CPF Summary Report EN 26-10-2016 · PDF file& Ready-to-eat Food Cooked ... complaint...

Message to Stakeholders

Foods ToEnrich Life

* SETAwards2013-2014for“BestCorporateSocialResponsibility”andThailandSustainabilityInvestmentAwards2015.

ThisreportcoversperformanceofallCPFoperationsanditssubsidiariesinThailand.

Amidstthewhirlwindofchangesandchallenges,itisnecessaryforCPFtokeepourdynamic

growthanddrivebusinessholisticallythroughinnovationandefficiency.

Since2011,CPF’sThreePillarstoSustainability:“FoodSecurity,Self-SufficientSociety,and

BalanceofNature”havebeenthebeginningofthetransformationtoholisticallymanagethe

interconnectionofeconomic,environmental,andsocialissues.TheresultsofCPF’seffortsin

continually improvinganddevelopingsustainabilityperformancehavebeendemonstrated

throughthereceivingofThailandSustainabilityInvestmentAwardsfromtheStockExchange

ofThailandforthreeconsecutiveyearssince2013*andthelistingintheDowJonesSustainability

EmergingMarketsIndexfortwoconsecutiveyearssince2015.

TodayCPFhasdevelopedthe“Vision2020”asthedirectiontoguidetheCompanyforthe

nextfiveyears.CPFbelieves that thiswillbe thedirection thathelp theCompany“Build

Capacity”,“GraspOpportunitiesforGrowth”,and“CreateSharedValueforAll”.Thisdemonstrates

CPF’scorephilosophyof“3BenefitstoSustainability(fortheCountry,thePeopleandthe

Company)”thatdrivesthebusinesstobecome“theKitchenoftheWorld”

Mr. Adirek Sripratak

PresidentandChiefExecutiveOfficer

Building capacity, grasping opportunities for growth, and creating shared value for all

WORLD WORLD

WORLD WORLD

1

3

2

4

FeedManufacturing

ProductionofProcessed&Ready-to-eatFood

Cooked&Ready-to-eatMeal

Breeding&AnimalFarming

DistributionChannels(FoodRetailOutlets,Restaurant&FoodCourts)

AnimalFeed Fresh&UncookedMeat

Feed

Food

Farm

Retail and

Food Outlets

CPFleveragesitsexpertiseinagro-industrialandfoodandexpandsbusinessesinthe

countrieswithgrowthopportunitiestostrengthenfoodsecurityforthebenefitsofthe

Country,thePeopleandtheCompany

CharoenPokphandFoodsPublicCompanyLimitedorCPFoperatesintegratedagro-industrial

andfoodbusinessincludinglivestockandaquaculture:swine,broilers,layers,duck,shrimp

andfish.Thebusinessesarecategorizedinto4mainareasasfollowed:

1. FeedBusiness

2. FarmBusiness

3. FoodBusiness

4. RetailandFoodOutletsBusiness

1. Thailand

- LivestockandAquaculture

IntegratedBusinesses

2. Taiwan

- LivestockIntegratedBusiness

3. Laos


4. China


Feed

- AquacultureFarming

- FoodProcessingPlant

5. Russia

- LivestockFeed

- SwineFarming

- ChickenIntegratedBusiness

6. Turkey


7. Belgium


8. UK


- FoodKiosks

9. India


- AquacultureFeed

10. Sri Lanka


11. Cambodia


12. Malaysia



13. Vietnam



14. Philippines


FeedandFarming

CPF… Kitchen of the WorldCPF at a Glance

Thailand Operations International Operations

OPERATIONS AND

INVESTMENT IN 14

COUNTRIES, EXPORT TO

MORE THAN 30 COUNTRIES

ACROSS 5 CONTINENTS,

CATERED TO OVER 3 BILLION

CITIZENS OF THE WORLD

9

10

2

1

3

48 56

1311 12 14

7

DataasofJuly2016

Awards, Recognition and Participation

CPF’s CSR to Sustainability Direction

3 Pillars to Sustainability Issue

Resource and EnvironmentalConservation

Reducing Environmental Footprints

Protecting Biodiversity

Society Development Developing Win-Win Partnership

Supporting Community Livelihood

Food Safety and Consumer Health

Enhancing Quality & Food Safety throughout the Chain

Improving Food Access

Goal

Balance of Nature

Food Security

Self-Sufficient Society

People

Development

Governance, Risk Management

and Compliance (GRC)

Three Benefits

to Sustainability

Adapt to change

InnovativenessSpeed & Quality

Simplification Integrity, Honesty

and Reciprocity

Dow Jones Sustainability Indices : DJSI

UN Global Compact

Thailand Sustainability Investment Award

Sustainability ReportAward

CSR-DIW Continuous Awardand CSR-DIW Award

Outstanding Workplace forSafety, Occupational Health

and Environment Award

Foodsecurityisatthetopoftheagenda

undertheglobalpublicattention.Global

and regional strategicplansareset to

address thischallenge.As the leading

agro-industrialandfoodconglomerate,

werecognizetherolewecouldplayin

achieving foodsecurity.Ouraimsare

to“Enhance Quality and Food Safety

throughout the Chain”andto“Improve

Food Access”forhealthandsafetyofthe

consumersaswellasforrelievinghunger

andmalnutritioninthewidersociety.

By 2020

We aim to increase the portion

of healthy and nutritious

products from 10% to 30% of

new consumer products and

are committed to promoting

sustainable production and

consumption to 300,000

young people.

FoodSecurity

Enhancing Quality & FoodSafety throughout the Chain


Research and Development for Product and Process Innovation

Wecontinuallydedicateourselvestotheresearchand

developmentonanimalfeed,animalfarming,andfood

products.Ourgoalistoprovidevalue-addedinnovation

andrespondtotheeverchangingtrends.

Management through International Standards

Theverticallyintegratedbusinessmodelallowsusto

control andmonitor the operations systematically.

We take preventive measures and strictly follow

the Company’s policies and guidelines. We take

preventivemeasuresbyassessing risks inall steps,

strictlycomplyingwith theCompany’spoliciesand

international standards,performing laboratory tests

and analysis, and conducting audits. In addition,

we apply reactive measures that include product

traceabilityandproductrecallincompliancewithour

complaintmanagementpolicy.

Enhancing Quality and Food Safety throughout the Chain

70

40

Wehavemorethan

Research and Development Centersforanimalfeed,animalfarmingandbreeding,andfoodproductsandmorethan

Learning Centersforknowledgesharingandtechnologytransfer

Since1996,wehavebeenadherent

to internationally recognized

standardsaccreditedbythirdparty

andhaveappliedourcustomers’

standardsinmanufacturingofanimal

feedandfoodproductsandfarming

practices.

Creating a Variety of Healthy Products

We offer over 1,000 fresh, processed, and ready-to-eat products of

varying form, taste, size,andnutrition.Wealsocontinuallydelicate to

thedevelopmentofhealthyproductsfocusinginfreshandhygienefood

market,childrenhealthandnutritionmarketwithafocusonnutritiousfood

productsthatareessentialtothegrowthanddevelopmentofchildren,and

adultwell-beingmarkettohelpreducetheriskofthreenon-communicable

diseasesi.e.diabetes,hypertension,andhypercholesterolemia.

CP Balance... Lo(w) in what is not, Hi(gh) in what is yes First frozen food innovation in Thailand

Decrease nutrientthatcausesobesity

Increase nutrientthatisgoodforhealth

Highvalue,variousbenefits

Noaddedfoodcoloringandpreservatives

First time ever for Egg Tofu with Veggie

Omega Plus Egg

Raising Layer for Student’s Lunch Project

Since 1989,wehavebeenworking inpartnershipwith theRuralLives’

DevelopmentFoundationunder the support fromCPGroupandour

employeestogetherwithotherpartnersonthe“Raising Layer for Student’s

Lunch Project”.Theprojectaidsstudentsinruralareastogainaccessto

agoodsourceofproteinlikeeggs,meanwhileservesasagoodlearning

opportunityforchildrentodevelopprojectmanagementskills.


International Standards

CPF Growing Happiness, Growing Futures Project

TogetherwiththeMinistryofEducation’sOfficeoftheBasicEducation

CommissionandtheRuralLives’DevelopmentFoundation,welaunched

the“CPF Growing Happiness, Growing Futures Project” in celebration of

HRH Princess Maha Chakri Sirindhorn’s 60th Birthday Anniversary.With

thecommitmenttopromotenutritioninchildren,wehaveseta5-year

planfrom2015–2019tocreatealearningplatformandtoimproveaccess

toquality,safe,andnutritiousfoodi.e.vegetablegrowing,fishfarming,

andraisingawarenessonsufficientconsumption,forstudentsaroundour

factoriesandfarms.

Morethan

150,000

600studentsinover

schools

Central Region

Western Region

Eastern Region

Southern Region

Northern Region

North-Eastern Region

• GMP

• ISO/IEC 17025

• BRC

• ISO 9001

• GAP

• HACCP

• OHSAS 18001

• BAP

• GENESIS STANDARDS

CPF

Feed Farm Food

RetailandFoodOutlets

Part of Our Commitment

for Better Health

low-fatandhigh-protein

CP Delight...Tender Chicken Breast

By 2020

We aim to support

employment and income

generation among 50,000

smallholder farmers and

small entrepreneurs.

Self-Sufficient Society

Developing Win-WinPartnership

Supporting CommunityLivelihood

Promoting Sustainability in the Supply

Chain

Weraiseawarenessamongourbusinesspartnerson

theircontributiontotheprovisionofhighqualityand

safeproductswhilebeingsociallyandenvironmentally

responsible.We developedand sharedwithmore

than7,500ofourbusinesspartnersthe“Sustainable

Sourcing Policy and Supplier Guiding Principle”

covering4elementsofourbusinessprinciples;namely,

ProductandService,People,Process,andPerformance.

WealsolaunchedtheSupplierSelf-Assessmentamong

ourcriticalsupplierscoveringEnvironmental,Social,

andGovernance(ESG)issues.

Developing Win-Win Partnership

Sourcing Agricultural Raw Materials Sustainably

Wearecommittedtosourcingagriculturalrawmaterials

from sustainable sources based on international

standards or raw materials that are traceable in

compliancewithourpracticeguide.

7,500

TheSustainableSourcingPolicyandSupplierGuidingPrinciplewassharedwithmorethan

businesspartners

Oneofthekeysuccessfactorsforbusinesses

istorecognizetheirroleintacklingsocial

andenvironmentalissues.Astheleading


wearededicatedtocontinuallymitigating

negativeimpactswhilefosteringpositive

influenceonthecommunities.Weaimto

“Develop Win-Win Partnership”withour

businesspartnersand“Support Community

Livelihood”throughtheleverageofour

expertise,theengagementofstakeholder

groupsandthecollaborationwithother

partners.Ourworkwillhelppreparemore

than 100,000ofourbusinesspartners

andcommunitiesfortoday’sandtomorrow’s

challenges.

Supporting Community Livelihood

Enhancing Capability and Potential of Livestock Farmers

Wecontinuetoworkcloselywithapproximately5,000smallholderfarmers

undertheContract Farming Schemesince1975tosupportemployment

and incomegenerationamongThai farmers.Wepromote the transfer

of technology,support foraccesstosecuredmarket,shareknowledge

throughtheteamofourCompany’sexperts,andsupportforaccessto

financewithourfinancialinstitutionpartners.Thepartnershipbetweenthe

Companyandfarmersisbasedonintegrityandtransparencyofcontract

thatisopentoallparties.ThesurveyconductedbytheCompanyshows

that98percentofcontractfarmersexperiencegreatsuccess.Thesuccess

indicatorsmeasurethecontractfarmer’sabilitytodisburseloanmoneyto

financialinstitutionswithinagreedtimeframe.Approximatelytwopercent

ofcontractfarmershadtoceasetheirbusinessduetofactorssuchas

sickness,deathandlackofdescendant.

Supporting Small Entrepreneurs to become Professional Franchised Retailers

Weprovideopportunities for small entrepreneurs to start andowna

businessandbecomefranchisedretailersthroughour“Five Star Franchise”

since2000.Weprovidetraininganddevelopbusinessmanagementskills

forsmallentrepreneurs.Wealsohelpwithsiteselectionaswellassupport

forkioskandoperatingequipmentsetting.Thebusinessmodelisreplicable

andexpandedtoIndiaandVietnam.

Inaddition,wealsoprovideopportunitiesforsmallentrepreneurstoown

abusinessthroughthe“CP Community Refrigerator”projectin2012and

“CP Commodity Pork Fridge”projectin2015.

Promoting Quality of Life of the Communities Surrounding the Operations

TheCompanyhasastrongcommitmenttosupportsocialandeconomic

developmentofcommunitiessurroundingallofouroperationsasweknow

thathealthycommunitybringsabouthealthybusiness.Ourpeopleplayan

importantroleindrivingour“4CstoSustainability:Competency+Creation

+Collaboration+(Connection)”framework.Wesupportedmorethan300

projects/activitiesthatpromotequalityoflifeofthecommunities.

Supporting Local Employment and Income Generation for Smallholder Farmers

Realizingthatsmallholderfarmersaretheimportantfoundationthatdrives

agricultureandfoodindustry,wehavebeenworkingcloselywiththeRural

Lives’DevelopmentFoundation,underthesupportfromCPGroupand

ouremployeesaswellasotherpartnersinavarietyofprojectstosupport

employmentofsmallholderfarmersthroughthetransferofagricultural

knowledgeandtechnologysince1977.

Wehavemorethan

12,000

Small-Scale Franchised Retailers whoareself-sufficientandabletoraisetheirfamilyfromFive Star Franchise, CP Community Refrigerator, and CP Commodity Pork Fridge Project.

98 %offarmersexperienced

greatsuccessinbusiness

CPF Funds for the Elderly

benefitedmorethan

500elderlypeople

surroundingthefactoriesand

farmsannually,withthetotal

budgetofmorethan

70millionbahtsince2011.

5,000families

creatingeconomicvalueof

1,000millionbaht

peryear

Fishmeal

100%offishmealsourcedandusedinThailandcomes

fromlegalandtraceablesourcesandisonlyfromby-

productcomponentoffishmealfromprocessingplants

certifiedbytheIFFOResponsibleSourcing(IFFORS)

whichcurrently is thebest internationalstandard for

sustainablefishmealpractice.

Corn

100%ofcornsourcedandused inThailand isunder

traceabilitysystemforcorn,helpingtoaddressnatural

resourceandenvironmentalchallengesincludinghaze

andmanagementofagriculturalwasteinthehighlands.

The traceability systemunderwent theparticipation

fromvarious stakeholdergroups includingbusiness

partners,farmers,academia,thegovernmentandcivil

society.TheCompanyalsoorganizedworkshopsfor

allcornbusinesspartners.

Soybean

WecollaboratedwithAGProcessingInc.orAGP,the

leading soybeanbusiness in theUSmarket, in the

“Collaboration to Develop Sustainable Soybean

SourcingSystem”projectwhichisthepilotprojectfor

sustainablesoybeansourcing.

Contribution to the establishment of Thailand’s first Fishermen’s Life Enhancement Center

In collaboration with the Fish Marketing Organization

under Ministry of Agriculture and Cooperatives, the

Department of Labor Protection and Welfare, the

Planned Parenthood Association of Thailand, Stella

Maris Seafarers Center Songkhla (Baan Suksan). The

center is part of the effort to drive anti human

trafficking policy, tackle problem of illegal labor in

fishery industry, and promote the quality of life of

workers in the fishing industry and their family. It

benefits more than 25,000 workers and at-risk

persons.

“Self-Sufficient Farmers, Sustainable Corn” project

In collaboration with the Agricultural Land Reform

Office (ALRO), the Company has promoted knowledge

sharing and transfer corn cultivation technology

according to the agricultural standard to more than

15,000 smallholder farmers, covering approximately

225,000 rai (360 square kilometers) of cultivation

areas. The aim is to help increase yield per rai and

reduce cost per unit so that farmers could have more

income from better quality products. At the same time,

the project has also helped reduce concerns over

farmers’ health as a result of proper chemicals handling

and minimize the negative impacts to the environment.

Wepromoteemployment

ofsmallholderfarmers

frommorethan

Protecting environmental quality and

keepingtheecosysteminbalancearethe

responsibilities of all parties in the

societyfortheirtremendousimportance

inmaintainingfoodsecurityandpromoting

thewellbeingofpeople.Astheleading


we continue to embed environmental

sustainability in the way we do

business through the consideration of

environmentalimpactsandthesupport

onconservationactivities.Ouraimsare

to“Reduce Environmental Footprints”

andto“Protect Biodiversity”.

By 2020

We aim to reduce greenhouse

gas emissions by 5% per ton of

production, water consumption

by 10% per ton of production,

and waste by 30% per ton of

production relative to our 2015

base year inventory. We also aim

to protect biodiversity covering

the forest areas of 7,000 rai

(11.2 square kilometers)

Management through International Standards

Our effort in reducing environmental footprints is

exhibitedthroughprocessimprovementandproduct

development.Weplacehighemphasison takinga

holisticapproachinreducingenvironmentalimpacts

withtheapplicationofthe4RsPrinciple(Reduce,Reuse,

RecycleandReplenish).WestrictlyadheretoCPFSafety,

Health,EnvironmentandEnergyStandardwhichisin

linewithISO14001andOHSAS18001andincompliance

withapplicablelawsandregulations.

Reducing Greenhouse Gas throughout the Process

Withtheaimtoreducegreenhousegasemissions,we

remaindeterminedtoconserveenergyandimprove

energyefficiencythroughtheuseofrenewableenergy

andmanagementofwastefromfeed,farm,andfood

business.Simultaneouslywealsoincreasegreenareas

aroundouroperationswhichwouldhelpabsorbCO2.

Balance of Nature

Reducing EnvironmentalFootprints

ProtectingBiodiversity

Reducing Environmental Footprints

GHG Emissions

125.63

0

40

80

120

160

kg CO2eper ton product

year20142013

118.34 118.24

2015

Reduce GHG emissions of over

tonsofcarbondioxideequivalentsperyear

150,300

Replace electricitypurchase by 45 percent or the cost saving of

123 millionBaht



110,200

Reduce more than

36 millionlitersoffueloilconsumption



100

Produce over

1.5 millionlitersofbiodiesel

Efficient Water Use

Weplacehighimportanceonsettingappropriatewater

usetarget ineverystepoftheoperations.Ourdata

collectionsystemallowsus toanalyzeandplan for

wateruse.At thesame time,advanced technology,

research and development along with process

improvementhavebeenutilizedthroughoutbusiness

operationssoastominimizewaterconsumptionand

maximizewaterefficiencyparticularly inbusinesses

thataremorewater-intensivelikeanimalfarming.

Water consumption per swine per day Water consumption per chicken per day

Swine breeding stock farms

Fattening swine farms

Chicken products1

Broiler farms2

13882

4435 32

7280

45

122

44

116

44

113

37

108

36

100

34

0 0

40 20

80 40

120 60

160 80

Water (liter)

Water (liter)

2012 20142013 20152014 20202015 2016 2020

Farm Business

GreenFarm:installbiogas

productionsysteminallswine

farmsforelectricitygeneration

2

Feed Business

BoilerModificationProject:

substitutebiomassforfossilfuels

1

Food Business

BiodieselProductionProject:

producebiodieselfromused

vegetableoils

3

Part of Our Commitment to Mitigating Environmental

1 Averageweightofchickenenteringintoprocessingfacilities=2.5kg.

2 Averageweightofbroilergoingoutoffarms=2.5kg.

CPF’s sustainability direction is founded on the belief that the effort

in achieving quality and food safety excellence together with

innovation and efficiency while creating the resilient and self-

sufficient society based on sustainable resource uses would bring

about food security and mitigate social and environmental changes.

It would ultimately leads to sustainability of all parties.

Theworld’sfirstchickenproductmanufacturerandAsiaPacific’sfirstfoodproducercertifiedagainsttheProSustain® standard by DNV-GL

Protecting Biodiversity

Product Sustainability

WeappliedtheconceptofProductLifeCycleAssessmentbasedonISO

14040and ISO 14044 indevelopingour“CPF Product Sustainability”.

Morethan700 itemsofourchickenproductsarecertifiedagainst the

ProSustain®standardbyDNV-GL,theworld’sleadingverifierforproduct

sustainability.

Designing Packaging towards Excellence

Wehelpsavetheearthbyreducingover1,900tonsofplasticandpaper

consumptioninpackagingproductionwhichaccountformorethan260

millionBahtcostreductionduring2007-2015.

Wehavestringentpolicyandpracticetoselectsitesthatarenotlocated

inconservationareasandrigoroussustainablesourcingpolicythatdoes

notsupportthesourcingofrawmaterialsthatcontributetothedestruction

offorestandmarineresources.Wealsoputhighemphasisonprotecting

biodiversitythroughthestrategythatalignswiththenationaldevelopment

plan.Ourapproachisfocusedoncollaborationamongthegovernment,

theprivatesector,andthecivilsociety.

CPF Grow-Share-Protect Mangrove Forestation Project

Wehavebeensupportingmangrovereforestationsince1993.Wehavealso

joinedforcewithDepartmentofMarineandCoastalResources,Biodiversity-

BasedEconomyDevelopmentOffice(PublicOrganization),andcivilsociety

groupstocontinuecommitmentinconservingandrestoringmangrove

forestsinthestrategicareasinRayong,Chumphon,SamutSakhon,PhangNga,

andSongklaprovince,coveringtheareasof2,200rai(3.52squarekilometers)

during2014-2018.

CPF Conserve Ecosystem Project

IncollaborationwiththeRoyalForestDepartment,ThailandGreenhouse

GasManagementOrganization(PublicOrganization),andtheBiodiversity-

BasedEconomyDevelopmentOffice(PublicOrganization),weconserve

and restorePasakwatershed forestatPhrayaDoenThongmountain

coveringtheareaof4,400rai(7.04squarekilometers)during2016-2020.

year year

CPF Summary Report EN 26-10-2016 · PDF file& Ready-to-eat Food Cooked ... complaint...

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