1、 2022 Nielsen Consumer LLC.All Rights Reserved.1 1 1How will accelerating forces of change shape the green revolution of Consumer Packaged Goods?The changing climate of SustainabilityNovember 2022 2022 Nielsen Consumer LLC.All Rights Reserved.2 2 2 2022 Nielsen Consumer LLC.All Rights Reserved.1.Pre

2、vailing forces of change reach critical juncture 2022 Nielsen Consumer LLC.All Rights Reserved.3The impacts and costs of climate change are being felt across society1980-1999Natural disastersClimate related disastersFloods&stormsHuman lives lostPeople impactedCost of disasters2000-20194212365629381.

3、19M3.25M$1.63T7348668252881.23M4.2M$2.97T4 4 4 2022 Nielsen Consumer LLC.All Rights Reserved.Disruptive forces accelerating required change across ecosystemGovernment Regulatory changeChallenges of Energy transition eg costSanctions;disruptive trade agreementsIncreased domestic protectionism Shareho

4、lder/financial requirementRising raw material costsExtreme weather events/climate crisisCost of living&income stressConsumer values and attitudesTech enablementSupply chain delays&disruptions Personal impact and disruptionClimate impact inequality5 5 5 2022 Nielsen Consumer LLC.All Rights Reserved.G

5、overnance and cost will accelerate momentum beyond consumer demandRole of governance and mandatesFinancial reporting requirements SEC,EU CIBRNew legislationE.g.French green roovesFines and TaxesGreenwashingSustainable InvestmentBanks,Shareholder value,FundingExploding costs due to the impact of clim

6、ate changeRising cost of goodsIncreased prices due to scarcityPersonal impactCost of living stressShifting values&attitudesAvailability of choiceEscalatingconsumer demandRising energy pricesShift to renewablesSupply chain disruptionShifting source of origin6 6 6 2022 Nielsen Consumer LLC.All Rights

7、Reserved.United StatesChileRegulatory mandates will become increasing more stringentSEC proposed rule to standardize the climate-related disclosures provided by public companies.June:Plastic Pollution Prevention and Packaging Producer Responsibility Act(Senate Bill 54)into law with bipartisan suppor

8、tCalifornia plastic reduction bill calls for major shift in recyclable packaging falling to producersFederal procurement and operations including 100 percent zero-emission light-duty vehicle acquisitions by 2027New York buildings over 25,000 square feet required to meet new energy efficiency by 2024

9、,with stricter limits coming into effect in 2030Stores to display,sell,and receive refillable beverage bottles.Larger supermarkets must comply by February 2022Smaller stores comply to refillable beverage bottlesBy 2024,at least 30%of beverages displayed in stores must be in refillable bottles with%i

10、ncreasing.New law will also eliminate single-use plastic requiring dine-in eateries to phase out all disposable tableware Europe203020232022202420262025202720282029EC adopt first set of corporate sustainability reporting standardsSept Deforestation regulation:goods sold in the EU have not been produ

11、ced on deforested land anywhere in the world Jan Oblivations under EU CSRD come into force EU carbon boarder levy forcing companies importing into bloc to pay carbon costs at the border for those outside the“carbon club same emissions targets”Oct EC adopt 2nd set of corporate sustainability reportin

12、g standardsBinding EU-level targets to reduce by 50%the use and risk of chemical pesticides and the use of the more hazardous pesticides by 2030Governance and mandatesMar New Ecodesignfor SustainableProducts Regulation:Digital passport 2022 Nielsen Consumer LLC.All Rights Reserved.7China,the largest

13、 wheat producer,rains delayed planting last year,this crop may be its worst-ever.Droughts cause water shortages leading to hydro electricity power cuts causing factories to shut down and retail stores closeExtreme temperatures in India,the worlds second-largest producer,a lack of rain threatens to s

14、ap yieldsThe Horn of Africa is being ravaged by its worst drought in four decades15 administrative departments in Francehave had to restrict water use while farmers warn that the current situation will have an adverse impact on crop yieldsDrought and wheat mites ravage Americas wheat basketSevere dr

15、ought in Brazil impacting corn production.Severe frosts threaten coffee cropsFloods throughout 2022 impacting crops;limiting supply and raising prices Droughts in Spain have severely damaged olive oil,mango and avocado cropsExtreme climate events have severe impact on cost of goods and supply chains

16、Climate pressure 2022 Nielsen Consumer LLC.All Rights Reserved.8Climate realities already impacting daily running of businessMexico Should Stop Making Beer in Drought-Plagued NorthMexico,the worlds largest beer exporter,should stop making the drink in the north of the country as the region faces sev

17、ere water shortages,said PresidentAndres Manuel Lopez ObradorCitizens in drought-plagued Monterrey,the countrys industrial heartland where beermakers like Heineken NV have facilities,have suffered from water scarcity for months as dams emptied out.Lopez Obrador said the government will support compa

18、nies that want to produce beer in the south or southeast.Rising cost of energy spurring food inflationWhile companies have had to contend with increased prices as commodities rallied over the past year.They are now also contending with soaring energy billsOlive Oil Set to Get Pricier as Spains Heatw

19、ave Hits ProductionRelentless heatwaves blasting Spain this summer threaten to sink production of olive oil from the worlds top exporter of the cooking ingredient,according to Agriculture Minister Luis Planas.Read more Read more Read more Source of originRising cost of goodsSoaring energy costsClima

20、te pressure 2022 Nielsen Consumer LLC.All Rights Reserved.9 9 9 2022 Nielsen Consumer LLC.All Rights Reserved.2.Escalating consumer demand101010 2022 Nielsen Consumer LLC.All Rights Reserved.But becoming increasingly for manyMost important things when choosing a brand55%37%Very importantSomewhat imp

21、ortantNot at all importantNo opinion1.42.42.42.92.95.65.810.111.211.213.013.118.1 Foreign/os products Unique&differentLuxury/indulgenceNiche,specific needsSocial impactLocal country originPrivate LabelSuperior,high qualityEnvironment friendly/sustainableTrusted/familiar brandHealthier optionsSafety&

22、Hygiene guarantees Affordable/lower prices42%27%21%Much more importantA little more ImportantStayed the same ie.Always been importantLess importantImportance of Sustainability TODAYChange in importance v.two years agoMost importantLeast importantSource:NielsenIQ 2023 Sustainability Report-Ranked on

23、Global.Sustainability is one of many things considered when shoppingEscalating consumer demand11 11 11 2022 Nielsen Consumer LLC.All Rights Reserved.54%48%47%47%43%35%30%22%In the news all the timeMore informed aoout climate change/sustainabilityHealth and safety is/could be impacted by climate chan

24、geSeen more pollution and waste around meLeaving a world for future generation is more importantThings have become more expensive because of climateeventsPersonally impacted by extreme weatherSomething/one has convinced me its happening NOWWhy has sustainability become more important?1 in 3 have bee

25、n personally impacted by extreme weather eventsAwarenessImpactSouth Korea54%Indonesia43%India41%South Africa40%Source:NielsenIQ 2023 Sustainability Report-You said that climate change and sustainability has become a more important issue to you in the last 2 years.Why?Awareness will drive the narrati

26、ve,but impact will spur momentum 2022 Nielsen Consumer LLC.All Rights Reserved.121212Consumers are trying to live sustainably49%47%45%45%39%36%33%30%26%25%24%23%19%18%17%15%15%13%12%Take own/reusable bags when shopping Only buy what I need-avoid waste Minimise electricity usage where possible Consci

27、ously separate garbage for recycling Eat leftovers,rather than throwing away Try to buy products with easy to recycle packaging Use refillable containers/buy refill products Consume healthy products eg local/home-made not processed Buy eco/sustainable/energy saving appliances Buy products that are l

28、ocally made/sourced Buy grocery products with sustainable credentials if possible Make travel decisions to minimise enviro.Impact Compost Buy/use secondhand clothes and appliances Buy eco/sustainable fashion/beauty Support climate/environmental charities Boycott certain brands due to negative enviro

29、.Impact Support,attend events with sustainable principles/action Shop at bio/organic storesLifestyleShopping1 in 20 Take NO action to live sustainablyGlobal5%United States12%Australia9%United Kingdom/France8%Source:NielsenIQ 2023 Sustainability Report-What actions,if any do you currently do to live

30、a sustainable lifestyle?131313 2022 Nielsen Consumer LLC.All Rights Reserved.Opportunity is ripe as majority want to do the right thingSource:NielsenIQ 2023 Sustainability Report-Which of the following statements best reflects your day to day behavior when it comes to sustainability?134%15%48%33%I d

31、ont care if I live in a sustainable wayAll things are equal,will choose the sustainable path as its the right thing to do,but wont go out of my wayIts important for society and I try to make sustainable choices when I canIts an important priority in my life that I try to activate daily141414 2022 Ni

32、elsen Consumer LLC.All Rights Reserved.26%(vs 18%in 2017)2022 Nielsen Consumer LLC.All Rights Reserved.141414Of consumers find it difficult tofind sustainable options on shelfCompanies arent making it any easier for consumers to shop sustainablySource:NielsenIQ 2023 Sustainability Report-How easy do

33、 you find it to shop for grocery products in a sustainable way?2017 How easy or difficult is it to find environmentally friendly products in the stores where you usually buy your grocery/household products?2022 Nielsen Consumer LLC.All Rights Reserved.15151511%12%13%15%16%20%21%26%35%41%Dont believe

34、 it makes a differenceNot a priority right nowDont trust sustainable claims Influence from family/friends/peers Unreliable/bad quality/inferior to unsustainableoptions Too difficult to do/inconvenient Time consuming eg sorting recycling/composting Confusing,information unclear/unavailable Limited su

35、stainable product availability/choice Sustainable options are too expensiveBut cost,access and lack of clarity stop them from adopting more sustainable lifestylesSource:NielsenIQ 2023 Sustainability Report Q:What are the barriers that stop you from living a more sustainable lifeBrazil,South Korea:51

36、%|Singapore:50%|United Kingdom;Spain:49%Indonesia:62%|Brazil:46%|South Africa:45%India:24%|Thailand:18%|Australia;China;U.K.:17%India:18%|China:17%|Poland;U.K.:16%2022 Nielsen Consumer LLC.All Rights Reserved.161616Source:NielsenIQConsumers expect companies to take initiative to improve the environm

37、ent38%38%19%3%Extremely ImportantVery ImportantSomewhat ImportantNot Very ImportantNot at All ImportantQ How important is it to you that companies take initiative to reduce their environmental footprint?Source:NielsenIQ 2023 Sustainability Report-Q:How important is it to you that companies take init

38、iative to reduce their environmental footprint?2022 Nielsen Consumer LLC.All Rights Reserved.171717 2022 Nielsen Consumer LLC.All Rights Reserved.46%39%38%29%28%25%24%17%17%BrandsLocal governmentConsumersRetailersFarmers/ProducersEnergyprovidersGlobal/enviro agenciesTechnologyprovidersIndependent ac

39、credited sourcesFinancialinstitutions 2022 Nielsen Consumer LLC.All Rights Reserved.11%Which groups should be most responsible for making progress on sustainability in your market?Consumers hold brands and government most responsible for sustainable progress 2022 Nielsen Consumer LLC.All Rights Rese

40、rved.18Reduced plastic and cheaper/incentivized options would help consumers shop more sustainablyTop options to help consumers be more sustainableRetailers7%8%8%9%10%11%11%14%17%8%8%9%10%11%11%11%13%15%8%8%9%11%12%11%12%12%13%Grow fresh produce directly in store egrooftops/hydroponicsRetailers deli

41、st products that dont meet sustainable standardsProvide refillable stations/optionsEnsure a sustainable option in everycategoryIncrease assortment of sustainableofferingsArrange all sustainable items in store incommon area eg focused aisles,shelvesCreate loyalty/rewards programsbenefiting sustainabl

42、e choicesIncrease range of cheaper(private label)options with sustainable credentialsReduce plastic packaging/compostablealternativesRank 1Rank 2Rank 345%40%34%34%33%30%26%24%23%2022 Nielsen Consumer LLC.All Rights Reserved.Source:NielsenIQ 2023 Sustainability Report-Q.Please choose the top 3 option

43、s you feel would help you shop more sustainably from Retailers?191919 2022 Nielsen Consumer LLC.All Rights Reserved.Top options to help consumers be more sustainableSource:NielsenIQ 2023 Sustainability Report-Q.lease choose the top 3 options you feel would help you choose more brands that follow sus

44、tainable practices?Cheaper and clearer labeling are best options to help consumers buy sustainable brandsBrands7%6%7%8%9%11%15%15%18%7%7%8%8%9%12%13%16%15%7%8%8%9%12%12%13%14%14%More plant based options,instead of meatRenewable energy used in operations andproductionSupport environmental charities/c

45、ausesUse of ingredients produced in a moresustainable wayMore visibility into sustainability practicesLocally sourced with lower carbon footprintEasy to understand recycling labelsEasy to understand sustainability standardslabellingComparable price to other productsRank 1Rank 2Rank 346%45%41%35%30%2

46、4%23%22%20%202020 2022 Nielsen Consumer LLC.All Rights Reserved.77%(*43%very likely)2022 Nielsen Consumer LLC.All Rights Reserved.202020are likely to stop buying if brands found guilty of greenwashing*Stop buying77%Less likely/No opinion 23%Indonesia91%United States34%Thailand90%Australia,France31%C

47、hina88%United Kingdom30%Source:NielsenIQ 2023 Sustainability Report-Q.How unlikely or likely are you to take following actions,when choosing a particular grocery brand?212121 2022 Nielsen Consumer LLC.All Rights Reserved.Consumers expect governments to play a strong role to shift the sustainability

48、agendaTo what extent would do you disagree or agree with actions believe that the government do to should encourage companies to act more sustainably?To what extent would do you agree with actions that government should encourage companies to act more sustainably?Q82%Create less complicated recyclin

49、g/waste processes80%Incentivize business to switch to more sustainable business practices78%Companies should be mandated to show full transparency of their supply chain so shoppers can make informed choices75%Mandate that companies must comply with third party certification of sustainability standar

50、ds74%Increase regulations to enforce business to move more quickly to sustainable practices to meet climate targets66%Stop/fine businesses that cant meet sustainable standards 2022 Nielsen Consumer LLC.All Rights Reserved.222222 2022 Nielsen Consumer LLC.All Rights Reserved.3.The future of sustainab

51、ilityCan companies afford not to?232323 2022 Nielsen Consumer LLC.All Rights Reserved.What might a sustainable journey look like to keep pace with accelerating requirements?To meet retailers/partners goalsTo match the competitionTo meet reporting requirements&KPIsTo be an employer of choiceTo match

52、or lead consumer expectations12-Traceability and validation recorded on blockchain1-An internal or 3rd party Expert assessment on footprint and action plan to cover blind spots&reduce emissions2-Alternative packaging to reduce plastic3-Invest in off grid sustainable energy or commit to buying4 Remov

53、al of unsubstantiated green claims5-3rd party accreditation of sustainability credentials and improvements6-Invest&develop sensors,tech and data collection that enable monitoring of emissions&resource use across value chain from sourcing to production7-Annual report(in compliance with local governan

54、ce)to gauge footprint,highlight improvements&process investment8-Leverage sensors,AI,automation to improve a smart supply chain to reduce water,energy and ingredient waste9-Recalibrate transport logistics to incorporate electric fleets,automation10-Integration of vertical farmed or lab grown ingredi

55、ents that garner improvement11 Replace alternative ingredients and suppliers to minimize footprint Regenerative agriculture local producers alternative protein&ingredientsSystemic shifts that may replace existing practices2030 AND BEYONDTODAY2023-2028Existing solutions that can be readily adopted an

56、d spreadRequire additional development,investment and timeStart nowStart now242424 2022 Nielsen Consumer LLC.All Rights Reserved.Change is comingShort term-“easy wins”-Existing solutions that can be readily adopted and spreadFrance:France is taking the lead on refill legislation with French grocery

57、chains having to begin switching to food refill stations as part of a new environmental bill.The law,which has been passed by the French parliament,will require retailers to phase out disposable plastic packaging and dedicate a fifth of their store to allow customers to buy dry food products using t

58、heir own reusable containers.If passed,the legislation will require retailers with a storefront larger than 400 metres squared to dedicate 20%of their space to food refill stations by the end of the decade.ALDI Australia operations are now being powered with 100 per cent renewable electricity six mo

59、nths ahead of schedule,making it the first Australian supermarket to rely solely on renewable energy sources.Amazon will add Stellantis all electric Ram ProMaster van to its fleet when the vehicle launches in 2023 as the e-commerce giant pushes to meet its pledge to be carbon neutral by 2040.South A

60、frican Breweries(SAB)will soon produce using renewable electricity,Berlin-based GetHenry,a startup that provides electric last-mile delivery bikes to couriers and logistics companies,has raised a$17.4 million(16.5 million)seed round to expand its business across Europe.The startupcurrently operates

61、in Germany,Austria,Italy and France,but plans to use its latest funding to move into Spain,the Netherlands and the U.K.over the next two quarters,according to a GetHenry spokesperson.Read more Read more Read more Reduced PlasticsRenewable EnergyLocal sustainable delivery252525 2022 Nielsen Consumer

62、LLC.All Rights Reserved.Unilever is launching 50 regenerative agriculture projects over the next five years.The projects build on more than a decade of Knorrs collaboration with farmers and suppliers,which has led to 95%of its vegetables and herbs now being sustainably sourced,globally.France:Planet

63、-Score is based on LCA methodology,but also addresses pesticide use,climate impact,biodiversity and animal welfare.The score is superior as it looks beyond just environmental(climate)on which most life cycle analysis are based.Critical to its success will be adoption across countries and brands.Deve

64、lopment is currently underway in France,the United Kingdom and 6 other European countries(Spain,Belgium,Netherlands,Germany,Italy and Switzerland).About 120 companies are currently testing the Planet-Score.Read more Read more Mid-term Require additional development,investment and timeCarrefour,owned

65、 and operated by Majid Al Futtaim in the UAE,has opened its first Bio store in City Centre Meaisem in Dubai.It features the retailers first-ever caf and an in-store hydroponic farm,with an underlying focus on sustainability.The stores concept has been drawn up based on qualitative data studies aroun

66、d organic shopping in the UAE and on locally-sourced products,with over 3,000 items spanning from food and beverages to beauty,personal,and home care itemsRead more Regenerative agricultureNew retail modelsSupply chain transparencyChange is coming262626 2022 Nielsen Consumer LLC.All Rights Reserved.

67、Read more The holy grail of sustainability could be a fully digitized copy of a cradle to grave processes for companies.All the data inputs captured by sensors that can give real time modeling of how efficiencies can be derived.Changing energy or water inputs to the system based on weather for examp

68、le.These digital twins are expected to provide huge advantages for companies in their mandated reporting and footprint reduction.In the future,Mars plans to use digital technologies to introduce even more intelligence into the end-to-end supply-chain processes,including identifying the optimal way t

69、o create products through digital simulations that take into account climate and other situational considerations,as well as creating greater transparency and visibility into its supply chain from the point of origin all the way to the consumer.Change is comingLong term Systemic shifts that may repl

70、ace existing practicesDigital twin of production process272727 2022 Nielsen Consumer LLC.All Rights Reserved.Electric vehicle delivery fleets-ReadDedicated space for electric car charging-ReadOff grid energy solar panels on roofsand parking-ReadClimate labelling on products-ReadNo plastic,bring your

71、 own containers-ReadReduction in food waste-ReadVastly different range and assortment More vegetarian,organic,local offerings-ReadShoppers are rewarded loyalty points for choosing more sustainable products-ReadVertical farming produce and in-store hydroponics-ReadSupermarket APP lets shoppers track

72、the impact of their basket-ReadWhat might the future of sustainable retailing look like?Detailed examples are provided in the following hidden slides282828 2022 Nielsen Consumer LLC.All Rights Reserved.What might the future of sustainable brands look like?Collaboration with farmers/producers to ensu

73、re raw ingredients are sustainably sourced/regenerative agriculture ReadDriving cleaner logistics,optimizing routes,switching to low emission fuels,electric vehicles and more sustainable transport options-Drones,electric delivery-ReadSustainable packaging and innovation to keep waste out of landfill

74、-ReadReduce food waste/embrace imperfect-ReadUsing renewable energy to manufacture products-ReadUsing voice to galvanize action on climate issues with farmers,industry,NGOs and communities-ReadCreating new,low-carbon products and reformulating existing ones using ingredients and processes-ReadShifti

75、ng focus from animal to plant-based meal options-ReadDetailed examples are provided in the following hidden slides292929 2022 Nielsen Consumer LLC.All Rights Reserved.Shifting from animal to plant-rich foodsReadSwitching to more sustainable housing and home energy useReadSustainable car free persona

76、l transport the default E-bikes,bikes,etc.ReadSlowing down fast fashion consumptionReadReduce food waste/embrace imperfectReadRecycle/compostReadShop localReadRent Upcycle Reuse ReadAPPS&tech used by consumers to Shop sustainablyReadHome grown vertical produce gardens ReadDetailed examples are provi

77、ded in the following hidden slidesWhat might the future of sustainable lifestyle look like?303030 2022 Nielsen Consumer LLC.All Rights Reserved.What might the future of governance look like?Regulation against deforestation in supply chain-ReadIntroduction of Carbon tax-ReadWindfall tax to help poore

78、st-ReadMandatory front of pack labeling based on full life cycle assessment-ReadAdvertising regulation against greenwashing-ReadNew sustainable building codes-ReadExtended Producer Responsibility-ReadElectric vehicle Conversion-ReadDetailed examples are provided in the following hidden slides313131

79、2022 Nielsen Consumer LLC.All Rights Reserved.Enablers and barriers that will fast track/impede the journeyBut driving forces will prevail and push forwardCost of getting it wrong e.g:greenwashingComplexity in identifying what mattersLack of scalable technologyWaiting for best“tech”/to be easier!Lac

80、k of government willLack of transparency in supply chainBarriersIncreased costs of productionLack of consistency in standardsTechnology advancesSustainable options becoming more affordableRenewable energy transitionWeight of sustainable investmentAdapt to sustainable business models due to spiraling

81、 costs under old business modelsNecessity to comply to new legislationProduct removal if dont complyEnablersSocial movementPenalties if dont evolve323232 2022 Nielsen Consumer LLC.All Rights Reserved.“To meet targets that become increasingly stringent over the next 10 years,we anticipate a great dea

82、l of scrambling from companies that now realize its crunch time.They will look for easy wins in the short-term but the gamechanger is the requirement to report and validate their footprint and gain visibility of emissions and resource use across their whole value chain.This will require a long-term

83、shift and for many a departure from how they currently operate.NIQ Global Intelligence TeamThe time to act is NOWThe“cost of inaction”will supercharge the green revolutionInvesShort termMid termLong termUnderstand and start cleaning up your footprint todayWithdraw unsubstantiated claimsActivate easy

84、 winsInvest and improve product full life cycle change todayWork with suppliers to gain a cradle to grave model for sustainabilityLong-term change needs to start nowSystemic shifts may replace existing practices Invest todayReplace parts of our food and product systems that are roadblocksAbout Niels

85、enIQArthur C.Nielsen,who founded Nielsen in 1923,is the original name in consumer intelligence.After decades of helping companies look to the future,we are setting the foundation for our future by becoming NielsenIQ.We continue to be the undisputed industry leaders as evidenced by our experience and

86、 unmatched integrity.As we move forward,we are focused on providing the best retail and consumer data platform,enabling better innovation,faster delivery,and bolder decision-making.We are unwavering in our commitment to these ideals and passionate about helping clients achieve success.For more information,visit: 2022 Nielsen Consumer LLC.All Rights Reserved.33For more insights: