Deforestation is one of Colgate’s key sustainability issues. It is critical from a business, social, environmental, and reputational risk standpoint. Our policies and commitments help us manage the deforestation risks in our supply chain for pulp and paper, palm oil and derivatives, soy and soy oil, and beef tallow. In line with Colgate’s values, we are committed to protecting the global environment, enhancing the communities where people live, and operating in compliance with government laws and regulations. As part of Colgate’s 2020 sustainability strategy, which is focused on People, Performance and Planet, we are committed to the responsible sourcing of forest commodities to reach a sustainable supply chain by 2020. Because we share a vision with our key stakeholders for a future without deforestation, we are committed to being transparent with our employees, shareholders, suppliers, and NGOs about our commitments, challenges, and the progress we have made in this area.
Much of Colgate’s packaging materials utilize wood-derived or paper-based products. Approximately 76 percent of our pulp and paper is recycled or certified as sourced from responsibly managed forests. Colgate has made significant progress in policy development on commodity sourcing and deforestation over the past three years. Contributing to this progress is the company’s active membership in the Consumer Goods Forum (CGF), a large network of retailers, manufacturers and service providers dedicated to a vision of “Better lives through better business.” Ian Cook, Colgate’s Executive Chairman, currently serves on the CGF Board of Directors. Colgate is committed to tackling deforestation for pulp and paper, palm oil and derivatives, soy and soy oil, and beef tallow. Colgate believes the implementation of an effective deforestation program is critical so we can manage the impact our activities have on ecosystems and habitats, meet stakeholders’ expectations, protect our reputation, and comply with regulations.
2018 Colgate’s Deforestation Milestones
Colgate developed a commodity-specific policy on responsible and sustainable sourcing of palm oil in 2016. Since then, we have taken action to responsibly source palm oil in the following ways:
- • Communicated our policy to our direct suppliers
- • Requested information on traceability to the mill and plantation level from 100 percent of Colgate’s direct suppliers of palm oil and palm kernel oil (PKO)
- • Engaged direct suppliers of palm oil and PKO to drive policy implementation, encourage increased transparency, and understand their plans for transformation of their supply chain
- • Requested information on palm oil derivatives traceability work to the mill level. Earthworm Foundation has determined key supply chain points to act as milestones in the work to achieve full traceability upstream. These supply chain points are as follows: first importer, origin refiner and mills
- • Incorporated sustainability considerations into the supplier selection process
- • Committed to procure 100 percent certified palm oil and PKO
- • Included palm oil suppliers in Colgate-Palmolive Supplier Responsible Sourcing Assessment Program
- • Disclosed Colgate’s suppliers of palm oil and palm kernel oil and mills
- • Established Governance team for palm oil suppliers to enhance current due diligence process
- • Discontinued relations with certain suppliers who are not making adequate progress towards our policy commitments and time-bound action plan
- • Started to use WRI-GFW satellite monitoring system to identify and manage potential deforestation alerts within our supplier’s palm oil network
- • Started to pilot Starling-TFT satellite monitoring system to enhance our current risk management program for palm oil suppliers
Key elements of our approach to No Deforestation and successes to-date are as follows.
1. Pulp and Paper
Pulp and Paper Approach
Colgate is committed to sourcing paper and packaging from recycled sources and responsibly managed forests that do not contribute to deforestation.
As part of our responsible sourcing strategy, we continue working with our partner Rainforest Alliance, an international non-profit organization, to assess our supply network for paper based materials. We are also actively working with our suppliers to leverage our longstanding strategy to increase the volume of certified or recycled pulp and paper-based materials each year, setting a goal to source 100 percent by the end of 2020. Our partnership with Rainforest Alliance helps us engage with our suppliers to increase the use of certified materials, giving preference to suppliers that use pulp and paper compliant with Forest Stewardship Council (FSC) certification standards. Rainforest Alliance also supports mapping our supply chain to identify hot spot areas, which present the highest risk to our business, the environment, or the local community.
We will continue partnering with our suppliers to build a low-risk global supply chain that meets the following criteria for pulp and paper:
- • No illegally harvested wood
- • No exploitation of people or local communities
- • No deforestation of High Conservation Value (HCV) areas
- • No sourcing wood from forests that were converted to plantations or non-forest use after December 31, 2010
In addition, we have taken additional steps to ensure compliance with the U.S. Lacey Act, which requires all product and disposable packaging to be composed of legally sourced wood or other plant-based material.
Pulp and Paper Progress
Our partnership with Rainforest Alliance will support the execution of our responsible sourcing strategy for pulp and paper and drive transformation in our supply chain.
As part of the work plan with Rainforest Alliance, Colgate is focusing first on the following pulp and paper based materials:
- • Paper-based cartons
- • Corrugated materials for shipping
- • Paper-based labels
- • Corrugated materials for displays
- • Dryer sheet products and cleaning wipes
Due to the complexity in the pulp and paper portfolio, Colgate will prioritize policy implementation with the suppliers of these products representing 80 percent of the spend, with a long-term goal of reaching 100 percent of spend.
The following actions were identified to support our current responsible sourcing strategy for pulp and paper:
- • Issued a commodity-specific Policy on Responsible and Sustainable Sourcing of Pulp and Paper
- • Communicated our policy to our direct suppliers
- • Map pulp and paper supply chain to country of origin to identify any controversial sources and drive actions toward policy conformance (Ongoing)
- • Requested information on traceability to the mill level from the suppliers that represent 80% of our spend
- • Conduct risk assessment analysis to determine areas of focus and develop a roadmap for policy implementation, with the support of Rainforest Alliance (Ongoing)
- • Launched second phase on traceability request, focusing on the suppliers that represent 20% of our spend
- • Increased awareness of policy commitments by conducting supplier webinars
- • Increased awareness of policy commitments and requirements to suppliers by conducting webinars for procurement professionals and packaging teams
- • Purchase increasing volumes of certified or recycled pulp- and paper-based materials each year with a goal to source 100 percent by the end of 2020, using the Forest Stewardship Council and other respected certification schemes as geography and availability necessitate (Ongoing)
- • Included pulp and paper suppliers in our (SRSA) Supplier Responsible Sourcing Assessment program
- • Incorporated sustainability and responsible sourcing requirements in the supplier selection criteria and process
- • Report and communicate performance and progress against policy
2. Palm Oil, Palm Kernel Oil and Derivatives
Palm Oil, Palm Kernel Oil and Derivatives Approach
Palm oil is the most widely produced vegetable oil in the world and continues to grow in its use, replacing other vegetable oils. More than 85 percent of the world’s palm oil comes from Indonesia and Malaysia, where land is sometimes converted from forest to palm plantations, resulting in greenhouse gas emissions, impacts on biodiversity, and social issues linked to deforestation.
Colgate has specific commitments to source palm oil, palm kernel oil and palm derivatives that are responsibly produced and that can be traced from plantation to product. As we strive for zero deforestation in our palm oil operations and activities, we will partner with stakeholders and our suppliers to build a transparent global supply chain that meets the following criteria:
- • No deforestation of High Carbon Stock (HCS) forest
- • No deforestation of High Conservation Value (HCV) areas
- • No use of fire for land clearance
- • No new development on peat lands, regardless of depth
- • Reduction of greenhouse gas Emissions
- • No exploitation of people or local communities
With The Earthworm Foundation risk assessment analysis and collaboration, Colgate will be able to make informed decisions about which producing suppliers to support in their transformation to meet our standards, and where to focus efforts to contribute to supplier assessments and training to have a positive, tangible impact on the practices on the ground within Colgate’s supply chain. Additionally, Colgate has been working with NGOs and other stakeholders to increase our transparency and traceability of palm mills in our supply chain. We now disclose the mills to which our production traces back. See List-of-Mills for more detail.
Palm Oil, Palm Kernel Oil and Derivatives Progress
Colgate uses palm oil, palm kernel oil and palm oil derivatives in some of our soap products, toothpastes, antiperspirants, deodorants, and household cleaners.
Our palm oil responsible sourcing policy, issued in July 2016, addresses the key requirements for our suppliers to build global supply chains that meet Colgate’s palm oil policy criteria. Colgate continues working in partnership with Earthworm Foundation to move the palm oil responsible sourcing strategy to the next level by executing transformation projects and engage with stakeholders from government, civil society, and palm oil producers.
Palm Oil, Palm Kernel Oil and Derivatives Traceability
Having continued visibility to palm oil mills is critical for Colgate to support on-the-ground supplier transformation work, assess risk in the supply chain, and evaluate the progress of our suppliers in achieving compliance with Colgate’s Responsible and Sustainable Sourcing policy. We continue working with our suppliers to expand the traceability efforts back to the plantation level.
Palm Oil and Palm Kernel Oil Traceability
For the second half of 2018, Colgate global palm oil/ palm kernel oil traceability to the mill was as follows:
Colgate Global Traceability to the Mill
The percentages in the table reflect the percentage of palm oil and palm kernel oil for each purchasing market that can be traced back to the origin mill.
Overall, we can identify the mill sources for 100 percent of our palm oil supply by volume and 97 percent of Colgate’s palm kernel oil supply. Identifying the mill sources for our palm supply enables us to prioritize upstream suppliers for engagement based on associated risk. It also allows us to seek further information and respond if stakeholder concerns arise about our supply chain. It is also a critical step toward our goal of achieving full traceability to the plantation/source.
We continue to maintain complete traceability to the mill, and we request updated traceability information from our palm oil and palm kernel oil suppliers on a biannual basis to maintain visibility into our supply chains. Palm Oil Derivatives Traceability
Colgate’s No Deforestation commitment includes the source of the palm derivatives that Colgate purchases and uses in its products. Palm derivative supply chains are multi-tiered and complex, so achieving traceability in the derivatives supply chain comes with challenges. Earthworm Foundation supports Colgate on this journey and helps us trace back to the mill level, following the Earthworm Foundation’s methodology.
Many of Colgate’s suppliers act as first importers themselves, and so the current focus is on identifying the origin refiners in Colgate’s supply chain. The origin refiners will have visibility into the mills in Colgate’s supply base, and will be a crucial leverage point to engage their supply bases on transformation.
Colgate has currently achieved 60 percent traceability of the origin refiners in its supply chain, and 53 percent to the mill level for our derivatives portion. We will continue to work with our derivatives supplier to increase the traceability percentages for this portion of its supply.
Colgate 2018 traceability for palm derivatives is as follows:
Colgate Global Palm Oil Derivatives Traceability to the Mill
We continue evaluating our palm and PKO derivatives suppliers’ responsible sourcing policies. Colgate will work with our suppliers to ensure that they have developed responsible sourcing policies and plans that align with Colgate’s own policy, or will demonstrate to Colgate how they will work to meet our policy expectations. Through this work, Colgate is an important catalyst to increase the transparency of supplier companies in the oleochemical industry.
As a step in the transformation journey toward responsibly sourced palm oils, Colgate is procuring certified oils as detailed below.
2018 Total Company Weighted Average Certified Oil Usage
We are currently sourcing palm oil and palm kernel oil certified by Roundtable on Sustainable Palm Oil (RSPO) and Rainforest Alliance. We continue working with our palm and PKO derivatives suppliers to increase the usage of palm oil derivatives that are physically certified.
Encouraging transparency and traceability is only one aspect of Colgate’s work to drive change upstream. Equally important is our work to understand our suppliers’ plans and existing activities geared toward transformation and bringing their supply base into compliance with Colgate’s responsible and sustainable sourcing policy.
Colgate’s policy implementation plan activity includes understanding suppliers’ progress and actions toward meeting Colgate’s responsible and sustainable palm oil sourcing policy. We are focused on the development of suppliers’ own policies and commitments, traceability status, grievance process, transparency, and verification activities. The approach measures the supplier’s performance on achieving its goals to close the gaps identified and promotes a better understanding of the challenges each supplier has as well as identifying opportunities for improvements.
Colgate’s supplier engagement has demonstrated that our suppliers are currently at different levels of preparedness to meet Colgate’s policy requirements. Many of Colgate’s suppliers have policies that match Colgate’s policy and are reporting transparently about their progress toward policy implementation on dashboards or through regular reports.
Colgate will continue to engage our suppliers to ensure we make adequate progress toward full policy implementation. Earthworm Foundation will also continue to support Colgate’s development with strategies to meet our palm oil sourcing requirements.
With risk assessment analysis and policy implementation activities, Colgate makes informed decisions about which producing suppliers and regions to support in transformation. This direct transformation work is supported by ongoing monitoring and progress management of Colgate suppliers’ own transformation efforts.
Earthworm Foundation and Colgate have agreed on transformation activities that Colgate can best support, based on Colgate’s palm oil supply network, identified hot spots and risks, and existing transformation work. During the current transformation work plan, we continue tackling environmental and social issues at scale in Indonesia through the ongoing support of Earthworm’s multi-stakeholder, multicommodity Priority Areas for Transformation (APT) initiative and mill visits.
During 2018 and early 2019, Colgate partnered with Earthworm Foundation (EF) to facilitate a Support for Transformation (SFT) project with a cluster of four mills in the Nagan Raya regency of Aceh Province, Sumatra, Indonesia. The SFT program is a flexible supplier assistance model that provides training, coaching, support for action planning, and monitoring over a six to 12 month period. The goal of the program is to empower mills to transform environmental and social practices by providing tools and technical support to address priority issues, tailored to the needs of specific mills. From participating in this program, suppliers have developed action plans focused on Health, Safety and Environment; mill waste management; and traceability. EF is currently conducting monitoring and facilitation on the progress of the mill action plans.
In Thailand, we continue to work with our suppliers to build internal capabilities and Earthworm Foundation continues to support several Thai-language workshops and training sessions on the concept of responsible palm oil sourcing and practices for Colgate suppliers.
Through our partnership with Earthworm Foundation, we started to fund the Centre for Social Excellence (CSE Indonesia), a training initiative focused on creating an enabling environment for social harmony and respect for human rights in regions where natural resource management and agricultural production take place. With our support, CSE convened a multi-stakeholder workshop in Aceh Tamiang, where approximately fifty representatives from over two dozen local and national government offices, palm oil companies, communities, and civil society organizations discussed land use planning and natural resource management. The workshop focused on improving stakeholders’ understanding of land use planning issues and building relationships between local actors. This event is helping local stakeholders to collaborate more effectively in a province with remarkable biodiversity and natural resources that are vital to the livelihoods of local people and regional economic development.
We continue to partner with our key strategic suppliers to drive changes on the ground and transform practices. In collaboration with Wilmar, Business for Social Responsibility (BSR) and several palm oil buyers, we continued our support of collective actions to improve working conditions and livelihoods of workers across the wider palm oil supply chain in Indonesia. This transformation project included a series of workshops to heighten awareness on wages, employment contract status and grievance mechanisms in Indonesia.
We acknowledge the role played by NGOs in bringing to light the unacceptable labor practices of one of our palm suppliers and the intensified efforts we are making to support transformation efforts on the ground on our own and as part of industry consortiums. We do not use forced labor within our own operations, and we will strive to eradicate forced labor from our value chains. Colgate believes that every worker should have freedom of movement, no worker should pay for a job and no worker should be indebted or coerced to work. Moreover, it is Colgate’s policy not to work with any supplier or contractor known to operate with forced labor. In line with the CGF’s recently announced Social Resolution on Forced Labor, Colgate joins CGF in acknowledging the broad societal problem of modern slavery and commitment to eradicate forced labor from supply/value chains.
Tallow, a cattle byproduct, is a key ingredient in bar soap production. Colgate sources tallow from suppliers in North America, Latin America, and Europe. In Brazil, there are concerns that rising demand for beef as a food source is prompting farmers to clear parts of the Amazon rainforest for cattle ranching.
As a result, we mainly focus on the tallow sourced from Brazil, and work with our Brazilian suppliers to transform practices in our tallow supply chain. We require our suppliers in Brazil to meet the following criteria:
- • Certify that suppliers follow environmental and social requirements set forth by the Brazilian Institute of Environment and Renewable Natural Resources
- • Confirm that their operations are conducted in conformance with the Minimum Criteria for Industrial Scale Cattle Operations in the Brazilian Amazon Biome, which aims to stop deforestation in the Brazilian Amazon
In addition, we started to implement the following important actions:
- • Developed a risk assessment tool to evaluate and assess the sustainability performance of 100 percent of our tallow suppliers
- • Incorporated sustainability and responsible sourcing requirements in the supplier selection criteria and process
- • Included Tallow suppliers in our Supplier Responsible Sourcing Assessment (SRSA) program
- • Certified that our suppliers operate in compliance with the environmental and social requirements set forth by the Brazilian Institute of Environment and Renewable Natural Resources (IBAMA)
- • Confirmed that 100 percent of our suppliers’ operations conform with the Minimum Criteria for Industrial Scale Cattle Operations in the Brazilian Amazon
- • Exclude suppliers that do not meet our policy criteria and requirements
- • Work with our suppliers on verification by using satellite systems to proactively address issues linked to deforestation and assure the material is sourced responsibly
We are publishing our list for all beef tallow suppliers. This snapshot reflects our current supply network refresh as of May 2019. We optimized our supply network to only source from suppliers that meet our policy requirements and operate in compliance with IBAMA and the Cattle Amazon sourcing criteria.
Colgate uses soy and soy oil as ingredients in certain products. Colgate currently sources these materials from the United States and South America. The United States, Brazil, and Argentina account for more than 70 percent of the global soy supply. In Brazil, soy production has been linked to deforestation of highly biodiverse forest regions, and its cultivation has contributed significantly to clearance of the Amazon forest, the Cerrado, the Atlantic Forest, the Gran Chaco, and the Chiquitano.
We are committed to using responsibly and sustainably sourced soy products from South America, which is considered the highest risk area for soy products. We will procure soy products that are responsibly and sustainably sourced and are certified by credible certification schemes, including Roundtable for Responsible Soy, Proterra or equivalent organizations to verify that the soy Colgate sources poses a low risk of contributing to deforestation.
For material procured in Brazil, our primary source, we use soy and soy oil suppliers that are in compliance with the Brazil Forest Code, including registration in the Rural Environmental Registry.
We completed the initial mapping of our indirect volume for soy. To support our current sourcing strategy for Soy we identified the following critical actions:
- • Supported efforts, such as the Soy Moratorium, that help minimize deforestation from soy expansion and increase transparency in the soy sector
- • Completed mapping of our soy footprint for Indirect Soy, following CGF and RTRS guidelines
- • Work with our suppliers in Brazil and any other high-risk areas to assess the availability of soy that does not contribute to deforestation in our soy supply chain, such as soy certified by the Roundtable on Responsible Soy or Proterra, and will continue to increase our purchase from these suppliers (Ongoing)
- • Increased usage of certified sources to 100 percent, for the volume sourced from Brazil
- • Included Soy suppliers in our (SRSA) Supplier Responsible Sourcing Assessment program
- • Joined efforts on supporting the Cerrado Manifesto through the Consumer Goods Forum ( CGF ), to minimize deforestation from soy expansion in Brazil and increase transparency in the soy sector
- • Began a partnership with Earthworm Foundation to continue the traceability work back to the origin, risk assess our supply chain and identify transformation opportunities in collaboration with our suppliers in South America
- • Communicated our policy to our direct suppliers
It is Colgate’s worldwide policy to manufacture and market our products and operate our facilities so that we conform to, and often exceed, applicable environmental rules and regulations. Our environmental standards, including the management systems standard, define environmental performance expectations for Colgate facilities. All Colgate facilities have a fully implemented Environmental Occupational Health and Safety (EOHS) Management System covering a wide range of categories, including energy, water, and waste management. Colgate’s manufacturing environmental performance goals are included in our Global Supply Chain annual objectives, which are cascaded to site-level facility managers, energy managers, and EOHS managers. Colgate facilities are expected to self-assess compliance with our standards and local regulations every 18 months. Corporate audits are conducted every three to five years, closure progress is reported quarterly, and verification audits are conducted to provide closure assurance.
At Colgate, we understand the potential consequences of climate change, and we are committed to acting responsibly and conscientiously to protect people and the environment wherever we operate. We recognize that businesses and their suppliers, customers, and consumers have a vital role to play in addressing the global issue of climate change. Climate change is one of Colgate’s key sustainability issues. It is a key focus for our business from both a reputational and an operational standpoint. Consumers, non-governmental organizations, and other external stakeholders expect companies to do their part to mitigate climate change. Reducing our energy use and greenhouse gas emissions also enables Colgate to mitigate costs. Since 2002, our energy reduction program has helped us avoid more than $560 million in energy costs. Managing the risks associated with climatic events, such as storms and droughts, is also important to ensure the continuity of our own operations and that of our supply chain. See Climate Resilience for more information. Our approach to climate change management and reporting is based on the guidelines of the GHG Protocol, covering about 95 percent of operations and sales where we have financial control.
Key elements of our Climate Strategy include:
We will set science-based climate goals to reduce greenhouse gas emissions.
Energy Management and Investment
We will continue to improve our global energy management system and invest in planet-related improvements via our manufacturing capital program.
We will promote the use of renewable energy and support the development of low-carbon energy supply.
Low-Carbon Products and Supply Chains
We will quantify greenhouse gas emissions throughout our value chain and focus on reducing the most significant emissions. Colgate will ensure responsible sourcing of the forest commodities associated with deforestation.
We will integrate climate resiliency into our risk management process.
Collaboration and Disclosure
We will collaborate with stakeholders to demonstrate business leadership on climate. We are also committed to transparency and will publicly disclose our climate strategies and goals, and report on our progress.
In 2018, Colgate continued working with Walmart’s Project Gigaton to support their goal to work with their suppliers to reduce 1 billion metric tons of greenhouse gas emissions (GHG) from the global value chain by 2030. Through Project Gigatron, Colgate has committed to GHG goals in six areas: emissions, energy, waste, deforestation, packaging, and product use. Colgate reports against these goals annually.
Colgate has committed to reducing absolute Scope 1 and 2 GHG emissions from manufacturing by 25 percent from 2002 to 2020, with a longer term goal of a 50 percent reduction by 2050. As a way to reduce our most significant Scope 3 GHG emissions, Colgate also commits to promoting water conservation awareness to 100 percent of our global consumers, reducing emissions associated with consumer behavior by up to 5 percent from 2016 to 2022, and increasing the recycled content of our packaging to 50 percent by 2020.
As part of our strategy to track and reduce GHG emissions, Colgate also tracks direct and indirect CO2, or carbon dioxide, emissions as well as direct nitrous oxide, sulfur hexafluoride, HFC and PFC emissions. We additionally estimate NOX, or nitric oxide, emissions from Colgate’s North American and European car fleets and from the trucks that deliver Hill’s Pet Nutrition products to retail customers in vehicles that are controlled by Colgate. We track VOC data as needed to comply with local regulations.
Energy Management and Investment
Colgate has a longstanding energy reduction program that has helped us lower GHG emissions and energy use intensity as well as increase financial savings. Our energy management system is modeled after U.S. EPA’s ENERGY STAR program and is implemented globally. In 2018, Colgate was named a U.S. EPA ENERGY STAR Partner of the Year for the eighth year in a row, recognized specifically for Sustained Excellence.
Key elements of Colgate’s energy management program include:
- • “Top 10” Energy Actions
- For the past several years, as a way to help our global sites prioritize the most effective energy reduction activities, we have used our Top 10 Energy Actions program. Implemented over two-year increments, this program tracks progress against our ten best global energy reduction opportunities.
- • 5% for the Planet
In 2011, Colgate implemented a program to set an annual capital expenditure budget as a way to drive investment in environmental sustainability projects across our global manufacturing sites. Our “5% for the Planet” program helps ensure that sites identify, fund and implement climate, energy, water, and waste projects that drive both environmental improvement and cost savings. The program sets an annual goal to invest a minimum of five percent of our manufacturing capital expenditure budget on energy reduction, water conservation, and reduction of waste to landfill. Upgrades for environmental compliance and product design are funded separately. A minimum of two percent of the manufacturing capital budget is targeted specifically toward energy reduction projects. Since inception, Colgate has invested more than $235 million in more than 1,250 planet projects, delivering an estimated savings of more than $59 million.
- • Energy Treasure Hunt Program
We engage people across Colgate’s operations through participation in the Energy Treasure Hunt program. Over a three-day period, 30 to 50 participants visit all areas of a facility, searching for energy waste and brainstorming opportunities to drive continuous improvement.
In 2018, Energy Treasure Hunts were completed at Colgate facilities in the United States, Italy, Mexico, and France.
In 2018, our facility in Rillieux, France, completed its first Energy Treasury Hunt. Approximately 35 people participated and identified over 60 energy reduction opportunities.
Our facility in Anzio, Italy, completed its second Energy Treasure Hunt in 2018. They identified 37 energy reduction opportunities, with over one-third estimated to have no more than a one-year payback.
- • Global Energy Reduction Team
Colgate’s Global Energy Reduction Team leads the technical implementation of Colgate’s energy strategy in our manufacturing sites by setting annual objectives and developing tools and programs to help our sites reach their energy reduction targets. This cross-functional global team is comprised of individuals with expertise and passion for reducing Colgate’s energy use and GHG emissions. For 16 years, the Global Energy Reduction Team has continued to focus on supporting our plants with many tools, activities, and initiatives. For example, in 2018, the team worked on creating generic “Energy Start/Stop Standard Work Instructions,” developing a list of key items to look for during Energy Treasure Hunts, gathering and sharing examples of innovative energy technologies and supporting the implementation of Ecolab’s 3D Trasar technology at multiple facilities.
Energy Intensity Goal
Colgate’s 2020 goal is to reduce the energy intensity of manufacturing our products by one-third compared to 2002. As of 2018, our global energy programs have resulted in the reduction of energy per ton of products by 31.8 percent.
As part of our strategy to achieve a 25 percent absolute reduction in GHG by 2020, we are working to promote the use of renewable energy and support the development of a low-carbon energy supply.
As a way to further develop our balanced approach to renewable energy, Colgate developed a Renewable Energy Roadmap, which helps the company identify and prioritize renewable energy opportunities at our facilities around the world. In 2018, Colgate implemented two additional onsite solar energy projects, one in Burlington, N.J. and one in Sri City, India, each generating 2 Megawatts of electricity.
Colgate has been a U.S. EPA Green Power Partner since 2014, supporting the voluntary use of green power to reduce the environmental effects associated with conventional electricity use. In 2018, Colgate purchased 220,000 MWh of Green-e certified wind power renewable energy certificates generated from wind power farms located in Kansas. This green power purchase was recognized by the U.S. EPA Green Power Partnership Leadership Club, achieving the rank of No. 50 in the United States. The purchase cost of green power is allocated back to our facilities in proportion to their carbon emissions as a way to help assign a cost-of-carbon to its source.
Although Colgate uses only a small quantity of refrigerants in our air conditioning and chilled water systems, we continue to take steps to minimize refrigerant losses and transition to lower global warming potential refrigerants over time. Colgate has aligned with the Consumer Goods Forum’s resolution on refrigerants, which calls on Food and Beverage supply chains to phase out hydrofluorocarbons. Although Colgate is not in the Food and Beverage sector, we have proactively aligned our global refrigerant standard to meet the intent of the CGF’s resolution as a way to support these efforts. In addition, we developed an associated e-learning training tool to assist our global facilities in transitioning toward less carbon-intensive refrigerants.
Low-Carbon Products and Supply Chain
Each year, Colgate works to assess the carbon consequences and opportunities across our value chain. We have expanded our knowledge into areas beyond our own direct energy (Scope 1 emissions) and indirect electricity (Scope 2 emissions) to include areas such as raw material procurement, transportation and logistics, business travel, waste, employee commuting, consumer use of products, and product end-of-life.
The predominance of our GHG emissions is associated with the consumer use of our products. Our category GHG footprint indicates that the impact of brushing, showering, washing hands, and washing dishes differs greatly.
To reduce GHG emissions associated with our products we are focused on:
- • Raising consumer awareness of water conservation
- • Designing products that allow consumers to use less water or temperate water
- • Designing packages that can be recycled
Low-Carbon Supply Chain
We are also focused on GHG emissions in our supply chain. To reduce these emissions we are focused on:
- • Supplier engagement
- • Carbon-intensive materials
- • No deforestation
- • Sustainable and efficient logistics
We request that our key Tier I suppliers and suppliers of carbon-intensive materials participate in the CDP Supply Chain Program Climate Disclosure to help us understand and address climate effects and associated risks and opportunities in our upstream supply chain. In 2018, more than 48 percent of our Tier I suppliers responded to the survey, including our largest raw material suppliers and contract manufacturers. We achieved 82 percent supplier participation.
We have identified the oral care, personal care, and home care raw and packaging materials that have the highest carbon footprint. This information has been shared with our Research & Development and Procurement teams to help them identify and prioritize opportunities through material and supplier choices without negatively affecting consumer experience, quality, or cost.
We also recognize that deforestation and forest degradation contribute significantly to the release of GHG. Our No Deforestation policy commits to sourcing forest commodity materials responsibly and sustainably by 2020. See Our Commitment to No Deforestation for more details on Colgate’s progress on policy implementation.
Sustainable and Efficient Logistics
Customer Service and Logistics teams at Colgate continue to focus on sustainable and efficient logistics initiatives around the world. Through these efforts, we are reducing costs as well as our carbon footprint, all while improving customer service.
Our sustainable and efficient logistics efforts in 2018 included initiatives such as:
- • Load Optimization: Through the use of SAP Transportation Management—a tool currently in place in Canada, the United States, Mexico, Brazil and Vietnam—we are automatically planning shipments to their optimal capacity. This has led to more efficient load planning and minimization of the number of shipments to deliver our products in a timely fashion. In 2019, we will be rolling out this technology for Hill’s exports, which will continue to drive freight planning efficiencies.
- • Route Optimization: By analyzing trends in lane level detail, using internal tools and partnering with third parties, we are identifying transport solutions aimed at reducing transit time, emissions, and costs.
- • Distribution Network Optimization: By using a customer location study, which reorganizes the freight to customers through a buffer warehouse and/or new warehouse location, we reduce costs, better serve our customers, and reduce our carbon footprint.
- • Co-Loading Trailers: Colgate is working to minimize the number of trucks on the road by co-loading trailers with other companies. This creative freight load-sharing program enables us to minimize the number of our trucks on the road as well as wasted space in our trailers.
- • Improving Vehicle Fuel Efficiency: Our logistics providers are upgrading their fleets to include more aerodynamic and efficient vehicles, resulting in improved fuel efficiency.
- • Intermodal Shipping: We are using intermodal shipping globally to drive reductions in CO2 emissions, diesel consumption, and cost. Hill’s has been a prime example of our commitment to this initiative and has reached 100 percent utilization on lanes set up for transport by rail two years in a row.
Colgate has a long-standing operations risk management process that includes managing the effects of episodic climatic events, such as storms, floods, droughts, and temperature extremes, to our facilities and supply chain. Climate risk is defined as part of the operational, regulatory, and reputational and market risks; therefore, Colgate is committed to developing a long-term strategy to mitigate risks from climatic events. As part of this process, we assess potential climate vulnerabilities and risks to ensure our business is able to respond and recover from climatic events. As part of our loss-prevention program, our strategic manufacturing sites are mandated to be highly protected against risks. Third-party assessments on property loss control are conducted annually for all strategic sites. Additionally, we develop and routinely update category contingency product sourcing plans. In 2018, Colgate hosted an Environmental Defense Fund (EDF) Climate Corps fellow who helped Colgate analyze energy reduction opportunities at our global manufacturing facilities to incorporate into our next generation “Top 10 Energy Actions.” The project’s aim was to determine what types of technologies and activities a facility might need to decrease its dependence on externally supplied energy, thus increasing its resiliency to potential climate impacts.
Collaboration and Disclosure Colgate is committed to transparency and has reported publicly on our carbon and energy reduction performance since 2004. Through these disclosures, we report on financial, regulatory, physical, and reputational risks as well as savings associated with eco-efficiency. In 2018, we continued to collaborate with a variety of stakeholders and engaged with leading organizations to inform our climate strategy and drive continuous improvement on a broader basis.
Further details of our risk management strategies related to climate change, water availability, and forest commodity risk can be found in our response to CDP’s annual climate change, water, and forest surveys. Please go to our Reporting for more details.
Colgate Quantifying Scope 3 emissions and goals.
Colgate was recognized as a U.S. EPA ENERGY STAR Partner of the Year for the eighth year in early 2018
U.S. EPA’s Green Power Partnership National Top 100 List
Water is an ingredient in many Colgate products and required in almost every phase of the product lifecycle. Clean water is also vital to the communities we serve, yet it is becoming an increasingly scarce resource in many regions of the world. Additionally, other related issues such as flooding threatens to have negative consequences on our supply chains and the delivery of raw materials and, as well as the finished goods to customers.
Water Stewardship is one of our Key Sustainability Issues. These challenges define the boundaries of Colgate’s Water Stewardship Strategy, which covers the following areas where we have the opportunity to manage impact and create a better environment for communities: Direct Operations, Supply Chain, Consumer Use, Water and Sanitation Access, Ecosystem Protection, and Collaboration and Disclosure.
Key elements of our Water Stewardship Commitment include:
We will continue to invest in water conservation and assess water risks associated with our global operations. We will replenish water in highly stressed regions and manage our wastewater appropriately.
Supply Chain Management
We will increase supplier participation in our water stewardship program to identify opportunities and mitigate water risks.
We will strive to develop innovative products that enable consumers to use less water while meeting or exceeding their expectations. Colgate will also promote water conservation awareness to our global consumers.
Water and Sanitation Access
We respect the human right to water, sanitation, and hygiene. We will partner with local and global organizations to offer clean water to underserved areas around the world. We will also provide health and hygiene education in our communities.
Colgate will continue to work to protect water-related ecosystems through our commitment to No Deforestation, water replenishment, aquifer protection, wastewater treatment, and community partnerships. In the U.S., Colgate continues to support Nature Conservancy in its mission to protect and restore the health of rivers, lakes, wetlands, and forests as well as to educate consumers about the importance of clean, accessible water for people and nature. This includes helping to protect bodies of water like the Delaware River Basin (a clean water source to nearly 20 million Americans) by combating nutrient runoff and sedimentation through riparian restoration and the Sierra Nevada (the source of 65 percent of California’s water supply), where Nature Conservancy is working to conserve 50,000 acres of critical land to act as a natural reservoir for clear mountain streams.
Collaboration and Disclosure
We will partner with stakeholders and our communities to help drive water stewardship programs. We are committed to transparency and will publicly disclose our water stewardship strategies and goals, and report on our progress.
As a way to inform our water stewardship efforts, Colgate engages with leading water experts. This collaboration helps build expertise, align efforts and ensure our water programs meet stakeholder expectations.
Our Water Footprint
Colgate’s water use footprint consists of the water used by our suppliers to produce the raw and packaging materials we purchase, the water used by our facilities to manufacture our products, and the water associated with the consumer use of our products.
Although we continue to focus on reducing the water used in our own operations, increasingly we are making efforts to help manage water use along each step of our value chain. The results of our ongoing water footprint exercises have helped quantify the opportunity to have a positive water impact beyond our own operations.
Colgate has had manufacturing water conservation goals since 2002, and since then we have reduced the water consumed per unit of production in the manufacture of our products by nearly 46 percent.1 Our goal is to reduce our manufacturing water intensity by half compared to 2002 and to find ways to replenish water withdrawn in highly stressed regions.1
Key elements of our program include:
- • 5% for the Planet
Colgate invests in water conservation strategies at our global facilities through our manufacturing capital expenditure program, 5% for the Planet, and by implementing our Water Stewardship Strategy. A minimum of one percent of the manufacturing capital expenditure budget is targeted specifically toward water conservation projects.
- • True Cost of Water
Colgate’s True Cost of Water Toolkit, developed with Rutgers University Business School’s Supply Chain Management Program, is a manufacturing-based tool designed to help sites quantify some of the hidden costs of water, such as pretreatment, pumping, and wastewater treatment, thereby increasing both economic and environmental opportunities for reduction.
- • Water Stewardship Standard
Colgate’s global Water Stewardship Strategy is intended to help ensure that all of our manufacturing facilities and technology centers develop responsible and appropriate programs to ensure that water-related risks are understood and managed, and that water conservation opportunities are continuously evaluated and implemented in support of Colgate’s environmental and sustainability goals. Water Stewardship Strategy expectations vary by the level of geographic water stress.
In regions with high water stress, we continue to assess water risks and implement appropriate resiliency measures as a way to anticipate and mitigate the effects. In 2015, Colgate developed a framework project to create replenishment criteria, define geographical boundaries and identify both environmental and community-related options to meet our commitment to replenish water in highly stressed regions.
Subsequently, we leveraged this project’s output by piloting the overall replenishment approach for our manufacturing sites in India. Through this work, we identified future opportunities to maximize on-site water reduction by increasing rainwater harvesting and community water projects. In 2018, we estimated our water replenishment to be approximately 71 percent at our manufacturing facilities in India.
Supply Chain Management
We continue to address supply chain water risks in several ways. We are increasing supplier engagement in our Water Stewardship Strategy by participating in programs such as the CDP Supply Chain Program. Additionally, we are helping our product developers and procurement teams understand and identify our most water-intensive raw and packaging materials.
We requested several of our Tier I suppliers and suppliers of water-intensive materials to participate in the CDP Supply Chain Program Water Disclosure to help us understand and address water consequences and associated risks and opportunities in our upstream supply chain. In 2018, 48 percent of our Tier I suppliers responded to the survey, including our largest raw material suppliers and contract manufacturers. Overall we achieved 82 percent supplier participation.
To help reduce the water associated with the production of raw materials, we are working to identify the most water-intensive materials in each of our product categories. With this information, we are able to engage our suppliers to better assess where there are opportunities to reduce the water footprint of our products through feedstock choices and conversion efficiency, particularly in markets under high water stress.
Colgate engaged with the Mint Industry Research Council (MIRC) on water efficiency and stewardship opportunities. MIRC invited Colgate to present our Water Stewardship Strategy at their annual meeting to help drive the sustainable use of water throughout the mint grower industry. In 2018, we collaborated with MIRC to gather and analyze data from mint suppliers to better understand the climate and water challenges across North America and share the insights with the industry.
Colgate understands that the water required to use our products represents the largest portion of our overall water footprint. To that end, water scarcity is an opportunity for innovation, and we are working to develop products that allow consumers to use less water. Colgate’s portfolio includes a number of products that allow consumers to use less water.
Suavitel 3X Fabric Softener - Colombia
Our 3X concentrated fabric softener has an improved ingredient sustainability profile, requires less water, and generates less waste in the manufacturing process. The product-to-packaging ratio was improved, saving materials and reducing greenhouse gas emissions associated with the movement of finished goods.
Water Conservation Awareness
To help consumers conserve water as they use our products, Colgate seeks to promote water conservation awareness to all our global consumers. In 2018, Colgate continued to expand our Save Water campaign globally with messaging around World Water Day on March 22 and beyond.
On World Water Day in 2018, our videos, messages, and in-store activations to make every drop of water count went live in more than 70 countries around the world. All our divisions engaged Colgate People around the world regardless of office size or location on World Water Day, inviting them to take a Save Water pledge and spread the word about water conservation. Some locations also held events with guest speakers and or employees volunteered in the local community. The Save Water message already appears on our toothpaste and toothbrush packaging. Thanks to the ongoing efforts of Colgate People around the world, we are helping drive greater awareness of water issues—on World Water Day and every day—among consumers, customers and fellow Colgate People.
• In Turkey, we promoted World Water Day by engaging people with a fun and unique on-the-spot challenge to Save Water, reaching 2.8 million people.
• Colgate’s Save Water campaign reached over four billion people in 2018 with the “Turn Off the Faucet” message. In 2018 Colgate also sponsored ultra-runner Mina Guli, who committed to running 100 marathons in 100 days to raise awareness about our planet's water crisis as part of the #RunningDry movement.
• Colgate launched the Save Water campaign in 2016 with a turn-off-the-faucet-while-brushing” message and has reached nearly three billion people worldwide. Our campaign continues to increase consumer awareness through messaging on our packaging, online and in stores. According to a global consumer survey, the impact of this campaign on consumer behavior has contributed to an estimated reduction of 53 billion gallons of water.
• In celebration of World Water Day, Colgate India joined the country’s leading organized wholesaler, METRO Cash & Carry, for a month-long “Save Water” Awareness program. This is the second year of the partnership surrounding the Save Water program. Throughout the month of April, a portion of the purchase of select SKUs from any of the 27 Metro stores across the country will be donated to Colgate’s NGO partner Water for People - India Trust. Water For People will use this contribution to support the accessibility of water in local communities.
• In 2018, Colgate India, in partnership with Water For People India Trust, launched its Amravati Water initiative in the villages of Amravati District of Maharashtra. This expansion of Colgate’s partnership with Water For People continues as a result of their successful collaboration in Bihar and West Bengal, since 2013. This program supports the availability, accessibility, and quality of water. It also helps build awareness about water, sanitation, and hygiene (WASH). Rain water harvesting will be explored in select schools to help the availability of water for sanitation. Key components of the program are to ensure the continued operation and maintenance of water facilities. The program aims to support projected cumulative coverage to approximately 36 villages by 2022. Collaborations and engagement with local communities, local and district level government authorities and stakeholders will play a vital role in building the infrastructure, operation and maintenance of water facilities and ownership.
As part of Climate Week NYC 2018, Vance Merolla, Worldwide Director of Sustainability, and JoAnne Murphy, Director of Shopper Marketing, U.S., shared how Colgate’s ongoing consumer campaign to save water is conserving a precious resource while also reducing global greenhouse gas emissions.
Water and Sanitation Access
Colgate respects the human right to water, sanitation and hygiene. One of Colgate’s 2020 Sustainability Strategy goals is to work with local and global organizations to help promote access to clean water. We also provide health and hygiene education in communities around the world. As part of Colgate’s Water Stewardship Strategy, we work with local and global organizations to help promote access to clean water while providing health and hygiene education in communities. In that spirit, Colgate is proud to continue our commitment to support water, sanitation and hygiene (WASH) programming through our partnership with Water For People as they pursue their mission to reach Everyone— Forever with WASH services across Guatemala, India, and Peru. From 2013 through 2018, Colgate’s total support of more than $1.6 million has helped more than 287,000 people in communities and 152,291 people in public institutions gain access to services, more than 200,000 people gain access to a toilet, and more than 400,000 people learn about proper hygiene.
In 2018, Colgate continued our partnership with Water For People to strengthen and support the municipal water and sanitation offices that were established since we began our partnership in 2013. Our partnership exists to promote the development of high-quality drinking water and sanitation services, accessible to all, and sustained by strong communities, businesses, and governments.
We also recognize that communities facing inadequate access to safe water often do not have sufficient sanitation services and that handwashing is not widely practiced. Colgate continues to work with public health officials, academia, local schools, and clinics to educate millions of children and their families about the health and hygiene benefits of handwashing. Further, as a matter of long-standing practice, Colgate provides safe water, sanitation, and hygiene to all people in our workplaces.
Colgate will continue to work to protect water-related ecosystems through our commitment to No Deforestation, water replenishment, aquifer protection, wastewater treatment, and community partnerships. In the U.S., Colgate continues to support The Nature Conservancy in its mission to protect and restore the health of rivers, lakes, wetlands, and forests as well as to educate consumers about the importance of clean, accessible water for people and nature. This includes helping to protect bodies of water like the Delaware River Basin (a clean water source to nearly 20 million Americans) by combating nutrient runoff and sedimentation through riparian restoration and the Sierra Nevada (the source of 65 percent of California’s water supply), where The Nature Conservancy is working to conserve 50,000 acres of critical land to act as a natural reservoir for clear mountain streams.
Wastewater discharges from Colgate’s operations are generally treated on site and/or by the local municipality prior to discharge to a body of water. We continue to work to reduce pollutant-loading in our wastewater discharges prior to treatment. In selected locations where water stress is high, Colgate treats wastewater to tertiary levels, allowing it to be reused for cooling, toilet flushing, gardening, and other purposes.
Collaboration and Disclosure
As a way to inform our water stewardship efforts, Colgate engages with leading water experts. This collaboration helps build expertise, align efforts, and ensure our water programs meet stakeholder expectations. We are also committed to transparency and reporting publicly on our water stewardship and reduction performance. Colgate participates on the United Nations CEO Water Mandate Action Platform as part of our commitment to the United Nations Global Compact (UNGC). This initiative seeks to mobilize business leaders to advance water stewardship, sanitation and the United Nations Sustainable Development Goals (SDGs). Colgate is working with the UNGC to leverage the SDGs in the ongoing development of our water stewardship and sustainability strategies. Additionally, we have joined the UNGC Action Platform on climate-related Pathways to Low-Carbon and Resilient Development.
Hear from Ann Tracy, Colgate’s Vice President of Global Sustainability, EOHS and Supply Chain Strategy and Vance Merolla, Worldwide Director of Sustainability, on how Colgate utilizes the United Nations Sustainable Development Goals as a framework to align Colgate’s business goals to a sustainable future.
- • 5% for the Planet
Colgate sites have been reducing, reusing, and recycling waste for many years. As part of our 2020 Sustainability Strategy, we have committed to halve our manufacturing waste sent to the landfill per ton of product compared to 2010, working toward our goal of Zero Waste. In 2018, Colgate initiated a new relationship with the Green Business Certification Inc. (GBCI) on its TRUE Zero Waste certification program, adopting their program as our global platform to drive Zero Waste. Currently, manufacturing facilities in all geographies are using the TRUE Zero Waste approach and tools to develop roadmaps to reach zero waste. Additionally, we are aligning our global waste data management systems with TRUE Zero Waste to ensure uniform measurement of results.
In 2018, an additional six sites were certified in the United States, The Netherlands, Czech Republic, and China. Three sites obtained the Gold level certification and three sites obtained the Platinum level certification.
Discover how our Hill’s Pet Nutrition plant in Richmond, Indiana achieved TRUE Zero Waste Certification in 2018 and is continuing to Build a Future to Smile About through its waste reduction efforts.
We recognize the importance of reducing waste at every stage of the product lifecycle, including at the end-of-life of our products and packaging. We have committed to improving the recyclability of our packaging, by offering resources to enable breakthrough innovation in Oral Care packaging. We have also committed to delivering 100 percent recyclable packaging in our Personal Care, Home Care and Hill’s Pet Nutrition categories by 2020 and 100 percent recyclable packaging in all categories by 2025. Read more information on our packaging commitments and progress. Building a circular economy in which industrial materials and packaging can be recycled and reused is an important part of a sustainable future. In addition to commitments for our own packaging, Colgate has committed to work with stakeholders to drive continuous improvement in local recycling systems.
In 2014, we became one of the initial investors in the Closed Loop Fund to develop local recycling infrastructure and sustainable manufacturing technologies that advance the circular economy. In the United States, municipalities often lack access to the capital to invest in recycling programs and infrastructure. The Closed Loop Fund provides zero-interest loans to municipalities and below-market loans to private companies with a goal to develop infrastructure and improve recycling rates. The fund will also seek to co-invest with local private and public entities to magnify its impact. The fund has invested in the collection, sorting and processing of waste. To learn more, visit ClosedLoop Partners' website here. Progress is measured using five key metrics:
1. Tons recovered and returned
2. Metric tons of GHG emissions avoided
3. Economic benefit to municipalities
4. Households reached or represented
5. Co-investment dollars leveraged
Since inception, the Closed Loop Fund has invested in 21 projects and deployed $50M to date, with co-investors investing over $200M. One of Closed Loop Fund’s first loans – to the Council Bluffs Recycling Center in Iowa – was repaid in full in 2018. Since 2014, the project contributed to diversion of more than 25,000 tons of material and generated savings and revenues for the municipality of nearly $1 million in just 3 years. If you want to explore more, read the Closed Loop Fund’s 2018 Impact Report.
For many years, Colgate has committed to the U.S. Green Building Council (USGBC) Leadership in Energy and Environmental Design (LEED) certification for all of our new construction projects around the world. We have used the LEED green building rating system to help design and construct our manufacturing sites, technology centers, warehouses and offices as one way to help reduce our overall exposure to water and climate change-related issues and offer a healthier, more comfortable work environment. Currently, Colgate has 19 facilities that have achieved 26 LEED Certifications, with one additional project underway. Our LEED projects have been conducted in the United States, Latin America, Asia, and Europe. In addition, we use several LEED-certified third-party distribution centers. Colgate has been a member company of the USGBC since 2007. Colgate is also a charter member of the USGBC LEED User Group: Industrial Facilities, which collaboratively engages in the advancement of LEED and green building practices for the global manufacturing sector. Further information about Colgate’s LEED-certified buildings is available on the USGBC Green Building Information Gateway.
In 2018, Colgate achieved three new LEED certifications at our Burlington, New Jersey Oral Care manufacturing site (LEED Silver), our Greenwood, South Carolina Personal Care manufacturing site (LEED Certified), and at our Sri City, India Toothbrush manufacturing site (LEED Gold).
“LEED” and related logos are trademarks owned by the U.S. Green Building Council and are used with permission.