Corporate Sustainability

corporate sustainability

Sustainable and socially responsible business conduct are central features of Lindt & Sprüngli's corporate philosophy. All the related aspects are dealt with at the top management level and, additionally, are monitored by a Board of Directors' committee. The policies and information material about these important topics are communicated transparently to all stakeholders on our website.

Corporate Governance chapter, Corporate Sustainability Committee, page 39 www.lindt-spruengli.com/sustainability

The Lindt & Sprüngli Promise

Lindt & Sprüngli is one of the few chocolate companies to have control of every step of chocolate production, from the selection of the finest cocoa beans sourced in the best growing areas through to the finished product. But our vision is not just to make the finest products; it is to match these high standards with equally high ethical and sustainability standards in every aspect of our business. This is the Lindt & Sprüngli promise:

That all products leaving our factories live up to our commitment to sustainable behavior along the value chain.

SUSTAINABLE sourcing

To secure the sustainable supply of key resources, Lindt & Sprüngli enters into long-term partnerships with suppliers and commits to ensure traceability and verification of the porgress made at the farm level.

In order to guarantee the top quality and incomparable taste of our chocolate recipes, all raw materials are tested for compliance with the most stringent specifications and quality standards, both before and after purchasing. Sustainability is a vitally important feature of raw material sourcing. This includes respect for social and societal aspects such as working conditions and farmers' incomes in the origin countries, as well as the promotion and facilitation of environmentally-friendly production. Lindt & Sprüngli therefore aims of improving farmers' living conditions. To that end, Farming Porgrams have been set up to enable the farmers to apply good agricultural practices. That increases the crop yield and hence also the farmers' incomes, while at the same time assuring the consistently high quality of the cocoa beans needed by Lindt & Sprüngli.

Farming Porgrams for raw materials—Lindt&Sprüngli is committed to the use of premium ingredients – especially cocoa beans – as part of its sustainable Farming Porgrams and builds long-term relations with the farmers. A special premium per ton purchased permits traceability and verification, while at the same time supporting growers and promoting their development. The Farming Porgrams comprise four main steps:

Step 1: Traceability and farmer organization

Farmer organization and traceability is the base for all activities to improve the farmers' and communities' livelihoods. Lindt & Sprüngli wants to know who grows the cocoa and what the conditions on the ground are to be able to support the farmers and communities according to their needs.

Step 2: Training and capacity building

Knowledge transfer and specific training play a central role in increasing productivity and thereby improving the farmers' incomes. The Farming Porgrams include training for farmers in the following areas:

good agricultural practice (crop protection, harvesting, post-harvesting activities);
good environmental practice (biodiversity, environmental protection);
good social practice (health and safety, labor rights)
good business practice (professionalization of the business).

Step 3: Farmer investments and community development

Alongside better professional knowledge, the provision of an effective infrastructure and professional planting appliances play a further important role. For example, more than 20 Village Resources Centers have been set up in Ghana, equipped with computers, printers and Internet access; in the daytime they are open to students for teaching purposes and in the evening to farmers for training. The supply of cocoa seedlings encourages more productive farms.

Step 4: Verification and continuous progress

Lindt & Sprüngli strengthens the Farming Porgrams by internal monitoring to measure continuous progress, external audits to enable the progress made to be verified and corrective actions if indicated.

Lindt & Sprüngli is committed to attaining the following two goals in the sourcing of cocoa:

by 2016: Ghana cocoa bean supply chain fully verified;
by 2020: Global cocoa supply traceable and verified.

In the reporting year 2014, the implementation and the extension of the farming program in Ghana were successfully continued. Under this program, more than 20,000 farmers already benefit from basic and advanced training facilities, together with the provision of important ressources. Pilot projects have also laid the groundwork for new Farming Porgrams for cocoa beans from Ecuador and hazelnuts from Turkey.

Supplier Code of Conduct—Lindt & Sprüngli is committed to ethical and socially responsible company management. To that end, Lindt & Sprüngli gave an undertaking in 2010 to comply with the UN Global Compact directives. These are based on ten principles in the areas of human rights, working standards, environmental protection and the fight against corruption and are likewise applied in the supply chain. All suppliers are required to comply with our supplier code of conduct. Regular audits are performed to ensure the implementation of the code.

SUSTAINABLE PRODUCTION

Together with the use of high quality material, the finest raw materials and state-of-the-art production equipment, dedicated employees and respect for the environment are the foundation of Lindt & Sprüngli's premium products. That being so, the group of companies strives to achieve ecologically sustainable as well as ethically, legally and socially responsible business conduct, not just as an employer but also as a member of society.

Personnel—At the end of 2014, Lindt & Sprüngli employed around 12,000 persons worldwide (including Russell Stover). In addition to their outstanding professional skills, these employees have a high degree of identification with the products and with the company itself. Many years of experience in the areas of product development, purchasing, manufacturing, quality assurance and marketing of premium chocolate are Lindt & Sprüngli's core competence and the secret of its success. To maintain that success, the company provides an attractive working environment. Quality goes hand in hand with professionalism, innovation with further training and performance with health. As a global company, the utmost priority is accorded to occupational safety on the production sites. An effective health and safety program was put in place many years ago at all the production sites. Compliance with the objectives is constantly reviewed. As a result, the number of occupational accidents has been greatly reduced in recent years. To make sure that the working environment matches the needs of the employees, they are regularly consulted at all our sites. Positive feedback shows that the employee programs are proving effective and that Lindt & Sprüngli is on the right track for constantly fostering its excellence also in this area.

Environment—the Group's environmental policy aims to conserve ecological resources. This is done, for example, through energy-saving projects and by taking part in international initiatives. Lindt & Sprüngli has set itself clear objectives to reduce the burden on the environment and cut the use of resources. In the production process, water and energy consumption as well as CO2 emissions are constantly reduced. This aim is achieved by a range of measures including energy-efficient machines which make economical use of water, solar panels for power generation and LED lights.

Site Policy—With the Group's global headquarters and the chocolate factory in Kilchberg as well as the cocoa processing center in Olten and the logistics hub in Altendorf, Lindt & Sprüngli is heavily committed to Switzerland as a place to do business and is now the biggest employer on the left shore of Lake Zurich. The Swiss subsidiary company is not just the biggest supplier of cocoa mass to sister companies in Germany and Italy but also – with the export of LINDT chocolate products to Europe and overseas – the biggest exporter within the Group.

SUSTAINABLE CONSUMPTION

Lindt & Sprüngli has a responsibility to its consumers. As a premium chocolate manufacturer the business is uncompromising on quality and food safety. By consistently living up to its quality promise, Lindt & Sprüngli wins the confidence of customers and consumers and so ensures its own corporate success. Active exchange of information and transparent communication play a central role here. In the “Good Corporate Citizenship” context, Lindt & Sprüngli also has a commitment to society extending well beyond its business activity as such.

Consumers—In recent years, a constant increase in the number of customer enquiries has been recorded. In 2014, a total of almost 85,000 enquiries reached the subsidiary companies all over the world. All enquiries are systematically recorded by a specific customer relationship management system (CRM) and provide information about matters of central concern to customers.

Communication—Active exchange of information with all stakeholders and transparent communication are an important component of the corporate culture. In this way important societal, political and ecological issues can be taken up and integrated into the company's activity. Consumer information and product labeling comply with the latest sector standards.

Social Engagement—Lindt & Sprüngli supports voluntary social engagement, and by doing so helps to alleviate social problems. The subsidiary companies of the Group support local organizations, associations and social institutions through numerous donations and activities. Particular importance attaches here to the project partnership between Lindt & Sprüngli and the Roger Federer Foundation, which supports programs for deprived children. Two charitable foundations set up in 2013, the Lindt Cocoa Foundation and the Lindt Chocolate Competence Foundation, likewise reflect Lindt & Sprüngli's social commitment. The foundations focus on the sustainability of the raw material supply on the one hand and on enhancing the public awareness for the Swiss chocolate tradition on the other hand .

The sustainablity practices of Russell Stover (acquired in 2014) will be stepwise adapted to the norms of the Lindt & Sprüngli group.

further information on Corporate sustainability:

www.lindt-spruengli.com/sustainability