Our Food. Our Future - OSI Group
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Our
Food.
Our
Future.
GLOBAL SUSTAINABILITY REPORT 2018 / 2019
Contents
OVERVIEW 2
VALUES 8
STRATEGY 16
SUPPLY CHAIN 24
ENVIRONMENT 36
SOCIAL RESPONSIBILITY 48
|1
LETTER FROM THE PRESIDENT OVERVIEW | VALUES | STRATEGY | SUPPLY CHAIN | ENVIRONMENT | SOCIAL RESPONSIBILITY
In the last decade, sustainability has moved from the periphery of business thinking When we released our first Global Sustainability
Report in 2016, it was a big step into the
• It highlights our drive for CONTINUOUS IMPROVEMENT. We have
consistently been defined by our “can-do” attitude. In addition to
to the forefront. It impacts nearly every element of our industry. At OSI, we see this spotlight for OSI. We don’t often talk publicly delivering the highest quality products in the safest, most efficient way
about our successes, but producing the 2016-2017 possible, OSI employees also make a difference in their communities
as an opportunity to rethink and reform how we work – from processes to people Global Sustainability Report provided an opportunity and their workplaces. It is their dedication and personal commitment
for us to step back and reflect on both our impacts that enables us to set ambitious targets for expanding our sustainability
to partnerships – to ensure we are mindful of the sustainability of our company and and our influence in the industry. Our emphasis on impacts and ensures our products are responsibly made.
communities along the way. sustainability throughout the OSI organization provides a platform for us
• It highlights our spirit of INNOVATION. Entrepreneurial passion is at
to activate our values and highlights what those values mean for the future
the core of the company. Thinking about things in new and better ways
of our company and our approach towards sustainability.
In this report, you’ll learn about our approach and the concrete steps we’ve taken easily lends itself to an ongoing search for more sustainable approaches
• It highlights our commitment to INTEGRITY. In each interaction and and creative solutions for difficult problems facing our environment and
to date. We share them with you not only as markers of our progress, but also as activity, we strive to be consistent and remain true to our principles. supply chain. We are happy to be pioneers in animal welfare standards
First and foremost, we’re dedicated to operating our business and resource efficient processing and will continue to lead the way by
the foundation for new and far-reaching goals. Sustainability is one of the primary responsibly, and we will hold ourselves to best-in-class standards of providing education and training in sustainability advancements to those
concerns of our time, and OSI will continue to dedicate the necessary resources to operation around the globe in order to maintain the trust that has been in our supply chain.
placed in us.
further progress our sustainability agenda. • It highlights the priority we place on PARTNERSHIP. We believe
As a company, we continue to pursue sustainability because we know
it is fundamental to operating a successful business. To strengthen our
collaboration is the key to making positive changes to our industry. commitment to sustainability, we’re updating our Global Sustainability
In this report, we document our intentions, policies, progress, and The data in this report was gathered from OSI facilities around the globe.
The cornerstone of our success has been dynamic and successful Report for 2018-2019 by releasing new 2025 targets and priority action
activities in order to be transparent about our operations and impacts. We are reporting on the 2016 and 2017 calendar years; however,
relationships with our customers, suppliers, and local partners who areas for our environment, workplaces, communities and supply chain.
Although there are areas where we are still making improvements, examples from other years are included to provide context. In creating
join us in identifying and promoting the best practices in sustainability We have also taken steps to become more vocal about what sustainability
we are energized to reach our ambitious goals and contribute to the this report, we introduced Global Reporting Initiative (GRI) principles as a
throughout our supply chain. means to us as a company by appointing Nicole Johnson-Hoffman as
sustainability efforts that create positive change throughout the food framework for communicating about our business and sustainability
industry. We are honest and forthright about the challenges we face, activities. GRI is an independent international organization providing the our Chief Sustainability Officer to lead these activities and expand our
• It highlights the power of OSI’s TEAMWORK. The people within our
and are dedicated to achieving meaningful results. We look forward to most widely used standards of sustainability reporting. Guidance from engagement with other industry stakeholders.
organization are essential to the positive contributions OSI can make in
sharing those results with our partners in the next OSI Global GRI allows us to clearly communicate our impacts and align our our communities. We appreciate the pride each individual takes in their Thank you for joining us on this journey. We to look forward to providing
Sustainability Report planned for 2020. sustainability activities with those of other businesses in our industry. work to deliver exceptional products, and we support them in their further updates that highlight the milestones we achieve along the way.
personal and career development.
We welcome feedback on our report and sustainability activities.
David G. McDonald
For questions or comments, please reach out to
President and Chief Operating Officer
osisustainability@osigroup.com.
2 | OSI GLOBAL SUSTAINABILITY REPORT 2018 / 2019 |3
OVERVIEW | VALUES | STRATEGY | SUPPLY CHAIN | ENVIRONMENT | SOCIAL RESPONSIBILITY
Organization Profile NETHERLANDS
Locations Markets CHINA
OSI is one of the world’s largest OSI partners with the world’s leading GERMANY
privately held food providers. Our foodservice and retail food brands to
international network of food processing provide concept-to-table solutions
and vertically integrated poultry that delight customers around the PHILIPPINES GREAT BRITAIN
POLAND
companies is headquartered in Aurora, globe. With our extensive international CANADA
Illinois, USA and organized into three infrastructure, we are able to offer HUNGARY UKRAINE
global zones: North America, Europe, unparalleled ability to source, develop,
JAPAN SPAIN
and Asia Pacific. The OSI Group produce and distribute custom food
operates 77 sites in 18 countries solutions throughout the world. AUSTRIA JAPAN
UNITED STATES
and territories and sells products into
In addition to creating customized
68 countries around the world.
solutions for our customers, OSI’s CHINA
AUSTRALIA TAIWAN
product and company portfolio includes
INDIA
UNITED STATES the brands shown here.
THAILAND
PHILIPPINES
INDIA
CANADA
Beef
EUROPE
BRAZIL
TAIWAN Pork
Poultry
AUSTRALIA
Vegetables
Fresh Produce
Other
4 | OSI GLOBAL SUSTAINABILITY REPORT 2018 / 2019 |5
The OSI Group has a proud history of more
than a century of strategic growth, driven by
the needs of our customers.
6 | OSI GLOBAL SUSTAINABILITY REPORT 2018 / 2019 |7
OVERVIEW | VALUES | STRATEGY | SUPPLY CHAIN | ENVIRONMENT | SOCIAL RESPONSIBILITY
Meat market expands to wholesale meat trade and As Lavin becomes Chairman and CEO, OSI begins period of OSI begins its entry into the Asia Pacific region with joint OSI spends two years establishing wholly foreign-owned
relocates to another Chicago suburb. The Kolschowsky Otto & Sons begins supplying fresh ground beef patties Formerly an investment consultant for the Kolschowsky family, significant growth in the early 1980s, through expansion and joint ventures in Taiwan and the Philippines, and operations in China. enterprises (WFOE) and joint venture entities in China, and
sons join the business. for new quick serve restaurants (QSR). Sheldon Lavin becomes a partner in the OSI business. ventures in new countries and other sectors of the food industry. China becomes a focus for OSI’s international growth. enters the fresh produce business. TODAY: OSI Group, LLC is a
100-plus year old, privately
OSI History
Production facilities open to produce salsa, beans, and tofu held corporation that is a
products in the western U.S. and poultry in China. A Canadian global leader in supplying
company is also acquired. value-added protein items and
other food products to leading
OSI opens culinary innovation centers in the U.S. and China and foodservice and retail brands.
a global R&D center in the U.S.
Beef production facility
opens in Japan, and
vertically integrated A merger is completed in
poultry operations are Australia to strengthen
initiated in China. OSI’s portfolio in that region.
1917 1955 1975 1981 1987 2001 2010 2014 2018
1909
1910
1917
1920
1928
1930
1950
1955
1960
1970
1973
1975
1977
1978
1980
1981
1987
1990
1993
1996
2000
2001
2004
2006
2010
2011
2012
2014
2016
2018
1909 1928 1973 1975 1977 1978 1993 1996 2004 2006 2011 2012 2016
Acquisition of a Poultry operations are
retail branded added through acquisition
company producing of vertically integrated
Company begins operations diversified meat poultry company. OSI opens two new
beyond supplying to QSRs products in the U.S. vegetable product
Establish beef deboning processing facilities
and establishes a separate
Otto & Sons builds its first plant in West Chicago which used and slaughter operations in India.
unit for the new Glenmark
cryogenic food processing to preserve food through in Europe.
brand, which would later be
nitrogen freezing. Otto & Sons becomes sold in 2011.
OSI Industries in the U.S.
and transitions from
The company is founded by Otto Kolschowsky as a family-owned Business grows into a stable, successful local operation and family butcher shop to
OSI begins a decade of international expansion, opening Three years of expansion to New U.S. facility opens to produce bacon, sausage,
meat market and butcher shop in the Chicago area. rebrands to Otto & Sons. a technologically OSI opens a European
facilities in Germany, Spain, Brazil, Austria and Italy. Hungary, Poland, India and United and hot dogs. A beef and pork processing facility in
advanced manufacturer regional office in Germany
Kingdom, providing greater depth the Ukraine also opens.
of processed meats. and acquires two more
to OSI’s product line and services.
companies to expand its
European footprint.
A new dry sausage operation opens in the U.S.
6 | OSI GLOBAL SUSTAINABILITY REPORT 2018 / 2019 |7
Our Our Our
OVERVIEW | VALUES | STRATEGY | SUPPLY CHAIN | ENVIRONMENT | SOCIAL RESPONSIBILITY
Food. Future. Values. Ethics and Business Principles Both the CEO and president approve and endorse the
As an extension of our values, OSI is committed to Global Business Standards and its updates which are
operating its business with integrity and believes that made to align it with applicable new regulations, laws
ethical conduct is the foundation of our business and policies within OSI. Our legal department serves as
success. We incorporate our code of conduct in our OSI the owner of the Global Business Standards, and there
Global Business Standards, which is formally provided to are regional business standards officers as well as a
our employees annually and is also readily available team of individuals from our human resources and legal
1 2 3 4 5
through our corporate intranet website. We also provide departments who serve as resources to employees
reinforcement to employees with training around these seeking further guidance.
business standards and task each individual with the Our fundamental
Work We maintain high levels of accountability throughout beliefs which
responsibility of promoting and practicing the highest
Seek together Strive to Explore the OSI organization. We encourage our employees express the OSI
standards of ethical conduct in their business functions. way of doing business.
Act with partnering as a continuously innovative to apprise us of their concerns and questions
VALUES
The Global Business Standards summarizes relevant
integrity relationships team improve solutions through our open door policy and other
laws and includes OSI’s expectations and policies on
reporting mechanisms, including our
important topics such as Anti-Discrimination and Code of Conduct that outlines
MAKE IT RIGHT Global Hotline. how to conduct business
We pursue honest We will find the best We value each other We believe that any We go beyond what Harassment, Privacy, Fair Competition, Federal Corrupt
ethically in accordance GLOBAL
Practices Act, Insider Trading, Accurate Records,
interactions. Our work solutions to difficult because we’re better problem can be solved, is easy or obvious with laws, regulations, and BUSINESS
Conflicts of Interest, International Business, Human company policies.
is straightforward, challenges in together. The strength and better operations because we desire
Rights and Labor Laws. Each location also has local
STANDARDS
reliable and consistent partnership with our of our collective power and supply chains are excellence. We are
throughout all global employees, customers, is found in safe, always possible. confident in our policies that provide operational direction to supplement
operations. suppliers, farmers diverse workplaces place and responsibility the Standards and our senior vice president, general
and communities. where our employees as leaders. counsel serves as the chief compliance officer.
Operational directions,
Our partners’ success can thrive, develop including management LOCAL
processes and procedures.
is our success. and grow. POLICIES
Systems that monitor and benchmark
operations regularly in order to make
the best possible decisions at regional PERFORMANCE
and global levels of management.
& ALIGNMENT
8 | OSI GLOBAL SUSTAINABILITY REPORT 2018 / 2019 |9
OVERVIEW | VALUES | STRATEGY | SUPPLY CHAIN | ENVIRONMENT | SOCIAL RESPONSIBILITY
Food Safety and Quality The OSI Group drives food safety excellence throughout
Our customers’ trust is of utmost importance to our network via our Global Food Safety and Quality
us and ensuring food safety is non-negotiable. We Council. This council ensures global alignment of our
take providing consumers, many of whom are our food safety and quality expectations in order to
families, with safe, nourishing, and delightful food consistently deliver best-in-class solutions to our
as a privilege and honor. customers worldwide. Further, our Global Quality Council
has made significant strides to develop and implement
While expanding internationally, OSI has worked with OSI’s food safety culture in a way that can be easily
many local suppliers to deliver quality, consistency, understood, embraced, and adhered to by every
and efficiency in order to help our partners achieve employee and externally verified to provide confidence
The quality of our growth and profitability. As a partner, OSI provides to our customers. We undergo regular internal and
products and the connections to the best practices in food manufacturing customer safety audits and globally track a strategic list
people who work with operations by introducing our suppliers to better of food safety key performance indicators (KPIs) for each
technology, food safety, and management practices as plant, which are routinely reviewed by OSI’s leadership.
us will always come
well as connections to experts and practical experience
first. That’s why we’re We also recognize the importance of continuing
in the most advanced farming and processing facilities
considered number one around the globe. We’re proud of maintaining the high to embed and enrich our food safety culture within
by the best leaders in standards our customers have come to expect across the core of OSI operations. Planned initiatives
the business. Every each location and facility. include communication campaigns for each facility
and additional benchmarking of facilities by
day is a new day
We also set high expectations for our suppliers and external programs.
to prove it.”
insist on the application of Hazard Analysis and Critical
SHELDON LAVIN Control Points (HACCP) based preventive approaches All of OSI’s facilities actively maintain Global Food Safety
to food safety in all supplying facilities to manage risk Initiative Certification or other globally recognized
around food safety. certifications for their food safety and quality systems.
10 | OSI GLOBAL SUSTAINABILITY REPORT 2018 / 2019 | 11
OVERVIEW | VALUES | STRATEGY | SUPPLY CHAIN | ENVIRONMENT | SOCIAL RESPONSIBILITY
OSI Corporate Governance
and Organizational Structure
OSI, like any company, has to balance business realities and stakeholder
expectations. As a privately held company, we have the benefit of being able to
respond quickly and with both short- and long-term views in mind.
The company is governed by a Board of Managers, who Over the course of 2016-2017, several new individuals joined OSI
include sustainability considerations in their management of Group’s Global Leadership Team. OSI Group’s global leadership is
company strategy, risk, and investments. The board is chaired shown below and on the next page.
by Sheldon Lavin and meets quarterly to ensure we are sustaining
our values throughout OSI operations.
Sheldon Lavin David McDonald Sherry DeMeulenaere Donna Coaxum Nicole Johnson-Hoffman Kevin Scott Brent Afman Kevin Cahill Dr. Kenneth Petersen Mark Richardson
Chairman & President & Chief Executive Vice President, Senior Vice President, Senior Vice President & Senior Executive Vice Senior Vice President Managing Director, Senior Vice President, Senior Vice President,
Chief Executive Officer Operating Officer Chief Financial Officer, General Counsel & Chief Sustainability Officer President, North America & Managing Director, Europe Quality Assurance, Food Global Supply Chain
Treasurer & Assistant Secretary Asia Pacific Safety & Regulatory Affairs
Secretary
12 | OSI GLOBAL SUSTAINABILITY REPORT 2018 / 2019 | 13
OVERVIEW | VALUES | STRATEGY | SUPPLY CHAIN | ENVIRONMENT | SOCIAL RESPONSIBILITY
Sustainability Governance
Our Global Sustainability Team and our sustainability strategy and activities are led by our Chief Sustainability Officer,
Nicole Johnson-Hoffman, who was appointed at the end of 2017. Weekly updates on sustainability goals, performance,
and initiatives are provided to OSI’s president and chief operating officer. With the launch of the 2018 OSI Global
Sustainability Strategy, the OSI Board of Managers also provides oversight and receives annual sustainability
performance updates from senior management on business ethics, environmental, and social sustainability topics.
OSI’s Global Sustainability Team is a cross-functional group of leaders from across each of OSI’s regions of operation
who support the direction of OSI’s global priorities. The members of the team ensure that OSI’s sustainability goals
and priorities are integrated throughout all areas of the business from their expertise in operations, procurement,
environmental management, health and safety, and quality assurance. The team meets on a regular basis via conference
calls or face-to-face meetings. Separately, regional sustainability leaders track the progress of OSI’s global initiatives,
monitor our performance against targets, share best practices across the group and keep internal and external
stakeholders informed about achievements against targets.
OSI also utilizes an internal dashboard to track our sustainability KPIs from a plant,
GLOBAL SUSTAINABILITY TEAM
regional, and global level in order to understand our performance against
established targets. Each facility pursues specific, detailed continuous
President & COO Board of Managers
improvement projects and each region also develops their own action plans
as they integrate their own sustainability ambitions with those of the broader
OSI organization. Each action contributes positively to the overall impact the Chief Sustainability Officer
company has on advancing sustainability throughout the business.
Europe Americas
Europe Sustainability Global Sustainability Asia Pacific
Director Leader
Safety Procurement Quality Operations
Environmental Human Sales Legal
Management Resources
Local, Facility-level Sustainability Champions
14 | OSI GLOBAL SUSTAINABILITY REPORT 2018 / 2019 | 15Our Our Our
OVERVIEW | VALUES | STRATEGY | SUPPLY CHAIN | ENVIRONMENT | SOCIAL RESPONSIBILITY
Food. Future. Strategy.
STAKEHOLDER ENGAGEMENT
OSI heavily engages in multi-stakeholder initiatives as a means of obtaining important feedback from our industry
OSI’s Global Sustainability partners, communicating our own priorities, and staying up-to-date on important trends.
STRATEGIC SUSTAINABILITY PROCESS Team began a formal strategic STAKEHOLDER GROUP ISSUES DISCUSSED ONGOING ACTIONS
planning process in 2017 to CUSTOMERS •
•
Sustainable Sourcing
Climate Change
• Regular meetings with regional and issue
specific teams on sustainability issues
continue to advance our • Animal Welfare • Annual assessments and subject-specific audits
Awareness • Human Rights • Collaboration on pilot projects
• Deforestation
• Identify risk areas sustainability efforts in
across global EMPLOYEES • Safety • Intranet
supply chains alignment with the goals of our •
•
Training and Development
Conservation
•
•
Town halls
Annual performance reviews
• Conduct stakeholder
engagement
customers and the trends of the •
•
Animal Welfare
Community Engagement
• Regional community outreach teams
food industry. CIVIL SOCIETY (e.g., NGOs
and Research Institutions)
• Climate Change • Strategic partnerships on pilot projects to
research and inform best practices
• Water
• Land Management and Deforestation • Speaker invitations during supplier engagement
Refinement Planning We recognize that, given the • Animal Welfare
• Antibiotics
• Seek areas for • Organize • Strategic Partnerships
continuous stakeholder inputs wide variety of issues that are • Transparency
improvement and into materiality
further engagement analysis raised about food production, it GOVERNMENT AND
REGULATORS
• Trade
• Regulatory Issues
• Maintaining regulatory compliance
• Pilot programs
with stakeholders
• Highlight priority
areas with clear
is important for us to review and • Antibiotics
objectives for INDUSTRY GROUPS • Animal Welfare • Sponsorships of annual events
Evaluation creating impact prioritize the critical areas • Climate Change • Hosting industry tours
• Land Management and Deforestation • Participation in monthly calls, annual
• Analyze past data, where we can specifically drive conferences and events on key issues
customer market initiatives
and societal goals for impact. We understand that our SUPPLIERS •
•
Animal Welfare
Antibiotics
• Regular self-assessments and annual on-site
audits
setting impact targets
customers want to know who • Environmental Management • Regular meetings with regional and issue
specific teams on sustainability issues
• Align clear metrics • Human Rights and Labor
to targets in order to
track progress
makes their food and how we CONSUMERS • Food Quality • Market research
• Dedicated field service team
treat our valuable resources. PHILANTHROPIC PARTNERS
• Food Security • Donations
• Agricultural Training • Volunteer contributions
• Workforce Development • Event participation and sponsorship
• Health and Nutrition
16 | OSI GLOBAL SUSTAINABILITY REPORT 2018 / 2019 | 17OVERVIEW | VALUES | STRATEGY | SUPPLY CHAIN | ENVIRONMENT | SOCIAL RESPONSIBILITY
Materiality Analysis
Based on frequent contact with important stakeholders, analysis of public interest
issues, and research among the marketplace and consumers, we defined a list of Antibiotics
Animal
Welfare
relevant topics for our business. We then performed a materiality analysis with Forest Food Safety
representatives from a cross section of different geographies and functions within Water Workplace Safety
Climate Change Energy
OSI to understand the issues that are most important to our success. We evaluated
Labor
IMPORTANCE TO STAKEHOLDERS
topics based on two dimensions in order to prioritize our areas of focus: Nutrition
Waste
Importance to Business Compensation Business Ethics
While there are some issues that exist squarely within the control of OSI’s operations,
other issues are outside of our direct contact and control. These issues require Land Management Traceability
cooperation and partnerships in order to inspire change within our supply chain. We
included these issues in our analysis because some are critical to our business’s place
Transparency Training
in industry and require our participation in collective initiatives to improve the system.
The internal evaluation of our responsibility and ability to impact these issues and their
Philanthropy Job Creation
relevance to our business operations is included on the horizontal axis. Diversity
Importance to Stakeholders
This analysis relied heavily on the views and perceptions of outside stakeholders
as we gathered and synthesized inputs from influencers across the industry including:
key customers, suppliers, non-governmental organizations (NGOs), community
organizations, industry trade associations, and media attention. Feedback from the
most important stakeholder groups were given the most weight, with the weighted
average on the vertical axis.
IMPORTANCE TO BUSINESS
This process has identified the ten most important economic, social, and Going forward, we will maintain an ongoing dialogue with our
environmental issues to our business: Animal Welfare, Antibiotics, Food customers, suppliers, NGOs and other stakeholders to continue
Safety, Employee Health and Safety, Employee Training, Energy, Climate refining our strategy by monitoring and assessing emerging issues
Change, Waste Reduction, Water Stewardship and Protecting Forests. and the evolution of topics included in our materiality assessment.
We expect to review the strategy annually.
18 | OSI GLOBAL SUSTAINABILITY REPORT 2018 / 2019 | 19OVERVIEW | VALUES | STRATEGY | SUPPLY CHAIN | ENVIRONMENT | SOCIAL RESPONSIBILITY
Sustainability Priorities
From our strategic sustainability process and the materiality analysis, we’ve
organized the most significant issues into the following six priorities for our company.
These priorities build on the sustainability vision that OSI has been communicating to our stakeholders and supply base over the past couple of
years to highlight the specific categories of Sustainable Supply and Procurement, Environmental Stewardship, and Social Responsibility. Highlighting
specific priorities advances our approach by defining the opportunities where we can drive meaningful and sustainable impact in the long term goals
that are listed below.
Sustainable Supply Environment Social Responsibility
ANIMAL WELFARE ANTIBIOTIC CONSERVATION CLIMATE CHANGE WORKPLACE COMMUNITIES
Animals respectfully STEWARDSHIP Reduced environmental Risk to changing Safe workplaces where Shared value for company
managed to ensure Antibiotic effectiveness impact through climates addressed by everyone’s rights are and community created
health and welfare preserved for human responsible stewardship mitigating greenhouse protected and skills
and animal health of natural resources gas emissions are enhanced
• Ensure respect for • Healthy animals • Use water sustainably • Reduce • Reduce workplace • Provide safe, quality food
animals in supply chain GHG emissions hazards
• Reduce critically • Reduce waste • Enrich our communities
• Lead animal important antimicrobials • Use energy sustainably • Respect workers’ rights
• Protect forests • Support individuals most
welfare practices from use in supply chain
• Build resilience to • Empower workforce with affected by food and
changing environment the skills to succeed agriculture supply chains
20 | OSI GLOBAL SUSTAINABILITY REPORT 2018 / 2019 | 21OVERVIEW | VALUES | STRATEGY | SUPPLY CHAIN | ENVIRONMENT | SOCIAL RESPONSIBILITY
& with Nicole Johnson-Hoffman
Chief Sustainability Officer
2018 was a great year for 2025 Sustainability Targets
OSI has been reporting on our sustainability activities since 2010, but our 2016-2017 Global Sustainability Report
OSI in terms of our increase in was the first integration of our sustainability efforts into a single narrative from around the globe. Since then, we have
Sustainability is a term that many people define What are OSI’s biggest sustainability continued to refine our approach in order to target strategic impacts in the areas of environmental stewardship, social
transparency and building a
differently. What does it mean to you? opportunities? And the challenges? responsibility, and sustainable supply chains. We have evaluated the progress made toward our prior regional
Sustainability articulates our aspiration that OSI’s business and supply When I joined OSI, I knew that we had both a tremendous opportunity and
strategic sustainability action commitments and set new, ambitious targets at the global level for 2025 in accordance with our greater focus and
conviction around sustainability. We have also looked for opportunities to use our size and global scope to our
chains can always be improved to deliver better outcomes for OSI’s responsibility in our company’s vision of being a Premier Global Food
plan. Focusing in on our six advantage by highlighting and sharing resources for best practices across the global business.
customers, the environment and the communities in which our company Provider to Leading Branded Companies. Our customers maintain
operates. Making commitments to sustainability shows that we plan to be ambitious, best-in-class sustainability goals because it is demanded by priority topics will give us a
around and competitive long into the future. I am confident that OSI will their customers, investors, and the public. For them, many of their
great start in meeting our All suppliers for all Expand industry
SUPPLY
continue to link hands with our fellow stakeholders around the globe to sustainability goals begin in the supply chain, and we’re fortunate to Utilize outcome based Third-party video
species have externally engagements across
indicators for all animal auditing at all primary
say “we will do our part” in providing sustainability leadership and
influencing our industry and supply chains to ensure consumers trust the
benefit from their important industry leadership that helps make those
goals a reality. As we join their sustainability momentum and help add our
common goal: a sustainable recognized animal
welfare training in place
welfare KPIs processing facilities
relevant species and
regions
quality and care for communities and natural resources that went into own energy and influence to the movement, we look forward to the food industry.
producing the food on their plate. change that we can create in our supply chains.
ENVIRONMENT
Report to
How did you approach your first year as In the same way, building a sustainable industry is a challenge bigger than Reduce water Reduce energy
Reduce GHG*
CDP** Supply
Increase
100% landfill emission renewable
OSI’s Chief Sustainability Officer? Has anything any one of us can tackle alone. OSI brings our long history of building usage intensity
free facilities
intensity by
intensity by
Chain and
energy usage
by 15% 20% Forests
surprised you? successful partnerships into this space as well, supporting collaborative 20%
questionnaire
75%
multi-stakeholder initiatives, like the Global Roundtable for Sustainable
As I began to scope OSI’s 2025 Sustainability Strategy, listening to our Beef, to start chipping away at the challenges and combining our
stakeholders was a clear first step. OSI has always been a company that influence to ensure that OSI, our customers, and our communities can be
Implement integrated
is finely attuned to our customers’ needs, and for the majority of leading confident about their future. health and safety Provide expanded
SOCIAL
branded companies, sustainability is a critical capability for food suppliers Donate 2000 volunteer Achieve new standard
system at all facilities to support to agriculture
and most certainly a priority for their customers. From there, we identified What is next for sustainability at OSI? improve monitoring,
hours per year to
community initiatives
education, families and
minimum training hours
at all facilities
a couple of key sustainability levers that we could pull to play our part in education and accident hunger relief at all sites
We’re becoming a stronger sustainability partner to our customers and to reductions
helping our customers reach the commitments they have made toward
our suppliers. This report is another milestone in our goal of becoming
sustainability objectives.
more vocal about the great achievements we’ve had in sustainability and *GHG = Green House Gas **CDP = formerly Carbon Disclosure Project
the role we want to have in telling our own story about what sustainability
looks like in our industry. Further, we’re looking forward to increased For our targets, we look at our own operations from a baseline of 2015 as we can control these outcomes ourselves.
engagement with both our suppliers and other collective action groups. We have been monitoring them closely through OSI Advantage, our proprietary data dashboard for tracking
operations KPIs. Separately, we are continuing to engage in other partnerships and industry associations to influence
and drive greater impact throughout our supply chain.
22 | OSI GLOBAL SUSTAINABILITY REPORT 2018 / 2019 | 23Our Our Our
OVERVIEW | VALUES | STRATEGY | SUPPLY CHAIN | ENVIRONMENT | SOCIAL RESPONSIBILITY
Food. Future. Suppliers.
From raw material suppliers to the consumer’s table, OSI performs a critical role in a BEEF POULTRY PORK
complex supply chain. This role positions us between the needs of our customers,
Industry Roundtable* Breeder
demands of the market and the realities of on-farm operations and raw material
Feed
Producers
suppliers. Although we have direct control over only some stages of the supply chain, Cow-Calf Operations
Feed
Hatchery
we work hard to bring all parties together to ensure the highest quality possible.
Feed
Sale Feedlots
Barns & & Finishing Broiler Farm Primary Processing
Stockers Farms
Primary Processing Further Processing
Primary Processing
Further Processing Further Processing Distribution
Distribution Distribution Customer Store
Customer Store Consumer
Customer Store
Consumer Consumer
Before a hamburger, nugget or slice of bacon ends up on the plate, OSI REGIONS OSI ACTIVITY
OSI plays a critical role in connecting the dots in the supply chain ● Asia Direct Operations
and adding value to protein products. ● Australia Indirect Influences
● Europe * Leaders, partners, influencers
24 | OSI GLOBAL SUSTAINABILITY REPORT 2018 / 2019
● U.S. | 25OVERVIEW | VALUES | STRATEGY | SUPPLY CHAIN | ENVIRONMENT | SOCIAL RESPONSIBILITY
SCHOERGERER
Influencing the Supply Chain GRSB brings together Industry Roundtables
We view it as our responsibility to source high-quality materials and raise supplier expectations in order to ensure people from around the Protein supply chains are complex systems with a wide OSI Group Memberships & Associations
the best product possible before it enters our facilities. We recognize the importance of long-term, trusting world who represent all variety of producers and practices that differ across each • Global Roundtable for Sustainable • Australian Chicken Meat Federation
We’re proud to highlight the outstanding farmers,
relationships with raw material suppliers, and continually seek to engage them independently and through industry segments of the beef country and region. For this reason, OSI harnesses our Beef (GRSB)
ranchers and producers in our supply chains because we • Victorian Chicken Meat Council
roundtables. This helps us facilitate the sharing of best practices in environmental protection, business and supply value chain, including partnering mindset and looks for ways to work • U.S. Roundtable for Sustainable
believe it is important to recognize what successful, • Board of PrimeSafe Victoria (Victorian
chain ethics, as well as communicate economic opportunities from market demands. individual producers collaboratively with our counterparts in the industry in Beef (USRSB)
sustainable farming systems look like and facilitate the State Government Meat, Poultry and
who, ultimately, agree order to communicate effectively with our stakeholders • Sustainable Agriculture Initiative Seafood Regulatory Body)
transfer of best practices to others within our network. We believe that animal welfare and good agricultural practices are pre-competitive issues, and so we participate there’s massive value and contribute to meaningful change. (SAI) Beef Platform
• China White Feather Broiler
in programs with our industry and supply chain to identify and address issues that do not meet our ethical in sharing knowledge
Beginning in 2016, we were honored to showcase the • National Chicken Council Association
responsibilities. OSI is also proud to support commitment-led supply chain enrichment programs on behalf of and who want to OSI is a founding member and dedicated supporter of
Schoergerer farm in Austria. The dairy flagship farm was • U.S. Poultry & Egg Association • China Poultry Industry
our customers. With expertise in a wide variety of such programs, our supply chain management experts engage partner to drive the Roundtables for Sustainable Beef. Since January
specifically recognized for its strong focus on animal Association, CAAA
our suppliers and industry partners to meet targets through programs for: exciting new levels of 2018, our chief sustainability officer has served • Professional Animal Auditor
welfare with a loose house system and careful herd Certification Organization (PAACO) • CLFMA Membership: Compound
performance in areas as the president of the Global Roundtable for
management to protect the environment of alpine Live Stock Feed Manufacturers
Enriched Housing Enriched Specific Varied Animal Medicine Farm Assurance Certifications impacting GRSB’s Sustainable Beef, and other members of OSI’s • Animal Agriculture Alliance
pasture and forest. In 2016 and 2017, we were pleased Animal Diets Production Regimes
Association of India
Management Methods principles and criteria sustainability team also participate with the regional • North American Meat Institute (NAMI)
to highlight our Hungarian poultry supplier, Master • Protein Foods & Nutrition
of sustainable beef.” roundtables in Europe, the United States, and Australia. • Professional Dairy Producers Development Association of
Good, for their leadership in animal husbandry, welfare, • Gestation • RSPCA • Grass-fed • Organic • Never Ever • Bavarian Origin
crate-free pork assured • Sustainable • Transitional Antibiotics • Fair Foods NICOLE JOHNSON-HOFFMAN of Wisconsin (PDPW) India (PFNDAI)
biosecurity, environmental activities and human welfare. OSI is also active within industry and agricultural
• Cage Free • GAP certified Soy Organic • No Hormone • Food Alliance
(HGP Free) • Roundtable for Responsible • Roundtable on Sustainable
• Natural behavior • Non-GM • Non-GM • German QS associations for other proteins. Dave McDonald,
We’re continuing to nominate leading suppliers and look enablers Soy (RTRS) Palm Oil (RSPO)
• Great Southern President and COO of OSI Group, has served on the
forward to reporting on other supply chain leaders and • Lighting
• Marine Stewardship Council • Women’s Food Service Forum (WFF) • ZDF (German Meat Association)
specifications Board of Directors for the North American Meat
their sustainable operations. • Origin Green
• Red Tractor Institute (NAMI) since 2003. • IPC (International Poultry Council) • U.S.-China Agriculture and Food
• SFS, OSI’s personal 3rd party Partnership (AFP)
Ben Harrison, President and • ZDG (German Poultry Association)
certified Farming Standard
CEO of Amick Farms, has • Association of Poultry Processors
As part of this effort, we strive to recognize the highest performing suppliers and farmers. Our Quality Assurance served on the Board of and Poultry Trade in the EU countries
Team is critical in benchmarking supplier performance with best practices and ensuring consistent quality Directors and as Chairman of the
through regular audits and supplier feedback loops. Through these activities, our suppliers can showcase their National Chicken Council for 2017-2018.
best practices and influence their peers and the industry to adopt practices that improve animal welfare, build He is also currently serving on the Board of
environmental resilience, and create positive social and economic impacts for their communities. We’re proud Directors of the U.S. Poultry & Egg Association.
MASTER GOOD
to showcase these individuals in our publications and sponsor them in recognition programs from customers
and industry groups.
From 2018 onward, we will also engage our supply chain annually through regional conferences, where we
bring together thought leaders from across our industry to share best practices, including specific sustainability
26 | OSI GLOBAL SUSTAINABILITY REPORT 2018 / 2019 highlights with our supplier base. | 27OVERVIEW | VALUES | STRATEGY | SUPPLY CHAIN | ENVIRONMENT | SOCIAL RESPONSIBILITY
Priority 1: Animal Welfare
OSI is committed to respectfully managing animals to ensure the
health and welfare of livestock in our supply chain and lead best
practices in our industry.
Both OSI and our stakeholders insist on high standards • Since 2013, OSI has provided ongoing sponsorship
of animal care in our supply chain. We recognize that this of several science-based animal welfare organizations,
is not only an ethical responsibility, it also ensures a high including the Professional Animal Auditor Certification
quality product. For this reason, we are careful about our Organization (PAACO), North American Meat
supply of raw materials. We source exclusively from Institute (NAMI) and Professional Dairy Producers
approved external suppliers or, in some areas of the of Wisconsin (PDPW).
world, from our own primary processing facilities for
• OSI supports and promotes meat and poultry
beef and chicken, which we take care to operate
animal auditor trainings, assessments and
according to best practices of industry experts such
programs throughout the industry in the U.S.,
as the World Organization for Animal Health (OIE),
Europe, China and Australia.
Dr. Temple Grandin and the North American Meat
Institute (NAMI) Animal Handling Guidelines. • OSI employs numerous PAACO certified auditors
with ongoing goals for more.
OSI respects OIE’s Five Freedoms of Animal Welfare, which standardizes primary animal needs under The quality controls in our supply chain’s policies and
human control: procedures ensure humane treatment, handling and
slaughter of animals at all times and in every global
1 2 3 4 5
Freedom from Freedom from fear Freedom from Freedom from pain, Freedom to express sourcing avenue. Our OSI Group Animal Welfare
hunger, malnutrition and distress physical and thermal injury and disease (most) normal Policy is available for review on our website and we
and thirst discomfort patterns of behavior are regularly assessing the performance of our animal
welfare management systems to improve outcomes of
measurable key performance indicators.
28 | OSI GLOBAL SUSTAINABILITY REPORT 2018 / 2019 | 29OVERVIEW | VALUES | STRATEGY | SUPPLY CHAIN | ENVIRONMENT | SOCIAL RESPONSIBILITY
Some Specific Animal Welfare Guiding Principles of Our Activities Include: We were honored that, in 2017, our integrated
poultry processing facility in Weihai was recognized
1 2 3 4 5
Compliance with all External standards and Regular internal and Ongoing technological Training, competence as one of three outstanding Chinese companies
applicable legislative, definitions of animal external animal welfare innovation for improved and awareness for all with a “Good Farm Animal Welfare Award” for
regulatory and welfare responsibility verification audits key animal welfare employees handling Good Chicken Production by the International
non-regulatory from recognized, indicators livestock Cooperation Committee of Animal Welfare (ICCAW)
In addition to daily animal and Compassion in World Farming. For us,
requirements scientific experts
welfare verification We are investigating the We strive to foster a this award represents our leadership in animal
All livestock destined and OSI recognizes that the activities by designated, use of technology to culture of best practice in welfare and the entire food industry in China.
received for slaughter at public perception of specially trained animal leverage improved animal science-based animal It has been very important to us to ensure that our
OSI facilities and animal welfare differs welfare officers, OSI welfare outcomes in our welfare with trained and Chinese livestock operations follow advanced
suppliers will be treated across cultures and conducts annual third- slaughter facilities. In competent employees, international concepts including best practices
humanely and with regions. We intend to party auditing of its over 50% of OSI auditors and suppliers. such as reduced stocking densities, leg health
respect in accordance implement, at a facilities. Our suppliers operated slaughter plants OSI’s auditors are trained plans, housing enrichment and natural light in the
with OSI procedures and minimum, consensus- must demonstrate and some of our supply under recognized animal sheds. Our development of activities such as these
in compliance with based best practices for ongoing compliance, chain partners, we have welfare auditing is what makes us a best-in-class operation.
regulations. animal welfare. We do and any finding of already incorporated the certification programs,
follow science-based, egregious abuse to latest in closed circuit such as PAACO, and we
internationally recognized animals results in television (CCTV) and utilize globally recognized
standards, such as OIE’s immediate suspension or computerized data subject matter expert
Five Freedoms and potential termination of analysis and automation trainers and training
include veterinarians as business. OSI is actively of the lairage and materials. This same
part of our process. We developing global animal slaughtering process. We level of excellence is
also support the sharing welfare key performance intend to continue the expected of our
of best practices indicators that we will roll-out of this technology suppliers, and we will
between countries and apply at all of our beef to the maximum extent continue to implement an
regions where our and chicken primary practicable in order to animal welfare KPI
suppliers are located, to processing facilities. support robust animal scoring system for all
ensure consistent quality welfare management. suppliers in our primary
controls are maintained processing business
in all areas. operations to further
measure and manage
animal welfare in our
supply chain.
30 | OSI GLOBAL SUSTAINABILITY REPORT 2018 / 2019 | 31OVERVIEW | VALUES | STRATEGY | SUPPLY CHAIN | ENVIRONMENT | SOCIAL RESPONSIBILITY
Priority 2:
ON TARGET FOR
90% reduction
Antibiotic Stewardship
of critically important Antimicrobials
in Europe by 2019
OSI is committed to preserving antibiotic effectiveness for human
and animal health by prioritizing healthy animals and the reduction
of critically important antimicrobials from use in the supply chain.
Antibiotics play an important part in both human antibiotics appropriately in food animal production will
and animal health by treating bacterial infections. lead to optimal animal health and welfare, which is good
Unfortunately, some bacteria are no longer able to be for producers and the rest of the food production chain,
controlled by antibiotics after developing full or partial and is essential to helping ensure a safe, affordable and
resistance to their effectiveness. We recognize that using abundant food supply.
IN 2017, BEGAN PHASING OUT
highest priority
critically important
antibiotics
as defined by World Health Organization
OSI Asia Pacific
(e.g., Macrolides and Fluoroquinolones) across
operations globally.
is actively collaborating with government officials in three
different emerging markets at both a technical level for
prudent use of antibiotics, and at the policy level to
develop pilot programs to measurably reduce the use of
antibiotics used in poultry grow out operations.
32 | OSI GLOBAL SUSTAINABILITY REPORT 2018 / 2019 | 33OVERVIEW | VALUES | STRATEGY | SUPPLY CHAIN | ENVIRONMENT | SOCIAL RESPONSIBILITY
We Manage Antibiotic Use Through Responsible Sourcing Guidelines. No Antibiotics Ever at Amick Farms OSI Europe Targets Antibiotics
“In 2016, we developed a program, in addition to our Reduction Across The Poultry
1 Dedicated antibiotic-
free programs
In some instances where
we have vertically
2Animal care under
veterinarian supervision
We recognize and believe
that farmers and
3 Reduction of critically
important antibiotics
We recognize the World
Health Organization’s
4Ensuring compliance
with withdrawal times
and residue testing
Legal regulations and
5Supporting industry
research
We work through industry
groups to support
other product lines, to better serve the growing segment
of our partners who wanted chicken products that have
never, ever been given antibiotics of any kind. Grown
completely free of antibiotics—from hatching, to raising,
Supply Chain
“We have been monitoring antibiotic use for many
years in chicken integrations and working closely
with our suppliers on reduction strategies to help meet
to harvesting, our No Antibiotics Ever (NAE) program future requirements of customers and make progress
integrated poultry supply ranchers work diligently categorization of our clear supplier ongoing and future
makes up about 50 percent of our total production. The towards embedding sustainability practices within our
chains or through to manage their livestock antibiotics to include expectations dictate research into the best
NAE supply directly addresses increasing customer supply chain. These activities include following World
dedicated suppliers in in the best manner those antimicrobials strict withdrawal practices for treating
requests for an antibiotic-free product that will meet their Veterinarian Association’s 10 Prudent Use Principles
other proteins, we are possible through sound designated as critically guidelines and residue animals and the way that
own commitments to antibiotic stewardship over and for antimicrobial usage, restricting antibiotic use in the
able to provide products husbandry practices, important to human testing that is closely antibiotic resistance is
above industry standards for antibiotic vigilance with hatcheries, and good farm management practices that
to the growing number of including genetics, medicine. OSI supports followed in both our and developed in humans
veterinary oversight, withdrawal times, and compliance are combined with vaccination programs, feed which
consumers who want to nutrition, housing, efforts of our suppliers our suppliers’ operations and animals.
to minimum residue limits. We worked with the United meets specific nutritional needs of the chickens,
ensure that their food is handling, and veterinary to implement animal to ensure that all raw
States Department of Agriculture (USDA) to implement and so on.
completely antibiotic- care in order to eliminate production practices material is subject to
our NAE program as a process verified program to
free. Through these any potential illness and that reduce, and, where ante-mortem and Another challenge has been the phase-out of Highest
ensure that our system had the proper documentation
programs, any livestock need for medicine. When possible, eliminate post-mortem Priority Critically Important Antibiotics (HPCIA). Since
and auditing procedures to support our antibiotic claims.
used in production has necessary, sick animals subtherapeutic antibiotic inspections, confirming 2014, we have encouraged our suppliers to seek
We’ve also dispatched our “Chicken Experts” - or
never been given are treated in accordance use in food animals. that it contains no technical advice from experts and have initiated
veterinarians and field technicians - to help support
antibiotics of any kind at with veterinary guidance We also encourage and antibiotic residue. meetings to speak about topics like substitution
growers in raising antibiotic-free flocks with necessary
any time during their life. as part of animal welfare are piloting programs possibilities and best farm practices. OSI Europe has
alternatives such as incorporating additional probiotics
Our antibiotic-free commitments. that adopt best introduced antimicrobial susceptibility testing prior to
to promote good intestinal health and reducing risks
programs are closely practices that result in treatment on a mandatory basis. Since the beginning of
for contamination and stress. As always, we maintain
monitored and kept subsequent reduction 2018, we have achieved the elimination of some groups
high standards of animal welfare for all of our programs
separate from the of antibiotic use. of the HPCIA and the rest will follow in 2019.
and implemented a “Plan B” for treating any sick
remainder of the
animal, if necessary, by moving those birds to our Despite these efforts, we know that to manage infectious
conventional supply.
conventional program.” diseases, it is sometimes necessary to turn to antibiotics.
BRITTNI MILLER Therefore, our primary target is to reduce antibiotic use
Communications Manager, Amick Farms
without compromising animal health and welfare.”
SAULE IALGASBAEVA
Quality Assurance Raw Material, Europe
34 | OSI GLOBAL SUSTAINABILITY REPORT 2018 / 2019 | 35Our Our Our
OVERVIEW | VALUES | STRATEGY | SUPPLY CHAIN | ENVIRONMENT | SOCIAL RESPONSIBILITY
Food. Future. Planet.
OUR OPERATIONS OUR EMPLOYEES OUR SUPPLIERS
We want to be more than a “green” company and consider environmental
We have prioritized the establishment of OSI Europe has been celebrating the United Environmental considerations are especially
stewardship to be particularly important given the opportunities and Environmental Management Systems (EMS) Nations’ (UN) World Environment Day held important to our European Quality
in our facilities as part of our environmental annually on June 5 since 2011. Every year, Assurance Raw Material Team. We’ve
challenges that agricultural supply chains offer to our planet and the and sustainability risk management. As a during the week of activities, each facility guided our customers’ dedicated supply
best practice, the EMS is developed from uniquely celebrates with events such as
resources we rely on for our operations. We want to lead by example in the ISO 14001 standard, which helps employee presentations on the year’s
base through ISO 14001 Environmental
Management Certification, or equivalent
environmental management and consider both our processes and organizations manage environmental highlighted focus. systems, over the past seven years.
compliance and track performance against
sourcing decisions to be influential platforms to drive these impacts. environmental goals.
BEYOND ISO 14001 CERTIFICATION, AS OF 2017
AS OF 2017
8 facilities 87% of suppliers
13 facilities
achieved Eco-Management and Audit Grade A environmental ratings
Scheme (EMAS) accreditation
ISO 14001 certified
This next level of environmental 54%
management has some of the most ISO 14001 accreditation
Four of OSI’s facilities and office buildings stringent criteria for external auditing
This indicates that, in addition to legal
are LEED certified, a marker in Leadership and official registration with government
compliance, suppliers are also maintaining
in Energy and Environmental Design bodies. The system implemented for eight
robust environmental policies, environmental
and the globally recognized marker of of OSI’s European country operations
risk management, regular trainings, and
environmentally sustainable construction. also boasts increased transparency of
continuous improvement in energy, water
environmental impact and demands
and waste efficiencies.
creative engagement of employees in
achieving environmental objectives.
36 | OSI GLOBAL SUSTAINABILITY REPORT 2018 / 2019 | 37You can also read
