Sustainability Snapshot 2021 - Sunrice
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About This Report Contents The latest SunRice Sustainability Report is combined into our Stakeholder engagement and materiality 2 4 6 8 10 2021 Annual Report. To make it easy to find the sustainability information in one place, we have assembled relevant sections as SunRice undertakes both a formal materiality process to well as our sustainability performance data and GRI Index into this identify the issues that are significant to the business and to key Sustainability Snapshot. stakeholders, as well as informal engagement throughout the FY2021 About Our Brands Our Strategy Our Strategy year, through a variety of channels in order to respond to our stakeholders’ insights. SunRice’s material topics are discussed in Highlights SunRice and Products in Action Reporting boundary and period the SunRice Stakeholder Engagement Statement at www.sunrice. SunRice’s Annual Report covers Ricegrowers Limited ABN 55 007 com.au/sustainability-reports. In FY2021, as part of our approach 481 156 and its controlled entities. Unless otherwise stated, all to sustainability, SunRice identified six priorities that address these disclosures in the Annual Report relate to the Financial Year ended 30 April 2021 (FY2021). In this report, ‘the year’, ‘this year’, ‘crop year 2020’ and ‘CY20’ all refer to FY2021. The ‘2021 harvest’, ‘crop year 2021’ and ‘CY21’ all refer to the rice crop harvested in 2021, material topics and provide a framework for the Group’s response. These priorities and related ambitions and actions are described in Our Approach to Sustainability on pages 28 – 39. 12 Our Approach 24 Our Growers 26 Our People 28 Our 36 GRI Index which will be processed and marketed in the Financial Year ending 2021 reports portfolio to Sustainability Sustainability 30 April 2022 (FY2022). ‘SunRice’, ‘SunRice Group’, ‘Group’, ‘we’ • Annual Report – provides information on SunRice, Performance and ‘our’ refer to Ricegrowers Limited ABN 55 007 481 156 and its including governance, strategy, key risks, financial and controlled entities, as defined in this report. non-financial performance and outlook, and includes the Annual Directors’ Report and Annual Financial Report. Reporting frameworks www.sunrice.com.au/annual-reports The content of the Our Approach to Sustainability section forms • Interim (Half Yearly) Financial Report – provides information on SunRice’s half-yearly financial and part of SunRice’s application of the Global Reporting Initiative (GRI) non-financial performance and outlook. Core standards for FY2020. The GRI Standards are the world’s most www.sunrice.com.au/financial-reports widely used standards for sustainability reporting. The GRI index (see relevant section in this document) highlights where required • Corporate Governance Statement – provides an online FY2020 GRI Core disclosures can be found. The sustainability overview of our policies, procedures and practices to disclosures in this report and the information in SunRice’s ensure application of the ASX Corporate Governance sustainability website www.sunrice.com.au/sustainability serve as Principles and Recommendations (4th Edition). our Communication on Progress for the United Nations (UN) Global www.sunrice.com.au/corporate-governance Compact. Other reports and information Report assurance • Sustainability information – provides further online All disclosures in this document have been subject to SunRice’s information on SunRice’s sustainability strategy, performance internal review and approval processes by management, the and future plans. www.sunrice.com.au/sustainability-reports executive and the Board, as appropriate. • GRI Index – is a summary of how SunRice has addressed each of the GRI reporting core standards, with references to where the detailed information can be located across the 2021 reports portfolio. www.sunrice.com.au/sustainability-reports • Tax Transparency Disclosures – in FY2021, SunRice voluntarily adopted the Board of Taxation’s Tax Transparency Code to complement the Group’s existing tax disclosures and enhance our stakeholders’ understanding of the Group’s compliance with Australia’s tax laws. SunRice’s first Tax Transparency report will be issued in late 2021. • Other information – presentations and announcements made to stakeholders during the year. www.sunrice.com.au/presentations www.sunrice.com.au/announcements B | SunRice Sustainability Snapshot 2021 SunRice Sustainability Snapshot 2021 | 1
2000 suppliers Engaged through the 100+ Community 40% Of our senior implementation of the SunRice organisations leadership roles Supplier Sustainability Program, supported across are held by women, the foundation for the release 6 countries 12 months ahead of SunRice’s inaugural Modern of our FY2022 goal Slavery Statement 28 University and rice research partnerships FY2021 Highlights 6 Six priority issues identified and ambitions set 2 silver awards In the Australasian Reporting Awards for SunRice’s FY2020 Annual Report 41% of sunrice branded products now display the Australian recycling label 100% vitamin enrichment in our white rice in PNG and the Solomon Islands 2 | SunRice Sustainability Snapshot 2021 SunRice Sustainability Snapshot 2021 | 3
Our objective is to optimise returns for both classes of shareholders. About SunRice A Class shareholders Growers B Class shareholders Investors SunRice’s Structure SunRice’s structure supports the interests of both our B Class shareholders or investors, who have the right to receive Rice Pool Profit dividends through our Profit Businesses; Business Shared Businesses and our A Class shareholders, who The SunRice Group is an costs must be Active Growers, and who are Receival, International Rice, paid for their paddy through the Rice Australian ASX-listed branded Asset Pool Business, and have control of the milling & Rice Food, Riviana food group, comprising multiple Financing company. selling of Charge Foods, CopRice & businesses, assets and operations Riverina Rice Corporate While separate, the two business groups across Australia, New Zealand, Revenue – Expenses Brand Use Revenue – Expenses have mutual benefits and purposes. Charges the Middle East, the United States, = Paddy Price = Profit They ultimately complement each other, the Pacific Islands and Asia. strengthening the alignment between our investors and growers. In addition to rice foods, the Group’s diversified portfolio includes gourmet and ‘free from’ food products, and animal feeds and nutrition. Our Payments for paddy rice to Dividends to ~35 major brands are sold in ~50 global markets and we hold leading brand positions in ~15 A Class shareholders B Class shareholders countries. Our ~2000 employees have a strong and growers focus on delivering value for all stakeholders as part of our Group Strategy, underpinned by SunRice’s values and behaviours. Our Stakeholders What Drives Us We are committed to providing our stakeholders with credible, SunRice’s Stakeholder Engagement Statement, which outlines transparent and timely information. We engage with them on the material topics identified by our key stakeholders and our Our values the topics that matter most through a variety of channels and business, and how SunRice engages with each stakeholder and respond to their insights, both directly and as a Group. responds to these issues, can be found at: www.sunrice.com.au/sustainability-reports In FY2021, this included face-to-face Director-led meetings with ~150 of our A Class Shareholders, receiving feedback from ~1200 team members through our employee engagement survey and reaching out to ~2000 suppliers Government and regulators as part of our Supplier Sustainability Program. The governments and regulators Integrity Dynamic Collaborative Innovative Community Employees that have jurisdiction over the We will always do We are fast, flexible Everything is better We constantly We care deeply for the Our team of ~2000, who regions in which we operate or intend to operate. Shareholders the right thing and energetic when we work seek new ideas people and places that work in our businesses Our A Class shareholders, who together and better ways care for us around the world. Community control SunRice, and our B Class The local communities shareholders, who have the right to in which we operate. receive a dividend (if declared). Our behaviours Peers Food and non-food Peer companies which SunRice suppliers, including growers Customer focussed Intellectually curious Decisive Good communicators engages with on mutually The people and enterprises from which we Without our customers, nothing We will create an environment We do what we say and say We work hard on being beneficial initiatives. purchase our rice and other food products, matters. So we work tirelessly that will keep curious minds what we do, making smart, respectful communicators, and to deliver the highest quality active. We will encourage open enterprise-wide decisions pride ourselves on taking the as well as other goods and services. product, demonstrating an engagement and collaboration as well as taking personal time to listen and respond (not Media and analysts Non-government unbridled passion for customer and look at challenges as accountability for results or react). We practice coaching and Analysts and local, national and organisations (NGOs) service excellence, safety and opportunities to unearth fresh, outcomes. Being decisive also the more we communicate, the international media outlets which Advocacy groups and other peak sustainability. creative ideas, or new solutions. means being brave, so we’re not deeper the understanding. That cover SunRice, or our subsidiaries, Customers bodies of which SunRice is a afraid to take calculated risks way, everyone has the same set and the rice industry. and consumers member, or works closely with. to make a difference in the way of facts. Groups which purchase our we work. products for consumption or use in a value add product. 4 | SunRice Sustainability Snapshot 2021 SunRice Sustainability Snapshot 2021 | 5
Our Brands and Products With ~35 major brands and market leading positions in ~15 countries, the SunRice Group continues to grow in key markets. In FY2021, we added 12 brands and more than 150 related products to our portfolio. This included SunGold, Toscano, Hart & Soul and Bare Bakers, as well as Top Cow, Top Calf and Longacre in New Zealand. Our business segments, product mix and markets are directly aligned to our 2024 Growth Strategy. RICE POOL BUSINESS Australian Rice Pool Supplying premium branded Australian rice, #1 #1 Rice brand in Rice brand in built on provenance and our heritage. Australian & Australian New Zealand food service grocery channels PROFIT BUSINESSES International Rice A growing global supply chain and #1 #1 #1 distribution network, delivering quality Rice brand Medium grain Rice brand across and sustainability. in PNG & the rice brand in the 10 other Pacific Solomon Islands Middle East Island markets Rice Food Innovation in healthy snacking and food #1 #1 ingredients aligned to global food trends. Microwave Rice cakes brand rice brand in Australia and in Australia New Zealand Riviana Foods Brand led food business building on #1 #1 Pickled Olives brand “special occasions” and key consumer vegetables brand in Australia trends. in Australia CopRice Innovative animal nutrition that leverages SunRice’s Riverina rice by-products. 6 | SunRice Sustainability Snapshot 2021 SunRice Sustainability Snapshot 2021 | 7
Perry and Catherine Hardy Our Strategy Coleambally rice growers Our 2024 Growth Strategy is designed to cement the SunRice Group’s position as a truly global, multi- origin, multi-market FMCG business. Importantly, The external macro factors1 we are proudly Australian-owned and our business that influence us are: is designed to benefit our investors, our growers, our Macroeconomic considerations employees and the communities in which we operate. • Growing demand for health, Challenges: 2 Over the last two years, a range of extraneous factors in the form of the drought and wellness and nutrition COVID-19 has delayed our ability to execute the Group’s original five-year growth plan, • Trust, traceability and transparency • Increasing global competition. due to end in 2022. The plan and its targets still remain responsive to and appropriate • Demographic shifts • Volatility of Australian rice supply. for the external macro factors and specific business challenges that influence SunRice. • The rise of the Asian consumer • Alternative crops competing for Accordingly, we have extended the Growth Strategy’s timeline by two years to 2024, • Food security limited water and land. as we focus our efforts to achieve our goals and build on the significant foundational • Supply chain stress • Market diversification and access. work undertaken to date (see Our Outlook on page 26 for further details). Sustainability considerations • Foreign exchange volatility. To optimise returns for both • Climate change • Economic conditions, including Objectives classes of shareholders by… • A global waste crisis geopolitical instability. • Water scarcity • Climate change. • Chemicals and pesticides • Market impacts of COVID-19, including • Habitat and biodiversity loss disruptions to the shipping industry. • Poverty, slavery and inequality • Competition for talent, resources and Increasing Adapting Securing • Population growth capabilities. profits and reducing our product range a sustainable and earnings volatility to take advantage of reliable global changing food trends supply chain What success looks like: Strong financials How we’re responding: 1 3 4 An aspirational revenue target of $2bn , Cementing a global supply chain in Being recognised for our high which may take longer to achieve than response to increased demand in performance, delivered by by 2024, and to maintain double digit branded products, ensuring quality a positive, inclusive and returns on capital employed. and sustainability. accountable culture. 2 Premium branded player 5 Repositioning Australia as the supply Accelerating the growth and Leverage our reputation for quality source of choice for premium branded diversity of our strong, cash- and innovation in premium varietals, rice markets. generative portfolio, including healthy eating and snacking. 3 through further investment in Using our capabilities to meet evolving Riviana and CopRice. Asian presence global food trends, especially in healthy Expand sales in high-growth Asian eating and snacking, in particular through: consumer markets. • Diversifying into new markets to offer high- Diversified earnings quality and convenient packaged rice of trusted provenance. Expand our CopRice and Riviana Foods • Playing a pioneering role in addressing the segments through strategic growth obesity and diabetes epidemics with our unique opportunities. Low GI rice. Food ingredients expansion • Leveraging our unique position to take advantage of the global fascination with sushi. Build our tailored food ingredients • Being recognised as a leader in healthy offering to service industrial customers. snacking through a range of innovative snacks. Resilient global supply chain • Operating a strong food ingredients business with diversified, high-value rice derivatives Secure a multi-varietal and resilient servicing global food companies. global supply chain with Australian growers at its centre. • Assurance of quality and sustainability with traceability, no matter where we grow our rice. 1. See pages 11 – 12 in our FY2020 Annual Report for 2. Further detail about our approach to these challenges can be found in Our Approach to Sustainability further information on our global context. on pages 28 – 39 and Our Approach to Risk on pages 44 – 49 in our FY2021 Annual Report. 3. This is an aspirational target, not a budget or forecast and assumes reasonable macro conditions. 8 | SunRice Sustainability Snapshot 2021 SunRice Sustainability SunRice AnnualSnapshot Report 2021 | 9
SunFoods, California, USA Aqaba Processing Our Strategy USA Italy Company (APC), Jordan SunFoods, in Action A focus on product Japan Hawaii, USA Ensuring reliable China innovation Pakistan Despite challenging operating conditions, and quality supply Rice supply sources Taiwan and new launches Global offices which included the ongoing impacts of low and assets India Myanmar Australian rice production, COVID-19 and Existing markets Thailand Vietnam instability in key global markets, the Group Cambodia Ricegrowers Vietnam Target markets Ricegrowers Trukai Industries, retained a sharp focus on executing SunRice’s and/or new offerings Middle East, UAE Papua New Guinea 2024 Growth Strategy. in existing markets Ricegrowers Singapore SolRice’s launch of This included leveraging a strong balance sheet to invest for Solrais Famili, Further expanding our the future at a time when many businesses were focused solely SunFoods’ significant and strategic which underpinned supply sources, including SolRice, on survival. Our investment in developing global supply sources agreement with the Central Valley Rice the business’s market Ricegrowers Singapore’s Solomon Islands over many years also ensured we were well placed to service Growers Association to guarantee leading position in the negotiation of significant supply of high-quality medium grain agreements with strategic Solomon Islands in our markets despite the difficult circumstances. rice through until at least January commercial partners in Australia FY2021. SunRice’s investment in our people, our brands and our 2024. The rice, to be sourced from the China and India to ensure Association’s 115 rice growing members, Uruguay the supply of milled white environment, supply chain and assets hold us in good will be processed at SunFoods’ facility rice to key markets in the stead for the future. Across the Group, our strategy in action at Woodland California, and packed into Pacific throughout FY2022. included the following highlights for FY2021. high value branded products for sale to SunRice, CopRice, customers in existing and new markets. AGS, Riviana Foods, Ricegrowers Australia New Zealand Riviana Foods’ transformative Growing benefits of the New product innovation in Increased product innovation and acquisition of branded food importer, integration of Roza’s Australia, including the launch export opportunities, including the KJ&Co Brands, for $51 million, which Gourmet into the of the Riviana Basmati launch of Brown Rice Chips and is already delivering benefits and is Riviana Foods’ business, microwave range and SunRice’s Cracker Chips in China, Singapore, expected to be earnings per share including doubling new Flavour Your Rice sachets. Hong Kong, United Arab Emirates, Growth through accretive in the first full year of ownership. Kuwait and Qatar, as well as the its revenue relative to strategic M&A The acquisition included KJ&Co’s exciting FY2018, the financial year launch of health and wellbeing and capital brand portfolio, featuring Toscano, Hart immediately prior to the and microwave rice ranges into the investment & Soul and Bare Bakers amongst others, acquisition in September United Arab Emirates. which are sold into the Australian retail 2018. markets, including through Coles and Woolworths, and distributed in New Zealand. CopRice’s acquisition of the dairy CopRice’s expansion into New and beef business of Victorian-based Zealand following the acquisition of The launch of a producer of livestock products Inghams’ dairy nutrition business, new more affordable The launch of SunRice’s Riverbank Stockfeeds for $5 million, which produces and sells dairy and Asian-sourced rice new Australian including a feed mill at Leongatha calf feed products. The $11 million brand, SunGold into Infant Rice Cereal. and a dairy business across Gippsland acquisition represents CopRice’s the Australian food While ranging was and south west Victoria. Having a first operational expansion into the service market. achieved in Australian manufacturing facility in Gippsland important New Zealand dairy market, retail channels, entry into complements CopRice’s existing and included Inghams’ feed mill at China via the daigou sales facilities, securing coverage across all Hamilton, and direct-to-farm and channel was impacted by key dairy regions in Victoria. packaged dairy business in New COVID-19. Zealand under the ‘Top Cow’, ‘Top Calf’ and ‘Longacre’ brands. 2020 Modern Slavery The completion of the FeedRite The completion of the Statement site upgrade, which was acquired $4.5 million upgrade of Building our sustainability The implementation of the Group‘s new by CopRice in FY2020. With a the Leeton Specialty Supplier Sustainability Program, total investment of $6 million, the Rice Foods Facility to framework for the future, with a focus on labour standards in Wangaratta facility reopened in FY2021 reduce operating costs An ongoing including the identification the supply chain as a part of SunRice’s as a pet food and companion animal and improve product focus on of six priorities for commitment to United Nations product manufacturing plant. innovation and quality sustainability SunRice’s sustainability Sustainable Development Goals. This The release of SunRice’s of our microwave rice. included reaching out to more than The facility was formally targets where we can make inaugural Modern Slavery 2000 suppliers worldwide. opened by NSW Minister a difference, including Statement in response to the for Finance and Small SunRice’s ambition and the SunRice’s adoption of the Board of requirements of the Australian Business, Damien Taxation’s Tax Transparency Code Modern Slavery Act 2018 (Cth). actions to be taken as we to complement the Group’s existing The statement reflects the work Tudehope MLC in April 2021. develop measurable and tax disclosures and enhance our undertaken across SunRice to meaningful goals for each. stakeholders’ understanding of the better understand and manage Group’s compliance with Australia’s tax the risks of modern slavery and laws. Our first Tax Transparency report human rights abuses in our Further details can be found in the relevant segment performance sections will be issued in late 2021. operations and supply chain. on pages 16 – 25 and in the Our Approach to Sustainability section on pages 28 – 39 in our FY2021 Annual Report. Further strategic initiatives are discussed 10 | SunRice Sustainability Snapshot 2021 in Our Outlook on pages 26 – 27 in our FY2021 Annual Report. SunRice Sustainability Snapshot 2021 | 11
Our priority issues & ambitions We also worked with SunRice’s Board to define our long-term ambitions for these We continue to evolve our approach and programs and in the following pages we In FY2021, we took the next step in our areas. By leveraging our assets and our share our short-term actions to support sustainability journey, defining the six skills with focus on these six priority issues, these ambitions. Our detailed targets priority issues that support our sustainability we know we can deepen our impact and and the roadmaps to deliver against framework and our growth ambitions. address the material topics to our business.4 them will follow. Our Approach to Sustainability Our Framework Making a difference to the sustainability Like all food products, rice relies of places and lives on a healthy ecosystem and thriving rural and regional communities by WASTE REDUCTION AND to deliver the highest quality WATER EFFICIENCY CLIMATE RESILIENCE SUSTAINABLE PACKAGING outcomes. As such, looking after MAKING A DIFFERENCE people and planet is core business. TO OUR ENVIRONMENT Towards the most Net zero emissions from Toward zero waste Minimise the environmental impact of our products from water-efficient rice our controlled operations from our products Whether it be ensuring access to nutritious food, farm to table products in the world Partner with growers to and packaging supporting regional communities in need or reducing the environmental impact of our operations, SunRice create a step change in has a long history of looking after the people and MAKING A DIFFERENCE reducing emissions planet that look after us. TO OUR COMMUNITIES Partner with communities This section provides a snapshot of SunRice’s to enrich lives socially and sustainability efforts, as well as our commitment economically, leveraging to public and transparent communication of our our expertise wherever ambition in our priority issues, goals and sustainability we operate performance. It also serves as our Communication on Progress for the United Nations Global Compact. MAKING A DIFFERENCE For more information on our sustainability WITH NOURISHING performance, please see: www.sunrice.com.au/ PRODUCTS sustainability-reporting. Create nutritious products to improve the lives of consumers PARTNERING FOR RESPECTING FOOD SAFETY, RESILIENT COMMUNITIES HUMAN RIGHTS SECURITY & QUALITY by taking action to achieve our ambitions we will deliver Our communities Equity and equality Food security and on the following SDGs consider SunRice a vital across our operations quality products for and address the topics that are part of their ecosystem and supply chain our communities material to our business,4 creating value for all of our stakeholders. Our Pathway 2018 2019 2020 2021 2022 Established Board Senior executive Integrated financial and Identified key priority Deliver short term governance of sponsorship for non-financial reporting issues and ambitions actions identified sustainability, including sustainability, followed by to provide information in this report First Modern Slavery Sustainability Charter the appointment of the on all aspects of Statement issued Create road maps first Head of Sustainability our performance in Became a toward targets in SunRice’s annual report SunRice Supplier signatory to Materiality assessment each priority area Sustainability UN Global completed Introduced three-year Code implemented Compact performance data Released inaugural SunRice Australia Sustainability Report 12 | SunRice Sustainability Snapshot 2021 4. For detail on material topics identified by our key stakeholders and our business, and how SunRice Sustainability Snapshot 2021 | 13 SunRice engages and responds, please see: www.sunrice.com.au/stakeholder-engagement.
An industry OUR PRIORITIES committed to R&D More than $85 million Water efficiency invested in research and Our ambition FY2021 results development programs by Make SunRice the Australian rice industry World leaders in water efficiency since 2012 resulting in 0.88T/ML products the most water-efficient varieties average water Water is essential to all agriculture, efficiency achieved such as Reiziq, Viand, Topaz including rice. Most Australian rice water efficient in and others suited to the across CY20 Riverina is grown using general water security Australian climate. rice crops. allocations, meaning water is allocated to production after the needs of the Great tasting products the world A new environment, people, high-security water with less water Australian rice variety users and livestock have been met. Not only has our $4.5 million tested, with positive upgrade to Leeton’s Specialty results ready for next year. Because rice is an annual crop, in years of limited water availability, our farmers either don’t grow it or grow only very small quantities. Rice Foods Facility boosted They flex their production to respond to their environment. It’s the perfect crop for the variability of Australian conditions. the texture and quality of our best-selling microwave 492 growers trained by our When our farmers do grow rice, they are among the most water rice, but it will also reduce supply partner in Thailand. efficient in the world, using 50% less water than the global average our fresh water use and and achieving some of the highest yields in the world. wastewater. 2,200+ recorded touch points with our growers, from field days to podcasts, all focused on sharing best practice. FY2022 actions A BOLD NEW PLAN Develop a FOCUSED ON WATER road map DEVELOPING NEW VARIETIES SHARING BEST PRACTICE ENHANCING NATIVE VEGETATION USE EFFICIENCY in partnership with the rice industry, including specific AND KNOW-HOW THROUGH WATER FLOWS grower extension Through the Australian Rice Partnership, A wholly owned subsidiary of SunRice, Rice Research activities focused on SunRice’s researchers have been involved Our leading water use efficiency is a result In FY2021 our Rice Research facility Australia Pty Ltd (RRAPL) was established more than improving water use. in the development of a new cold-tolerant of the industry’s collaborative approach to participated in a native vegetation 30 years ago for the specific purpose of carrying out rice medium grain variety ‘VO71’, which was research and development and the adoption initiative with the NSW Department of research and development. It’s part of a unique three- of world-best management practices. Planning, Industry and Environment, the way Australian Rice Partnership between SunRice, the Develop trialled in southern NSW in FY2021. Commonwealth Environmental Water Office NSW Department of Primary Industries and AgriFutures To date VO71 has responded well, with Practices like delayed permanent water Australia to deliver improvement in breeding, agronomy a plan and the Murray Darling Wetlands Working its built-in mechanisms to reduce the risk leverage techniques, including direct drilling, and extension. Group to demonstrate how enhancing native of cold damage. Early results show an to allow growers to delay the time their vegetation can enhance biodiversity and in To support the Australian Rice Partnership’s work and to share insights with increased yield and improved water use crops need permanent water on them while turn benefit the rice industry. build on our world leadership position in rice productivity Vietnamese growers, efficiency, even against our top performing continuing to produce higher yields and and water use efficiency, AgriFutures has announced including finalising a current varieties. reduce greenhouse gas emissions. Variations Under the initiative, rice irrigation systems a bold new plan to increase water use efficiency in the $5 million research and on this technique are being adopted around were used to efficiently deliver water to The new variety is one of several developed Australian rice industry. development partnership the world as a solution to help make rice the Black Box forest at our ‘Old Coree’ through investment in research and with government and from other countries more sustainable. property, rejuvenating numerous native Together, our goal for Australian rice production is development by SunRice, Australian research institutes to plants, including nitre goosefoot, lignum to achieve an industry average of 1.5 paddy tonnes underpin sustainability in rice growers and the NSW and Federal In Australia, a network of extension officers and nardoo without the need for overbank per megalitre by 2030. This is a 75% water productivity the Vietnam supply chain. Governments. This has led to specialty ensures our growers have access to best flows in these once flood prone regions. improvement on FY2021 levels. varieties better suited to the Australian practice information throughout the This environmental work complements climate that are widely used across the season. We then track and share results to rice growing activities, providing habitat for Riverina region of Australia and have drive continuous improvement. We’re now supporting plants and aquatic animal life in been adapted to suit SunRice’s Northern working with our partners in Thailand and one operation. Australian rice growing operations. Vietnam to share what we know and work together to achieve better results. 14 | SunRice Sustainability Snapshot 2021 SunRice Sustainability Snapshot 2021 | 15
OUR PRIORITIES Climate resilience Our ambition Committed to climate action SunRice is committed Net zero to implementing the emissions SunRice relies on natural resources in from our recommendations Australia and around the world to supply nutritious food products. Material changes of the Task Force on controlled in weather patterns and reduction in Climate-related Financial operations Disclosures biodiversity, which are increasing with climate change, may negatively influence arable lands Partner with currently used for rice production, crop yields, Since 2018 we’ve saved growers to nutritional composition of rice, farming cost approximately 1,026MWh create a step and deplete the number of farmers. per annum through our change in It is critical that we continue to reduce carbon pollution and position ongoing program to install reducing energy efficient lighting SunRice to manage the risks and opportunities of a changing climate. across our Australian emissions In FY2021, across our businesses, we have ensured we have the data and information we need to continue working towards our ambition of net zero operations. That’s the impact from our controlled operations. equivalent of 1,088 tonnes FY2021 results In terms of climate resilience, our commitment has long been embedded in of CO2. both the SunRice 2024 Growth Strategy and our risk management activity. Group baseline projects We continue to work to implement all of the recommendations of the Task for energy, waste and water were completed. Force on Climate-related Financial Disclosures (TCFD) to provide continued transparency on these issues to our stakeholders. ~30,000GJ of renewable energy for drying rice in our Vietnam mills was generated from rice hulls. Progress toward TCFD recommendations, including management presentation of progress plan to Finance Risk and Audit Committee (FRAC) TOWARDS NET and confirmation of FRAC oversight.5 EXPERTS AT GLOBAL SOURCING SUNFOODS: POWERED BY RENEWABLE AND CARBON REDUCING METHANE IN MOULAMEIN ZERO EMISSIONS FY2022 actions A key element of SunRice’s 2024 FREE ENERGY Growth Strategy is the establishment SunRice Director, Dr. Leigh Vial’s family has of a secure, sustainable and reliable In FY2021, our U.S. based subsidiary been farming rice for more than 50 years in In FY2021, with the support of the NSW Government Department Develop our Net Zero global supply chain that mitigates our SunFoods LLC moved to renewable southern NSW. of Planning, Industry and Environment, we’re proud to have Emissions pathway by: exposure to weather events in any one and carbon free forms of energy commenced two new projects: an Energy Management Program, • Finalising our In 2005, Leigh commenced a program region. This diversification strategy to power its plant in Woodland, and a Net Zero Emissions Strategy. energy baseline to reduce methane emissions at his was initiated more than 10 years California. Sourced from Valley Clean and identifying property North Dale. By switching from As part of these projects, we have investigated and developed an ago by investing in direct access to Energy, 42% of the site’s energy was opportunities. aerial seeding, where germinated seed is energy consumption and energy performance indicators baseline; Californian rice and, more recently, by renewable and 75% was carbon free. • Reviewing potential dropped into water, to direct drilling where a carbon emissions baseline and business-as-usual forecasts; a the acquisition of a mill in Vietnam. As the SunRice Group has worked for 100% renewable rice is drilled into unflooded soil, methane masterplan for the aggregation, analytics and reporting of energy to improve its energy management electricity at specific As part of this, SunRice has production has reduced significantly. This and emissions data; and a consolidated register of renewable systems, SunFoods has provided a sites. accelerated establishment in recent is complemented by a no-till approach to energy investment options and efficiency projects. years of strategic relationships with important pilot site for how this can crop establishment, which preserves soil • Partnering with our key suppliers to access suitable lead to improved performance at a site carbon. Some rice growers are pushing Together these actions establish the foundations for us to identify growers to create an level. the boundaries further by using delayed and evaluate climate-related risks and opportunities to deliver emissions baseline for rice from other countries, such as permanent water, which can add to this a step change to our energy use and carbon emissions profile, our rice products. Cambodia, China, India, Italy, Pakistan, Spain, Taiwan, Thailand and Uruguay. reduction in methane production and enabling us to develop a robust road map to net zero emissions for • Continuing to progress increase nitrogen efficiencies. It’s part of an our business operations. TCFD adoption, industry-wide shift towards techniques that including climate are delivering excellent outcomes for both 5. Please see page 44 of Our Approach to Risk for further information. scenarios. on-farm performance and the environment. 16 | SunRice Sustainability Snapshot 2021 SunRice Sustainability Snapshot 2021 | 17
OUR PRIORITIES Waste reduction and sustainable packaging Our ambition FY2021 results We’re on a mission to waste nothing Creating new uses for difficult wastes Toward zero 400 waste from SunRice, Riviana and Our ambition is to be a zero-waste business, 195 pallets of SunRice’s CopRice branded products meaning nothing goes to landfill from our reviewed for packaging operations or products. This is not without Australian one tonne bulker bags used to our products sustainability. and packaging its challenges, but with waste becoming an transport rice were New Product Development increasingly valuable resource, SunRice is recycled into new assessments of packaging already well on the journey. bulker bags and sustainability now included other recycled plastic in all new packaging. More than 30 years ago, our CopRice business was created to make nutritious animal feed from rice by-products. Today, SunRice turns products, as part nearly all rice by-products into new and valuable products including nutritious stabilised rice bran, rice flour, quality stock feed products, of a new pilot in FY2021. 41% companion animal food, animal bedding and pet litter. This year we of SunRice branded products expanded that approach to include by-products of other agricultural now display the Australasian A global approach Recycling Label. crops such as almonds and grapes. to waste When it comes to packaging, we continue to play our part in working Our Vietnam operation towards a circular economy. Guided by the Australian National reported recycling or FY2022 actions Packaging Targets and as members of the Australian Packaging Covenant Organisation (APCO), we have made some good progress. reusing the majority of We also acknowledge there is still work to do. its wastes in FY2021, In line with APCO targets: demonstrating local • Complete review of all leadership on a global Australian packaged products via APCO issue for the SunRice tools to determine Group. sustainability. • Continue roll out of ARL labelling for the Group products in Australia CAMPAIGN TO and New Zealand with a target of 100% by HELP CONSUMERS FY2024. UNDERSTAND • Create baseline for waste and begin RECYCLING developing the road map towards zero. We know that in Australia the amount of soft plastics that are being CREATING VALUE FROM SHARING EXCESS PRODUCT NEW WAYS TO DISPLAY recycled is not high enough to meet Australia’s National Packaging EVERY GRAIN SUSTAINABILITY Excess products are those we can’t Targets. One thing we can do to contribute is to help consumers By-products include the parts of sell. Wherever possible, we donate At SunRice, we’re always looking for understand the types of packaging that can be recycled and the the rice that don’t end up in our these products to charity to help ways to bring sustainability to life for recycling system. core products, including rice hull, those in need. We top this up with our business and for our customers. SunRice developed and launched campaigns via our social channels rice bran and broken rice. They are extra donations because it’s the In FY2021 we started using sustainable in FY2021 to share the details of how REDcycle works and remind highly nutritious, so we process them right thing to do. displays to showcase our products our customers that in Australia 99.9% of our SunRice soft packaging into rice bran, rice flour, stock feed, Supporting our local communities is in Australian retailers. The displays, can be recycled through that program (and a large percentage of companion animal food, animal part of our values and we’re proud to produced from recyclable materials our other Australian packaging can also be recycled through your bedding and pet litter. In FY2021, have been working with Foodbank in Australia, replace metal and plastic kerbside recycling). We will continue to build this awareness through 100% of the rice hull by-products since 2002. Last year, we donated fittings with cardboard clips and struts, the adoption of the Australasian Recycling Label (ARL), which from milling our Australian rice crop 114,700 equivalent meals through while still holding 16 kilograms of will soon feature on 100% of all of our Australian SunRice were turned into new and valuable Foodbank to help fight hunger in product per shelf. They look so good branded products. products. Australia. If excess product can’t be (and perform so well), we’re expanding In the future, innovation will help solve the challenge of recyclability In our Vietnam mill, our drying used by communities in need, we look their use for our newly acquired Toscano of soft plastics and alternative packaging types that can protect equipment is also powered by rice for options such as worm farms to and Hart & Soul branded products, as and keep our products safe. Until then, we continue to proactively hulls, using approximately 30,000GJ ensure the goodness of the product well as our Always Fresh and Fehlbergs improve the sustainability of all our packaging for all our products by of renewable heat energy. is not lost. In FY2021, 89.9 tonnes of products. reducing, removing and improving it wherever we can. You can see excess product went to Wormtech as our progress here: www.sunrice.com.au/sustainable-packaging/ part of a new pilot project to find new uses for waste. 18 | SunRice Sustainability Snapshot 2021 SunRice Sustainability Snapshot 2021 | 19
OUR PRIORITIES OUR PRIORITIES Partnering for resilient communities Our ambition Human rights Our ambition In FY2021 we reached out to more than Our Equity and Helping grow resilient communities In years of average Riverina rice production, SunRice delivers close to $400 million per annum directly in the Riverina region of communities Respecting human rights SunRice fully supports the United Nations 2000 suppliers to engage equality Rice farming and production NSW and supports more than 600 growers, 500 employees and 400 local suppliers.6 consider Guiding Principles on Business and Human Rights and expects our business, employees them in our Supplier Sustainability Program across our supports agriculture and farmers, sustains lives On top of this, SunRice invests significantly in SunRice a and suppliers to respect all human rights, operations vital part and our local causes, including regional sponsorship, and improves the health community engagement, training and including labour rights, throughout our Access our inaugural Modern Slavery Statement at www. operations and supply chain. of communities. development, as well as providing aid- based support where it is needed most. of their We are proud to have released our first Modern Slavery Statement sunrice.com.au/our-modern- slavery-statement. supply chain With more than 70 years of operation in the NSW Riverina, we understand what investing This approach to job creation and local community investment is replicated ecosystem during FY2021, which reflects the work undertaken across SunRice to date, to better understand the risks of modern slavery and human in our communities looks like and what it everywhere we operate, including in rights abuses in our operations and supply chain and to determine FY2021 results can mean to those living there. North Queensland, Vietnam, the U.S., the a long-term approach working with our suppliers to tackle these Solomon Islands and Papua New Guinea. FY2021 results challenges. With its release, we recognise the need for continued, Inaugural Modern increasing effort and stakeholder collaboration to achieve the shared Slavery Statement issued. 100+ goal of equity and equality across our operations and our supply chain. Sustainability Supplier community organisations supported across Code implemented. 6 countries. Interactive eLearning module developed and $52.4m launched to communicate our Sustainability Supplier in paddy payments Program to our Board, to Riverina growers. employees and suppliers. 114,700 Targeted training sessions for our procurement and SunRice meals donated supplier relationship via Foodbank in 2020. teams, prior to engaging with over 40 priority SUPPORTING HEALTHY COMMUNITIES DELIVERING EDUCATION OUTCOMES, DEEPENING OUR UNDERSTANDING OF BUILDING STRONG GOVERNANCE strategic suppliers. THROUGH BIODIVERSITY INITIATIVES AS WELL AS RICE ACROSS THE PACIFIC SUPPLY CHAIN RISKS AND PROCESSES FY2022 actions The Bitterns in Rice Project is about farming Our businesses Trukai Industries and SolRice In FY2021 we launched SunRice’s new Supplier As we dig deeper in engaging with our and wildlife conservation working together. have a long history of investing in campaigns Sustainability Program across our network suppliers, it is critical that we have strong FY2022 actions Develop a community related to health and nutrition, literacy and of more than 2000 suppliers. As a part of our internal governance, processes and systems Since 2012, we have worked with the engagement strategy domestic violence across the Pacific. risk assessment process, approximately 40 to be able to respond effectively to any 2021 Modern Ricegrowers’ Association of Australia and to reflect our ongoing suppliers were prioritised for deeper one-on- modern slavery risks we uncover. Slavery Statement. Riverina Local Land Services to uncover Since FY2020, SolRice has partnered with the commitment to support one engagement. the well-guarded secrets of the globally Solomon Islands Government’s Ministry of our vibrant global In FY2021, we reviewed our internal endangered Australasian bittern. We now Women, Youth, Children and Family Affairs, supplier and community While we wanted to better understand how processes and engaged with legal, finance, Three year road map know there is a large breeding population that the Royal Solomon Islands Police Force and ecosystem. our priority suppliers are managing their risks, people and culture, risk and quality outlining how we will descends on the rice crops of the NSW Riverina the Australian High Commission to distribute more importantly we wanted to understand assurance experts, with a longer-term view minimise the risk of each year, numbering 500–1000 mature pamphlets with its SolRais-branded bags. how we can collaborate with them to improve to embed an ethical sourcing mindset, labour rights abuses in our Review and relaunch our individuals in most years. This is remarkable, The pamphlets include options and performance across our supply chain. A pilot enabling sustainable procurement practices operations and supply chain inclusion and diversity as there are only 1500–4000 of these bitterns information for survivors of violence, while was launched to provide these suppliers with and continuous improvement. This resulted and, by fostering trusted policy and practice and remaining in the world. reminding perpetrators that violence against access to eLearning and resources to increase in new clauses being inserted in our supply supplier relationships, target our engagement to women, including their wives, is illegal. their awareness and understanding of modern and procurement contracts, as well as identify and address any reflect our communities. The project provides growing tips and small issues uncovered. slavery risks and help them complete risk-based proposed changes to the way we select incentives to help rice farmers implement During FY2021, the Solomon Islands health self-assessment questionnaires transparently. and onboard new suppliers and report on practices that will best support the bittern officials again relied on SolRice to get potential human rights related issues. Continue to strengthen population. In FY2021, 11 growers across important COVID-19 health information out We have now received close to 90% of our supply chain mapping 952 hectares participated and initial surveys through our on-pack distribution network, questionnaire responses and commenced We will continue to test, review and refine and supplier engagement revealed at least 24 bitterns at the incentive further demonstrating our role in delivering analysis of the data. We will report the our processes to ensure the robustness of to improve our supply sites. These results show that the industry is education, as well as rice, across the many results and intended follow-up from these our internal governance systems. As a Group, chain visibility and risk on the right track and reinforce the value of the hundreds of islands that make up the questionnaires in our second Modern Slavery we are committed to effectively surfacing assessment. incentive program to this endangered species, Solomons. Statement, due for release in October 2021. and responding to modern slavery risks, in as well as our regional communities. alignment with our broader SunRice risk and We know there is more to do to engage with our compliance approach. Photo: Matt Herring. 6. Based on a crop year of ~600,000 paddy tonnes. suppliers on how to use these resources and 20 | SunRice Sustainability Snapshot 2021 this is part of our focus for the coming year. SunRice Sustainability Snapshot 2021 | 21
OUR PRIORITIES Food safety, security and quality Our ambition FY2021 results Rice is eaten by more people in the world Food security Supporting those who support others 100% In FY2021, Trukai Industries than any other grain. It’s a staple food for more than 3.6 billion people, who rely on and quality supported Port Moresby General of our operations Hazard Analysis and rice for more than one meal a day. products for our Hospital with monthly rice donations and extended support to St John Critical Control Point (HACCP) certified. We appreciate the role rice plays in food security, particularly in communities Ambulance and three further the Pacific, where our support spans more than 50 years and where we partner with governments to provide vitamin enriched rice to hospitals as the pandemic escalated. Likewise, SolRice partnered with 100% positively contribute to local health outcomes. vitamin enrichment in our the Salvation Army to distribute rice white rice provided to PNG Our processes and systems underpin the safe, nutritious, quality and tuna to communities who were and the Solomon Islands. products we supply to around 50 countries. So, however you receive without food after local gardens were our products – whether in a restaurant, direct from the supermarket damaged by Cyclone Harold. Infant rice cereal offering shelf or via aid assistance – you can count on the SunRice quality. launched in Australia. Multigrain options for Asia and the Middle East Health and wellbeing As SunRice experiences double digit range launched in the growth in convenient microwave rice Middle East. formats, our range was introduced into China, Hong Kong, and the Establishment of new third United Arab Emirates in FY2021 with party quality and technical a particular focus on the multigrain partners to validate offerings, which are increasingly products globally. appealing to time poor health- conscious consumers. Aid, food security and COVID-19 related support offered to organisations where we operate. THE AUSTRALIAN QUALITY STORY RIVERINA RICE NOURISHES BABIES INNOVATIVE PARTNERSHIP FY2022 actions IN AUSTRALIA AND CHINA APPROACHES DURING Ensuring supplies of genetically pure DIFFICULT TIMES rice seed for our growers forms the SunRice unveiled its first ever infant food Continue to provide food basis of our pioneering Australian Pure offering in FY2021, providing Australian During COVID-19, regional and security through our ‘Good, Seed Scheme, which ensures the variety parents with an infant rice cereal alternative international travel restrictions prevented Better, Best’ framework integrity and traceability underpinning produced from Riverina grown rice. our quality and technical experts from – aligning local need to our premium product. validating manufacturing processes and quality product. While ranging was achieved in Australia, product in person. Instead, our Global Seed production is only able to occur in entry into China via daigou channels was Operations team developed new ways of Develop a method of the region for our Riverina crops, which impacted during the year by COVID-19. working, including establishing innovative capturing impact of our is a rice quarantine zone and further In May 2021, our infant rice cereal was partnerships with third party experts, who long-term partnership with protects the quality of the rice we grow. shipped to distributors ahead of its launch acted as our teams’ eyes and ears on the food security organisations The program is unique to SunRice and to Chinese consumers via cross border ground in multiple countries to ensure our around the world. ensures growers have access to pure e-commerce channels. Approximately product continued to be processed to the genetics, based on their region. 12 million babies are born in China each highest food quality and safety standards. Continue to provide year and our new product should appeal targeted nutritional support Complementing our Pure Seed Scheme, to parents’ desire for clean and safe foods, through our vitamin our subsidiary Rice Research Australia in line with Australia’s strong reputation enriched rice for specific uses research and development levies local communities. for this. paid by growers to fund, in partnership with the NSW Department of Primary Continuous improvement Industries and AgriFutures Australia, in our Australian Pure Seed the development of new varieties with Scheme. enhanced agronomic properties and subsequently higher returns for growers. It’s another way we’re achieving superior research outcomes (and great tasting product) for the Australian rice industry. 22 | SunRice Sustainability Snapshot 2021 SunRice Sustainability Snapshot 2021 | 23
Our OUR PRIORITIES CY20 Riverina growers Rice Harvest 45,000 Our growers are pivotal to paddy tonnes harvested. SunRice’s success in every way. As A Class shareholders, our Riverina growers have control of SunRice 90% through our Constitution, and of crops drill sown. have a unique 70-year connection to the business producing and supplying high quality grain for our premium markets. Overall CY20 Riverina yields were 2.2% above From Vietnam to Uruguay, our Riverina growers long-term industry are complemented by a growing network of global averages: grower suppliers, spanning 12 countries, including Australia (see pages 14 – 15). Together, we bring the world 6 billion serves of rice, feeding around Exceptional whole 19 million people every day.7 grain yields of 64.9% Meet our growers for Reiziq. Average yield of THE SERGI FAMILY, GRIFFITH SunRice growers Patrick and Hayley Sergi (pictured 10.62 above), run a mixed cropping farm in Griffith, NSW. tonnes of paddy rice Australian rice growers’ In mapping out the framework, both BRINGING SUNRICE BEST per hectare (all varieties, “This year we’ve got plenty of water and there’s a big sustainability framework PRACTICE TO VIETNAM on and off farm data will inform all locations). rice crop in the ground; it’s going to benefit the whole The forthcoming season will be the third for accurate benchmarking and goal community, right through the system. The whole In FY2021 we continued to develop a rice grower Tran Phuoc Nhan, who has been setting, which will take place at the Top Reiziq yields of town is vibrant because there’s water and there’s farmer-led sustainability framework 15.6 end of this season’s harvest. supplying Ricegrowers Vietnam with short rice – it’s really a fantastic feeling,” says Patrick. in collaboration with Local Land grain variety DS1 from the Hon Dat district, Services (LLS), the Ricegrowers A critical part of the development will also Ken Giang Province. This season will see tonnes of paddy rice THE GLENN FAMILY, MOULAMEIN Association of Australia (RGA) and 24 be how we engage consumers and other the rollout of a research and development per hectare. Riverina rice growing businesses. The stakeholders in the process to ensure program to assist with managing inputs SunRice grower Robert Glenn, wife Alison and framework, now officially known as that they have a greater connection to to improve grain quality and in turn, the daughters, Samantha and Charleton, run a mixed the Rice Growers’ Promise has been how their rice is grown in Australia. We number of export markets available for farming business at Moulamein, NSW. built from the ground up by Australian want them to understand our growers’ Vietnamese rice. SunRice agronomists will Overall CY20 “You’re growing something for Australia; it’s on the rice growers, for rice growers. It passion and pride for growing rice and be involved on a weekly basis in the field to tonnages achieved supermarket shelf – COVID-19 has really brought encompasses a number of priorities their commitment to sustainability. We assist in managing the program and keeping per megalitre (ML) that home that people want to know where and goals that will be significant believe that the framework will provide a digital record of all activities. were favourable, their food comes from – something we’ve always in maintaining and achieving a platform to bring together Aussie rice sustainability outcomes both on farm growers and our consumers, closing gaps considering the known,” says Robert. PARTNERING FOR and more broadly, as an important in understanding of how Australian rice is challenging GROWTH IN THAILAND local agricultural industry. delivered from paddock to plate. conditions: In Thailand, we’re partnering with government breeding programs and RICE OUR FRAMEWO RK Average GROWERS multiple seed, paddy growing and packing partners to deliver 5,000 hectares of 0.88T/ML PROMISE OUR ENVIRONMENT specialty rice grown specifically to support second tier brands within our supply chain. (all varieties, all locations). Through our partners and stakeholders in country, SunRice is funding the training Top return of COMMUNITY of close to 500 Thailand farmers in SunRice systems, including farm record keeping, 1.32T/ML integrated pest management and (drill sown crop). INNOVATION QUALITY Showcasing our passion and Continuous improvement Proudly producing fresh and pride to build prosperous and technologies for climate-smart farming, through industry led innovation trusted quality food directly safe communities for our including nutrient, straw and stubble and technology. traceable from paddock to plate. children and future generations. management. 7. Based on a 75 gram serving size. 24 | SunRice Sustainability Snapshot 2021 SunRice Sustainability Snapshot 2021 | 25
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