CINCINNATI, Ohio – The Kroger Co., one of America’s largest grocers, outlined an updated environmental, social and governance (ESG) action plan to support the company’s comprehensive ESG strategy and published its annual ESG report.
“We are living our purpose—to fuel the human spirit—through Kroger’s commitments to fostering positive impacts for people and our planet and creating more resilient global systems,” said Rodney McMullen, Kroger’s chairman and CEO. “We are proud to report that Kroger continues to make progress toward important ESG goals. I am especially proud of the Kroger team’s collective efforts to create communities free of hunger and food waste. Through Zero Hunger | Zero Waste, Kroger has donated billions of meals to help end hunger and millions of pounds of surplus fresh food to avoid waste. We are committed to expanding food access, affordability and choice for all our customers.”
As the centerpiece of its ESG strategy, Kroger’s signature Zero Hunger | The Zero Waste social and environmental impact plan emphasizes the unique role Kroger plays across the food system and its many stakeholders such as employers, food processors, retailers, healthcare professionals and more. This month, Kroger marks the fifth year of this signature initiative. To date, the company has directed 2.3 billion meals to communities, including $1 billion in charitable support and 500 million pounds of surplus fresh food rescued from Kroger stores to help end hunger.
Kroger’s 2022 ESG Report: Nurturing Shared Values and other resources can be found at ESG Hub, ESG Strategy: Thriving Together.
ESG Action Plan Updates
In addition to Zero Hunger | Zero Waste, Kroger continues to make progress toward key goals and strengthen commitments in several areas, particularly in climate impact, packaging, human capital management, human rights and animal welfare.
“With this updated action plan, we seek to address a broad range of complex social and environmental challenges, and set ambitious impact goals,” said Keith Dailey, Kroger’s executive vice president of corporate affairs and chief sustainability officer. “These commitments express Kroger’s ambition to make affordable fresh food even more accessible, while promoting positive impacts for our communities and the planet. Our progress and commitments reflect our efforts to operationalize and integrate ESG performance across industries and develop a framework of shared value that creates positive results for all stakeholders.”
Climate impact
Kroger formally committed to setting a more aggressive greenhouse gas (GHG) reduction target in accordance with the requirements of the Science Based Targets initiative (SBTi). The company’s current 2030 targets are in line with a climate scenario well below 2°C; But given the need for greater climate action, the target will be strengthened to support a climate scenario of 1.5°C. Kroger will also set a new Scope 3 target for reducing emissions in the supply chain as part of its SBTi commitment.
The company will share a detailed project roadmap to achieve the current GHG reduction target by the end of fiscal year 2022.
Packaging
Kroger completed an initial packaging assessment to establish a plan to achieve its 2030 sustainable packaging goals, which include 100% recyclable, reusable and/or compostable packaging from our brands by 2030. The baseline focused on grocery and fresh food products, as well as health, beauty, household items and cleaning items. Baseline findings show that 40% of the product packaging covered by Our Brands meets the company’s definition of recyclable today, measured by weight.
Human Capital Management
The Kroger family of companies continues to provide accessible employment and economic advancement opportunities to more than 400,000 people across the United States. Kroger has invested an incremental $1.2B in associate compensation and benefits since 2018, raising average hourly wages to over $17/hour, and over $21/hour when comprehensive benefits such as health care and pensions are included.
Human rights
Kroger recently updated its human rights policy to align with the United Nations Guiding Principles on Business and Human Rights (UNGPs). The company is in the process of developing a comprehensive human rights due diligence framework and implementation roadmap in line with the UNGPs. This work will continue through 2022. The company also recently launched its first human rights impact assessment.
Animal welfare
Kroger updated its animal welfare policies and shared a detailed animal welfare update to outline progress to date and roadmap for future milestones.
The company published specific milestones to achieve its goal of sourcing 100% of fresh pork sold in retail stores from suppliers housing sows in group housing systems by 2025. Kroger also outlined plans to invest $45 million in additional pricing, promotions and agreements to support transition to a cage-free or higher welfare egg supply, with specific milestones to reach 70% cage-free by 2030.
Following an announcement earlier this year, Kroger has partnered with Kipster Farms, the innovative egg production system founded in the Netherlands, to bring the world’s first carbon-neutral, cage-free shell eggs to customers in the United States in 2023.
Highlights from 2021
People: Help billions live healthier and more sustainable lifestyles
- Increased the average wage for hourly store associates to over $17, bringing the rate to more than $22 per hour when comprehensive benefits are included.
- Directed $343 million in charitable gifts – including food and funds – to local and national nonprofits; of this, $210 million focused on improving food security in communities where we operate, reflecting the Zero Hunger | Zero Waste mission.
- Directed 546 million meals to communities in food and funds in 2021, including 94 million pounds of surplus food donated through Kroger’s Zero Hunger | Zero Waste Food Rescue Program. Since the introduction of Zero Hunger | Zero Waste five years ago, the company directed a total of 2.3 billion meals to local communities towards the goal of 3 billion meals by 2025.
- Delivered 1.1 million dietitian approved meals to vulnerable populations.
- Conducted research on how retailers can serve as key health destinations, leveraging food and nutrition education to support shoppers and help them purchase healthy foods, resulting in a groundbreaking randomized controlled trial aimed at increasing diet quality and reducing cardiovascular risk by promoting a heart-healthy diet through nutritional guidance provided by a registered dietitian.
- Supported healthier lifestyles by offering a wide range of better-for-you and diet-friendly food options across stores and a seamless experience, including our integrated OptUP app with nutritional ratings on thousands of items.
- Increased access to fresh, affordable food for customers in existing and new geographies through the expansion of Kroger’s seamless ecosystem and the Kroger Delivery network.
Planet: Protect and restore natural resources for a brighter future
- Achieved a cumulative 9.1% reduction in greenhouse gas (GHG) emissions from a 2018 baseline.
- Installed infrared refrigerant leak detection technology in 2,000 stores to date to further reduce emissions.
- Reduced total food waste generated in retail stores by 18.9% and improved disposal rate for food waste by 21.7% since 2017.
- Completed a comprehensive baseline product packaging footprint in 2022 and found that 40% of our brands’ product packaging is recyclable.
- Sourced 16.9 million pounds of Fair Trade Certified™ ingredients for our brands, up 4% from the previous year.
- Sourced 94% of wild-caught seafood and 98% of farm-raised seafood in Kroger’s seafood department from fisheries and farms that meet the company’s requirements for sustainable seafood.
Systems: Build more responsible and inclusive global systems
- Continued to operationalize the company’s ESG strategy by integrating ownership and accountability for ESG goals into the business.
- Increased the diversity and breadth of expertise on Kroger’s board and clarified the board committee’s supervision of ESG topics.
- Spent $4 billion with diverse vendors and welcomed 230 new multi-owner vendors in 2021, up 115% from the prior year, reflecting more than $500 million in incremental spend.
- Provides comprehensive employee training on key governance topics, including business ethics and compliance; privacy; cyber security; food security; diversity, equity and inclusion; and personal safety.
- Secured Kroger’s $45 million investment in pricing, promotions and supplier agreements to achieve a sustainable transition to a cage-free or higher welfare egg supply, with specific milestones to reach 70% cage-free by 2030.
