ARYZTA: ARYZTA : 2024 ARYZTA ESG REPORT(11.37 MB)

SUSTAINABILITY REPORT PAGE Sustainability Report 2024 94 Introduction Sustainability Highlights 2024 Strategy & Progress Materiality Stakeholder Engagement Risk Management 110 Governance 113 Environmental Efficiency Responsible Sourcing and Innovation Our People and Communities Appendix Independent Assurance Report ARYZTA AG Annual Report 2024 93 INTRODUCTION BAKING JOY, SUSTAINING TOMORROW 2024 SUSTAINABILITY REPORT BAKING SUSTAINABILITY INTO OUR BUSINESS Dear Stakeholders, 2024 marked a pivotal year for ARYZTA as we moved from setting our sustainability goals to embedding them into our cul- ture, activities, and governance. As Chair of the Governance, Nomination & Sustainability Committee, we present this year's Sustainability Report, which demonstrates our progress and commitment to "Baking Joy, Sustaining Tomorrow". Sustainability has always been a part of ARYZTA's DNA , exemplified by initiatives of Hiestand, our Swiss ARYZTA subsidiary, and its 30-year partnership with IP-SUISSE , a Swiss sustainability label promoting biodiversity, soil health, and animal welfare, which has championed sustainable agricultural practices. Building on this heritage, 2024 was a year of laying strong founda- tions, embedding sustainability into every facet of the organisation, and preparing for accelerated progress in the years ahead. This commitment reflects ARYZTA's belief that sustainability is a long-term strategy , integral to how we create value for our stakeholders while contributing to a more sustainable planet. Initiatives like the Energy Excellence Programme , identifying over 200 Greenhouse gas (GHG) reduction opportunities, and the Water Conservation Programme , targeting water resource optimi- sation, are evidence of this enduring focus. Our governance structure plays a critical role in driving this progress. Led by the Governance, Nomination & Sustainability Committee, ARYZTA ensures transparency and accountability at all levels. Quarterly ESG reviews align sustainability goals with business priorities and guide investment decisions that contribute to meaningful outcomes. Additionally, in 2024, we strengthened our reporting practices in reference with the Global Reporting Initiative (GRI) Standards , the Task Force on Climate-Related Financial Disclosures (TCFD) , and the Swiss Code of Obligations . Sustainability is an immensely complex and multifaceted topic, requiring the coordination of diverse governing bodies, frame- works, and initiatives to ensure meaningful progress. These frameworks enable ARYZTA on one side to transparently track and communicate progress, and on the other side ensuring stakeholder confidence in our strategy. This report reflects ARYZTA's journey to embed sustainability across its activities and value chain, highlighting both achievements and future opportunities. We invite you to explore the initiatives described within as we continue our path to "Baking Joy, Sustaining Tomorrow". Alejandro Legarda Chair of the Governance, Nomination & Sustainability Committee ARYZTA AG Annual Report 2024 96 SUSTAINABILITY REPORT ABOUT THIS REPORT This report provides a detailed account of ARYZTA's progress in embedding its 5-Year Sustainability Strategy , into the way it does business and advancing its 13 Sustainability Goals during 2024. These goals, introduced in 2023, are aligned with ARYZTA's long-term commitment to contributing to a more sustainable planet and society. The report has been prepared in reference with leading international frameworks: Global Reporting Initiative (GRI) Standards 2021: Ensuring transparent and comparable disclosures. Task Force on Climate-Related Financial Disclosures (TCFD): Serving as the framework to comply with the Swiss Ordinance on Climate Disclosures. Swiss Code of Obligations (Art. 964a et seqq.): For reporting on non-financial matters which includes disclosures on due diligence and transparency in relation to child labour. The report references key international frameworks that guide ARYZTA's sustainability strategy, including the Greenhouse gas Protocol (GHG Protocol), Science-Based Targets initiative (SBTi), United Nations Sustainable Development Goals (SDGs), CDP, International Labor Organization (ILO) Conventions, and OECD Guidelines for Multinational Enterprises, among others. The baseline year for ARYZTA's sustainability targets is 2022 , unless otherwise stated, and the strategy is informed by the materiality assessment conducted that year. The report highlights significant progress, including achievements in GHG reductions, water conservation, and responsible sourcing. It also showcases how ARYZTA is fostering innovation and collaboration across the value chain to drive long-term value creation. To illustrate the real-world impact of these efforts, the report includes case studies and examples of community partnerships, regenerative agriculture initiatives, and employee-driven projects. Independent limited assurance on key sustainability metrics for 2024 has been provided by Ernst & Young Ltd (see assurance letter in the Appendix). For further details on ARYZTA's business model, performance, and results, refer to pages 4-11 of the Annual Report. For additional information, please contact: Paul Meade, Head of Communication Email: Paul.Meade@aryzta.com ARYZTA AG Annual Report 2024 97 SUSTAINABILITY REPORT SUSTAINABILITY HIGHLIGHTS 2024 56% Increase in renewable energy use SAFETY 5% 28% 82% Reduction in Scope Reduction in total Cage Free Eggs 1 & 2 GHG emissions incident rate 5% 99% 74% Reduction in water Sustainable Sustainable consumption sourced Palm Oil sourced Cocoa (non-product related) REGENERATIVE AGRICULTURE 8,000 Tonnes of CO 2 reduced and removed Supported by 8,500 new hectares of regenerative agriculture Percentages are compared to baseline years 2022 or 2023. See the graph "Progress on ARYZTA's Ambitions Under Three Pillars". ARYZTA AG Annual Report 2024 98 SUSTAINABILITY REPORT STRATEGY & PROGRESS: BUILDING A SUSTAINABLE FUTURE ARYZTA's sustainability strategy is built on a foundation of stakeholder engagement, regulatory alignment, and operational innovation, driving measurable environmental, social, and economic outcomes that create value for all stakeholders. In 2024, ARYZTA focused on further embedding its three sustainability pillars and 13 goals into its activities and decision-mak- ing. These efforts were guided by governance processes operating across all levels of the organisation, from the Board to operational teams. Regular reviews, supported by the Enterprise Risk Management (ERM) process and other site-specific environmental standards, ensured the strategy remained relevant and adaptable. l e S b i s o n u o r p c s ov a i n n t e i n o g R I n & s E e i t n i n v i u r Baking Joy, Sustaining o m n Tomorrow m o m e n C t & a l e E l f p o c e i P e n c y The 2022 materiality assessment continues to guide ARYZTA's approach, identifying key Environmental, Social, and Governance (ESG) issues that align with stakeholder priorities. These insights ensure the company's goals address critical global challenges and deliver measurable results across the value chain. Through this comprehensive strategy, ARYZTA is laying the groundwork for meaningful progress, fostering innovation, and meeting the expectations of its stakeholders, while building a sustainable future for all. ARYZTA AG Annual Report 2024 99 SUSTAINABILITY REPORT STRATEGY & PROGRESS: BUILDING A SUSTAINABLE FUTURE Key areas of progress in 2024 include: Energy Excellence & Water Conservation: As an outcome of the GHG emission and water reduction assessments, over 200 GHG reduction opportunities were identified and a 5% reduction in non-product water use was achieved 1 . Renewable Energy through Power Purchase Agreements (PPAs): Implemented two new local PPAs and advanced others to the final stage of development. These long-term renewable energy contracts enhance energy security, reduce carbon emis- sions, and support ARYZTA's sustainability commitments. Regenerative Agriculture: 8,500 hectares was transitioned to regenerative agriculture through a partnership with Klim, a regenerative agriculture support platform, contributing to a total of 7% wheat sourced sustainably. Sustainable Sourcing: 99% certified palm oil, 74% certified cocoa and 82% cage-free eggs were sourced for own produc- tion purposes, progressing towards 2026 targets. Enhanced Climate Disclosures: Strengthened transparency through alignment with the TCFD and Ordinance on Climate Disclosures which includes a more granular climate risk assessment. SEDEX: In 2024, all ARYZTA sites were integrated into the SEDEX platform, a third-party platform for supply chain due diligence, enhancing supply chain transparency and ethical compliance. 1 refers to all water utilized on-site except for water directly incorporated into products (e.g., in the baking process). ARYZTA AG Annual Report 2024 100 SUSTAINABILITY REPORT STRATEGY & PROGRESS: BUILDING A SUSTAINABLE FUTURE Progress on ARYZTA's ambitions under three pillars 13 Targets Baseline 2024 Target Greenhouse Gases Reduction Water Reduction Food Waste Reduction Sustainable/Regenerative Wheat Certified Palm Oil (segregated & mass-balance) 1 Certified Cocoa Beans 2 Cage-Free Eggs 3 Virgin Plastic Purchased Healthier Products - Better For You Supplier Due Dilligence - SMETA Audits 2022 -5% -34% by 2028 2023 -10% by 2028 -5% 2022 - 8% -20% by 2028 2023 25% by 2028 7% 2023 99% 100% by 2026 2023 74% 100% by 2026 100% by 2026 2023 82% 2023 -2% -30% by 2028 40% by 2028 2024 49% 4 2023 196 500 by 2028 Human Capital Development 5 2024 47% 100% by 2028 Health & Safety Incident Rate 2023 -28% -50% by 2028 Ethical & Safe Workplaces 6 2024 3 3.5 by 2028 The 2024 progress for palm oil relates to products produced by ARYZTA. The 2024 progress for cocoa relates to products produced by ARYZTA. The 2024 progress for cage-free eggs relates to products produced by ARYZTA. The target for 20