ACC3005 Sustainability Reporting Online Tutoring on ASX Listed Companies

Introduction

For the purpose of this report, the analyzer has selected 10 of the ASX listed companies related to farming, beef production, cattle and meat production, dairy and staple industry. The chosen companies are Australian Agriculture Co., Wellard Ltd., Graincorp Ltd., Wide Open Agriculture Ltd., Australian Dairy Nutritionals Group, Bega Cheese Ltd., Costa Group Holdings, Ingham’s Group Ltd., Select Harvest Ltd. and Ridley Corporation Ltd. The topic under consideration is sustainable use of resources by the selected companies. The analysis will be done by reviewing the annual reports, corporate social responsibility reports and other media releases by the listed companies.

 

Analysis of Sustainable Use of Resources

The annual report of Australian Agriculture Co. (2019) contains the sustainability policies followed by the company. The sustainability policy of AACo includes environmental stewardship, livestock transport and animal health & welfare. It acknowledges the role of beef production in methane emissions (AACo, 2019). The company also reported to adhere to best practices for abating carbon emissions within the beef and cattle herds.

The annual report of Wide Open Agriculture (2019) also revealed that the management has strong focus on climate change, food safety and biosecurity threats. The company with its Dirty Clean Food brand helps in rebuilding healthy soil, enhancing biodiversity and restoring of waterways (Wide Open Agriculture Ltd., 2019). GrainCorp Ltd. also acknowledges its role towards environment and sustainable use of resources including energy use, GHG emissions, water usage and tradewaste discharge. The company revealed key information in its sustainability report in 2019 (GrainCorp Ltd., 2018). Wellard Ltd. is a global distributer of livestock and meat as well as a controller of feedlot facilities, livestock trading and feed milling (Wellard Ltd., 2019). The annual report of Wellard Ltd. (2019) also reveals the company’s effort towards reducing environmental footprint and regulating sustainable water usage.

 

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Australian Dairy Nutritionals Group is a vertically integrated dairy producer, processor and brand owner. With its 4,004 livestock, 2,024 milkers and 17 mn litres of milk production, the company holds reputation of sustainable business (ADFL, 2019). The 2019 annual report of ADNG reveals that the company is regulated by the Environment Protection Act 1970 and is subject to water licensing restrictions under the Water Act of 1989 (ADFL, 2019).  Bega Cheese Ltd. is also a dairy producer in Australia. The analysis of its annual report (2019) suggests that it also covers the areas of sustainability including potable water intensity, energy consumption, GHG emissions, and waste disposal and landfilling (Begga Cheese Ltd., 2018). It clearly understands the global context for sustainable development of dairy industry and tries to fulfill its duties towards food safety, water & energy usage, animal welfare and sustainable sourcing.

Costa Group Holdings is Australia’s leading grower, packer and marketer of fresh fruits and vegetables. The company also issues its sustainability report annually in which it clearly addresses all the issues related to social sustainability, environmental sustainability and economic sustainability. It has clearly mentioned its focus on water use and scarcity, climate change, waste disposal, biodiversity and nutritional inputs (Costa Group Holdings, 2018). Ingham’s Group Ltd. is one of the Australia’s largest poultry providers. Its aim is to ensure that its processes are in line with environmental safety. The sustainability report of Ingham’s clearly states its aim towards minimizing the impact of its services on natural resources (Ingham’s Ltd., 2019). Its strategies include six main themes including water management, energy saving, GHG emissions, zero waste and community support (Ingham’s Ltd., 2019a).

Ridley Corporation Ltd. is Australian largest animal nutrition provider that grows and supply feed for beef, dairy, dogs, aqua, horses, pigs, poultry and sheep. It is committed towards minimizing the adverse environmental impacts through focusing on sustainability issues like energy & water usage, waste disposal and reduction of GHG emissions (Ridley’s Corporation Ltd., 2019). Select Harvest Ltd. is another vertically integrated Australian company that deals with nuts production along with orchard management, processing, horticulture and processing of health snacks and muesli (Select Harvest Ltd., 2018). It issued its first sustainability report in 2017 in which it discussed its role towards water use, energy saving and bee stewardship. The company also focusses on reducing carbon emissions and efficient use of scarce resources.

The above discussion revealed that companies like Select Harvest Ltd., Ridley Corporation Ltd., Ingham’s Ltd., Costa Group Holdings, Bega Cheese Ltd., Australian Agriculture Co. and GrainCorp Ltd. have issued separate sustainability reports for covering the sustainability issues related to economic, social and environment. However, Wellard Ltd., Wide Open Agriculture Ltd. and Australian Dairy Nutritionals Group have discussed the sustainability issues in Corporate Governance Reports and Annual Reports.

 

Accounting Practices for Sustainable Use of Resources

Upon analysis of the financial statements above, the accounting practices for three themes can be unified i.e. water & energy management, GHG emissions and waste management. For the selected firms, these themes and respective accounting practices are discussed below.

Ridley Corporation has a separate environmental risk management reporting process that provides the management with reports on environmental matters. It has followed an Australian Packaging Covenant for having a sustainable packaging of its products. By use of this initiative, it has aimed at increasing the recycling rates and reducing packaging litter. Ridley has developed employee’s led sustainability groups for increasing and maintaining awareness and importance of environment (Ridley’s Corporation Ltd., 2019).

Ingham’s Ltd. use life cycle assessment (LCA) for measuring the environmental and social impacts of its products at each stage of supply chain i.e. from farm to supermarkets (Ridley’s Corporation Ltd., 2019). The results obtained from LCA are then used for informing and developing the sustainability strategies, procurement decisions and reporting. In 2008, Ingham’s calculated its carbon footprint at each stage of breeding, rearing, hatching, processing and feedmilling (Ingham’s Ltd., 2019a). The calculations are done by three different scopes of measurement i.e. direct emissions from natural gas, LPG and liquid fuels, indirect emissions from electricity use and indirect emissions from raw materials use like grains (Ingham’s Ltd., 2019).

Ingham’s Ltd. also has water related internal governance report in which the water stewardship plan and its progress is being reported annually. It uses SMART targets for improving water intensity, water security, catchment governance and health streamside environment (Ingham’s Ltd., 2019). The targets are then tracked continuously for checking the progress of water reuse and efficient water management (see figure 1 below).

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Begga Cheese Ltd. has established site-based continuous improvement teams that assess merits of environmental programs (Begga Cheese Ltd., 2018). The team assesses and rates the impact of the programs on environment so that the company can improve its processes. Its environmental management system (EMS) is aligned to ISO 14001. It also reviews the energy management program by calculating the energy price fluctuations and analyzing sub-metering systems for better energy management  (Begga Cheese Ltd., 2018). It reported a possibility of 20% reduction in energy consumption by following the energy efficiency projects in 2019. The company calculates the energy sources consumed annually (see figure 4 below).

 

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