2013 Corporate Citizenship Report

2013 Corporate Citizenship Report Platteville Dairy Farm, Colorado Table of Contents Table of Contents Description Pages Description Pages Table of Contents 2 Environmental Stewardship Cont. Waste & Recycling 34 Introduction – Letter from Marc Peperzak, Chairman & CEO 4 Farm Waste 34 Plant Waste 36 2012 Overview 7 Biodiversity 36 Soil Health 37 37 Aurora Organic Dairy At-A-Glance – Mankind Meets Cowkind 9 Energy & Greenhouse Gas Emissions 39 Farm Enteric Emissions Farm Utility Emissions 39 About Aurora Organic Dairy 10 Plant Emissions 40 Our History 10 Product Packaging 40 Timeline 10 Transportation & Distribution 41 Company Overview 11 12 Healthy, Nutritious Food Our People 43 13 Governance & Oversight Introduction 43 13 Commitment to Organic Diverse Workforce 43 Employee Satisfaction 44 Delivering Values & Value 15 Comprehensive & Competitive Benefits 45 Company Values 15 Validus Worker Care Certification 45 Supply Chain 16 Employee Engagement Goals 46 Milk Production 16 Community & Philanthropy 47 Milk Logistics & Utilization 16 Milk Processing 16 Contact Information 49 Farm-to-Plant Feedback Loops – High Quality Standards 17 Sustainable Scale Organic Dairy Production 19 Appendix Sourcing 20 Global Reporting Initiative (GRI) G3 Indicators - C Level with Food Processing Supplement 50 Stakeholders 22 Animal Welfare 23 Introduction 23 Strong Foundation for Animal Care 24 Animal Welfare Policies & Procedures 24 Validus Animal Welfare Certification 26 Animal Welfare Goals 26 Environmental Stewardship 28 Foundation for Sustainability 29 Corporate Citizenship Working Groups 29 Lifecycle Assessment of an Integrated Organic Dairy Company 30 Sustainability Reporting Boundary 31 Custom Sustainability Tracking Tool 32 Water 32 Processing Plant Water 32 Farm Water 33 Aurora Organic Dairy 2 Aurora Organic Dairy 3 2013 Corporate Citizenship Report I have been involved with organic milk production since 1993, and responsibility, and include manager-level staff from throughout the in 2003 I decided to convert all of my company’s dairies to organic. organization. These groups are responsible for goal-setting, and their Introduction It still impresses me the extent to which organic dairy products work helped to form the basis for this report. have made inroads with consumers and retailers across the country. The path has not always been straight and smooth. Despite the In 2008, when we began to review and track the energy we use fact that the federal organic laws are scale neutral, because of and the GHGs we emit, we determined there were significant our size, certain groups have challenged some of AOD’s practices opportunities in our operations to reduce our impact on the related to organic dairy production. These challenges culminated environment. Armed with data, we increased our awareness of our in a class action lawsuit, which was originally filed in late-2007. environmental impact areas and identified opportunities for greater Aurora Organic Dairy settled the case in 2013, on behalf of itself efficiency. Our company-wide GHG emissions per half-gallon of milk and its customers, without admitting any wrongdoing and receiving sold increased by 2% and our energy use per half gallon of milk sold confirmation from the federal courts that our company at all times declined by 0.5% in 2012 compared with 2011. A 10% reduction maintained valid organic certificates for our dairy products. With the in our farms’ overall energy use in 2012 offset a 3% increase at lawsuit fully behind us, we can continue to help develop and lead the processing plant to drive the slight reduction in energy use per the organic dairy industry. One of the ways we do this is through our half-gallon of milk sold in 2012. While this is our benchmark year commitment to sustainability and social responsibility. for goal-setting, and our results in 2012 were achieved without major initiatives in place, we believe our focus on data tracking, and As a demonstration of our steadfast commitment to corporate structure we put into place in 2012 will allow us to reach our short- citizenship, we have developed our first-ever Corporate Citizenship and long-term goals into the future. Report. This report contains data on our comprehensive life cycle assessment (LCA) for energy use, Greenhouse Gas (GHG) emissions, 2013 Company Goals water use, landfill waste and recycling programs. We started this Platteville Dairy Farm, Colorado work in 2008 with the University of Michigan’s School of Natural Resources and Environment. Each year, for three years, groups of INTRODUCTION 2012 OVERVIEW AURORA ORGANIC ABOUT AURORA DELIVERING STAKEHOLDERS ANIMAL WELFARE ENVIRONMENTAL OUR PEOPLE graduate students came out to Colorado to study our facilities and % % DAIRY AT-A-GLANCE ORGANIC DAIRY VALUES & VALUE STEWARDSHIP gather data to complete the first ever LCA of a large-scale integrated 3 3 organic dairy company. We have built on that work by developing Reduction in Reduction in Dear friends of Aurora Organic Dairy, a custom data tool to track our sustainability performance within our operations boundary, and now have five years of data on GHG GHG emissions energy use As our Company has evolved, so have our focus and commitment emissions, energy use, water and solid waste by facility, which can to sustainability and social responsibility. At Aurora Organic Dairy be used as part of our strategic decision-making processes. Per half-gallon of milk sold in 2013 vs. 2012 baseline (AOD), we pride ourselves on the many initiatives we have put into place to tread more lightly on the planet, to treat our people and Due to the fact that this is a large body of work, as the data we track Our one-year goals are modest, as we are just now wrapping our animals with respect, and to give back to the communities that within our operating boundary is primary data covering our cattle arms around our data collection process and internal structure support our business. populations, feed purchases and utilities usage, in this first report, for sustainability goal-setting. We made great strides in 2012 to establish company-wide teams devoted to developing plans to Livestock and food production systems have been criticized as we opted to cover what we control within the LCA. While the LCA being large sources of environmental impact worldwide. Because covers the entire life cycle of a half-gallon of milk, our first Corporate reduce our environmental impact, and to improve our worker and we own our milk processing and 85% of our raw milk supply, Citizenship Report is focused on our farms and plant because animal well-being. We provide information about these initiatives and their various projects in each chapter of this report. and closely manage any outside milk we purchase, we can study we own those assets and can set goals for improvement. Where the environmental impacts closely. This includes measuring our appropriate, we do discuss the LCA results, and we intend to add greenhouse gas emissions, energy use, solid waste and water use Thus far in 2013, we have opened a new dairy farm in Gill, Colo., more life cycle stages - such as transportation - to our data tracking in an effort to conserve our resources at every stage, and encourage which is part of our High Plains Dairy complex. This farm allows and goal-setting activities in the future. our suppliers to do the same. us to convert our farthest dairy – the Pepper Dairy in Dublin, Texas – into a heifer-rearing facility, and brings the majority of our milk True sustainability encompasses more than the certified organic In addition to these sustainability indicators, at Aurora Organic Dairy, supply to Colorado, thereby reducing the transportation distance label. It’s a commitment to a broader, more far-reaching philosophy we believe corporate citizenship and sustainability reach beyond and associated emissions in our raw milk distribution. Additionally, of biodiversity, conservation and the wise use of the earth’s limited environmental factors. In this report, we have included a complete in 2013, our processing plant is undertaking a major expansion, natural resources. As a life-long dairy operator, it is my personal view of our business, and we have described how our focus on people, which will bring a cold storage facility on site, and will increase the vision to conserve our resources so that we leave as much – if not animals and communities also contributes to our ability to continue plant’s utilization. By having a cold storage facility at the plant, we more – of the earth’s bounty for future generations. to grow responsibly. In 2012, we formalized our commitment by significantly reduce the transportation emissions of shuttling milk to Marc Peperzak, Chairman & CEO establishing internal groups that cover both sustainability and social our third-party cold storage facility in Henderson, Colo. Aurora Organic Dairy 4 Aurora Organic Dairy 5 2013 Corporate Citizenship Report As a values-based organization, we follow key principles to direct our We plan to use this Corporate Citizenship Report as a benchmark to business decisions and development. We balance our need to be a measure our progress. We will update this report at least every other sustainable business – a profitable business – against the decisions we year, and will report against the goals we have outlined here. 2012 make in the areas of sustainability and social responsibility. We know Overview we are not perfect, but we do work to build a cultureof continuous Since we converted the Platteville Dairy farm to organic in 2003, improvement. At the end of 2012, we employed approximately 500 it has been Aurora Organic Dairy’s mission to bring organic milk people. These employees work hard every day to develop better ways to mainstream America with the highest quality and freshness, of doing things, and to continually improve our business. We would more affordable pricing and improved availability for consumers.

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