Sustainability report

2020. This year, waste is reported according to GRI Standard 306 (2016). In the next report, for the full year of 2021, AAK aims to follow the updated version of GRI Standard 306: Waste (2020). GHG emissions AAK reports according to GHG Protocol’s financial control approach. Scope 1 involves the direct GHG emissions from energy use. Scope 2 involves the direct GHG emissions from energy purchase and scope 3 involves GHG emisisons beyond scope 1 and 2. All GHG data reported are provided in CO 2 equivalents including global warming potential from CO 2 , CH 4 , N 2 O, HFCs, PFCs, SF 6 and NF 3 . Scope 1 The scope 1 emissions are calculated from the con- sumption of fuels together with documented heating values and emission factors. This year, combustion from AAK’s own vehicles, smaller working machines, and fugitive emissions are also included in the GHG inventory. Scope 2 This is the second year that AAK has disclosed scope 2 indirect emissions. The scope 2 data used to compare the GHG intensity rate during 2012–2018, related to the present GHG reduction target, is therefore based on energy use reported at the time and estimated emissions based on ecoinvent version 3.5*. New for the report this year is that in addition to only using the market-based GHG protocol scope 2 accounting method for scope 2, the location-based accounting method has also been applied to the GRI index. When calculating emissions according to the location – based accounting method, the grid-average emission factor is always used. For markets without a system of guarantees of origins for electricity, AAK has used the grid-average emission factor also for the market-based calculations. For more information, please see GRI index 305-2. Scope 3 During 2020, AAK has, with support from a third party, revisited the scope 3 greenhouse gas screening**, i.e. a rough assessment of AAK’s emissions in the whole supply chain. The scope 3 screening based on 2019 data shows that about 95 percent of the emissions in the supply chain are category 1: purchased goods and services. The key raw materials included in the assess- ment were palm (49 percent), palm kernel (12 percent), coconut (7 percent), and rapeseed (7 percent). Together with inbound and outbound transport, this covers 80 percent of the emissions in our upstream supply chain. Going forward, AAK will engage with suppliers to set targets in line with the science-based targets method and work actively to improve our climate footprint, worldwide. AAK Sustainability Report 2020 Reporting framework | 69 The large share of emissions in scope 3, and especially from purchased goods, are typical for companies that produce food or agricultural products, e.g. coffee or rice. However, they are not comparable with the impact of animal-based foods, such as meat or dairy, that are much more resource-intensive than plant-based foods***. GHG emissions AAK 2019 % 4% Scope 1 1% Scope 2 95% Scope 3 * Ecoinvent is the world’s leading LCI database in terms of inventory data for complete supply chains. Version 3.5 features more than 2,000 new, revised, and updated datasets across five sectors as well as improved representations of supply chains. It was released on August 23, 2018. **The greenhouse gas screening is a GHG Protocol requirement and is also required according to the Science Based Targets methodology. Emissions from raw materials were assessed based on lifecycle analysis for raw materials that match the volumes that AAK purchased during 2019. *** Creating a Sustainable Food Future, A Menu of Solutions to Feed Nearly 10 Billion People by 2050, World Resources Report, December 2018.