Outcome: Successfully withdrawn. Following a constructive dialogue, Target has committed to expand food waste related disclosures in its Corporate Social Responsibility Report in 2017. This report will describe how and why Target is working to manage food waste as well as provide an overview of how Target will be moving forward in its management and reporting of this critical issue.
40% of food produced in the U.S. goes uneaten, costing the American economy $218 billion per year.
Greenhouse gas emissions from wasted food in the U.S. are equivalent to the annual emissions of 39 million cars. Globally, if food waste were a country, its emissions would be 3rd, behind only China and the United States. Production of uneaten food consumes 21% of U.S. freshwater, 19% of fertilizer and 18% of cropland.
Approximately 40 million Americans, including 13 million children, are food insecure; reducing food waste by 15% could feed 25 million people every year.
Some retailers are taking action and realizing financial benefits. Stop & Shop saved an estimated $100 million annually by reducing losses of perishables, while providing items that were 3 days fresher on average. Price Chopper reduced bakery losses by $2 million in one year, while increasing sales by 3%.
The EPA established the first national food waste reduction target in 2015, striving for a 50% reduction by 2030. Fifteen companies recently made the same commitment; these “food loss and waste 2030 champions” include Walmart, Ahold USA, and Delhaize America. The 400 members of The Consumer Goods Forum have committed to halve food waste by 2025.
Several states have laws preventing retailers from sending food to landfills, creating regulatory risk for those who lack adequate diversion strategies. Many organizations are working to raise awareness of the impacts of food waste that may lead to negative media attention.
Target does not specifically discuss food waste management and reduction efforts or provide food waste data. Alarmingly, Target failed to achieve its 2009-2015 waste reduction goal due primarily to challenges in expanding alternative food disposal infrastructure. While Target provides a breakdown of its other waste streams (cardboard, plastics, glass, etc.), proponents see an opportunity for Target to provide assurance to shareholders that it is effectively managing the risks and costs associated with food waste.
In light of these political and industry trends, we believe Target Corporation and its shareholders are positioned to benefit from a comprehensive approach to food waste prevention and strategic diversion that can cut costs, provide competitive advantage, strengthen brand reputation, save resources, help alleviate hunger, and reduce greenhouse gas emissions.
Resolved: Shareholders request Target issue a report, to be prepared in reasonable time, at reasonable cost, and omit proprietary information, on company-wide efforts (above and beyond its existing reporting) to assess, reduce, and optimally manage food waste.
Supporting Statement: Items to be covered in the report can include:
• Scope, frequency, and results of audits to determine the causes, quantities, and destinations of food waste
• Estimated cost savings from optimized food purchasing, handling, and disposal
• Prioritization of strategies based on EPA’s Food Recovery Hierarchy
• Identification of additional revenue streams and possible tax benefits from new uses of previously wasted food
• Time bound reduction goals specifically for food waste and progress towards meeting these goals.