It’s hard to be a climate conscious consumer. Maybe you spend your cash at a company that offsets emissions, only to learn it buys junk credits.
Maybe you heard about ESG (environmental, social and governance) ratings and bought a product based on those – only to read that companies can raise their ratings while growing Earth-cooking emissions.
Many of the systems designed to measure good behaviour serve the companies making and using the ratings better than the rest of us.
The Climate Action Report Card - in partnership with Otago University - is an attempt to balance that, and assess companies on their climate impact, their transparency and what actions they’re taking that could slow or speed up Aotearoa’s journey.
We expect these assessments to create debate. You can see what the companies themselves think of them in their company profiles below.
You’ll notice the assessments are typically low – and with New Zealand’s emissions having barely fallen for decades, that’s to be expected. Yet almost every company here is doing something right, and as New Zealand moves faster, we expect them to improve. As Associate Professor in sustainable business (and panel judge) Dr Sara Walton put it: “We understand that companies are on a journey when it comes to the low-carbon transition. But we also need to be clear that it’s a journey with a destination, and a very tight timeline to get it right.”
This report is the first snapshot in what will become a regular survey on a variety of sectors. The University of Otago, which helped produce these scores, will take the lead in running them as a longitudinal piece of work, in partnership with Stuff and The Lever Room. Expect to see more companies in more sectors scrutinised, alongside progress reports on those already graded.
For full details of why and how companies were selected and scored, including details of the international guidance used, click here.
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While decent at counting and revealing emissions, Z lacks a strong plan for the crucial bit – shifting out of fossil fuels.
As New Zealand’s biggest petrol retailer it’s not surprising Z is also one of the largest emitters – in fact, it’s responsible for around a tenth of the country’s emissions.
In the 2022 financial year, Z’s total emissions, including from the fuel it sells to customers, were 10,041,008 tonnes, down from 11,959,040 in 2019 – a drop of 16 per cent. However, those figures cover pandemic lock-downs in Auckland and Waikato, when people used their cars less.
As a company whose core business is selling fossil fuels, the onus is on Z to have a strong and reasonably rapid plan to transition away from selling fuel and into a cleaner business model, the judges said. The judges noted that they couldn't see strong evidence of this, with Z’s biofuel plant closed and the company making confident statements about the strength of future demand for petrol.
By selling carbon offsets at the pump, the company puts the onus on customers to take responsibility for emissions arising from the company’s business, the judges noted. Z’s presentations to investors suggest it is moving only cautiously towards alternative fuels and electricity. Unlike rival BP, however, Z did respond to the survey and allow itself to be properly assessed.
Z says it is “committed to contributing to the decarbonisation of New Zealand’s transport network”. It plans to roll out a network of EV charging infrastructure across 20% of service stations by the end of 2023, is partnering with EV charging company Evnex on a “home smart charging solution” and will soon own 100% of Flick Electric. Z is also exploring hydrogen and sustainable aviation fuel. When Australian petrol company Ampol recently bought Z Energy, it promised the Overseas Investment Office it would invest a further $50 million into “future energy initiatives'', which Z points to as further evidence of its decarbonising plans. The company also points out it spent $50m on a biofuels plant but had to close it because it was not economically viable. Z also highlighted its target of cutting its operational emissions (not including the petrol it sells) by 42% from 2020 levels, which it thinks it will achieve by 2023.
Responses have been edited for length and clarity.
Like rival Z, BP is one of New Zealand’s biggest petrol retailers and therefore one of its biggest emitters. Most of its impact arises at the very end of the supply chain, when customers burn BP’s products in their vehicles.
Although BP declined to answer the survey about its impact, emissions estimates the company supplied to the EPA show the company’s footprint for the 2021 calendar year (the latest information available) was estimated at 4,930,794 tonnes, making it the second biggest emitter in the fuel business behind Z. That was significantly up on 2020, when BP’s reported emissions were 4,229,797 tonnes.
BP was marked No Response, because it declined to answer questions about its impact and emissions plans.
Fonterra didn’t have a target for reducing emissions from its dairy farmer-suppliers, and as a leading exporter it should be more ambitious about getting out of coal.
Being the main collector, processor and exporter of New Zealand dairy products puts Fonterra at number one in the list of the nation’s biggest emitters. Most of these emissions come from the farms that supply Fonterra, although a significant chunk is produced by burning coal to dry milk powder and other activities such as operating milk tankers.
Fonterra’s total emissions – 16,312,677 tonnes of CO2-equivalent, or around one fifth of New Zealand’s annual emissions – were almost unchanged between the 2019 and 2021 financial years.
The judges said that although Fonterra says it lobbies in favour of climate action, the fact that there is still no price on methane and nitrous oxide emissions from farming suggests a successful campaign of delay by the agri sector, of which the company is part.
Although Fonterra highlights the conversion of two coal boilers to cleaner fuels (one completed and one underway), it intends to continue burning coal at its other boilers for years to come, the judges noted, which they said was disappointing from such a pivotal exporter.
Crucially, Fonterra does not have a target for reducing emissions from its supply chain – aka dairy farmers – whereas the judges said Fonterra should be leading the way. The company does, however, invest in research into ways to cut farm emissions and assists farmers with preparation of farm environment plans.
By giving all of its farmers access to reports on their emissions, Fonterra says it has deployed the “largest emissions measurement programme in the Southern Hemisphere”. It also says its dairy is emissions-efficient per kilo of product, compared with other countries. Fonterra says it should not be accused of delay on emissions pricing when it has supported collaborative efforts to find a solution to pricing farming emissions, namely the He Waka Eke Noa collaboration between Government, Māori and industry. Fonterra says it supports sustainable emissions pricing, and has said this several times in its submissions on the Zero Carbon Act, reports by the Climate Change Commission, and policies for pricing agricultural emissions. Since completing the survey, Fonterra has promised to announce a target for Scope 3 emissions (including from farms) in mid-2023. It has invested in a methane-cutting programme with the Government, and announced plans to convert another coal boiler to cleaner energy at Waitoa. It has also launched a partnership with Nestlé to establish a net zero dairy farm.
Responses have been edited for length and clarity.
Cheese and milk powder maker Open Country Dairy is an independent dairy processor competing with Fonterra.
Although Open Country Dairy declined to answer the survey about its impact, emissions estimates the company supplied to the EPA put it second only to Fonterra in the ranks of New Zealand’s biggest dairying emitters.
Its estimated 2021 climate impact – 1,428,314 tonnes – puts it in the same league as the two big fertiliser companies.
It was also an increase on the 2020 calendar year’s emissions, of 1,350,641 tonnes.
Open Country Dairy was marked No Response, because it declined to answer questions about its impact and emissions plans.
Silver Fern Farms did good work on understanding the risks and opportunities of climate change but it didn’t have a target for cutting emissions from its meat farmer-suppliers.
The beef, lamb and venison seller is one of the country’s biggest emitters. Like Fonterra, most of its emissions come from the farms supplying its products (in this case, meat).
The company has just started including the climate impact from animals raised by its farmer-suppliers (largely animal methane and nitrogen fertilisers) in its annual emissions tallies, starting with the 2022 financial year.
Silver Fern Farms is legally required to give a standardised estimate of its full footprint (based on the number of animals killed) to the EPA. In the 2021 financial year that impact was estimated at 3,850,726 tonnes of greenhouse gases (up 2% from 3,773,923 in 2019), putting Silver Fern Farms in roughly the same league as Genesis Energy.
However the company has since made a more accurate (though not yet independently verified) 2022 estimate of its supply chain (or Scope 3) emissions: 2,859,180 tonnes. 97% of this is methane and nitrous oxide from animal sources.
Excluding the climate impact of raising the meat, the company’s direct impact has been shrinking: 97,222 tonnes in the 2021 financial year, down 14% from 113,892 in 2019.
The judges said it was positive that the company was aware of science-based guidance for its industry, and was setting itself annual targets as well as encouraging nature-based solutions to climate change by its farmers. It also won praise for having a comprehensive climate risk disclosure report, which assesses opportunities (as well as risks) from climate change, and for its Carbon Roadmap.
However, the lack of a target to shrink the main part of its impact– emissions from its meat suppliers – was a major drawback, the judges said.
Since companies were scored on transparency in late October 2022, Silver Fern has significantly improved its climate disclosure, which the panel noted should improve its transparency rating next time.
Silver Fern Farms says accuracy and transparency are its main drivers when undertaking emissions reporting. It has been reporting its emissions since 2018, and has had its reductions certified by consultancy Tōitu since 2019. When it comes to its farmer supply chain, Silver Fern says fully counting and reducing these emissions is a long process, especially if a company engages with (international benchmarking body) the Science Based Targets Initiative. Red meat companies have only been able to take part in this process since late 2022, says Silver Fern. It plans to have its 2022 Scope 3 (supply chain) emissions verified by the end of March 2023, and the company says it will then start the process of setting a target to cut its full emissions. Silver Fern Farms says it rejects being compared to fossil fuel companies in this report because it makes different gases – methane and nitrous oxide, rather than carbon dioxide. (Editor’s note: Methane is a shorter-lived but more potent heater than carbon dioxide, while nitrous oxide is both potent and long-lived). Silver Fern also notes that methane is treated differently from carbon dioxide under New Zealand law, and has a lower reduction target of 10% by 2030 (which, again, it says, means a methane-making meat company isn’t comparable with companies making fossil fuel emissions). “We have taken an active approach to efforts to reduce biogenic (animal) methane emissions including committing $14 million to reduce emissions; development of market incentives to suppliers (Net Carbon Zero products); being an active and constructive participant in agricultural emissions pricing considerations (Know Your Number and He Waka Eke Noa) and taking a leadership position in establishing the Government-Industry Joint Venture to develop agricultural emissions reductions technology,” it says.
Responses have been edited for length and clarity.
Meat processor Alliance Group produces beef, mutton and venison for export and sale here, including under the Pure South and Lumina Lamb brands.
Although Alliance declined to answer the survey about its impact, emissions estimates the company supplied to the EPA show that in the 2020 calendar year, the company processed animal carcasses accounting for 2,634,396 tonnes of emissions (mainly produced during the animals lives). That made Alliance second only to Silver Fern Farms in the biggest-emitting meat companies and one of the country’s biggest greenhouse gas producers - although a third meat business, Affco, has since overtaken Alliance.
In 2021 Alliance’s estimated emissions were a little lower at 2,595,484 tonnes.
Alliance Group was marked No Response, because it declined to answer questions about its impact and emissions plans.
Ravendown’s targets could have been more ambitious. They excluded its biggest impact, farmers using its fertiliser.
One of two big fertiliser makers in New Zealand, Ravensdown is in the top agricultural emitters nationally (along with rival Ballance). Most of its emissions happen at the end of the supply chain, when farmers and growers use the fertiliser, resulting in nitrous oxide emissions.
Ravensdown’s total emissions have shrunk by 8% since 2019, down to 1,202,224 tonnes in 2021 (the latest year for which Ravensdown has audited figures available) from 1,307,932 in 2019. During that time, both its direct operational emissions and emissions from its products fell.
Judges noted Ravensdown’s targets for its own direct emissions were not aggressive, and it did not appear to have interim targets to use as stepping stones to 2030. However it did invest in research and development to lower farming emissions from its customers.
Although Ravensdown hasn’t previously published a target for cutting its supply chain emissions (Scope 3) it says it does have a target – a 30% reduction by 2030 – which it will publish in its company reports from now on.
Unlike its rival Ballance, Ravensdown did engage with the survey and answered questions.
Ravendown says it has been transparently reporting on its climate impact since 2017. It has also been investing in research and development into cutting on-farm emissions, which has resulted in new products. Ravensdown says its target for reducing its emissions (30% by 2030) is “suitably aggressive” and, as a member of the Climate Leaders Coalition, it has already set a target for cutting Scope 3 emissions (including the impact of farmers using its fertiliser). While Ravendown has not previously published its Scope 3 target, its 30% reduction by 2030 target for Scope 3 will be published in its reports from now on, in line with new reporting guidance, it says.
Responses have been edited for length and clarity.
With a footprint similar to its rival Ravensdown, Ballance also ranks among the biggest emitters, largely because of the nitrous oxide released when its products are used as well as the manufacturing process.
Although Ballance declined to answer the survey about its impact, emissions estimates the company supplied to the EPA show that two Ballance companies – Ballance Agri-Nutrients and Ballance Agri-Nutrients (Kapuni) - together produced an estimated 1,179,509 tonnes of emissions in the 2021 calendar year (the latest figure available). That was significantly down on 1,436,680 in the previous year.
Ballance was marked No Response, because it declined to answer questions about its impact and emissions plans.
According to figures the company supplied to the EPA, gas supplier Todd Energy is one of the country’s biggest-emitting fossil fuel miners and drillers with an impact of 2.4 million tonnes in 2021, putting it in the same league as a big meat processor like AFFCO or Alliance Group, or the Huntly power station. The business owns Taranaki’s Kapuni gas field, among others.
After counting the climate impact reported by other companies bearing the Todd name – Todd Petroleum Mining Company (772,515 tonnes) and Todd Pohokura Limited (669,934 tonnes) – the Todd empire’s total impact jumps even further up the ranks.
The business lobbies for its fossil fuels - gas - to continue being used even as the country transitions away from other fossils (oil and coal).
Todd was marked No Response, because it declined to answer questions about its impact and emissions plans.
Like Todd Energy, EPA figures show that OMV ranks as one of the country’s biggest emitters in the oil and gas industry.
The Austrian oil giant is listed on the Vienna stock exchange and operates around the world, including drilling in the Arctic.
Like fellow fossil fuel driller Todd, OMV reports its emissions to the EPA under more than one company name: OMV New Zealand Limited (932,895 tonnes in 2021) and OMV NZ Production Limited (1,451,380 tonnes).
In New Zealand it is best known as a gas supplier with control of the big Māui gas field and a stake in Pohokura (with Todd).
OMV was marked No Response, because it declined to answer questions about its impact and emissions plans.
Places you spend your money
Meridian was an early mover when it came to counting its climate impact, but it could be doing more with its market position to speed up the transition.
One of New Zealand’s biggest electricity generators and retailers, Meridian makes entirely renewable energy, courtesy largely of the hydro dams it received in the carve-up of formerly-Government-operated electricity assets.
The company made $4.29b revenue in 2021. (Genesis and Meridian were included in this report because they were the largest electricity companies by revenue).
In the 2021 financial year Meridian’s operational emissions were 32,475 tonnes of CO2-equivalent. That was a drop of 25% from 2019’s pre-pandemic emissions of 43,333 tonnes.
Meridian records emissions from its whole supply chain, including the electricity it supplies to its customers.
However, the “Scope 2” emissions the company reported (which include the electricity the company uses itself) were remarkably tiny at 14 tonnes - the equivalent of only about seven households. The company achieved this by certifying that it had exclusively used electricity that it had generated itself from renewable sources, using a product called a Renewable Energy Certificate.
Meridian also sells Renewable Energy Certificates to other businesses, however their climate impact is debated. That’s because all electricity in New Zealand is mingled together on the wholesale market, where to some extent the various sources of power cross-subsidise each other. For example, coal power is pricier but is currently used to fill gaps in renewables during dry years, while renewables are cheaper and bring the overall prices down. When one company claims to have used entirely renewable power from the national grid, other companies buying power from the same grid don’t have to increase their emissions tallies to compensate, even though they are all drawing from the electricity pool.
In 2019, Meridian deliberately spilled water from its dams instead of using it to generate power, which pushed up power prices and raised the country’s carbon emissions.
The judges deducted points in the alignment category for the spilling, and also marked the company down for claiming to sell “fully renewable electricity” when the reality was it sold electricity from the wholesale market made from the same mix of sources as other retailers.
Overall, the judges said, Meridian could be doing more with its dominant position in the electricity market to speed up the low-carbon transition.
However, the company got considerable credit for counting and reducing emissions from its supply chain since before 2019, and for having an independently-verified target to cut its carbon footprint in half by 2030.
Meridian says it is committed to decarbonising its customers’ and its own activities and it is also committed to transparency, including about its sustainability performance. As a result it “was one of only five New Zealand companies recognised in the 2022 S&P Asia Pacific Dow Jones Sustainability Index, where selection is limited to only the top ranked companies in each industry. We have built and continue to develop wind farms, as well as exploring solar, hydrogen and electricity storage options. Since Meridian was formed we have invested $5 billion in new generation projects, which is enough to power 715,000 homes,” it says. It also has a pipeline of new renewable projects. The company says it is proud of its Renewable Energy Certificates, “which are of particular value to companies who operate in export markets as they confirm these companies’ products are backed by renewable energy. All of the proceeds we receive from these are reinvested into decarbonisation projects on behalf of our customers and chosen not for profit organisations”, says the company.
Editor’s note: Meridian was not able to supply details of the emissions savings from these funds but has promised to do so in the future.
Responses have been edited for length and clarity.
Genesis seems serious about moving to cleaner energy sources, but only recently started revealing its full impact.
One of New Zealand’s biggest electricity generators and retailers, Genesis Energy made $3.22b revenue in 2021. It generates power from a mix of sources: hydro, coal, gas and wind.
Genesis owns one of the country’s single biggest emissions sources, the coal-and-gas-fired Huntly power station, which is turned on to generate power for the national grid during dry winters, when renewables can’t meet demand. (Genesis and Meridian were chosen for inclusion in this report because they were the largest electricity companies by revenue). Genesis was until recently the country’s biggest coal importer – but the good news is, this has changed.
In the 2021 financial year (the latest available when Genesis was surveyed), Genesis’ total emissions including its supply chain were 5,210,523 tonnes of CO2-equivalent. For context, that’s about 6.6% of the country’s emissions. The panel couldn’t compare that to pre-pandemic levels because Genesis didn’t track its full emissions in the 2019 financial year.
The company’s direct emissions from its own activities - Scope 1 - rose hugely between 2019 and 2021, up from 2,492,279 tonnes in 2019 to 3,940,063 tonnes in the 2022 financial year, when dry hydro lakes resulted in a spike in coal burning. That was a 58% spike.
However its total emissions fell by almost a third the following year, from 5.21 million tonnes in the 2021 financial year to 3.65 million tonnes in the 2022 financial year. That was still well up on 2019 but much lower than 2021’s peak.
The judges noted that Genesis was at a disadvantage compared to Meridian because of the fossil fuel-heavy power stations it was given in the carve-up of public electricity assets. Despite that, they said the company appeared serious about investing in renewables and changing its mix of energy sources.
On the other hand, it had lobbied for fossil gas to be seen as an essential fuel and the company had only recently started disclosing its full climate impact.
Genesis says its high emissions in the 2021 financial year were because it had to burn more coal due to a dry year, and constraints on gas supply. The following financial year its emissions fell by almost a third, from 5.21 million tonnes to 3.65 million tonnes. In the first few months of 2023, “high rainfall into hydro catchments meant we could turn down fossil-fuelled Huntly Power Station to record lows, saving 470,000 [tonnes of emissions],” the company says. “The trajectory of carbon emissions is clearly down”, it says. Genesis says it remains committed to displacing coal generation with new renewables. In February 2023 it completed a successful trial of burning woody biomass (instead of coal) at Huntly Power Station, signed an agreement with Fonterra to explore the viability of a sustainable local supply chain of biomass, and secured the first site in a development of up to 500 MW of solar generation. The company has also invested in two wind farms and a geothermal plant. Regarding its support for fossil gas (a CO2 source), Genesis says gas is important as a transition fuel to ‘keep the lights on’ for energy security. Finally, Genesis notes that it has stopped being NZ’s biggest coal importer and doesn’t plan to import coal any longer. “We have not imported any for the past year and have no plans to import any more.”
Responses have been edited for length and clarity.
Bunnings’ targets lacked detail and didn’t cover its product supply chain, though it did reduce emissions from its operations.
Australian-based home improvement chain Bunnings has dozens of New Zealand stores and is a major employer. Like Kmart, it is part of the Wesfarmers group.
Bunnings’ total emissions (including for both its New Zealand and Australian stores) rose to 7,892,595 in the 2021 financial year, from 5,571,288 in 2019. While that seems like a big rise – 41% – the company says the main reason is that it now counts a fuller tally of its supply chain emissions.
Bunnings has also calculated the NZ-only figures for its supply chain. These were much smaller, although the trend was still up: 6,077 tonnes in the most recent financial year (2022) up from 5,455 tonnes in 2019.
The judges said Bunnings deserved credit for starting to count and track emissions from its supply chain early, in 2017.
However the company doesn’t have a target for reducing those supply chain emissions (for example by using its market position to cut carbon emissions from making and transporting products) despite this being the biggest source of its climate impact. It also wasn’t clear what the company was doing to reach its renewable energy targets in New Zealand (where energy is largely renewable anyway), the judges noted. (The company buys Renewable Energy Certificates, however the exact climate impact of these is debated).
The judges commented that in general the company’s targets lacked detail.
Bunnings says it reduced its operational (Scope 1 and 2) emissions in New Zealand by 37.1 per cent between July 2019 and June 2022, and that it buys its electricity from a retailer whose generation assets are 100% renewable. “By committing to purchasing 100 per cent renewable power through contracts with an energy retailer whose generation assets are 100 per cent renewable, we create demand in the system as a whole for renewable electricity, beyond what is offered through the grid,” Bunnings says. “We have a roadmap in place to achieve net zero scope 1 and 2 emissions in New Zealand by 2030.” As for its supply chain, Bunnings says it is “continuing to explore ways to decrease” these emissions and to “continuously improve our measurement and performance.” Bunnings notes its emissions data and actions are published each year in the annual report of its parent company Wesfarmers, which also includes material about the risk climate change poses to its business.
Responses have been edited for length and clarity.
Mitre 10 didn’t have climate targets, and wasn’t capturing its full impact in its emissions reporting.
Home improvement chain Mitre 10 has more than 80 New Zealand stores.
The company says it measures its direct and indirect (supply chain) emissions (Scopes 1,2 and 3), however it only has figures available for head office, not its network of stores.
The small total it has reported shows it is only measuring a subset of its impact and has a way to go to capture its full climate tally, the judges said.
For the 2021 financial year, Mitre 10 reported its total emissions from all three “scopes” as 546 tonnes - a tiny fraction of the footprint reported by rival Bunnings because it only covers Mitre 10 (New Zealand) Ltd, the company which purchases products for supply to Mitre 10 stores and operates the Mitre 10 support centre. The company says work is underway to measure carbon emissions from the co-operative as a whole, including its independently-owned store network and supply chain.
Mitre 10 didn’t yet have targets for reducing emissions, and there was little public information available on the company’s climate plans, aside from a project to use less electricity, judges said.
On the positive side, the judges noted that Mitre 10’s website recognises that the chain has a responsibility to support its customers to make their homes and lifestyles healthier and more sustainable. However, the website provides little guidance on how it does that.
Mitre 10 says,“Over the past year we have been working with each of our independently owned member businesses to measure their store’s carbon emissions [to] provide us a complete emissions picture for the co-operative network.” That tally should be completed by June 2023, it says. Mitre 10 has also worked to understand the main contributors to its carbon emissions – electricity, waste and freight – and has plans to cut them, says the company. Four stores now have solar arrays, all new stores will be built with solar, and Mitre 10 is exploring a plan to retrofit solar arrays on all older stores, too. The company says it has various waste-cutting projects, such as recycling polystyrene and a programme diverting 1 million pots from landfill. Mitre 10 is also working on a freight strategy to cut emissions from its freighting, and is working with the freight sector on this. The company says it’s looking forward to showing its progress in the next report.
Responses have been edited for length and clarity.
Kmart lacked a strong strategy for shrinking emissions from its business model.
Like Bunnings, Australian-headquartered department store chain Kmart is owned by the Wesfarmers group. That means it has the help of an Australian head office when it comes to emissions-counting, climate risk disclosures and other climate-related reporting.
Kmart has started reporting on emissions from its supply chain (scope 3) though judges noted it did not appear to be tracking its full tally. Total emissions have changed very little since the start of the pandemic in the 2019 financial year.
However Kmart’s direct, scope 1 emissions have plunged to an almost-unbelievably low 64 tonnes, the size of just a few dozen households. Supply chain (scope 3) emissions grew to make up the difference, however.
Like fellow Wesfarmers-owned Bunnings, Kmart did not answer a survey question about climate-related lobbying, losing points for transparency.
Kmart also did not answer a survey question about how much it invests in fossil fuels, however parent company Wesfarmers dumped a major coal mine investment four years ago in favour of minerals used in electric batteries. Wesfarmers remains active at selling fossil gas (LPG) in Western Australia through its Kleenheat gas business.
Judges said it was positive that Kmart was tracking emissions and reporting on its climate-related risks (at Wesfarmers level) but the company lacked a strong strategy for shrinking emissions from its business model.
Kmart says it is reducing its operational electricity consumption overall, and moving to 100% renewable energy by July 2025. As well as installing rooftop solar on stores, it is funding large-scale renewable energy installation through sleeved-PPAs (a type of power purchase agreement designed to support renewables). Kmart has committed to the UN Fashion Industry Charter for Climate Action, which requires it to deliver an emissions reduction pathway (currently under design) and a climate target aligned with keeping heating to 1.5C. To reduce Scope 3 emissions, Kmart says its strategy will: undertake circular design training for apparel designers “to proactively design for reuse and recycling at end of life and manage sourcing to reduce embodied impacts”; support appliance designers with a focus on energy efficiency gains; and trace and benchmark the performance of its energy-intensive fabric and dying facilities as a first step toward developing an action plan. The company says Kmart (including NZ) was ranked amongst the scoring brands in the Baptist World Aid Ethical Fashion Report 2022 for supply chain transparency and reporting.
Responses have been edited for length and clarity.
The Warehouse Group took some good steps but didn’t know the impact of the products on its shelves.
The Warehouse Group includes Warehouse Stationery, Noel Leeming and Torpedo7 as well as the red sheds.
The company has been reporting emissions from part of its supply chain for several years (including things like business travel and international transport fuel) and its tallies show a drop of 6.4% since 2019. However the figures only cover a subset of its total footprint and don’t count the climate cost of manufacturing most of the products you see on the shelf. The company says it is working with product suppliers to understand and count their emissions before it comes up with a plan to reduce them.
Efficiency changes like upgrading store lighting have slightly shrunk the group’s electricity emissions, but without full reporting it's not possible to see which direction the total impact is going.
The Warehouse offsets its direct emissions and energy use (from its stores, vehicles, landfill waste and other things) by paying for solar projects and cookstoves in India, and Bangladesh and China (its offsets are audited by Toitū Envirocare).
The judges said The Warehouse Group’s 2025 target could have been more ambitious given its stated commitment to cutting its impact, and its 2030 target was “solidly middle of the road.”
It has recently adopted new targets, to get the group’s operating emissions down to zero by 2040 and cut emissions from its own-label products by 80% at The Warehouse and Warehouse Stationery. However, these still don’t cover the full supply chain.
On the positive side the judges noted the company was making positive moves and public statements around climate action.
The Warehouse Group says it has made significant advancements with “new, ambitious emission reduction targets and an even stronger focus on sustainability” – and the company does not think its impact and transparency scores reflect its progress. It says its emissions-cutting targets are aligned to the Science Based Targets Initiative (an international benchmarking process) and compatible with keeping global heating within 1.5C. It plans to expand its 2040 target to cut emissions from its own-label products by 80% at The Warehouse and Warehouse Stationery to other brands, it says. The company says it will publicly disclose its supply chain or Scope 3 emissions by the 2025 financial year. “Reducing Scope 3 emissions is the biggest challenge for any retailer – this means supporting suppliers’ efforts to reduce their own emissions”, it says. The Warehouse Group also says it believes it is more transparent than its transparency score suggests, “noting our yearly Greenhouse Gas Emissions Inventory Report assured by Toitū Envirocare is publicly available, alongside our annual reporting to the CDP (Carbon Disclosure Project).” CDP (an international non-profit) scored it a B for climate reporting in 2021 and 2022, says the company.
Responses have been edited for length and clarity.
A major rival to Kmart and The Warehouse Group, Farmers is likely to have a sizable climate through its supply chain, particularly the products it sells.
However unlike Kmart and The Warehouse the company does not disclose its climate impact.
Nor will Farmers be required to disclose its climate risks and impacts by law under forthcoming climate disclosure regulations, because it is privately owned (the public can’t buy its shares on the NZ stock exchange).
For the foreseeable future, its impact and plans remain a mystery. Farmers was marked No Response, because it declined to answer questions about its impact and emissions plans.
Moves like building solar arrays are positive, but it was hard to get a true picture of Foodstuffs’ full climate impact over time and what direction it was headed in.
The owner of New World, PAK’nSAVE, Four Square, Gilmours (North Island) and Liquorland brands says most of its direct emissions come from leaking refrigerator gases and diesel for its truck fleet. It has made progress at getting direct emissions (like those potent planet-warming refrigerant leaks) down year-on-year, though it couldn’t supply 2019 financial year data to give us a pre-pandemic baseline because 2020 was the first year it reported emissions.
Foodstuffs has started reporting its supply chain emissions, though it doesn’t appear to be capturing this fully in its tallies. Its full supply chain emissions would include growing and manufacturing the products it sells, which is likely to be the biggest part of its footprint.
Judges said it was hard to get a true picture of the chain’s full climate impact and what direction it was headed in, and noted there was no indication that Foodstuffs was using its considerable market buying power to drive supply chain emissions down. Like many of the companies surveyed, the areas of emissions savings it was targeting were comparatively low-ambition, the judges said, for example reducing refrigerant gases and making electricity savings.
However, the company did build a very large solar array on its South Auckland distribution centre.
Foodstuffs says it is switching to climate-friendlier cooling gases in its refrigeration systems “as fast as the New Zealand refrigeration industry can deliver, with South Island stores being 100% natural refrigerant by 2025 and North Island stores also making good progress.” At an average cost of $2.5 million a store, the company says this is a significant undertaking. The company’s carbon audit for the 2022 financial year showed it had cut diesel emissions by 20% in the North Island, by being more efficient in order to cut freight travelling distances. The company also believes its climate targets (a 21% reduction from 2020 levels by 2025) are ambitious, and in line with keeping global temperature rise below 1.5C. When it comes to measuring emissions from its supply chain, Foodstuffs says “full life cycle data doesn’t currently exist for the thousands of items Foodstuffs sells in its stores.” It says it is engaging with its main suppliers to measure and assess their emissions profiles and to find opportunities to cut emissions. By 2027, the company has committed to send zero food waste to landfill. Foodstuffs North Island has also committed to making all newly-built stores conform to Greenstar standards and “already the latest stores are demonstrating to be 40% more energy efficient than stores of just 5 years ago,” it says. The company says its new generation of stores are on track to be “the lowest carbon supermarkets in the world”, and the company’s North Island support centre (the one with the huge new solar array) was carbon positive last year, exporting 19% of electricity generated from its rooftop back to the national grid. As well as hosting “more EV fast chargers at its sites than any other company in NZ” the company says it is about to start moving its own car fleet to EVs and plug-in hybrids. It has 29 EV vans and an electric refrigerated truck.
Responses have been edited for length and clarity.
Countdown has been improving its reporting and has a target to reduce emissions from its suppliers, although the target is too little compared with what’s needed.
The supermarket chain’s total emissions may appear to have exploded since 2019 but actually the company has just started accounting for a much fuller subset of its impact.
After reporting emissions from its suppliers – including the companies who make the products you see on its supermarket shelves – the chain had a footprint of 3,841,905 tonnes in the 2021 financial year and 3,142,633 tonnes in the 2022 financial year, down 18% year-on-year.
This tally puts the company in the same league as the country’s biggest meat processor, Silver Fern Farms. While Countdown’s main rival Foodstuffs reported much lower emissions figures, it’s not a fair comparison since Foodstuffs’ reporting covers a lot less of its supply chain.
The judges appreciated Countdown’s relationship with the GenLess campaign encouraging people to bike, walk or scooter on small trips to the supermarket but said that, given its position in the market, the company could do more to reduce its own transport and other emissions. Like its rival, Countdown’s biggest improvement so far has been slashing refrigerant emissions by replacing some cooling systems.
Unusually among companies in this report, Countdown has a target to reduce emissions from its suppliers – which, as with most retail companies, are the source of its biggest climate impact. However the judges said the company’s 2030 target for cutting supplier emissions was too little at 19%.
Countdown noted its total emissions were down 18% between the 2021 and 2022 financial years. Countdown says that while it was disappointed at its grading, “we do acknowledge that like many others, we do have a way to go in reducing our emissions – particularly in Scope 3/our suppliers’ emissions.” When it comes to cutting those supplier emissions, the supermarket chain has started engaging 13 of its major suppliers in a programme to report their emissions. “We are currently reviewing supplier results with a view to expanding the programme,” it says. Countdown says it has already cut its other, more direct areas of emissions (Scopes 1 and 2) by 46% from 2015 levels, mainly by retrofitting cooling systems in more than 130 stores so as not to leak potent planet-warming refrigerants. “Transport has to date represented just 6% of our Scope 1 and Scope 2, and therefore has been a lower priority than refrigeration. However as we have now reduced refrigeration emissions so significantly, we are moving our focus more squarely onto transport decarbonisation,” says Countdown.
Responses have been edited for length and clarity.
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How to read the emissions data
Emissions are reported in Scopes 1, 2 and 3.
Scope 1 emissions - Direct emissions from sources the company owns or controls, for example company vehicle fleets, office fridges, and heating, cooling and lighting of premises or direct emissions from burning coal or gas at a company’s manufacturing plants.
Scope 2 emissions - Emissions from creating the electricity the company uses, but doesn’t produce itself.
Scope 3 emissions - Emissions from the company’s supply chain. These emissions aren’t produced directly by the company, but are created by the company’s activities. Examples include emissions from the farms producing food sold by the company, emissions from petrol the company sells to its customers, business flights and taxi trips for staff and freight for getting goods from third-party suppliers.
CO2-equivalents - For the purposes of reporting, companies usually convert all planet heating gases (including methane and nitrous oxide) into units of carbon dioxide equivalent by averaging each gas’s heating impact over 100 years. All emissions in company tables are reported in CO2-e.
Judging Panel
Sara Walton
As Associate Professor of Sustainable Business at the University of Otago, Sara Walton teaches and researches in the area of sustainability and business. She is director of the university’s Master of Sustainable Business and coordinator of the Otago Climate Change Research Network, as well as being involved in the Technological Innovation National Science Challenge she works on projects concerning circular economies, readiness for climate change and abatement/mitigation strategies.
Rebecca Mills
Founder and Managing Director of The Lever Room, a strategy consultancy focussed on sustainability and climate impact. With training from both Harvard and Oxford Business Schools behind her, Rebecca is also a Board member of two of New Zealand’s National Science Challenges.
Barry Coates
Founder and Chief Executive of Mindful Money, an ethical investment charity that helps people find a KiwiSaver or investment fund that fits their values. Mindful Money aims to make money a force for good, channelling funding towards investment that supports climate action and sustainability. Barry studied finance at Yale University, and has been Executive Director of Oxfam Aotearoa and a Green Party list MP. He has been researching climate change and campaigning for climate action since 1991.
Paul Brownsey
Paul heads the investment team for Alvarium Wealth and sister company Pathfinder, where climate impact and carbon emissions are a core part of the equation when the team picks investments for its Kiwisaver and other funds. Before co-founding Pathfinder in 2009, Paul studied at Canterbury University and worked in financial markets in Wellington, London, Singapore and Auckland.
Eloise Gibson
As Stuff’s climate change editor, Eloise directs, edits and writes climate coverage. A former Resource Management lawyer with a Master’s in science writing from Columbia University, she has written for many publications internationally and in New Zealand. She was awarded best science writer at the Voyager Media Awards in 2019 and 2020, and best environment writer in 2021 and 2022.
credits
Climate change editor
Eloise Gibson
Commissioning Editor
Janine Fenwick
Data journalist
Felippe Rodrigues
Development
Felippe Rodrigues and Sungmi Kim
Designer
Sungmi Kim
Additional reporting
Melanie Carroll
Stuff
Stuff was in the early stages of its reporting and hadn’t published enough detail about emissions and targets. Its news operation had a positive impact.
Stuff is a relatively small player in terms of emissions.
Although Stuff wouldn’t otherwise qualify for inclusion in the survey, we’ve included Stuff in order to subject ourselves to the same scrutiny the judges applied to bigger emitters. Climate editor Eloise Gibson did not take part in judging sessions for Stuff.
While Stuff has made some progress at cutting its direct emissions, it did not have tallies of its full supply chain for 2019 or last financial year.
The judges said Stuff was still in the early stage of its climate reporting journey compared to bigger companies in the survey - for example, its emissions inventory had been prepared but not verified when the survey was done. It also didn’t break down its climate impact in the same level of detail of some of the higher-scoring companies.
As a media agency, the judges said Stuff bore a high degree of responsibility for influencing climate action, and, on the positive side, it had shown a high degree of conviction about highlighting climate issues through its news business, they said.
Stuff is a certified B Corp, which recognises companies going above and beyond business-as-usual to create a positive social and environmental difference, the company says. In 2019 Stuff set science-aligned Scope 1 and 2 targets and is on track to meet its target of a 25% reduction in these emissions by 2025. Scope 1 and 2 emissions were down 12% on 2019 in the 2022 financial year. Stuff says it has been working to measure Scope 3 emissions and aims to set a Scope 3 target, and get independent assurance for its FY23 emissions data. Stuff is a member of the Climate Leaders Coalition (CLC) and was recognised as an early adopter of the 2022 CLC Statement of Ambition, meaning it has to measure and report emissions; set science-aligned targets, and assess and disclose climate change risks. (This information was published in December 2022 in Stuff’s annual B Corporation Report.) In July this year Stuff plans to move 40% of its paper to recycled newsprint, “which will have a big impact on our footprint”, it says. “We also recognise the important part we have to play as a media organisation, in helping New Zealanders transition to a low carbon economy, by facilitating the conversations that grow awareness and action to address climate change. We are investing in and growing our coverage in The Forever Project.”
Responses have been edited for length and clarity.