CEO message

It is with great pleasure that I introduce the 2010 Sustainability Report for Lion Nathan National Foods (LNNF) – the first to be published for our newly formed business. This is Lion Nathan National Food’s third sustainability report but the first to incorporate the operations of National Foods.

The year 2010 marked our first chapter as Australasia's largest food and beverage company. With the integration of Lion Nathan and National Foods, we now employ close to 8,000 people and deliver economic contribution in excess of $5.5 billion. We are one of the region's largest purchasers of agricultural goods and an integral part of the retail, hospitality and tourism industries.

While our business has changed, our strategy of driving sustainable returns by investing in our core assets – our people, brands and production facilities – remains constant. Kirin's support of our long-term approach to managing our business means we remain focused on delivering compelling economic growth, while at the same time building a culture of social and environmental sustainability.

Sustainability approach

With our new scale and diverse business operations, in 2010 we took the opportunity to reassess our approach to sustainability. 

As a result, our General Counsel and Company Secretary has taken on the additional responsibility of Sustainability Director, supported by a Sustainability Leadership Group with senior representation from various arms of our business. As Company Secretary, our Sustainability Director is also present at Leadership Team and Board meetings and has a responsibility to engage senior management and the Board on our sustainability agenda and ensure sustainability issues are considered within broader business decisions. 

We have also developed a new sustainability strategy for LNNF, which will sit at the heart of everything we do. We are fully committed to doing the right thing for the long term, by amongst other priorities ensuring all our business practices are environmentally sound, our procurement and marketing activities responsible and our community investment targeted at programs that drive real change.

This year's report demonstrates significant progress in how we manage sustainability and highlights some of the excellent initiatives that are bringing benefits to our company, direct stakeholders, the environment and to the broader community.

For example, in FY10 LNNF's business units continued to reduce their environmental footprints. Lion Nathan decreased greenhouse gas emissions by 10% and National Foods by 8%. Across the whole LNNF group we also completed an extensive water usage profile for the first time. This has provided us with visibility of our total water usage, and a benchmark from which we can continue to improve and track our progress in partnership with our stakeholders.

During an increasingly challenging economic environment we have remained committed to our strategy of investing in our core assets, and by doing so we have continued to add significant value to both the Australian and New Zealand economies through our business operations – value that totalled more than $5.5 billion in 2010. 

We have also continued to progress our social investment program, working with our key community partners to address pertinent issues and fulfill our core purpose of bringing more sociability and wellbeing to our world. For example, in 2010 we entered into a partnership with Landcare Australia to help implement environmental initiatives such as natural resource management, sustainable farm practices, biodiversity and water efficiency. Through our partnership we are also supporting some of the community Landcare projects to help build community skills, knowledge and engagement.

Living our core purpose

We believe sustainability is about how we do business – it is not a project executed only by a specialist team. Only by recognising this, and adopting sustainable practices at all levels of our business, will we make a real difference and truly live our core purpose of bringing more sociability and wellbeing to our world. 

Our new sustainability structure and strategy for FY11-FY14 reflects the importance placed by the Lion Nathan National Foods leadership team, our Board and Kirin on doing the right thing for the long term. It also comes at a time of unprecedented community expectations around corporate citizenship and responsible behaviour. 

Our intention is to develop a sustainability function that drives coordinated social and environmental strategies, identifiable regulatory and governance outcomes and active engagement and accountability across the businesses. 

I look forward to reporting on our progress in the months ahead.

Rob Murray