Arla Foods has been accused of “greenwashing its way to climate leadership” in a scathing new report by NGOs the Changing Markets Foundation and Greenpeace Nordic.
While the dairy giant had pledged to reach net zero by 2050, a comparison of its “weak” climate plans with UN guidelines for non-state actors found the supplier had – in not using climate credits – fully met just one out of nine relevant recommendations. This meant Arla – described as a “poster child” of dairy sustainability – would likely not reach its net zero target under current policies, claimed ‘Dairytales: Arla’s smokescreen for its lack of climate action’, published today.
The dairy co-op was instead paying too much attention to so-called “silver bullet” solutions to improve its sustainability credentials, the report revealed. And as a result, Arla’s actions when it came to reducing its impact on the climate did not match its claims to be a “leader” on the issue.
Too much focus on adopting often controversial innovations such as feed additive Bovaer – which led to widespread calls for a boycott of Arla products late last year – was “unwise”, Greenpeace and Changing Markets warned. “Many of Arla’s reduction strategies rely on research and developments that are yet to demonstrate their effectiveness and long-lasting impacts, or do not tackle the root cause of emissions – including feed additives and biogas production from manure,” they claimed.
And beneath its “glossy surface”, Arla was merely “a multinational company focused on protecting its own interests”, which “invested in lobbying, clever emissions accounting and greenwashing” to “maintain the status quo”, the report suggested.
“With undemocratic structures and incentives that benefit larger, more industrial farms, Arla is not the champion of family farms and traditional farming methods that it purports to be,” it added.
Read more: Arla stands firm on controversial Bovaer feed additive trial, despite boycott calls
One particular area the report highlighted Arla did not meet UN climate plan guidelines was through its “failure” to declare any reduction targets for material non-CO2 emissions, including methane – despite outlining in its 2023 annual report that ‘methane emissions are a major challenge for the dairy industry’.
The gas comprised 43% of total emissions from Arla farms, said the report, which also cited a separate Greenpeace Nordic study that estimated the Arla Group’s total methane emissions of 13.4 MtCO2e/yr even surpassed the Netherlands’ total agricultural methane emissions (11.4 MtCO2e/yr).
“Its much-vaunted climate plans do not stand up to scrutiny, and the solutions it pushes do little to address the main source of its vast emissions – methane from burping cows,” the report claimed.
Elsewhere, the NGOs estimated a maximum emissions reduction potential of 15% if all manure was used for biogas – suggesting production of the gas alone was “not the silver bullet Arla suggests” for its goal to reduce emissions per kilo of milk by 30% by 2030.
The dairy giant also drew criticism for taking only “limited steps to transform its production system”.
According to calculations made by the authors for the UK market, its plant-based brand, Jörd – which The Grocer revealed last month had been delisted from UK retail due sluggish sales – represented only 0.3% of Arla UK’s total revenue, while its market share of 2.4% was dwarfed by its milk market share in the UK of between 20-27%.
“Arla attributes the launch and expansion of its plant-based range to consumer demand,” the authors said. But it “continues to put dairy at the core of its production”, they added, which demonstrates a “lack of commitment to fully transform its portfolio to provide products that are less emissions intensive.”
To reach its climate targets, Arla also promotes its FarmAhead Check Tool and FarmAhead Sustainability Incentive initiative, the report noted. These aimed to provide farm-level carbon footprint measurements and offered financial incentives to farmers for reducing emissions according to Arla’s own point-based system.
“However, these initiatives have been heavily criticised, especially by small to medium-sized dairy farmers, who argue that the system is unfair and pushes farmers towards intensification,” the study reported.
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“Arla has been selling us a fairytale for far too long and this report exposes the stark contradiction between Arla’s reputation as the poster child of dairy sustainability, and the reality of its failure to develop robust plans to reduce its emissions – in particular its methane emissions,” said Alma Castrejon-Davila, senior campaigner for the Changing Markets Foundation.
“We’re calling on Arla to set an ambitious methane target – at a minimum a 30% reduction by 2030 – and shift to less and better dairy, as well as more plant-based products. Only by implementing these measures will the dairy giant be able to reduce its emissions at the pace and scale that are needed,” she added.
“The overall conclusion from the report is that Arla cares more about looking good than actually doing good for the climate,” said Greenpeace Nordic campaigner Sandra Lamborn.
If Arla had put as much resources into the actual climate work as it does into PR and lobbying, it would probably have had a good chance of achieving its own climate goals, but sadly they are not.”
Responding to the report, an Arla spokesperson said it was “taking the time to thoroughly review the report but from what we have seen, there are multiple inaccuracies, and it is not a true reflection of Arla’s science-based targets and commitment to producing more sustainable dairy”.
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