Engaging on climate and nature at Ahold Delhaize

PGGM engages with Ahold Delhaize as part of our program targeting companies in the food sector, on the areas of climate and nature & biodiversity. This engagement is done through the Net Zero Engagement Initiative (NZEI) together with two other investors.

Our climate engagement with Ahold Delhaize focuses on the implementation of their greenhouse gas reduction targets (scope 1, 2, and 3). Scope 1 and 2 emissions stem mostly from energy use, refrigerant leakage, heating and transportation. The company aims to cut these by 50 percent by 2030 through greener refrigeration, fossil fuel-free transport and heating, energy efficiency and renewable energy. Regarding their scope 3 emissions, our engagement focuses on its deforestation commitments, customer and supplier engagement. Ahold Delhaize currently relies on key commodity certification, which is a step into the right direction, but should enhance traceability to ensure deforestation-free sourcing. We encourage Ahold Delhaize to trace products to mills or plantations and to integrate feasible, practical, time-bound and quantitative deforestation targets in supplier policies.

Ahold Delhaize’s New Strategy
Ahold Delhaize’s new strategy includes increasing their customer base through local brand loyalty programs, such as Albert Heijn’s personalized discounts. Ahold Delhaize plans to boost own-brand product sales to 45 percent by 2028 to have better control over production and nutrition. We support this approach and plan to discuss its rollout to all brands, including their US brands.

Ahold Delhaize as a food retailer has a significant impact on nature and biodiversity loss through their value chain. The company aims to halve their ecological footprint by 2030 and expects all European brands to baseline current plant-based protein ratios and set plant-based protein ratio targets by the end of 2024. Our engagement focuses on implementing this strategy, on reporting on its progress and we encourage similar commitments for their US brands.

Specifically for their supermarket brand, Albert Heijn, they are automating their distribution centres for better energy efficiency. Albert Heijn’s scope 3 emissions, mainly from purchased goods and services, will be reduced by 37 percent by 2030 through decarbonizing livestock farming, optimizing processing, reducing waste, ensuring deforestation-free supply chains, and engaging suppliers and customers.

Undertaking such in-person engagements, including speaking directly with the company's management, is valuable and helps us better understand a company’s strategy. Companies also get important feedback on investor priorities. Want to learn more about our engagements with the food sector? Visit: Climate change | PGGM or the specific segment in our stewardship report.