Ferrero’s 16th annual Sustainability Report, covering the period from September 1, 2023, to August 31, 2024, highlights significant challenges in its global supply chain, including child labour, Scope 3 emissions, and packaging waste. The confectionery giant’s candid disclosures highlight ongoing risks while reinforcing its commitment to transparency.
Ferrero, in collaboration with the International Labour Organisation (ILO), identified 3,020 children working on hazelnut farms in Türkiye. The company referred these children to schools and social support programs, but noted that child labour remains a persistent issue requiring continuous intervention. In West Africa, cocoa farming faces challenges from poverty, ageing plantations, and diseases such as the swollen shoot virus, which complicates sustainable practices.
The report also reveals that 97% of Ferrero’s palm oil is deforestation-free, but 3% is under scrutiny due to satellite alerts indicating potential deforestation risks.
Scope 3 emissions—those from suppliers and consumers—pose a significant challenge to Ferrero’s climate strategy, despite a ‘B’ score in CDP climate disclosure. Waste generation exceeded 130,000 tonnes, with recovery rates dropping from 97.92% to 89.32% due to new measurement methods and building demolitions.
Water scarcity is flagged as a growing risk, with several plants failing to report key water performance indicators, signalling data transparency gaps. Packaging recyclability remains problematic due to inadequate infrastructure and limited food-grade recycled plastic. Additionally, Ferrero reported non-compliance in 11.11% of online ads and 33.33% of website promotions, alongside challenges integrating newly acquired brands into its sustainability framework.
Ferrero’s transparency sets a benchmark for supply chain leaders, emphasising the need for collaboration across industries, governments, and civil society to tackle systemic issues. The report underscores the importance of proactive risk management, robust data tracking, and long-term commitment to ethical supply chains.