Danone to Place Greater Focus on ESG -- Update
May 20 2020 - 4:51AM
Dow Jones News
By Maitane Sardon and Cristina Roca
Danone SA said Wednesday that it will place greater focus on its
ESG goals by adopting the French "Entreprise a Mission" legal
framework, and setting up an independent committee to oversee and
report on its progress.
The move is part of the company's aim to get B Corp
certification by 2025. The certification is issued by nonprofit B
Lab to companies that meet certain social and environmental
criteria and that make themselves legally accountable to balance
the interests of their stakeholders with the interests of their
shareholders.
As part of the "Entreprise a Mission" framework, Danone will
define a social and environmental purpose beyond profit and bind
itself to pursue specific sustainability goals. Danone said it will
create a committee independent from the board that will monitor its
progress. Danone is the first listed company to adopt the
framework, according to the company.
Danone will set out its purpose, that it defines as "bringing
health through food to as many people as possible" in its articles
of association--a document that specifies the regulations for its
operations and defines the company's purpose.
"This move [responds to] a wake-up call from a crisis that we
believe is going to be long," Danone Chairman and Chief Executive
Emmanuel Faber said in a call with media. "We are designing a set
of key performance indicators that will allow us to monitor our
progress," he said.
Danone said this step is consistent with its goal to become a
Certified B Corporation. To date, 20 of the French dairy company's
subsidiaries have become B Corp certified.
"Danone is working to get the certification by having one
subsidiary after the next certified but it is not a simple process
as it takes a lot of work, specially for large multinationals,"
says Andrew Kassoy, one of the co-founders of B Lab, the nonprofit
behind the certification.
Mr. Kassoy says to become a B Corp, companies have to meet a
high set of social and environmental performance standards and
change their governing documents so these reflect that the
company's fiduciary duty isn't to maximize value for its
shareholders but to consider all of its stakeholders including
workers and supply chains, the communities where it operates, the
environment and its consumers.
Write to Maitane Sardon at maitane.sardon@wsj.com
(END) Dow Jones Newswires
May 20, 2020 05:36 ET (09:36 GMT)
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