Climate Change Data

Environmental Metrics

ESG Focus Areas

• Ethical Sourcing
• Global Competitiveness
• Ethics and Compliance
• Sustainable Agriculture
• Transparency
• Child Labor
• Food Safety
• Consumer Health
• Talent Management

Environmental Achievements

• Reduced waste by 38% against 2009 baseline
• Achieved 86.6% recycling rate
• 97% of U.S. production at zero-waste-to-landfill sites
• Reduced total GHG emissions by 22% from 2009 baseline; emissions per pound of product produced fell 5% from 2009 baseline
• Reduced total water consumption by 73% from 2009 baseline; water consumption per pound of product produced fell 72 percentage points

Social Achievements

• Launched myWell-Being program, achieving 94% employee satisfaction
• Hosted 939 Hershey’s Track and Field Games meets in 2013, up 16% over 2009 baseline
• Employees volunteered more than 200,000 hours in their communities
• Expanded Manufacturing Apprenticeship Program to provide opportunities for individuals with intellectual and physical disabilities

Governance Achievements

• Revised Supplier Code of Conduct
• Implemented Hershey Environmental Management System (EMS) at three plants

Climate Goals & Targets

Environmental Challenges

• Reversing increase in Total Recordable Incident Rate (TRIR), Days Away, Restricted or Transferred (DART) and Lost Workday Incident Rate (LWIR)
• Establishing benchmarks for international environmental data
• Reaching scale in markets where competition is already entrenched
• Recruiting and developing management and sustainable operations talent in new markets
• Keeping up with demand for products in new markets

Mitigation Strategies

• Investing in capital projects to improve energy efficiency and reduce GHG emissions
• Implementing water-efficiency measures in manufacturing operations
• Investing in global capabilities to harmonize and streamline global management, talent development and go-to-market capabilities
• Implementing a multifaceted approach to supporting the development of agricultural communities

Supply Chain Management

Supplier Audits: 86% of selected external suppliers audited by year-end 2013

Responsible Procurement

• Supplier Code of Conduct
• Winning Together Program

Climate-Related Risks & Opportunities

Physical Risks

• Weather-related impacts on agriculture

Transition Risks

• Regulatory changes

Opportunities

• Development of energy-efficient products

Reporting Standards

Frameworks Used: GRI G4

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Gluten-free, kosher, sugar-free versions of products
• Organic confectionery and baking chocolate products

Awards & Recognition

• Dow Jones Sustainability Index World Index
• DJSI Bronze Medal
• Civic 50
• Corporate Responsibility Magazine’s 100 Best Corporate Citizens list
• PR News CSR award (Workplace Innovation Category)
• Outstanding Business/Education Partnership, Pennsylvania

Environmental Metrics

ESG Focus Areas

• Employee Relations
• Environmental Impact
• Human Rights
• Philanthropic Practices
• Corporate Responsibility Practices
• Supply Chain Sustainability
• Cocoa Sourcing
• Palm Oil Sourcing
• Food Safety and Quality
• Environmental Sustainability
• Community Investment
• Employee Well-being

Environmental Achievements

• Reduced GHG emissions in US distribution and transportation by 4.75% (15.62 million pounds)
• Achieved zero-waste-to-landfill status at El Salto, Mexico plant
• Achieved 88.9% recycling rate
• Reduced waste by 1.4% per thousand pounds of product
• Reduced packaging waste by 1.75 million pounds through 26 initiatives
• New Hershey Miniatures wrapper design reduced paper and aluminum use

Social Achievements

• 38% participation in employee well-being assessments
• Donated $14.3 million in cash and products
• Employees donated over $3.1 million through United Way
• Over 1,700 employees volunteered over 5,300 hours
• Launched RunJumpThrow, a youth activity initiative
• Trained 1,465 cocoa farmers in sustainable practices through Learn to Grow program
• Improved safety across all operations (lower TRIR, DART, LWIR)

Governance Achievements

• J.P. Bilbrey named one of CR Magazine's Responsible CEO of the Year winners
• Updated corporate brand and visual identity
• Included in the Dow Jones Sustainability Index
• Recognized as a Best Place to Work for LGBTQ Equality
• Named in the Civic 50 list

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions
• Increasing raw material costs
• Market competition
• Climate change impacts on supply chain
• Meeting sustainability goals

Mitigation Strategies

• Supplier audits and assessments through Sedex
• Sustainable sourcing of cocoa and palm oil
• Water conservation measures
• Waste reduction initiatives
• GHG emission reduction strategies
• CocoaAction program for sustainable cocoa sector
• Learn to Grow program for cocoa farmer training
• Product Excellence Program for quality and safety

Supply Chain Management

Supplier Audits: 14% of remaining audits completed in 2014; 70% of external suppliers audited by end of 2014

Responsible Procurement

• Sustainable cocoa and palm oil sourcing
• Sedex audits
• CocoaAction program

Climate-Related Risks & Opportunities

Physical Risks

• Climate change impacts on cocoa and palm oil production

Transition Risks

• Regulatory changes related to sustainability

Opportunities

• Development of sustainable products and practices

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• CR Magazine's Responsible CEO of the Year
• Inclusion in Dow Jones Sustainability Index
• Best Place to Work for LGBTQ Equality
• Civic 50

Environmental Metrics

ESG Focus Areas

• Ethical Sourcing
• Sustainable Agriculture
• Illegal Child Labor
• Talent Management
• Ethics and Compliance
• Food Safety
• Consumer Health
• Global Competitiveness, Transparency and Governance

Environmental Achievements

• Decreased greenhouse gas emissions by 8 percent since 2014 and 23 percent since 2009. In 2015, reduced emissions by 13,000 metric tons CO2e
• 11 zero-waste-to-landfill facilities, 71 percent of total production globally took place in ZWL plants
• Monterrey, Mexico plant's desalination system saved 16 million gallons of water

Social Achievements

• Launched Nourishing Minds, a global social purpose initiative to provide basic nutrition to children
• Partnered with Feeding America® to provide meals to more than 13,000 kids
• Launched Energize Learning child nutrition program in Ghana, providing ViVi nutritional supplement to schoolchildren
• Donated more than US$20.7 million in cash and products to 1,300 organizations
• 2,300 Hershey employees volunteered more than 98,250 hours

Governance Achievements

• Received a 100 percent rating on the Human Rights Campaign Corporate Equality Index
• Listed as one of America’s Best Employers by Forbes
• Named to the 2015 World’s Most Ethical Companies® list by the Ethisphere Institute
• Reorganized and streamlined certain aspects of operations

Climate Goals & Targets

Environmental Challenges

• Economic slowdown in Asia and the impact on exports of the rise in value of the U.S. dollar
• Climate change and geopolitical risks in cocoa-producing regions
• Combating illegal labor practices, including illegal use of child labor and use of forced labor
• Improving gender equality in some communities where we source ingredients
• Scaling efforts to provide ingredient information across the entire product portfolio
• Integrating acquired plants into environmental measuring systems and metrics

Mitigation Strategies

• Reorganizing and streamlining operations, hiring a Global Chief Sales Officer
• CocoaAction initiative and Hershey Learn to Grow program to improve farmer livelihoods and combat child labor
• Developing a new food safety training program
• Implementing SmartLabel™ technology for ingredient transparency
• Setting ambitious new environmental goals for 2025

Supply Chain Management

Supplier Audits: 25% of internal manufacturing sites and external suppliers audited

Responsible Procurement

• Supplier Code of Conduct
• Sedex Members Ethical Trade Audit (SMETA)

Climate-Related Risks & Opportunities

Physical Risks

• Shifting weather and temperature patterns impacting cocoa farming

Transition Risks

• Changes in policies and regulations

Opportunities

• Development of energy-efficient products

Reporting Standards

Frameworks Used: GRI G4 Guidelines

Sustainable Products & Innovation

• Brookside Fruit & Nut Bars
• Hershey’s Kisses Deluxe Chocolates
• SoFit brand
• KRAVE Jerky

Awards & Recognition

• Dow Jones Sustainability Indexes
• World’s Most Ethical Companies
• 100 Best Corporate Citizens
• Newsweek U.S. Green Rankings
• Human Rights Campaign Corporate Equality Index
• Forbes America’s Best Employers
• Speedway’s Retail Partner of the Year
• Most Trusted Chocolate Brand
• Top 100 Powerful Brands
• Commercial Project of the Year Award
• Commonwealth Award
• Youth 100 USA report

Environmental Metrics

ESG Focus Areas

• Deforestation
• Climate Change
• Child Labor
• Farmer Livelihoods
• Environmental Sustainability
• Human Rights

Environmental Achievements

• 500,000+ non-cocoa trees distributed to farmers
• 135,000+ hectares with deforestation risk assessment
• 20,500 hectares under community-based natural resource management
• 17,000+ hectares of cocoa agroforestry in development
• 29,621 farmers trained in cocoa smart climate practices
• 10,969 farmers applying agroforestry
• 839 farmers receiving payment for environmental services
• 79,000+ cocoa seedlings distributed in Ghana
• 30,000+ multi-purpose shade tree seedlings planted in Kakum landscape
• 731 hectares restored in Forest Reserve / Forêts Classée (Ghana)

Social Achievements

• 37,757 farmers reached by good agricultural practices training programs
• 23,021 farmers with farm development plans
• 3,074 individuals participating in income generating activities
• 1,244 farmers with land tenure documentations
• Improved land governance in Côte d’Ivoire fostering better relations between social groups
• Establishment of village-level rural land management committees in Côte d’Ivoire
• Women's empowerment projects and activities involving 10,181 individuals (Côte d'Ivoire)
• Youth focused projects and activities (15-35 years old) involving 290 individuals (Côte d'Ivoire)

Governance Achievements

• 100% independently verified cocoa achieved in 2020
• Announced No Deforestation policy in 2021
• Partnership with the Ghana Forestry Commission to protect and restore the Kakum Forest
• Collaboration with USAID on Integrated Land and Resource Governance Program
• Collaboration with NCRC on Kakum Cocoa Agroforestry Landscape Project

Climate Goals & Targets

Environmental Challenges

• Deforestation
• Climate change
• Child labor
• Low farmer incomes
• Land tenure insecurity

Mitigation Strategies

• Cocoa For Good strategy with $500 million investment
• 100% sourcing visibility target in Côte d’Ivoire and Ghana by 2025
• Implementation of programs focused on improving farm conditions, farm and off-farm income diversification and land tenure in Côte d’Ivoire
• Partnership with USAID and NCRC for landscape-scale approaches to governance and land use planning
• Payment for ecosystem services program to incentivize tree planting and conservation
• CLAP project to secure land rights for cocoa farmers in Côte d'Ivoire

Supply Chain Management

Responsible Procurement

• No Deforestation policy
• Requirements for polygon mapping and CLMRS coverage

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather
• Deforestation

Transition Risks

• Regulatory changes

Opportunities

• Development of climate-smart cocoa farming practices

Reporting Standards

Frameworks Used: Cocoa & Forests Initiative (CFI)

Certifications: Rainforest Alliance, Fair Trade USA

UN Sustainable Development Goals

• Goal 8: Decent Work and Economic Growth
• Goal 13: Climate Action
• Goal 15: Life on Land

Initiatives contribute to these goals through improved farmer livelihoods, reduced deforestation, and climate-smart agriculture.

Environmental Metrics

ESG Focus Areas

• Cocoa
• Responsible Sourcing and Human Rights
• Environment
• Our People
• Youth
• Community

Environmental Achievements

• 48% improvement against Scope 1 and 2 GHG emissions baseline (2018)
• 18% improvement against Scope 3 GHG emissions baseline (2018)
• 9.5 million pounds of packaging eliminated
• 77% of electricity consumption was renewable and zero emission energy
• 23% reduction in water intensity at São Roque facility (Brazil)

Social Achievements

• 41% of total candidate search volume sourced through diverse-owned firms (35% increase over planned goal)
• Added 23 HBCUs and HSIs to recruiting roster
• Named as the World’s Top Female Friendly Company by Forbes
• Expanded SmartFlex benefits programs
• Supported nearly 200 VSLAs with 5,879 members (79% women)
• Supported CLMRS covered nearly 103,000 children

Governance Achievements

• Updated Corporate Governance Guidelines to clarify Board’s role in overseeing ESG matters
• Expanded enterprise risk portfolio to include ESG as a standalone risk
• Established ESG Advisory Committee

Climate Goals & Targets

Environmental Challenges

• Global impacts of the COVID-19 pandemic
• Supply chain disruptions
• Systemic racism in the U.S.
• Need for flexible work environments
• Economic consequences of the pandemic impacting cocoa communities
• Climate change, natural resource scarcity and extreme weather posing risks to supply chain
• Deforestation and biodiversity loss in cocoa-growing regions
• Child labor in cocoa-growing communities

Mitigation Strategies

• Flexible working conditions
• Resiliency programs for cocoa communities
• Ambitious new inclusion goals
• Science-based greenhouse gas reduction goals (50% Scope 1 & 2, 25% Scope 3 by 2030)
• Investment in three new utility-scale solar farms
• Improvements in energy efficiency
• Sustainable packaging solutions
• 100% sourcing visibility by 2025 for farmers in Côte d’Ivoire and Ghana
• 100% of cocoa volume sourced in Côte d’Ivoire and Ghana covered by CLMRS by 2025
• Investing in cocoa communities ($500 million by 2030)
• Refining due diligence and transparency in human rights
• Pathways Project to improve DEI
• Supplier Diversity Program
• Water conservation efforts in Malaysia and Brazil
• Waste recycling rate of 85%

Supply Chain Management

Supplier Audits: 238 audits in 2021

Responsible Procurement

• Hershey Supplier Code of Conduct
• Responsible Sourcing Supplier Program
• SMETA 4-Pillar audits
• Corrective action plans and capacity building for suppliers
• Better Buying Institute’s Partnership Index survey
• Responsible sourcing commitments for cocoa, dairy, sugar, palm oil, and pulp and paper

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather
• Water scarcity

Transition Risks

• Regulatory changes
• Market shifts

Opportunities

• Renewable energy
• Energy efficiency
• Sustainable agriculture

Reporting Standards

Frameworks Used: GRI, SASB, TCFD, UNGC, UN Guiding Principles Reporting Framework (UN GPRF), UN Sustainable Development Goals (SDGs)

Certifications: GFSI, ISO 14001, ISO 45001, ENERGY STAR, Bonsucro, Fair Trade USA, Rainforest Alliance

Third-party Assurance: Quantis

Sustainable Products & Innovation

• Organic REESE’S Peanut Butter Cups
• Organic HERSHEY’S bars
• Exploring plant-based versions of HERSHEY’S products

Awards & Recognition

• Forbes World’s Top Female Friendly Company
• Global DiversityInc Top Companies for ESG, Latino Executives, LGBTQ Employees, Executive Diversity Councils, and Philanthropy

Environmental Metrics

ESG Focus Areas

• Climate Change
• Water Stewardship
• Biodiversity
• Deforestation
• Sustainable Sourcing
• Packaging
• Regenerative Agriculture
• Human Rights
• Supply Chain Resilience

Environmental Achievements

• Increased renewable electricity purchased toward 100% renewable and zero-emission electricity coverage by 2030 (80% achieved in 2023)
• Accelerated target to achieve a deforestation and conversion-free supply chain for cocoa, palm oil, pulp and paper, and direct soy by December 31, 2025 (previously 2030)
• Developed a program for reforestation in the cocoa supply chain, with plans to plant 1.2 million trees in Côte d’Ivoire by the end of 2028
• Eliminated 1.7 million pounds of packaging toward a goal of eliminating 25 million pounds by 2030
• 46% water reduction at Hershey headquarters (since 2022)

Social Achievements

• Scaled investment, matched by the EPA, to reduce GHG emissions and improve water quality across dairy farms in Pennsylvania
• Launched plant-based versions of Hershey’s Milk Chocolate with Almonds and Sea Salt Bar and Reese’s Peanut Butter Cups in 2023

Governance Achievements

• Established robust goals for GHG emissions reductions aligned with limiting global warming to 1.5°C
• Executive compensation tied to ESG Priority Goals, supporting carbon reduction goals
• Integrated North America Salty Snacks segment into Hershey’s energy and water management program

Climate Goals & Targets

Environmental Challenges

• Physical supply chain disruptions due to extreme temperatures, drought, and water stress
• Geopolitical risk factors
• Competition for and rising costs of sustainably sourced ingredients
• Potential implications of a carbon tax
• Water stress affecting facilities in India and Mexico
• Biodiversity loss

Mitigation Strategies

• Climate scenario planning to understand and manage climate-related business risks
• Embedding climate change considerations into business processes and sourcing strategies
• Increased investments in commodities impacted by climate change (cocoa agroforestry, sustainable dairy solutions, regenerative agricultural practices in sugar)
• Establishing ingredient-specific climate roadmaps
• Improving energy and water use in operations and setting ambitious targets
• Investing in regenerative agriculture projects
• Implementing effective approaches to independent verification to mitigate deforestation risk
• Reducing unnecessary packaging materials, improving recyclability, and using more recycled materials
• Developing a detailed climate roadmap for logistics
• Developing strategies to communicate expectations to suppliers and strengthen their sustainability management
• Agroforestry initiatives to sequester carbon and mitigate climate risks to cocoa-growing communities
• Setting water reduction targets for manufacturing facilities in areas of highest water stress

Supply Chain Management

Supplier Audits: 86% of priority ingredients and materials sourced from responsible and sustainable sources in 2023

Responsible Procurement

• Investing in cocoa agroforestry, sustainable dairy solutions, and regenerative agricultural practices in sugar
• Implementing effective approaches to independent verification to mitigate deforestation risk

Climate-Related Risks & Opportunities

Physical Risks

• Extreme temperatures
• Drought
• Water stress
• Increased frequency and impact of tropical storms and cyclones

Transition Risks

• Competition for and rising costs of sustainably sourced ingredients
• Potential implications of a carbon tax
• New regulations increasing the liability and cost of packaging materials
• Rising transportation fuel costs
• Impacts on macroeconomic conditions and consumer spending

Opportunities

• Development of energy-efficient products
• Investments in operational energy efficiency and renewable energy to offset carbon pricing

Reporting Standards

Frameworks Used: TCFD

Third-party Assurance: Quantis (limited data); EY (limited assurance)

Sustainable Products & Innovation

• Plant-based versions of Hershey’s Milk Chocolate with Almonds and Sea Salt Bar and Reese’s Peanut Butter Cups