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Social, societal and environmental responsibility

5.2 Information concerning Danone's social, societal and environmental performance in compliance with the Grenelle II law

DANONE

REGISTRATION DOCUMENT 2015

190

Protecting biodiversity

Measures taken to preserve or develop biodiversity

Sustainable agriculture

The impact of Danone's business on biodiversity is primarily related

to upstream agriculture (soil and water). In 2012, the Danone Ltda

subsidiary (Fresh Dairy Products, Brazil) launched a pilot study on

product life cycle analysis in conjunction with NGO partners IPE

(

Instituto de Pesquisas Ecologicas

) and IUCN (International Union for

Conservation of Nature) to develop a methodology for evaluating

issues relating to biodiversity in Danone's value chain.

In 2014, Danone Brésil (Fresh Dairy Products) won the “Exame”

Guide for Sustainability 2014 award in the Biodiversity Management

category. This award is the culmination of a study on biodiversity

with the

Danoninho

brand and the related operational projects: water

management at the Poços de Caldas site and the pilot site for straw-

berry production in the southern part of the state of Minas Gerais.

In the area of agriculture andmilk collection, in 1997 the Fresh Dairy

Products Division, together with all its farmer partners, launched

the FaRMS initiative, which evaluates farmers' performance based

on economic, social and environmental criteria, including criteria

related to biodiversity protection (see section

Relations with milk

producers

hereafter). In 2013, Danone introduced a 360° evalua-

tion tool developed by the University of Bern to assess a farm's

sustainability. This tool is an enhancement to the Danone FaRMs

tool, which remains the benchmark Danone tool for all dairy farms.

Preserving and developing biodiversity near Danone sites

Danone's sites are located in very diverse ecosystems and climates.

Many of these sites benefit from an exceptional environment and

specific protection, as is the case with the Waters Division's sites,

whose rainwater catchment areas are very carefully managed:

•

since 2009, the catchment area of the Evian spring has been in-

cluded in the list of wetlands covered by the Ramsar Convention,

the aim of which is to ensure the sustainability of these natural

regions which are essential for maintaining biodiversity;

•

in France as well, the site of the Volvic springs was classified as a

Nature Reserve in 2015, particularly to protect the bat population.

A study conducted under the European SEMEAU project made it

possible to clarify the role of the forest in the functioning of the

hydrogeological system and propose guidelines for managing

this forest;

•

to preserve its natural mineral water spring in the pre-Andes in

Argentina, the

Villavicencio

brand has created a natural reserve

for its 72,000 hectares rich in biodiversity. Building on this

experience, it is continuing its innovative partnership with the

Banco de Bosques NGO through the

Deja tu Huella

(“Leave your

footprint”) operation, which invites consumers to participate in

the creation of a new natural reserve: for every bottle purchased,

Villavicencio

pledges to protect 1 square meter of natural biotope.

The brand has also launched initiatives to raise public aware-

ness about the dangers of deforestation and the importance of

biodiversity in the local ecosystem. The results of this operation

are impressive: nearly 4,800 hectares protected, active public

participation in the project, and increased consumer preference

for the

Villavicencio

brand;

•

starting in 2012, Danone Waters China has bolstered its protec-

tion initiatives at the Longmen site through a partnership with

the Danone Ecosystem Fund (see section 5.3

Funds sponsored

by Danone)

. The goal of the Eco-Longmen project, which aims

to involve a large number of farmers, is to preserve the quantity

and quality of water resources and biodiversity while improving

the living conditions of the local communities.

Danone's Forest Footprint Policy

Conscious of the importance of preserving the planet's forests

(particularly tropical forests in Indonesia and the Congo and Amazon

river basins), Danone is committed to a strategy of eliminating

the impacts of deforestation on its supply chain and to a program

of reforestation by 2020 (including the Livelihood Fund's natural

ecosystem restoration program).

To achieve this, Danone has created a Forest Footprint Policy that

aims to:

•

evaluate deforestation risks related to the raw materials used

directly or indirectly by Danone's businesses;

•

propose specific policies;

•

implement prioritized actions based on risks and associated

impacts. Six key materials have been prioritized: paper/card-

board packaging, palm oil, soybeans for animal feed, energy

wood, sugar cane and bio-sourced rawmaterials for packaging.

This policy has been adapted to three categories of raw materials:

Specific palm oil policy

With a volume of approximately 35,000 tons, Danone uses palm oil

in modest proportions relative to other activities in the food and

beverage industry.

In November 2015, Danone introduced a Palm Oil policy, which is

available at

www.danone.com

in the “Publications” section.

Danone is committed to ensuring that all palm oil used:

•

is traceable from the plantation of origin;

•

comes fromplantations whose expansion does not threaten “High

Conversation Value” (HCV) or High Carbon Stock (HCS) forests;

•

comes from plantations whose expansion does not threaten

tropical peatlands, regardless of their depth;

•

comes from plantations that respect the rights of indigenous

populations and local communities to grant or refuse their free

and prior consent to operate on land to which they hold legal,

communal or customary rights;

•

comes from plantations where the rights of all workers are

respected.

Since 2014, Danone has purchased 100% of its palm oil from CSPO

(Certified Sustainable Palm Oil) sources.

Overall, its oil comes from 30 mills and 10 producers located

in Indonesia, Malaysia, Papua New Guinea, Guatemala and the

Solomon Islands.

Danone is convinced that the path to responsible palm oil requires

innovative approaches that enable the various stakeholders to

develop positive solutions.

In a longer term, Danone plans to replace palm oil with alternative

resources on a case-by-case basis.