years, Chocolats Halba/Sunray has more than doubled its sales of sustainability-labelled products.

Since the merger of Chocolats Halba and Sunray in 2017, our commitment to sustainability has acted more than ever as a unifying element. It fosters a sense of togetherness and identification with the new company. This effect was strengthened by receiving the 2018 Swiss Ethics Award for our cocoa project in Ecuador, as well as by the first joint employee trip when nine colleagues from across all business segments visited our cocoa farmers in Peru in 2018.

What sustainability issues did the company find particularly challenging in 2017/2018?These two years were influenced by our relocation to the Coop Production and Quality Centre in Pratteln. This required a great deal of effort and flexibility from us all. Unfortunately, around half of Chocolats Halba’s workforce were unable to make the move from the

Interview with our CEO

canton of Zurich to the Basel region. This is regrettable, and I am pleased that we were able to find other suitable jobs for almost all the employees affected.

As a result of this high fluctuation rate, we were faced with the major challenge of recruiting new skilled workers. Here once again our commitment to sustainability worked in our favour: younger jobseekers in particular made a conscious decision to join Chocolats Halba/Sunray because they wanted to be involved in a meaningful activity that has a positive impact on their fellow human beings and the environ-ment.

What areas will Chocolats Halba/Sunray be focusing on over the next two years?One particular focus is climate protection. We are already planting 133 trees every day in order to offset our emissions. We would like to increase this number by selling even more products certified as carbon-neutral. We are also aiming to use well over 90% renewable energy at our new base. In our new sustainability project in Ghana, we are planning to combine cocoa cultivation with reforestation using dynamic agroforestry methods that meet the “Gold Standard” – a world first.

“With our efforts in this area, we have become something of a sus-tainability trailblazer in the Swiss chocolate industry in recent years.”

We would now like to take this one step further and become a sustainability trailblazer in the Swiss food industry as a whole.

Anton von Weissenfluh, Head of Chocolats Halba/Sunray, on a visit to Ecuador.


At a glance

Dynamic agroforestry

Cocoa is mainly grown in monocultural systems as producers expect higher yields from these. However, the equation more cocoa plants = higher yields does not hold true. The one-sided cultivation is depleting the soil. The ground is unprotected from erosion because the stabilizing roots of large trees are missing. In addition, the cocoa plants are exposed to the full sun and become overheated and dehydrated. As a result, after just a few years the cocoa yield falls and the plants become susceptible to diseases and pests. Producers react by applying expensive mineral fertilizers and pesticides, which cuts into their margins and does additional dam-age to the soil. This negative spiral drives many small-scale farmers into poverty – or to clearing intact forests to create more plantations.

MOTTO FOR THE FUTURE: BACK TO THE ROOTSChocolats Halba/Sunray is a global leader in cocoa cultivation using dynamic agroforestry methods (DAF). This holistic approach mimics the original rainforest habitat of the cocoa tree – including establishing an understorey and a closed nutrient cycle. Cocoa is grown in combination with crops such as maize, manioc (cassava), bananas or mangoes, and with high-quality timber trees such as mahogany. The various plants help each other to grow, with tall light-loving ones providing a canopy for other crops that prefer more shade. Plants with high nutrient requirements benefit from neighbours that supply nutrients. The cocoa trees grow in the moist and shady undergrowth where they flourish and produce more beans.

This form of balanced mixed cultivation also produces large quantities of organic material. In contrast to monocul-tures, this is not thrown away or burned, but left lying. As a result, the ground does not dry out and the mulch created provides the plants with all the nutrients they need, making synthetic fertilizers and pesticides redundant.

DAF is an advanced cultivation method. In particular, the specific initial planting of the plots and correct pruning requires a great deal of expertise. Our DAF projects are designed to run over several years. During this period, selected farmers receive intensive instruction in agroforestry methods so they can then act as trainers themselves and pass on their acquired knowledge to other producers.

COCOA FARMERS GAIN LONG-TERM BENEFITSFarmers benefit from the DAF model several times over: thanks to better soil quality, cocoa productivity can be doubled in the long term. Mixed-crop cultivation enables farmers to harvest crops regularly for their own consumption or to sell. High-quality timber trees also serve as a form of old-age provision – they can be felled and sold 20 to 30 years later, as long as they are replaced. DAF consequently improves the living standards of smallholders while at the same time countering social problems such as exploitative child labour practices, malnutrition or migration to the cities.

Nature is a beneficiary too, as with the DAF model deforested areas are reforested. Biodiversity in the plantations is enhanced, and the insects that are vital for pollination return. The timber trees act both as a water reservoir and as a natural defence against erosion. Moreover, they sequester CO2 and consequently help protect the climate.

PROJECTS IN ECUADOR AND GHANAWe are already running two major DAF projects in Ecuador and Ghana, and at the end of 2018, we launched another similar project in Madagascar. The year 2019 will see the addition of further DAF pilot projects in Honduras and in the Dominican Republic. We are also leading agroforestry projects in Honduras and Peru where cocoa is being cultivated in combination with high-quality timber trees. This represents an initial step towards dynamic agroforestry.

In 2018, Chocolats Halba/Sunray was the recipient of the Swiss Ethics Award for outstanding ethical achieve-ment in business for its FINCA agroforestry project in Ecuador.

COCOA IN MONOCULTURE

COCOA IN DYNAMIC AGROFORESTRY

1.

2.

3.

4.

1.

2.

3.

4.


At a glance

CULTIVATION METHODS: MONOCULTURE VS DYNAMIC AGROFORESTRY

1. One-sided cultivation depletes the soil. The cocoa plants in need of shade are exposed to the full sun and become overheated and dehydrated.

2. The weakened plants yield less and are increasingly infested with diseases and pests.

3. Farmers use expensive mineral fertilizers and pesticides, which cuts into their margins and does additional damage to the soil.

4. This negative spiral drives many small-scale farmers into poverty – or to clearing intact forests to create more plantations.

1. In dynamic agroforestry, cocoa grows almost like in the rainforest – in combin-ation with local fruits, vegetables and timber trees.

2. The various plants help each other to grow, with tall light-loving ones provid-ing a canopy for other crops that prefer more shade. Plants with high nutrient requirements benefit from neighbours that supply nutrients. The cocoa trees grow in the moist and shady under-growth where they flourish and produce more beans.

3. Constant pruning and replanting produces a lot of organic material. It is left lying around, protects the soil from drying out and provides the plants with all the necessary nutrients. Fertilizer and pesticides become superfluous.

4. The farmers benefit from higher cocoa yields and additional income thanks to the mixing of plants.

COMPANY

Company 11

Chocolats Halba and Sunray 12

Facts and figures 13

Organizational structure 13

Sustainability strategy 14


Company

Chocolats Halba and Sunray

In 1933 Willy Hallheimer and Werner Baer founded a joint stock company in Zurich for the purpose of manufacturing chocolate. These two pioneers chose a company name that combined the start letters of their respective last names: Halba. To begin with, they set up production in Zurich, before moving to Wallisel-len and later to Hinwil (both in the canton of Zurich). In 1972 Chocolats Halba was taken over by Coop, and ultimately fully integrated into the Coop Group in 2004. 2013 saw the foundation in Honduras of the subsidiary Chocolats Halba Hondu-ras to safeguard the sustainable procurement of top-quality cocoa from this country.

Sunray was founded in 1907 in Pratteln, in the canton of Basel-Landschaft, as part of the “Verband schweizerischer Konsumvereine” or VSK, the association of Swiss consumer co-operatives from which the Coop Group was later to emerge. Initially its main business was purchasing and packaging “colonial goods”, as foodstuffs such as nuts, spices and coffee were known at the time. Over subse-quent decades, the range it carried continually evolved, at times also including butter, eggs, animal feed and even shoes. In 2005 the department responsible for raw materials and processing became a separate division of Coop, operating under the name Sunray from September 2006.

RELOCATION AND MERGERBetween 2017 and 2018 Chocolats Halba moved its two plants to the Production and Quality Centre in Pratteln as the former facilities could no longer cope with the rise in orders. The additional and more efficient machinery in Pratteln boosted production volumes. At the same time, being at Coop’s largest production location allows us to exploit synergies with other units there. One of these units is Sunray after moving its operations within the municipality of Pratteln to the Production and Quality Centre during 2017.

It was during the course of relocation that Coop’s management decided to merge Chocolats Halba and Sunray with effect from September 2017. This was a logical decision as both divisions produced high-quality foodstuffs for the retail trade and industry, and both shared corporate values of sustainability, quality, customer focus, innovation and Swissness. Since the merger, significant synergies have emerged in relation to the procurement of raw materials, quality assurance and building maintenance, and more can be expected. The merger was an important step that enabled us to join forces to become an even more effective player in the highly competitive food sector.


Company

Facts and figures

Chocolats Halba/Sunray currently has 358 employees. We produce high-quality chocolate bars, coatings, hollow figures and confectionery items in our chocolate production facilities. The Sunray division processes and packages foodstuffs from eight product groups: nuts and seeds, dried fruit, dried mushrooms and vegetables, pulses, cooking oils, baking and dessert products, herbs and spices, and sugar.

In 2018 Chocolats Halba/Sunray sold 16,500 tonnes of chocolate products and 46,000 tonnes of other food (excluding sugar trading), achieving total sales of CHF 288 million. 79% of sales were generated in Switzer-land, chiefly to our parent company Coop. Chocolate exports mainly accounted for the remaining 21%. Our most important export markets are Germany, USA, Canada, France, Italy and Australia.

We are aiming to further increase exports over the coming years. In addition, we aim to roll out new technologies and speed up innovation. Our core expertise is still manufacturing premium foodstuffs with added value: sustainability-labelled products accounted for 56% of our sales in 2018, and as much as 80% for chocolate products.

Organizational structure

The Coop Group is a cooperative society with over 2.5 million members. It holds stakes in a number of companies in Switzerland and abroad. Cooperatives do not exist to generate profit for their shareholders. Instead, the profits they generate are used for the benefit of their employees and customers or are reinvested. See the annual report for more detailed information about the struc-ture and governance of the Coop Group.

In organizational terms, Chocolats Halba/Sunray is a Coop division within the IT/Production/Services business unit. The division is led by CEO Anton von Weissenfluh assisted by the six departmental managers. The autumn of 2019 will see a change at the top when Anton von Weissenfluh retires and hands over the reins to Andreas Hasler, currently Head of Marketing & Sales.

SUSTAINABILITY TEAMChocolats Halba/Sunray has a sustainability team staffed with the equivalent of 2.8 full-time employees and headed by Petra Heid. It is attached to Quality Management. In consultation with individual departments, the team draws up our sustainability strategy and defines specific goals and actions. The team is also responsi-ble for planning and implementing sustainability projects and for monitoring the progress of our sustainabil-ity goals and actions every year.

COLLABORATION WITH STAKEHOLDERSChocolats Halba/Sunray actively promotes sustainable development through its membership of industry organizations such as Chocosuisse, the Swiss Platform for Sustainable Cocoa, the Swiss Cocoa Forum and the World Cocoa Foundation (WCF). In addition, we are members of the Swiss Business Council for Sustaina-ble Development (öbu). We also work closely with other organizations in projects and working groups, including the Swiss Agency for Development and Cooperation, Helvetas, the International Trade Centre, Max Havelaar Switzerland, and Swisscontact.

https://report.coop.ch/en/corporate-governance/


Company

Sustainability strategy

Chocolats Halba is the sustainability trailblazer of the Swiss chocolate industry. We laid the foundations for our commitment when we launched a flagship project in Honduras in 2008. In the four years following this launch, we marked further milestones: buying virtually all our cocoa from certified sources, cutting green-house gas emissions from production by a quarter, and offsetting the remaining emissions within our own value chain.

Today Chocolats Halba pursues a sustainability strategy across its entire value chain, from cocoa farmer to consumer. Since the merger in 2017, we have gradually transferred Chocolats Halba’s 2016 – 2020 sustainability strategy to Sunray’s business segments.

SUSTAINABILITY AT CHOCOLATS HALBAIn 2012 Chocolats Halba drew up its first comprehensive sustainability strategy. By this means, our sustain-ability efforts were defined in the form of core principles and goals and systematically integrated into our core business. Many stakeholders were also consulted in various exploratory discussions. The result of this process was our 2013 – 2015 sustainability strategy.

The targets and actions were updated in 2016 to produce the 2016 – 2020 sustainability strategy. We adjusted our areas of focus and updated the materiality matrix. As part of a survey conducted by the University of Lucerne, internal and external stakeholders were once again able to have their say. In addition, we aligned our strategy with the Global Reporting Initiative (GRI), the UN Sustainable Development Goals (SDGs) and the International Labour Organization’s guidelines as well as with Coop’s multi-year sustainabili-ty targets.

Materiality Matrix

Purchasing2 Human rights in procurement

3 Partnerships

5 Raw material procurement

9 Ecosystems

Employees6 Employee loyality

Sales1 Product safety and product quality

4 Customer satisfaction

10 Development of new markets

Production7 Use of resources and climate neutrality

8 Climate change

11 Odor emissions12 Operational safety

low

Imp

orta

nce

for

sta

keh

old

ers

(in

terg

rity

)

2

3

5

9

7

8

12 11

1

4

6

10

Hig

hly

sig

nifi

can

tS

ign

ifica

nt

hig

h

low Importance for Chocolats Halba (competitiveness)

high


3 Partnerships


9 Ecosystems






8 Climate change


low

Imp

orta

nce

for

sta

keh

old

ers

(in

terg

rity

)

2

3

5

9

7

8

12 11

1

4

6

10

Hig

hly

sig

nifi

can

tS

ign

ifica

nt

hig

h


high


3 Partnerships


9 Ecosystems






8 Climate change


low

Imp

orta

nce

for

sta

keh

old

ers

(in

terg

rity

)

2

3

5

9

7

8

12 11

1

4

6

10

Hig

hly

sig

nifi

can

tS

ign

ifica

nt

hig

h


high

https://sustainability.chocolatshalba.ch/en/nhb2016/profile/sustainability-strategy.html

https://www.taten-statt-worte.ch/content/dam/act/TatenstattWorte_Relaunch/Hintergruende/nachhaltigkeit-bei-coop/Strategie/Mehrjahresziele_NH_2014-2020_en.pdf



Company

Sustainability strategy

The 2016 – 2020 sustainability strategy is based on the three pillars of “procurement”, “manufacturing and production” and “marketing and sales”. The main focus areas for each of these pillars were defined and broken down into strategic targets, key actions and indicators (KPIs), with “integrity” spanning and linking all three pillars.

SUSTAINABILITY AT SUNRAYAt Sunray, too, sustainability has been strongly ingrained in its corporate philosophy from the outset. Although it had not formulated its own sustainability strategy, it followed Coop’s multi-year sustainability targets to a large extent. Since the merger, we have gradually transferred Chocolats Halba’s 2016 – 2020 sustainability strategy to Sunray’s business segments. This process has already been successfully completed for the “manufacturing and production” and “marketing and sales” pillars. Here, all sustainability targets and actions apply to the entire company. The situation is different with the “procurement” pillar. Some initial targets and actions are already defined for the most important Sunray raw materials. However, full integration will only take place in the Sustainability Strategy 2021 – 2025.

Stakeholder dialogueMedia and document analysis

Internal interviews

Marketing and sales — Quality — Sustainability as a competitive advantage

— Customer satisfaction

Manufacturing and production

— Resource efficiency and carbon-neutral production

— Packaging and waste — Employee development — Equal opportunities — Work-life balance

Procurement — Working conditions and human rights

— Standard of living and food security

— Environmental protection and sustainable cultivation methods

— Education and training of young people

— Quality and security of supply

— Traceability

INTEGRITYGoal: Chocolats Halba/Sunray is a company of integrity and is

perceived as such by its stakeholders.



PROCUREMENT

Procurement 16



Raw materials 19

Certifications and standards 23

Fairtrade premiums 25

Projects 26


Procurement

Management approach and multi-year objectives

The responsible and sustainable sourcing of raw materials is a key pillar of our sustainability strategy. We focus on three areas in particular:• Fair treatment of producers• Sustainable use of natural resources • Adequate availability and high quality of all relevant raw materials

We attach great importance to entering into direct relationships with producers wherever possible and we favour those who take a sustainable approach. We are committed to conducting fair trade with certified partners and – all other things being equal – give preference to businesses with production operations in Switzerland. We buy in our main raw materials on the basis of independent standards, taking social, ethical and environmental sourcing guidelines into account. We aim for maximum transparency and traceability.


Procurement

OBJECTIVES ACHIEVED IN 2017/2018 – CHOCOLATS HALBAThe procurement targets listed relate to chocolate production. For the approximately 500 Sunray raw materials, not all measures have yet been defined in the current sustainability strategy 2017 – 2020. This will be done in the sustainability strategy 2021 – 2025.

Achievement Objectives Achieved in 2018 Achieved in 2017 Comments Action planned

Objective almost achieved

Cocoa beans: 100% certified

98% certified (organic/ Fairtrade: 30% Fairtrade: 40% Utz: 28%)

91% certified (organic/ Fairtrade: 91%)

The percentage of organic beans was exceptionally high (91%) in 2017 because none were sourced from Ghana (our Ghana beans are Fairtrade certified, not organic/Fairtrade).

We also pay the full Fairtrade premium for Utz-certified beans, and more than the Fairtrade minimum price.

Greatly increase the volume of cocoa purchased from the Dominican Republic (organic and Fairtrade certified) in future.

Beans from the new source country Madagascar will be both organic and Fairtrade certified.

Objective achieved

Cocoa butter 100% certified

100% certified (organic/ Fairtrade: 19% Fairtrade: 37% Utz: 44%)

100% certified (organic/ Fairtrade 15% Fairtrade: 37% Utz: 48%)

The traceability of cocoa butter is an industry-wide challenge. We are actively seeking to improve the situation (by participating in a working group of the Swiss Platform for Sustainable Cocoa for example).

Objective achieved

Agroforestry projects: one project in all 5 relevant cocoa-sourcing countries

100% 100% We are running agroforest-ry projects in Ecuador, Ghana, Honduras, Madagascar and Peru.

In Honduras and Peru we are additionally combining mixed-crop cultivation with carbon offsetting.

In Ghana, we will also combine mixed cultivation with CO2 offsetting in the future.

Agroforestry project in the Dominican Republic.

Evaluate agroforestry projects for Sunray products.

Objective achieved

Palm oil: 100% certified to international standards

100% RSPO segregated

100% RSPO segregated

We greatly reduced the quantity of palm oil we use over the reporting period.

Replace palm oil with alternative fats in as many formulas as possible.

Objective not yet achieved

Soya lecithin: 100% certified to international standards

0% 0% Switching over to lecithin compliant with the “Danube Soya Standard” requires extensive factory testing. Owing to relocation, this will not commence until 2019.

100% soya lecithin that meets the “Danube Soya Standard” by the end of 2020.

On track

Hazelnuts for chocolate production: 100% certified by 2020

76% (organic: 8% Utz: 68%)

16% (organic: 8% Utz: 8%)

Sharp rise from 7% (2016) to 76% (2018)

Increase the percentage of certified hazelnuts to at least 80% across all product groups by 2020.

https://www.kakaoplattform.ch/en/




Procurement

Raw materials

The procurement strategy of Chocolats Halba/Sunray focuses chiefly on critical raw materials, i.e. raw materials (and semi-finished products) that are associated with social and environmental risks during primary production and are vitally important for our business. Chocolats Halba/Sunray uses the list of critical raw materials of parent company Coop as the basis for defining these critical raw materials.

As well as the materials listed below, there are also some key raw materials for the Sunray range that are associated with risks. A detailed action plan will be defined for them in our 2021 – 2025 sustainability strategy.

COCOACocoa farming presents great challenges. Despite the rising demand for cocoa, many small-scale farmers lack a stable income. There are consequently social risks such as poverty, exploitative child labour practices and gender inequality. Cocoa farming is also linked to the loss of valuable primary forests. A further factor is that the labour-intensive work involved does not appeal to the younger generation. Along with the negative impact of climate change and less sustainable cultivation methods, this poses a threat to the long-term availability of cocoa. In view of these factors, we have adopted a strategy to safeguard supplies of high-quality cocoa comprising three components:

— Direct relationships — Fair trade (certifications) — Sustainability project

We keep our supply chain as short as possible and buy a significant proportion of cocoa beans directly from cooperatives. This cuts out intermediaries and ensures that farmers receive a higher share of the purchase price. We set up a separate subsidiary – Chocolats Halba Honduras – expressly for this purpose in Hon- duras. The political conditions in Ghana do not allow direct purchasing, but we are working very closely with our partner cooperative there.

Our procurement and sustainability experts are in constant contact with the cooperatives and visit them regularly. We support them by making interest-free upfront payments, contributing to certification costs and providing training. Long-term contracts and personal relationships help to create mutual trust and motivate our partners to adopt higher standards. Direct relationships also contribute to quality assurance: as we are able to get a detailed insight into the local farming and processing methods, we can provide tailored training and invest in the post-harvest infrastructure.

Where our cocoa comes from

1 Honduras

2 Ecuador

3 Peru

4 Ghana

5 Dominican Republic

Cocoa-growing regions

2

3

1 5

4

https://www.taten-statt-worte.ch/en/sustainability-topics/agriculture-and-processing/raw-materials.html

https://www.taten-statt-worte.ch/en/sustainability-topics/agriculture-and-processing/raw-materials.html


Procurement

Fair trade with cocoaSustainability labels (organic, Fairtrade and Utz) represent the second component of our cocoa procurement strategy. Minimum requirements are specified in relation to social and environmental aspects, with inde-pendent bodies verifying compliance. In recent years we have greatly increased the quantity of certified cocoa we purchase. We have almost reached our sustainability objective of a fully certified cocoa supply chain.

COCOA BEANSIn 2018 Chocolats Halba/Sunray bought a total of 7,995 tonnes of cocoa beans from partnered cooperatives (2017: 1,889 tonnes). Around two thirds were sourced from Ghana and a third from Ecuador, Peru, Honduras and, for the first time, also from the Dominican Republic. The reason for this considerable difference in purchasing volumes between the two years was that in 2017 we did not buy any beans from Ghana in order to reduce our inventory levels.

In 2018, 98% of the beans purchased had at least one sustainable production label. Only 2% of the cocoa beans were not certified (2017: 9%). These beans came from small cooperatives in Honduras. They produce only very small quantities so they have not yet sought expensive certification. Chocolats Halba/Sunray nonetheless pays these cooperatives prices far higher than the Fairtrade minimum. Our subsidiary Choco-lats Halba Honduras handles quality assurance and ensures adherence to Fairtrade standards.

In 2017 the proportion of Fairtrade-certified beans was 91% – one year later it was 70%. The reason for this decline was one customer’s wish to obtain some cocoa beans from Ghana with Utz rather than Fairtrade certification. Chocolats Halba/Sunray paid the cooperative in Ghana the full Fairtrade premium for the Utz beans too, as well as a purchase price higher than the Fairtrade minimum.

COCOA BUTTERAfter beans, cocoa butter is the second-most important ingredient in chocolate production. In 2018 Choco-lats Halba/Sunray bought a total of 3,179 tonnes of cocoa butter (2017: 3,167 tonnes). 100% of this butter purchased was certified with at least one sustainability label.

COCOA MASSAll the cocoa mass purchased in 2017 (268 tonnes) and 2018 (152 tonnes) was certified as Fairtrade or organic or both. The large drop in volume from 2017 to 2018 was due to the acquisition of a new super-effi-cient bean roaster, which enabled us to produce greater quantities of cocoa mass, ourselves.

Fight against illegal loggingThe clearance of intact forest ecosystems to create new agricultural land is one of the major challenges in the cocoa sector. Chocolats Halba/Sunray has a no deforestation policy: we do not buy cocoa that has been planted illegally in protected areas and we require our business partners to comply with this policy too. This no deforestation policy is underpinned by a multi-pronged cocoa-sourcing action plan that has been in place since 2011: we minimize the risk of acquiring illegally sourced cocoa by requiring certification and by working directly with cooperatives. We contribute to reforestation by carbon offsetting and dynamic agroforestry projects.

In 2017 we also joined the Cocoa & Forests Initiative (CFI), a partnership between the governments of Côte d’Ivoire and Ghana and 34 leading cocoa and chocolate producers. The initiative aims to halt deforestation resulting from cocoa planting in West Africa and help restore forest areas. Members are required to spell out the specific measures they will take in an action plan. Our action plan was published in 2019. The dynamic agroforestry project in Ghana forms a key part of this.


Procurement

PALM OILChocolats Halba/Sunray began the process of cutting palm oil out of its recipes many years ago. Today we use it only for a few confectionery products and in fillings for chocolate bars. In 2018 Chocolats Halba/Sunray purchased 138 tonnes of palm oil (2017: 211 tonnes). The oil we use meets the Roundtable on Sustainable Palm Oil (RSPO) guidelines and is traceable (segregated).

Worldwide demand for palm oil is growing. At the same time, palm plantations are not without their prob-lems. Monoculture oil palm plantations often displace valuable forest ecosystems, and working conditions there are sometimes inadequate. We are aiming to replace palm oil with alternative fats as far as possible by the end of 2020, and we are currently running comprehensive trials for this.

SOYA LECITHIN In 2018 Chocolats Halba/Sunray purchased 44 tonnes of soya lecithin (2017: 43 tonnes). This natural emulsifier improves the viscosity of the chocolate mass. While the demand for soya is growing, the in-creased acreage given over to its cultivation is creating environmental and social problems. Rainforests are being cut down, while the use of pesticides is endangering the health of field workers.

Soya lecithin is a byproduct of soybean oil refining. Although its purchase has no direct impact on the demand for soya and we use only very small quantities, we still consider it significant. We have therefore initiated the switchover to soya lecithin that meets the “Danube Soya Standard". This standard guarantees that soya is non-genetically engineered and comes from Europe (the Danube region), which prevents rainforest destruction and significantly cuts transport miles.

Owing to our plant relocation and the need for extensive production trials, the changeover to the “Danube Soya Standard” originally planned to take place in 2017/2018 has been delayed. It is now scheduled to be completed by the end of 2020.

HAZELNUTSIn 2018 Chocolats Halba/Sunray purchased 544 tonnes of hazelnuts from Turkey for chocolate production. It also bought a further 891 tonnes of hazelnuts for nut mixtures and as an ingredient for baking mixes. Of this, 115 tonnes were sourced from Italy and the remainder (776 tonnes) came from Turkey, too.

Since hazelnut growing in Turkey is linked to social risks, Chocolats Halba/Sunray focuses on certified partners. In the case of hazelnuts used for chocolate, the proportion of certified nuts (organic or Utz) rose from 7% to 76% over the last three years (2016 vs 2018). In the case of hazelnuts not used for chocolate production, the certified proportion rose from 14% to 43% (2016 vs 2018). We aim to increase the percentage of certified hazelnuts to at least 80% across all product groups by 2020.

DRIED FRUITChocolats Halba/Sunray buys in over 20 different types of dried fruit, with the largest purchasing volumes being for sultanas, figs, apricots, dates, mangoes and plums. In 2018, 28% of all dried fruit purchased was certified organic. 34% of dried fruit from the global south carried the Fairtrade label. 99% of mangoes purchased were Fairtrade certified.

Procurement objectives will be defined for dried fruit in our 2021 – 2025 sustainability strategy. Until then, we will follow the minimum requirements set out in the Coop sustainability strategy.

https://www.taten-statt-worte.ch/en/sustainability-topics/agriculture-and-processing/raw-materials/fruit-and-vegetables.html


Procurement

OTHER RAW MATERIALS

Pulses/seeds/kernels 95% of pulses, seeds and kernels purchased in 2018 were certified organic.

Over the past two years we have taken a number of steps to ensure sustainable sourcing. For instance, Chocolats Halba/Sunray is helping a farmers’ cooperative in Macedonia to produce organic borlotti and red kidney beans as well as sunflower seeds. A direct value chain with an organic producer located in the Armagnac region of France is in place for chickpeas, green lentils, red kidney beans, linseeds and hemp-seeds. This producer employs an agroforestry system where trees are grown among field crops.

NutsBesides hazelnuts, Chocolats Halba/Sunray’s range includes cashews, peanuts, walnuts, Brazil nuts, macadamia and pecan nuts. In the West African country of Benin, we are supporting a project to set up a local processing facility for cashew kernels and for organic certification according to Bio Suisse standards. Around 1,300 smallholder families are benefiting from this initiative.

Dried mushroomsThe dried mushrooms we purchase range from porcini, morels, horn of plenty, champignons and shiitake to wood ears and chanterelles. Around 50% are sourced from southeastern Europe, ensuring short transport distances. We will increase this share in future.

SugarChocolats Halba/Sunray purchased 41,000 tonnes of sugar in 2018, chiefly for Sunray’s sugar-trading business. 63% of the sugar came from Switzerland. The rest was cane sugar, 99% of which was Fairtrade certified. In 2018, 5% of all sugar purchased was organic.


Procurement

Certifications and standards

The majority of raw materials Chocolats Halba/Sunray requires come from the global south where labour conditions are often inferior to European standards and poverty is widespread. We have set ourselves the goal of contractually obliging all our suppliers to uphold human rights. Owing to the large number of suppliers, this had still not been completed by the end of 2018. In 2019 we will harmonize our General Purchasing Conditions and revise the requirements regarding human rights. At the same time, our quality management team will continue to carry out extensive audits of suppliers.

For critical raw materials in particular, we look to established certifications and standards. In today’s globalized economy, these are playing an increasingly important role. This is reflected in our sales figures for labelled products (organic, Fairtrade, Utz, carbon neutral): products bearing such labels accounted for 80% of chocolate product sales last year. In the other categories, labelled products took a 32% share of sales, also showing a rising trend.

OUR LABELSBelow is an overview of the standards and certification labels we use.

FairtradeThe Fairtrade standard (which is also known in Switzerland as “Max Havelaar”) guarantees acceptable social conditions for products originating from the global south. It also promotes good agricultural practices. The standard guarantees prod-uct-specific minimum prices and Fairtrade premiums that are paid to producer groups.

UtzThe Utz certification standard focuses on increasing productivity in order to improve the living standards of producers. Producers must also adhere to minimum environ-mental and social standards. The word “utz” comes from the Mayan language and means “good”.

OrganicOrganic labels denote the produce of organic farming. Among other things, they forbid the use of mineral fertilizers and synthetic pesticides. There is a wide variety of such certification marks. Organic products that we make for our parent company Coop carry the Bio Suisse bud label. This imposes strict requirements on producers and licensees.

RSPOThe Roundtable on Sustainable Palm Oil (RSPO) is an international organization that seeks to establish long-term practicable solutions for the environmentally and socially responsible cultivation of palm oil.

Amfori BSCIThe Business Social Compliance Initiative (BSCI) is an international business initiative that aims to safeguard decent working conditions (e.g. adequate remuneration, socially acceptable working hours) by means of a code of conduct.

https://www.bio-suisse.ch/en/thebudlabelstandsfor.php


Procurement

SA8000The SA8000 standard is the social accountability standard based on conventions of the International Labour Organization (ILO) and the United Nations. It seeks to improve the labour conditions of workers by laying down minimum requirements (e.g. no child or forced labour and no discrimination).

Suisse GarantieSuisse Garantie, the quality label of AMS Agro-Marketing Suisse, guarantees that food products are grown and processed in Switzerland or the Principality of Liechtenstein.

FSCThe Forest Stewardship Council (FSC) campaigns for sustainable forestry around the globe. This non-profit organization has developed standards for environmentally and socially responsible forestry.

Carbon Neutral ProductThis label, awarded by the French organization PUR Projet, guarantees that the emissions produced along the supply chain of a product are offset elsewhere. This process is clearly defined in an independent standard and is audited by independent certification organizations.


Procurement

Fairtrade premiums

Fairtrade is particularly important for Chocolats Halba/Sunray primarily in relation to cocoa. In 2018, 70% of all the cocoa beans we bought were Fairtrade certified (2017: 91%). Fairtrade producers benefit from minimum prices and Fairtrade premiums. In 2018 the Fairtrade premiums that Chocolats Halba/Sunray paid for cocoa products alone (beans, butter, mass, powder) amounted to CHF 2.7 million.

The members of the producer organizations democratically decide among themselves how to invest these premiums. Our cocoa partner cooperatives use the premiums to pay for various quality improvement measures, health programmes, infrastructure projects, education initiatives, social inclusion programmes and direct support for their members.

— For instance, ACOPAGRO in Peru is funding advice services for its members (focusing mainly on fermentation and drying cocoa beans).

— UNOCACE in Ecuador is investing money from premiums, for example, in building a new warehouse and in training young people (traineeships in administration, certification, consulting).

— In Honduras the various cooperatives spend some of the premiums on supporting schools and providing school materials.

— Kuapa Kokoo, our partner cooperative in Ghana, uses the premiums among other things to finance projects to empower women, such as a women’s rights group campaigning for gender equality for example.

—

Fairtrade premiums for cocoa

Cocoa beans (Dom. Republic, Ghana, Peru, Ecuador, Honduras)

Cocoa mass (Dom. Republic, Togo, Ghana)

Cocoa butter (Dom. Republic, West Africa)

Cocoa powder (West Africa)

TOTAL CHF

2012 830,730

2013 1,068,534

2014 864,890

2015 1,521,990

2016 1,479,120

2017 1,44,700

2018 2,669,080

In 2018 Chocolats Halba/Sunray paid CHF 2.7 million in Fairtrade

premiums to its cocoa partner cooperatives. Since 2012 we have

paid premiums of CHF 10.7 million for cocoa products. 2012 2013 2014 2015 2016 2017 2018

0

500000

1000000

1500000

CHF


Procurement

Projects

Along with direct relationships and certification, sustainability projects are the third component of our responsible procurement approach for raw materials. Chocolats Halba/Sunray supports projects that aim to reduce and eradicate poverty over the long term and where environmental and social inclusion elem- ents play an important role. In particular we are seeking to develop agroforest-ry, i.e. balanced intercropping instead of environmentally damaging monocul-tures. We are currently involved in agroforestry projects in all the cocoa- sourcing countries relevant to us – Ecuador, Honduras, Ghana, Madagascar and Peru, and also in the Dominican Republic from the end of 2019.

We specifically support women and young people in our cocoa projects in order to help counteract gender discrimination and depopulation and to encourage rural development. Our projects are based on the “train-the-trainer” principle: selected farmers receive intensive instruction in agroforestry methods over an extended period so they can then act as trainers themselves and pass on their acquired knowledge to other producers in their cooperatives. As a result, the methods spread quickly and the cooperatives build up a large store of expertise themselves.

The costs of developing and implementing these agroforestry projects – and also for other sustainability projects – are borne principally by Chocolats Halba/Sunray and the Coop Sustainability Fund. Public and private-sector partners also provide vital financial assistance and support personnel.

ECUADORProject costs for 2018: CHF 617,000Ecuador’s traditional “Nacional Arriba” fine-flavour cocoa is one of the most aromatic varieties in the world. In recent years, however, many farmers have turned their back on it and have chosen instead to invest in high-yield cocoa grown in a monoculture system. In collaboration with Coop, the Swisscontact foundation and our partner cooperative UNOCACE, we initiated the FINCA project in 2015. This project promotes the cultivation of Nacional Arriba beans using dynamic agroforestry (DAF) methods. We produce project chocolate exclusively for Coop from this organic and Fairtrade-certified premium cocoa.

Today 300 producers apply the agroforestry method on their plantations. To date they have converted 240 monoculture hectares to mixed-crop cultivation, planting some 230,000 cocoa trees, 32,000 fruit trees and 30,000 high-quality timber trees. As at the end of 2018, the project had 10 agroforestry trainers. Two of them are women, and half are under 35 years of age.

In 2018 FINCA won the Swiss Ethics Award presented by the Swiss Excellence Forum to honour companies for outstanding ethical achievement.

HONDURASProject costs for 2018 (including carbon offsetting): CHF 433,000In 1998 hurricane Mitch wrought enormous damage to Honduras. Floods and landslides destroyed planta-tions, washing away fertile soil, in some cases almost completely. In the years that followed, many cocoa producers switched over to rearing cattle and cleared valuable forests to create additional pasture land.

Together with Coop, the Swiss Agency for Development and Cooperation and Helvetas, in 2008 we launched a project to revive the cocoa sector and preserve the Criollo fine-flavour cocoa varieties. The project helped farmers to organize themselves and establish new plantations using agroforestry principles. To simplify trading relations and better support producers, in 2013 we founded our subsidiary Chocolats Halba Hondu-ras. Among other things, it organizes training courses on sustainable cocoa farming and quality improve-ment. Chocolats Halba Honduras is also leading a reforestation project, which we use to inset the carbon emissions from our manufacturing operations. Today, 1,348 cocoa farmers are benefiting from additional

https://www.youtube.com/watch?v=oDW3xcFrz0Y&feature=youtu.be

https://www.swiss-excellence-forum.ch/de/leistungen/business-ethics/swiss-ethics-award

https://www.youtube.com/watch?v=JyLSQjo_RpA&feature=youtu.be


Procurement

project income, and a further 700 are set to be added by 2021. We produce project chocolate exclusively for Coop from organic and Fairtrade-certified Criollo fine-flavour cocoa.

Trial plots for dynamic agroforestry will be established in 2019. With a mixed-crop system combining cocoa with various local fruits, vegetables and high-quality timber trees, we are laying the foundations for even more sustainable cocoa cultivation in Honduras.

MADAGASCARProject costs for 2018: CHF 155,000Around 90% of Madagascar’s original forests have already disappeared due to illegal logging and charcoal production. In addition, Malagasy farmers employ a slash-and-burn practice known as “tavy”. Forests are burned down in order to plant rice or other crops in monoculture systems. With this one-sided cultivation, even the lushest rainforests are transformed into dry savannah. As a result, many farmers encroach into protected areas such as the Masoala National Park.

At the end of 2018 we launched our Madagascar project in the Masoala region in conjunction with Coop, the US Foundation Wildlife Conservation Society, the Swiss development organization Helvetas and Zurich zoo. The project aims to promote the cultivation of fine-flavour cocoa varieties using dynamic agroforestry and to protect Madagascar’s forests. It also seeks to help smallholders establish a cocoa-processing facility and build a supply chain for selling their various products (vanilla, cloves, etc.). 15 farmer trainers are to be trained up by 2023 to support a total of 300 small-scale farmers. 200 to 400 hectares will be given over to dynamic agroforestry (DAF).

The quantities of cocoa produced in the Masoala region are still relatively small. In the interim we are buying organic and Fairtrade-certified fine-flavour cocoa from the Sambirano region in the north of the island to make project chocolate for Coop. We are also promoting sustainable cocoa cultivation using dynamic agroforestry there too.

GHANAProject costs for 2018: CHF 388,000Ghana’s cocoa sector is facing many challenges. In particular, the low income of farmers – a result of low productivity, poor access to markets and credit, and the insufficient integration of women – leads to problems. These include exploitative child labour practices, depopulation and the loss of valuable forest areas.

From 2016 to 2018 we ran a pilot dynamic agroforestry project in the south of Ghana, which was financed by the Coop Sustainability Fund. 16 cocoa producers were trained to become agroforestry trainers. We also created nurseries for quality timber and fruit trees. Covering a total area of four hectares, the agroforestry trainers’ plots served as study plantations when the Sankofa project commenced in 2019. The project envisages around 400 cocoa farmers cultivating at least one hectare using DAF methods by 2023. A further 2,500 farmers are to mix cocoa with other plants on their plots, which is an initial step towards dynamic agroforestry. Slash-and-burn practices is prohibited.

For the first time ever, DAF will be combined with carbon offsetting according to the internationally recog-nized “Gold Standard” in the Sankofa project. Not only will the trees planted within the agroforestry plots capture CO2, they will also provide shade for the cocoa plants and act as nutrient and water stores. By the end of the project, this reforestation will enable us to inset 75,000 tonnes of CO2 for our parent company Coop. The Sankofa project was created jointly with the Kuapa Kokoo cooperative, the International Trade Center, Max Havelaar, Fairtrade Africa and WWF. It receives financial assistance from the Swiss State Secretariat for Economic Affairs (SECO).


Procurement

MACEDONIAProject costs for 2018: CHF 20,000Chocolats Halba/Sunray source some of their certified organic borlotti and red kidney beans from China. To cut down on transport miles, in 2016 we began looking for new suppliers in Europe. We found Eko Ilinden in Macedonia, a farmers’ cooperative with 16 members who manage 120 hectares of land. 70 hectares are certified organic, making Eko Ilinden Macedonia’s organic pioneer.

Until now, Eko Ilinden has grown wheat, sunflower seeds, barley, oats, chickpeas and alfalfa. It began cultivating borlotti and red kidney beans as part of the project. We are supporting the cooperative with expertise and instruction provided by experts from the Research Institute of Organic Agriculture (FIBL). In addition, we are funding the salary of one employee. Since organic farming requires a high level of invest-ment in mechanical weed control and high-quality seeds, we also make direct payments and offer crop input finance. To further boost farmers’ income, additional crops for Chocolats Halba/Sunray are to be cultivated in the future.

Thanks to the project, Eko Ilinden was recently the first producer in Macedonia to achieve Bio Suisse certification. Besides Eko Ilinden, further cooperatives are also benefiting from this pilot project. For instance, field visits are regularly arranged for other farmers in the region. The project receives organiza-tional support from the Swisscontact foundation as part of the IME (Increasing Market Employability) programme promoted by the Swiss Agency for Development and Cooperation.

BENINA large proportion of cashew nuts destined for the world market are grown in West Africa, but are then shipped to Vietnam for processing. This added value is consequently lost to West Africa. The long transport distances are also bad for the environment. In recent years we have therefore been gradually reducing the quantity of cashew nuts we import from Asia. Today we only ever need to import cashews from Asia in exceptional circumstances.

Playing a key role in this supply chain transformation is our project in Benin that was established in 2017 in collaboration with the Gebana company and with financial support from the Coop Sustainability Fund. 1,300 smallholder families were helped to set up a processing infrastructure and certify their cashews in accord-ance with Bio Suisse guidelines. In the course of this project, we carried out over 4,000 training sessions.

With this newly established supply chain, the farmers benefit from guaranteed minimum prices, greater purchase quantities, and also from increased crop yields thanks to the knowledge gained from training. The cashew nuts from the project are available from Coop. There were no project costs in 2018 as all invest-ments had already been made in 2017.

PRODUCTION

Production 29

Management approach and multi-year

objectives 30

Energy 32

Packaging 34

Waste and recycling 35

Safety 35

Employees 36


Production


Manufacturing, production and employees form the second of our sustainability strategy’s three pillars. The key challenges here are: • The resource-efficient use of energy and consumables • Carbon-neutral production • Attractive working conditions for our employees

To continue manufacturing high-quality products in the future, we need capable, motivated staff and high-performance production facilities that meet safety standards and have as little impact on the climate as possible.


Production

OBJECTIVES ACHIEVED IN 2017/2018As described in the section on sustainability, the Sunray business unit is fully integrated into the “Manufacturing and Production” pillar. The objectives and actions defined here therefore apply to the Group as a whole.

Achievement Objectives Achieved in 2018 Achieved in 2017 Comments Action

Objective exceeded

To use mainly renewable energy at the new site

84% of energy used is renewable (hydroelectric, wood-chip plant, heat recovery and solar panels)

77% of energy used is renewable (hydroelectric, wood-chip plant, heat recovery, solar panels)

In 2018, we produced 19% of the renewable energy at the Pratteln site ourselves.

Oil-fired cooling systems ceased operation in May 2018

Objective not yet achieved

To reduce relative CO2 emissions from chocolate production to less than 190 g CO2e /kg (2016 benchmark)

254 CO2e/kg 311 g CO2e/kg Additional emissions due to parallel production at three (2017) and two (2018) sites Oil-fired cooling systems used during the relocation period

Decommission oil-fired cooling systems and reduce air shipments

Objective achieved

To document and actively communicate energy consumption and energy recovery

Energy consumption: 32 gigawatt hours (GWh)

Heat recovery: 53%

38 gigawatt hours (GWh)

All heat recovery meters were installed in 2018.

Define quantitative objectives once the relocation is complete, and perform baseline measurements at the new location

Objective achieved

To offset all operational CO2 emissions plus those from products labelled carbon-neu-tral within our own value chain

5,311 tCO2e of operational emissions offset in Honduras 3,569 tCO2e of emissions from carbon-neutral products offset in Peru

5,595 tCO2e of operational emissions offset in Honduras 2,536 tCO2e of emissions from carbon-neutral products offset in Peru

The offsetting trees are growing in and around cocoa plots, benefiting the soil and the cocoa plants.


At least 35% of managers are women

33% 39% Since October 2018, there has been one woman in top management – Head of Quality Management and Sustainability Simone Zollinger.

Objective achieved

To ensure equal pay According to analysis, equal pay ensured for the same job and the same age

Wage analysis conducted every two years

All employees earn more than the minimum wage agreed by Coop.

Check monitoring tool together with Coop

Objective not achieved

Annual exchange between employees and raw-material producers on an employee trip

Yes No The trip did not take place in 2017 due to the relocation. Nine employees travelled to Peru in 2018. Employees from Sustaina-bility, Purchasing and Quality Management travel regularly to cocoa-growing countries.

The next employee trip will be to our cocoa project in Ecuador in January 2020


To be an attractive employer, scoring at least 70/100 in the employee survey

Employee survey held every three years

69 points At 43%, the response rate in 2017 was rather low since the survey occurred during the relocation period and participation was voluntary.

Objective achieved

To provide develop-ment opportunities, scoring at least 70/100 in the employee survey

Employee survey held every three years

78 points At 43%, the response rate in 2017 was rather low since the survey occurred during the relocation period and participation was voluntary.


Production

Energy

We need a lot of energy to produce our high-quality foodstuffs. Chocolate manu-facturing, with its multitude of processes, requires a particularly large amount of heat. To protect the climate, we are steadily reducing emissions of green-house gases and compensate the remaining emissions with reforestation pro-jects within our own value chain (insetting). As a result, manufacturing opera-tions at Chocolats Halba/Sunray have been completely carbon-neutral since 2017 (and since 2011 at Chocolats Halba).

NEW LOCATIONIn 2014 the laying of the foundation stone in Pratteln was the first step in building Coop’s largest and most modern production site. After three years of construction work, the site was officially opened in October 2017. Chocolats Halba/Sunray share the site with the country’s largest wine-bottling company Cave, Switzerland’s most modern private quality laboratory and a state-of-the-art distribution centre.

The Pratteln Production and Quality Centre features an advanced energy management system, which measures consumption using over 1,600 data points. Wood-pellet heating and the use of waste heat eliminate the indirect greenhouse gas emissions of district heating. On sunny summer days, the 8,000 square-metre solar plant runs the entire high-bay warehouse and the logistics facility. Moreover, the Pratteln site is linked to the rail and river networks, enabling the CO2 emissions from road transport to be reduced.

ENERGY CONSUMPTIONIn 2018, when we were producing chocolate in parallel at two locations (Pratteln and Wallisellen), our energy consumption was 21 gigawatt hours (GWh). Our consumption of thermal energy was 11 GWh. 84% of the energy (electricity and heat) came from renewable sources (hydroelectric, wood-chip plant, heat recovery and solar panels). Most of the rest came from the oil-powered cooling systems that we had to use during the relocation period. We produced 19% of the renewable energy ourselves on site (wood-chip plant, heat recovery and solar panels). 83% of the heat came from the wood-chip plant and 17% came from recovering heat from cooling systems, ventilation systems and generating compressed air. The wood for the wood-chip heating came from within a 50-kilometre radius of Pratteln.

Since the relocation work finished, our objective has been clear: to use 100% renewable energy at the new site. In future, natural gas will only be needed to cover seasonal peak periods and during maintenance checks on the biogas plant and peanut-roasting plant. Following the relocation, we also made significant progress in terms of coolant losses, and are now exclusively using efficient coolant technologies with significantly less global warming potential. For example, we have reduced the CO2 emissions resulting from coolant used in the chocolate-manufacturing process from 123 tonnes to 8 tonnes (2015 vs. 2018).

Because of export growth, the CO2 emissions generated by our product deliveries rose from 1,017 tonnes to 1,483 tonnes (2017 vs. 2018). Due to production bottlenecks during the relocation, we had to use occasional air shipments.


Production

CARBON NEUTRALITYWe apply the principle of avoid – reduce – offset.

— Avoiding means choosing processes that do not release any CO2. For example, we obtain electricity exclusively from renewable sources.

— Reducing means designing and modifying processes so that they release less CO2, for example by means of energy efficiency measures.

— We compensate for unavoidable emissions by taking carbon-offsetting measures within our own value chain.

Based on this three-pronged approach, Chocolats Halba’s production has been completely carbon-neutral since 2011, as has that of Sunray since 2017. We have the calculations for the CO2 footprint of our business activities independently audited by the myclimate foundation every year.

CO2 footprint in tonnes

Energy

Commuter traffic

Business transactions

Deliveries

Corporate waste

In 2017 we produced chocolate at three, in

2018 at two locations at the same time. This

increased CO2 emissions significantly. For

Sunray, the CO2 footprint was not calculated

before the merger.

5000

4000

3000

2000

1000

0

2012 2013 2014 2015 2016 2017¹ 2018²

CHOCOLATS HALBA SUNRAY

2017 2018

2,50

6

2,38

0

2,43

8 2,69

3

2,59

2

4,50

4

4,18

6

1,09

0

1,12

5tonnes

CLIMATE PROTECTION PROJECTSWe offset our operational CO2 emissions and the emissions of products labelled “Carbon Neutral Product” within our own value chain with reforestation projects in Honduras and Peru. To offset the equivalent of one tonne of CO2, we need to plant four trees. Since 2011 we have planted 389,145 trees – or around 133 per day. Each tree can be located thanks to GPS tracking.

At the beginning of 2019 we launched a new reforestation project in Ghana, where cocoa cultivation in dynamic agroforestry is being combined for the first time worldwide with Gold Standard carbon offsetting. Gold Standard is the most stringent standard for climate protection projects. Within this project, our parent company Coop will offset 75,000 tonnes of CO2 from business flights, air freight and home deliveries over the next five years.

https://www.myclimate.org/


Production

Reforestation project in HondurasTo offset our operational CO2 emissions, we are running a reforestation project in the buffer zone of the Patuca National Park together with our partner cooperative APROSACAO and the French company PUR Projet. We have planted 238,849 trees there since 2011.

The farmers plant the offsetting trees within their cocoa plots, where they provide shade and act as water reservoirs, thereby boosting cocoa productivity. The farmers benefit from higher yields and additional income for planting and caring for the trees. In addition, the trees act as an old-age pension – after 25 years or so, they can be felled and sold. Regular training within this FSC-certified project ensures that the forest is managed sustainably. It is certified in accordance with the Gold Standard.

Reforestation project in PeruGreenhouse gas emissions are caused not only by our manufacturing processes, but also by the production of raw materials, by deliveries or by end consumers. Our customers have the option of getting their choco-late labelled as carbon-neutral. To do this, we calculate the complete carbon footprint of the chocolate with the support of the myclimate foundation, based on figures from our sustainability-monitoring programme and external data (the life cycle assessment of cocoa farming or milk production). We offset the emissions within our own value chain in Peru. Together with the partner cooperative ACOPAGRO and the French company PUR Projet, we are carrying out a reforestation project in the north of Peru (San Martín). Within the project, we have planted 65,191 trees since 2011.

As in Honduras, the Peruvian ACOPAGRO cocoa farmers plant most of the offsetting trees in and around their cocoa plots, where they act as an additional source of income. The cooperative has been FSC certified since the end of 2018. The project is certified in accordance with the Verified Carbon Standard (VCS).

Packaging

In 2018 we purchased 4,469 tonnes of packaging material (2017: 4,106), of which 35% (2017: 28%) was made from recycled materials (paper and cardboard). Scientific studies show that packaging accounts for just 5 to 10 per cent of a chocolate bar’s environmental footprint. Despite this fact, we got together with an environmental consultancy firm in 2011 to examine all of Chocolats Halba’s packaging material using the Federal Office for the Environment’s “environmen-tal impact points” method. Since then, we have been gradually implementing the findings. We are constantly working to environmentally optimize packaging and evaluate innovative materials, particularly packaging solutions based on renew-able raw materials.

Since 2012, we have exclusively used material from FSC-certified timber for chocolate bar wrappers and cardboard packaging. Sunray’s paper and cardboard packaging is also fully FSC certified. More difficult is the search for environmentally appropriate alternatives to aluminium foil. This foil has traditionally been used for wrapping chocolate because it has outstanding protective properties and is easy to shape and reseal. However, aluminium has a large environmental footprint.

As a B2B company, we only have a limited influence on product packaging – the final decision is made by our customers. When talking to customers, we always suggest oriented polypropylene (OPP) film as an alterna-tive to aluminium. OPP film is considered to be one of the most environmentally friendly plastics. We are currently running tests to reduce the strength of this film to a minimum. Depending on the product in question, this will result in material savings of up to 25%.


Production

Waste and recycling

Our sustainability strategy includes the correct handling of waste. Our aims are to prevent waste and increase our recycling rate. In 2018 and 2017, we sent 70% of our waste to be recycled (organic waste, plastic, paper, electrical appliances, scrap metal, waste oil and waste wood). The largest category – organic waste – is used as animal feed or compost, or goes to produce biogas. In 2018, 1,510 tonnes of waste was generated by Chocolats Halba/Sunray (excluding the Wal-lisellen and Hinwil sites). However, these recycling figures are merely indicative, since not all waste-related data was collected during relocation activities. Since the end of 2018, we have been constructing a central waste management system that systematically captures data.

FOODWASTEAround one third of all food worldwide is thrown away. We are doing everything we can to keep our waste levels as low as possible. In the case of surplus goods about to pass their best before date, we have devel-oped a multistage system:

— We try to sell these products to customers at reduced prices. — If this does not work, we donate packaged food to charitable organizations such as Caritas and Tischlein deck dich.

— Unpackaged food is sent to Basel Zoo and local farms to be used as animal feed. — We sell any excess chocolate at reduced prices directly in our two factory shops, the “Schoggihüsli” in Pratteln and Hinwil.

SAFETY

We have a modern factory that is certified in accordance with the internationally recognized IFS standard for food safety and the quality of processes and prod-ucts. Our chocolate production is also FSSC certified – a standard for ensuring food safety. All equipment meets legal and industry safety standards. All work-stations, in both offices and in production areas, are ergonomically designed and incorporate the necessary hygiene, safety and emergency precautions. Our food production does not pose any particular accident risks for employees, but mov-ing machinery components and hot installations are nevertheless well secured. We do not use any materials that are hazardous to health.

The accident rate indicates how many full-time-equivalent working days are lost because of accidents. At 1.3%, our rate is slightly higher than the average for the Coop Group as a whole (0.8%), as most of the Group’s employees work in the retail sector. The most frequent causes of accidents are trips and falls. Our sickness rate is 3.4%, which is less than the Coop Group average (4.2%). This rate indicates the number of working days on which employees were unable to attend work due to sickness.

In common with the entire Coop Group, we undertake to restrict the processing of personal data to an operational minimum and treat employee data in confidence.


Production

Employees

In 2018, 358 employees enjoyed progressive working conditions at Chocolats Halba/Sunray (2017: 427 employees). The decline in numbers is because Choco-lats Halba in particular increased staffing levels during the relocation period between 2015 and 2017 in order to ensure a transfer of expertise and safeguard production across three sites. After the factories at Wallisellen and Hinwil were closed, some employees moved to other companies or took early retirement.

RELOCATION AND MERGER

2018 saw the successful completion of two major transformational projects – a relocation and a merger – that called for a huge amount of commitment and flexibility from employees.

Relocation to Pratteln Production and Quality CentreIn 2012, the Coop Group decided to focus Chocolats Halba’s production on a single site and to transfer the production facilities at Wallisellen and Hinwil (canton of Zurich) to Pratteln (canton of Basel-Landschaft). This would optimize manufacturing processes and exploit synergies with other production companies.

Employees were informed of the relocation well in advance, and were closely supported throughout the changes. A few examples: from 2015 onwards, a change manager held one-to-one meetings with all employees to find tailor-made solutions for them. They were all offered an equivalent post at the new production location or at the Coop site at Schafisheim (canton of Aargau). Long-standing employees moving to Pratteln received a contribution towards their personal removal costs. Team members who had to start commuting to work were financially supported for two years. After 2012, we provided regular information on job vacancies within the Coop Group, with our employees qualifying for a streamlined application process. Employees aged 58 years and over with at least five years’ service at Chocolats Halba were offered a bridging pension for a maximum of two years.

Around half of our employees (48.6%) relocated to Pratteln, a good 100 kilometres away. There were only 17 resignations (5.7%) as a result of the change. These employees chose not to accept the offer of a contract on the same conditions. They all received support from HR during their search for new external jobs.

The relocation of Sunray’s production facilities within the municipality of Pratteln to the new Production and Quality Centre in 2017 did not result in any personnel changes.

Merger of Chocolats Halba and SunrayIn parallel to the site relocation, the Coop Group decided to merge the two divisions Chocolats Halba and Sunray in September 2017. This merger was marked by various activities such as an employee party, training events, workshops and the first joint employee trip. We also organized inaugural events for custom-ers and partners, as well as for residents and local people.

PERSONNEL STRUCTUREAt the end of 2018 we had 358 employees from 24 countries (2017: 427), of whom 349 were permanently employed and nine were employed on fixed-term contracts. 33 employees, or 9%, were working part-time (maximum 80%). 32% of the team were women (115 employees). 33% of management were women. Since October 2018, there has also been one woman in divisional management – Head of Quality Management and Sustainability Simone Zollinger. A second woman is joining her in top management in autumn 2019 – Réka Szalay, our new Head of Marketing and Sales.


Production

Prior to the relocation, we employed a number of trainees. Due to the move, no trainees were taken on in 2017/2018, but we did take part in the Coop Group’s internal training programme and employed two com-mercial trainees on a rotational basis. Our aim is to take on some trainees again from summer 2020 (machine operators and food technologists).

Proportion of women 2017/2018

Proportion of men

Proportion of women

1 Employees

2 Employees (collective employment agreement)

3 Management

The reason for the decrease in the proportion of women in

2018 compared to 2017 is the relocation of Chocolats Halba

to Pratteln, which many women were unable to join.

80%

60%

40%

20%

0

2017 2018

1 2 3 1 2 3

61%

39%

61%

39%

61%

39%

68%

32%

31% 33

%

69%

67%

EQUAL OPPORTUNITIESWe promote equal opportunities. As stated in the Coop Cooperative’s collective employment agreement, any violation of dignity through behaviour, acts, speech or images must be combated. Discrimination because of gender, sexual orientation, nationality, religion or age is not permitted.

Equal pay is another important objective, and for this reason, we analysed salaries in detail in 2018. The results showed that equal pay is ensured. Moreover, all employees earn more than the agreed minimum wage (as per the Coop collective employment agreement).

WORKING CONDITIONSOur employees are subject not to the collective employment agreement for the Swiss chocolate industry, but the Coop collective employment agreement, which guarantees above-average working conditions. A couple of key figures:

— The working week averages 41 hours. — All employees enjoy at least five weeks of holiday each year. Trainees and people aged 50 or over are entitled to six weeks’ vacation. Employees over the age of 60 enjoy seven weeks, employees over 63 eight weeks of holiday.

The Coop “Veritas” employee survey was conducted in June 2017. Since the survey took place in the middle of the relocation period and was voluntary, the response rate of 43% was rather low. Employees rated their working conditions at an average of 77 points out of 100, with Chocolats Halba scoring 81 points and Sunray 73 points. Despite the high workload during the relocation, employer attractiveness was rated at 69 points out of 100.


Production

Remuneration and benefitsThe Coop collective employment agreement ensures a high degree of pay transparency and fair wages for all. Pay is defined in line with workplace requirements and responsibilities, professional experience, individual performance and labour market conditions. In Switzerland, the reference wage for someone with three years’ basic training is CHF 4,100 gross (guideline value for a 20-year-old person who is fully able to work). The minimum monthly wage for semi-skilled employees is CHF 3,900 gross. All employees are entitled to a 13th month’s salary. In addition, they enjoy numerous benefits and discounts when they buy goods or services from other Coop Group companies.

Social welfareAll employees have a pension plan managed by the government’s AHV pension insurance scheme, and also have occupational pension cover with the Coop’s CPV/CAP pension fund. The company pays two-thirds of the contributions. This means it is contributing significantly more than the legal requirement (50%). Employees covered by the CPV/CAP pension fund also have the option of early retirement, and those with at least five years’ service can enjoy a bridging pension.

When it comes to maternity benefits, we also exceed legal requirements: from their third year of employ-ment, employees receive 16 weeks’ maternity leave on full pay. Fathers are entitled to 15 days’ paid paternity leave on the birth of their child.

Employee trip to the sourcing countriesChocolats Halba/Sunray attaches great importance to its employees identifying with the business and its values. For this reason, we regularly send employees from all parts of the company to a cocoa-growing country, where they can directly experience how we work with small-scale farmers and cooperatives and what the purpose of our commitment is. There was no employee trip in 2017 due to the relocation. In May 2018, nine representatives from Chocolats Halba/Sunray travelled to Peru. Since 2011, a total of 47 employ-ees have visited our partners in Honduras, Peru, Ecuador and Ghana. They all returned as ambassadors of sustainability.

DEVELOPMENT AND TRAININGThe Coop Cooperative offers a programme of 350 development and training opportunities for various career levels and specialist subjects. We also support employees in their professional activities with internal and external development and training courses. In 2018, Chocolats Halba/Sunray employees spent an average of 1.5 working days on training courses, with managers receiving 2.4 days of training.

SALES

Sales 39

Management approach and multi-year

objectives 40

Quality 41

Product safety 41

Labels 41

Customer satisfaction 42


Sales


Selling sustainable products is one of the three strategic pillars of our sustaina-bility strategy. The key challenges here are:• Product safety and sustained high quality• A high level of customer satisfaction and retention • Increasing the sales of products with sustainability labels

We offer our wholesale and industrial customers high-quality products based on innovative formulations. We also guarantee Swiss quality, outstanding service and sustainable procurement and production.

Our customer promise is reaping dividends: in 2018 Chocolats Halba/Sunray sold 16,500 tonnes of chocolate products and 46,000 tonnes of other food (excluding sugar trading). We have more than doubled our sales of labelled products since 2014.

OBJECTIVES ACHIEVED IN 2017/2018Sunray is fully integrated into the "Sales" pillar. The objectives and actions defined in the sustainability strategy therefore apply to Sunray as well as to Chocolats Halba.

Achievement Objectives Achieved in 2018 Achieved in 2017 Comments Action

Objective exceeded

Share of labelled products in total sales: Chocolats Halba: >75% Sunray: >30%

Chocolats Halba: 80% Sunray: 34%

Chocolats Halba: 79% Sunray: 32%

Objective exceeded

To increase sales of carbon-neutral chocolate products by 30% between 2015 and 2020

+35% CHF 21,045,659 +19% CHF 18,61,429 2015 sales: CHF 15,536,114

Objective achieved

A key sustainability customer will visit our cocoa projects each year

Coop visited the FINCA project in Ecuador.

Alter Eco USA visited the FINCA project in Ecuador

Customer opportunities for project partnerships will be further formalized and promoted.

Objective achieved

To secure commit-ment for a sustaina-ble cocoa sector in at least two relevant industry organiza-tions

Membership of the Swiss Platform for Sustainable Cocoa and the World Cocoa Foundation

We are also co-leader of the climate resilience and biodiversity working group in the Swiss Platform for Sustainable Cocoa.

Objective exceeded

85% of customers feel valued and treated professional-ly by us (according to a survey)

89% Customer survey held every two years

Due to the relocation and merger, the survey was postponed until the beginning of 2019.


Sales

Quality

Knowing where raw materials come from is a basic prerequisite for the high quality of our products. We select producers and producer groups carefully and establish long-term partnership-based collaboration with them. We also support partners in many production countries via farming and processing initiatives. In this way, we are able to influence quality right at the start of our supply chain.

Manufacturing and selling high-quality foodstuffs calls for much experience and expertise at all levels. For this reason, we specifically invest in regular development and training for our staff, thereby enabling us to guarantee high-quality custom-made products for our customers.

Product safety

To make sure our products are safe, we have defined rules and requirements as part of our quality management system that exceed the minimum legal require-ments. Guidelines, processes, and the expertise we require from our employees are all precisely defined – from procurement through to sales. All staff receive annual training in product safety, quality management, occupational health and safety, and sustainability. In addition to our general quality management require-ments, our quality labels and certifications impose strict conditions on us.

Internal and external audits ensure that we meet our high-quality requirements and continually improve our performance. Chocolats Halba/Sunray is IFS certified, and its chocolate production is additionally FSSC certified. Our quality controls include structured goods receipt inspections, online checks during the manufacturing process, and goods dispatch checks. Additional measures for process control and logging are implemented and are continually being improved.

Labels

We make use of a wide range of high-profile sustainability labels such as Fairtrade, Utz, organic and Carbon Neutral Product. Over the last four years, we have more than doubled our sales of products bearing at least one such label – to CHF 160 million. In 2018 labelled products accounted for 56% of all our sales (Halba: 80%; Sunray: 34%).

We give our customers the option of labelling their chocolate as a carbon-neutral product. The basis upon which a product is deemed to be carbon-neutral is its carbon footprint. This is calculated by Chocolats Halba/Sunray and then offset in a reforestation project in Peru within our own cocoa value chain. Since 2015, we have increased our sales of carbon-neutral products by 35% to CHF 21 million (2018).


Sales

As well as sustainability certification, we also offer certification in accordance with kosher and vegan standards. In the Jewish faith there are traditional rules regarding the preparation and consumption of food. Food and drink that is permitted for consumption is called “kosher” in Yiddish. We make use of two kosher labels with different certification criteria – Badatz and OU Koscher.

Products that are particularly suitable for vegetarian/vegan diets bear the European Vegetarianism logo (V label). We also prepare gluten-free products in accordance with the requirements of the Swiss “aha!” allergy label.

Sales of sustainability-labelled products

Sunray

Chocolats Halba

In 2018 Chocolats Halba/Sunray achieved

sales of CHF 160 million with products bearing

sustainability labels. CHF 108 million was

attributable to chocolate products and CHF 52

million to products from the Sunray range.

150

100

50

0

2012 2013 2014 2015 2016 2017 2018

23.9

18.3

36.2

23.2

55.6

27.4

66.4

28.4

88.3

34.4

103.

2

49.6

108.

3

51.8

CHF million

Customer satisfaction

We witness our customers’ satisfaction not just in face-to-face interviews – we also record it systematically. 50 customers took part in our survey at the beginning of 2019. The general customer satisfaction level was 80%. 89% of customers said they felt valued and had been treated professionally by Chocolats Halba/Sunray. A full 90% perceive us to be a company of integrity. The basis for this excellent result is the constant high quality of our products. Equally important are the strong services that we offer our customers: innovation, sustainability and customer service.

Given the strength of the Swiss franc, it requires extraordinary customer focus to hold your own and even grow in a competitive export market. To this end, we put our promise of Swiss quality to the test day in, day out, and keep in constant touch with our partners. As with our suppliers, we also want to maintain long-term stable relationships with our customers. Alongside support with communication materials, we also offer them the chance to accompany us on trips to cocoa-growing countries. They get to know the raw materials and people behind their products, and are able to satisfy themselves of the high quality on the spot.

SDG INDEX AND KEY FIGURES

SDG index and key figures 43

SDG index 44

Procurement 45

Production 46

Employees 47

Sales 48


SDG index and key figures

SDG index

Achievement level Multi-year objective 1 N

o po

vert

y

2 Ze

ro h

unge

r, s

usta

inab

le

farm

ing

4 Q

ualit

y ed

ucat

ion

5 G

ende

r eq

ualit

y

8 D

ecen

t wor

k,

econ

omic

gro

wth

9 In

dust

ry, i

nnov

atio

n an

d in

fras

truc

ture

10 R

educ

ed in

equa

litie

s

12 R

espo

nsib

le c

onsu

mpt

ion

an

d pr

oduc

tion

13 C

limat

e ac

tion

15 L

ife

on la

nd

17 P

artn

ersh

ips

PROCUREMENT

Objective almost achieved Cocoa beans: 100% certified ● ● ● ● ● ● ● ● ●

Objective achieved Cocoa butter: 100% certified ● ● ● ● ● ● ● ●

Objective achieved

Agroforestry projects: a project in all five relevant cocoa-growing countries ● ● ● ● ● ● ● ● ● ●

Objective achieved

Palm oil: 100% certified in accordance with international standards ● ● ● ●


Soya lecithin: 100% certified in accordance with international standards

● ● ●

On course

Hazelnuts for chocolate production: 100% certified in accordance with international standards

● ● ● ● ●

PRODUCTION

Objective achieved

Use mainly renewable energy at the new Pratteln site ● ● ● ●


Reduce relative CO2 emissions from chocolate production to less than 190 g CO2/kg (2016)

● ● ● ●

Objective achieved

Document and actively communicate energy consumption and energy recovery

● ● ● ●

Objective achieved

Offset all operational CO2 emissions plus those from products labelled carbon-neutral within our own value chain

● ● ● ● ● ●

Objective almost achieved At least 35% of managers are women ●

Objective achieved Ensure equal pay ●


Annual employee trips to raw-mater-ial producers ●


Attractive employer, scoring at least 70/100 in the employee survey ● ●

Objective achieved

Provide development opportunities, scoring at least 70/100 in the employee survey

● ●

SALES

Objective exceeded

Share of labelled products in total sales: Chocolats Halba: >75%; Sunray: >30%

● ● ● ● ● ● ● ● ●

Objective exceeded

Increase sales of carbon-neutral chocolate products by 30% between 2015 and 2020

● ● ● ●

Objective achieved

A key sustainability customer will visit our cocoa projects each year. ● ●

Objective achieved

Secure commitment for a sustainable cocoa sector in at least two relevant industry organizations

● ● ● ● ● ● ●

Objective exceeded

85% of customers feel valued and treated professionally by us

● High impact ● Relevant impact ● Slight impact



Procurement

Raw materials 20141 20151 20161 2017 2018

Total raw materials in tonnes 12,044 15,100 13,014 83,8072 83,0132

Cocoa beans in tonnes 1,537 3,738 2,197 1,889 7,995

Percentage of cocoa beans certified as Fairtrade and/or organic 97% 98% 94% 91% 73%

Percentage of cocoa beans that are Utz certified 0% 0% 0% 0% 25%

Fairtrade premiums paid for cocoa beans in USD (in accordance with FLO standard) 355,200 729,200 413,400 332,800 1,562,400

Cocoa butter in tonnes 2,425 2,045 2,487 3,167 3,179

Percentage of cocoa butter certified as Fairtrade and/or organic 38% 59% 77% 52% 56%

Percentage of cocoa butter that is Utz certified 17% 27% 21% 48% 44%

Fairtrade premiums paid for cocoa butter in USD (in accordance with FLO standard) 484,950 742,530 1,017,070 920,080 978,910

Dried fruit in tonnes 4,100 3,785

Percentage of dried fruit certified as organic 31% 28%

Percentage of dried fruit from the Global South that is Fairtrade certified 38% 34%

Pulses/seeds/kernels in tonnes 1,181 1,575

Percentage of pulses/seeds/kernels certified as organic 87% 95%

Nuts in tonnes 5,759 6,379

Percentage of nuts certified as organic 15% 20%

Percentage of nuts from the Global South that are Fairtrade certified 12% 15%

Percentage of hazelnuts that are Utz- certified 25% 40%

Sugar in tonnes 44,1752 40,6992

Percentage of sugar certified as organic 5% 5%

Percentage of sugar from the Global South that is Fairtrade certified 99% 99%

1 Chocolats Halba only 2 Of which sugar trading 2017: 20,766,069; and 2018: 20,917,450

Packaging materials 2017 2018

Total packaging material in tonnes 4,106 4,469

Recycled packaging material 1,143 1,583

Renewable packaging material 2,482 (60%) 2,614 (58%)

– of which cardboard 396 449

– of which corrugated cardboard (recycled) 1,668 1,722

– of which paper 372 390

– of which compostable film 46 53

Non-renewable packaging material 1,624 (40%) 1,855 (42%)

– of which OPP film 256 278

– of which dimensionally stable plastic 402 567

– of which aluminium 151 151

– of which glass 816 859

Operating supplies 284 307



Production

Corporate environmental protection1 2017 2018

Total energy consumption in gigajoules 135,177 140,471

Electricity consumption 95,672 93,879

– Electricity, renewable energy (hydroelectric, solar power) 95,672 93,879

Energy consumption for heating purposes 39,505 46,592

– Heating, renewable energy (wood-chip plant, heat recovery) 8,790 24,663

– Heating, non-renewable (heating oil, gas, district heating) 30,714 21,929

Percentage of renewable energy consumed 77% 84%

– Percentage of renewable energy produced on site Not recorded 19%

Total waste in tonnes 1,082.0 1,510.4

– Industrial waste (incinerated waste) 322.0 444.9

– Recycled waste 760.0 1,060.3

– Special waste (oil/paint) 0.5 5.2

– Waste recycling rate 70% 70%

Water consumption in cubic metres (m3) 46,173 36,475

Greenhouse gas emissions in tonnes of CO2e2

– Total greenhouse gas emissions 5,595 5,311

– Heating and cooling 2,422 1,865

– Electricity purchased 462 453

– Deliveries 1,017 1,483

– Transport using own vehicles 47 50

– Commuter travel 1,108 925

– Business travel 220 261

– Construction and auxiliary materials 28 22

– Waste 291 252

Direct greenhouse gas emissions (equates to GHG Protocol scope 1) 1,971 1,473

Indirect greenhouse gas emissions (equates to GHG Protocol scope 2) 16 11

Other indirect greenhouse gas emissions (equates to GHG Protocol scope 3) 3,608 3,827

Greenhouse gas emissions per kg of chocolate in grammes of CO2 311.13 253.73

1 In previous years, data on energy, waste and greenhouse gas emissions was only collected for Chocolats Halba. The current figures are for the new Chocolats Halba/Sunray company. Comparisons with previous years are therefore meaningless.

2 CO2e = CO2 equivalent: In order to compare different greenhouse gases, their impact on the climate is specified as a CO2 equivalent.3 Parallel production at three sites (2017) and two sites (2018). The figures for previous years were 208.4 (2015) and 189.6 (2016) grammes of CO2.



Employees

2017 1 2018 1

Total men (per cent) 261 (61%) 244 (68%)

Total women (per cent) 166 (39%) 114 (32%)

Total workforce 427 358

Type of employment contract

Permanent men: absolute (per cent) 248 (58%) 240 (67%)

Temporary men: absolute (per cent) 13 (3%) 4 (1.1%)

Permanent women: absolute (per cent) 157 (36.9%) 109 (30.4%)

Temporary women: absolute (per cent) 9 (2.1%) 5 (1.4%)

Average training days by position and gender

Divisional management 2 2.1

Management 1.8 2.4

Staff on collective employment agreement/monthly pay 1.1 1.5

Remainder (auxiliary employees, collective employment agreement/hourly pay, trainees) 0 0

Women 0.7 1.2

Men 1.4 1.8

Women in divisional management posts 0 1

Percentage of management posts held by women 39% 33%

Sickness rate 4.1% 3.4%

Accident rate 0.8% 1.3%

Employee turnover 20.8% 31.3%

1 In previous years, data was only collected for Chocolats Halba. The current figures are for Chocolats Halba/Sunray and can no longer be split into individual business segments. Comparisons with previous years are therefore meaningless.



Sales

Raw materials 2014 % 2015 % 2016 % 2017 % 2018 %

Sales in CHF m

Switzerland 223.6 88% 221.9 88% 211.8 85% 232.9 82% 227.7 79%

Abroad 31.9 12% 31.1 12% 37.2 15% 52.4 18% 60.1 21%

Total 255.5 253.0 249.0 285.3 287.8

Sales share of labelled products 31% 36% 49% 54% 56%

Sales of labelled products in CHF m

Organic and organic/Fairtrade (FLO, FSP, FFL)1 39 49% 41 45% 49 41% 64 42% 72 45%

Fairtrade (excluding organic)1 29 37% 39 43% 59 49% 69 45% 65 41%

Utz (cocoa and hazelnuts) 11 14% 11 12% 13 10% 17 11% 20 12%

Carbon-neutral only (excluding Fairtrade, organic and Utz) 0.2 0% 0.3 0% 0.3 0% 2.7 2% 3.1 2%

Total 79 92 121 153 160

Number of carbon- neutral chocolate products sold 17,039,281 18,140,795 18,847,489 21,016,967 31,574,385

1 Including a small proportion of products that are also labelled as carbon-neutral.

Customer satisfaction 2014 % 2015 % 2016 % 2017 % 2018 %

Customer satisfaction as a percentage2 89.3% 89.0% 88.0%

Not recorded 80.0%

2 In the years 2014 to 2016 customer satisfaction was only measured for Chocolats Halba.

Documents

2018 SUSTAINABILITY REPORT - Chocolats Halbachocolatshalba.ch/files/chocolatshalba_2012/downloads...2018 Sustainability Report | Chocolats Halba/Sunray 5 At a glanc e Reporting methodology