"Reducing food waste positively impacts significant policy issues while also improving financial performance.
BlackRock says “[t]he need for solutions that…lower food waste and provide alternatives to scarce resources has never been greater.” Institutional Shareholder services (ISS) calls food waste “a growing area of concern globally” that’s “starting to be addressed by regulators.” And Glass Lewis says it has “significant economic and environmental and social ramifications.”
Indeed, the production of wasted food causes significant greenhouse gas emissions and consumes vast amounts of freshwater, fertilizer, cropland, and other resources.
Further, Forbes has reported that wasting food costs taxpayers billions of dollars and poses “an existential risk to grocery stores.” Meanwhile, reducing food waste can save significant amounts of money.
In fact, the organization Champions 12.3—whose leadership includes Nestle’s and Rabobank’s CEOs and the U.N. Food & Agriculture Organization’s Chief Economist—​analyzed nearly 1,200 business sites (including retailers) across 17 countries and found 99% earned a positive return on investment through food waste reduction. Specifically, food retailers, hotels, and foodservice companies had ROI ratios between 5:1 and 10:1.
Against that backdrop, concerns arise about the company’s food waste disclosures.
For example, the company’s 2023 ESG report boasts that it “reduced our food waste footprint at over 3,800 stores.” But what about its 16,000+ other stores?
Also, Dollar General’s ESG reports cite some figures about expired dairy disposal (over 30,000 tons in 2022 and 2023 combined)—but don’t disclose if that was all its dairy waste, or just the amount diverted from landfills. They provide some figures about organic waste from stores in California, Vermont, and one city in Texas being composted—but without disclosing if that’s all the organic waste generated in those markets, let alone any such figures from other markets. And they describe sending millions of pounds of product to food banks—but without disclosing how much was left undonated.
Indeed, such selective disclosures fail to fully account for the types and quantities of all the company’s food waste. So, while shareholders know some limited diversion totals, we’re in the dark as to how much food waste the company generates, or what proportion of that total its disclosed diversions represent.
Furthermore, Dollar General also hasn’t disclosed measurable food waste reduction targets—which is especially troubling given its recent “goal of offering fresh produce in 10,000 stores over the next few years.”
Thus, while we recognize the limited data and disposal efforts disclosed to date—and that food waste has been reduced at about 20% of stores—we believe disclosure of overall food waste totals and measurable reduction targets could significantly advance the company’s management and oversight of this highly consequential matter. Thank you.
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