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    Message from our CEO

    Fulfilling our role to source, add value to and deliver food and agricultural products worldwide is essential to ensure food security for a growing global population. Doing so sustainably is critical to ensure we can continue to do so for the long term.

    Michael Gelchie

    Michael Gelchie

    In a context of increasingly urgent global challenges, we took significant strides to advance transformative sustainability strategies across our operations, assets and supply chains during 2021, while keeping our people safe, ensuring supply chain continuity, and working with partners to support farmers and protect the environment.

    Priority on People

    At LDC, sustainability always starts with people – whether they are employees, contractors or other partners and stakeholders, we strive to instill a health and safety culture wherever we operate and work around the world, ensuring every person working for and with us goes home safe and well each day.

    In 2021, for the second year in a row, we recorded our best-ever safety metrics, a very positive performance that I am especially proud of and grateful for, in a context that continued to pose many challenges.

    And because wellbeing is also a matter of inclusion, we continued to take steps to advance in our roadmap to shape an inclusive workplace and culture across LDC, recording progress toward our diversity & inclusion goals.

    Addressing shortcomings highlighted by the pandemic in relation to the welfare of maritime workers, LDC also helped to develop and launch a dedicated Code of Conduct to protect seafarers’ rights, from fair terms of employment to grievance mechanisms. Developed in collaboration with like-minded shipping industry stakeholders, this new code will contribute to more responsible maritime operations and increased support for these essential workers.

    All Hands on Deck

    On the topic of essential work, never more than in recent months and years have we seen the importance of shipping to keep essential supply chain moving – so decarbonizing the shipping industry is also key to mitigate climate change. And in this area too, our collaborative approach was reflected in our signing in 2021 of a decisive call to action to enable full international shipping decarbonization, alongside more than 230 organizations representing the entire maritime value chain.

    The signatories call on governments to work together with industry to deliver the policies and investments needed to reach a full and equitable decarbonization of international shipping by 2050, while making zero emission shipping the default choice by 2030.

    To reach these ambitious targets, the private sector must continue to invest in research and development that seeks to reduce shipping fuel consumption and emissions, an area in which our Freight Platform has continued to advance over the past year.

    Accelerating Global Decarbonization

    Indeed, decarbonization was center stage in 2021 – at LDC and on a macro level, as government and corporate leaders came together at the 2021 UN Climate Conference in Glasgow (COP 26) to discuss and advance individual and collective efforts to limit global warming, consistent with Paris Agreement goals. In the context of this conference, LDC was among the co-signatories of a corporate statement of purpose from ten major agri-commodities companies for accelerated and collaborative supply chain action consistent with a 1.5°C pathway.

    In line with this and our own existing commitment to reduce our environmental impact and help shape a net-zero economy, in 2021 we established a new Carbon Solutions Platform charged with leading and accelerating LDC’s decarbonization roadmap through action within our operations and across our value chains, supported by participation in compliance and voluntary carbon markets. The platform is building an extensive emissions reduction project portfolio, with a focus on collaborative projects in line with our approach to tackle sustainability challenges through partnerships.

    Action for the Environment

    In parallel, we also continued to explore and implement innovative solutions to reduce the environmental footprint of our operations – for example, investing in solar power in Mexico, switching packaging options in the US to reduce solid waste generation, optimizing use of steam in Asia and reducing the emissions profile of our Zambian cotton.

    Thanks to these and many other initiatives around the world, we remain on track to achieve our global environmental key performance indicators (KPI) reduction targets for 2018-2022 for greenhouse gas emissions, electricity and energy consumption, water usage and solid waste sent to landfill.

    Our confidence in our ability to deliver on these was highlighted in October 2021, when LDC raised a five-year JPY10 billion sustainability-linked private placement with a Japanese investor, with a pricing mechanism where the interest rate is linked to performance against these same environmental KPIs, similarly to our regional revolving credit facilities, all of which are now linked to our environmental performance.

    Future of Forests

    Eliminating deforestation and conversion of native vegetation in food and agricultural supply chains is among the most significant contributions our industry can make to limit global warming. This conviction was the basis of our commitment, announced in 2022, to target zero deforestation and native vegetation conversion for agricultural purposes in all our supply chains, by the end of 2025.

    This commitment builds on our existing product-specific sustainability codes and policies for higher risk commodities in relation to deforestation, our past work to drive supply chain traceability and reporting transparency as a crucial basis for responsible sourcing decisions, and our initiatives to encourage crop expansion over already cleared land, among other environmentally responsible agricultural practices.

    In 2021, for example, we began the roll-out of our revised Global Code of Conduct for Coffee Suppliers and successfully completed a pilot project in Colombia with a new traceability solution provider, with a view to global implementation. Our coffee teams also developed detailed documentation for LDC’s own responsible sourced program and trained the first group of farmers on this basis, aiming to refine and finalize training methodology in 2022.

    In juice, as part of sustainability verification for LDC-managed citrus farms in Brazil, we also continued to enlarge biodiversity conservation areas and plant thousands of native trees.

    We also continued to promote our Soy Sustainability Policy with our suppliers, emphasizing our zero deforestation and conversion expectations in particular, enhanced internal processes and systems for traceability and land use monitoring, and began developing zero deforestation and conversion verification methodology, to be finalized in 2022 as we establish our global baseline for deforestation- and conversion-free soy.

    In palm, we continued to improve our traceability to plantation, reaching over 70% for our global volumes. We also developed and successfully piloted our protocol to verify supplier compliance with LDC’s No Deforestation, No Peat and No Exploitation policy, with direct suppliers to our Indonesia refineries.

    Looking Ahead

    Climate change, a lingering pandemic and supply chain dislocations resulting from geopolitical crises will continue to pose significant challenges in the months and years ahead. Fulfilling our role to source, add value to and deliver food and agricultural products worldwide is essential to ensure food security for a growing global population. Doing so sustainably is critical to ensure we can continue to do so for the long term.

    To this end, we draw inspiration from our 170-year heritage and experience, our entrepreneurial mindset and flexibility in adapting to challenges, our shared purpose to create fair and sustainable value, and the people who make that purpose come to life – key among them, our late Global Head of Sustainability, Guy Hogge, who passed away earlier this year.

    Guy worked for LDC for nearly 30 years, during which time he made many important and inspiring contributions to the company – since 2010, in leading the implementation of our global sustainability framework and roadmap, an essential part of our business model and identity. Over the years, he fervently encouraged and enabled LDC to take important steps, driving key commitments to help shape a better tomorrow – the latest, our 2025 zero-deforestation commitment.

    A hugely respected champion of sustainability within LDC, and a much-loved colleague for his warm manner and wry sense of humor, he is and will continue to be greatly missed.

    Still, his crucial work must, and will, go on through our commitments to protect and invest in our people, to support communities connected with our activities – especially vulnerable farming communities, to safeguard the environment, and to forge trusted partnerships in our work to shape more sustainable agricultural and food production chains.

    I would like to thank our teams for the important work they delivered in 2021, with many positive results already, as outlined in this report, and I am confident that more will come this year and beyond, thanks to their dedication, resilience and collective determination to achieve success – safely, reliably and responsibly.

    Michael Gelchie
    Chief Executive Officer

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