Greenhouse gas (GHG) emissions are one of the major causes of rising global warming, and companies from the FMCG sector account for a significant amount of the global emissions. A significant portion of the greenhouse gases released from fossil fuels like gas and oil includes CO2, methane, and NOx gases. Due to rising GHG emissions from companies, it became important among major contributing sectors to report gas emissions during their operations.
Companies in the FMCG industry are coming under pressure to reduce their carbon footprint. Consumers are becoming more conscious of the harmful environmental effects of excessive carbon dioxide emissions. As a result, their consumption habits become dynamic, and they take an active interest in sustainability issues.
GHG Emissions by Scope
Greenhouse gas (GHG) emissions are generally classified into Scope 1, 2, & 3 emissions. Scope 1 includes direct GHG emissions from stationary fuel combustion and refrigerant gases. Scope 2 encompasses indirect GHG emissions from the on-site generation and purchase of electricity. Scope 3 involves indirect GHG emissions in the company’s entire value chain such as the purchase of goods and services, waste generated in operations, upstream transport, and distribution.
GHG Emissions from Major FMCG Companies by Market Cap
LVMH, Procter & Gamble, Nestle, Coca-Cola, and PepsiCo were major companies with significant GHG emissions in 2021.
LVMH Moet Hennessy Louis Vuitton SE (LVMH) is a luxury goods manufacturer and marketer with a market cap of $298 billion as of October 2022. In 2021, emissions form the major portion of LVMH’s total GHG emissions, accounting for around 376 thousand tonnes CO2 equivalent of total GHG emissions and an increase of 23% from 2020.
Procter & Gamble Co (P&G) is a manufacturer and marketer of fast-moving consumer goods and had a market cap of $296 billion as of October 2022. In 2021, emissions form the major portion of P&G total GHG emissions, accounting for around 2,400 thousand tonnes CO2 equivalent of total GHG emissions.
Nestle SA (Nestle) is a manufacturer and marketer of food products and beverages and one of the major Scope 3 GHG emitters. It had a market cap of $291 billion as of October 2022. Nestle’s total GHG emissions were 118,680 thousand tonnes of CO2 equivalent in 2021, a decrease of 0.4% from 2020. The FMCG company aims to achieve net zero greenhouse gas emissions by 2050.
Coca-Cola is a producer, distributor, and marketer of non-alcoholic beverages and had a market cap of $236 billion as of October 2022. Coca-Cola’s total GHG emissions were 5,170 thousand tonnes of CO2 equivalent in 2021, an increase of 8% from 2020.
PepsiCo Inc (PepsiCo) is a manufacturer and marketer of non-alcoholic beverages and food products. It had a market cap of $224 billion as of October 2022. The company’s total GHG emissions were 4,281 thousand tonnes of CO2 equivalent in 2021, a decrease of 0.7% on an annual basis. It aims to achieve net zero carbon emissions of Scope 1 & 2 by 2030 and decarbonize its Scope 3 emissions by 2050.
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