Can you provide an overview of Coca-Cola HBC's relation to the larger Coca-Cola Company and explain the retention of the “Hellenic” in its name despite the move to Switzerland?
Coca-Cola HBC is a growth-focused consumer goods business and a strategic partner of The Coca-Cola Company, operating in 29 countries. We serve over 700 million consumers with a diverse beverage portfolio tailored for various consumption occasions. We also partner with producers like Costa Coffee, Café Vergnano, Monster Energy, Edrington, Campari, and Brown-Forman, enhancing our offering, especially in the premium spirits and mixers segment for late-night consumption. The breadth and depth of our portfolio are positioning us to be the leading 24/7 beverage partner for our customers. We also share a common interest with our customers on sustainability and this collaboration is enhanced by the recognition we receive as a leader in sustainability within the industry.
The retention of "Hellenic" in our name is a nod to our rich heritage and history that dates back to the 1950s. Despite our geographical expansion, this element of our identity encapsulates the essence of our origins, the path we have treaded, and the evolution we have undergone.
Could you elaborate on Coca-Cola HBC’s sustainability commitments, particularly Mission 2025, and the strides made towards achieving a Net Zero carbon footprint by 2040?
Our sustainability strategy has progressed significantly over the years. Today our commitments are anchored in Mission 2025, with a further extension of our commitment to achieve a Net Zero carbon footprint by 2040. Mission 2025 consists of 17 sustainability commitments aligned with the UN Sustainable Development Goals. Several of these have already been realized ahead of the 2025 deadline; exceeding our target of 50% energy-efficient coolers in the market, and currently achieving 100% clean and renewable energy for our plants in Europe.
The transition to a Net Zero footprint is integral to our sustainability agenda. We have reduced our carbon emissions by over 50% in Scope 1 and 2 and by 30% across all three scopes since 2010. This achievement stems from multifaceted approaches including energy-efficient coolers, green fleet implementation, reduced energy consumption, and sourcing agricultural ingredients responsibly. A pivotal part of this journey is our partnership with suppliers to mitigate carbon emissions across the entire supply chain, given that 89% of our emissions emanate from scope three.
What are the key milestones achieved in packaging sustainability and green energy?
We are proud to have made all our packaging 100% recyclable. Our achievement of over 50% market presence of energy-efficient coolers (Excluding Egypt, which joined the CCHBC Group after Mission 2025 targets were set) and currently sourcing 100% clean or renewable energy for our European plants underscores our commitment to environmental stewardship. We are also expanding our renewable energy solutions to Africa, exemplified by our solar panel initiative in Nigeria, a collaboration where we provide the space while the investment partner funds the project, expediting the green energy transition. For us, this is a great example of the key role of partnerships for the green transition.
Looking ahead, our Net Zero by 2040 aspiration plays a pivotal role in shaping our sustainability commitments. Our emissions reduction is bolstered by a series of innovations, including transitioning to a circular economy and introducing more sustainable packaging solutions. Packaging constitutes 34% of our Scope 3 emissions, hence our efforts to transition towards a circular economy, introduce recycled PET, and expand our product offerings in returnable packaging. Across our EU and Swiss markets, we expect to reach 50% recycled PET use in our primary packaging by year-end.
We are also investing in infrastructure that helps us to collect back all the bottles and cans we sell, so they can have a life beyond their initial use. By 2026, we expect that the majority of our EU countries will have established Deposit Return Schemes, which typically deliver collection rates of up to 90% while enhancing the quality and availability of recyclable materials.
How significant is addressing Scope 3 emissions for Coca-Cola HBC, and what challenges have you encountered in this area?
Indeed, Scope 3 emissions are a pivotal concern for us, constituting 89% of our total emissions. Initially, the challenge lay in raising awareness among our 35,000 suppliers about the importance and benefits of mitigating their operational carbon footprint. In 2016, when we adopted science-based targets, only one of our suppliers joined us. Proper reporting and planning were contingent upon an external audit and without the suppliers’ understanding and collaboration realizing our emissions reduction goals was unattainable.
We are now in a much better position, having worked extensively with our suppliers to communicate the long-term benefits of reducing emissions and compliance with future regulations.
Our approach has been to present this not only as a cost but as an opportunity for economic growth, using examples like the adoption of solar panels which reduces electricity costs and strengthens business resilience.
Following up on the last point, would you agree overall that the green transition is not a cost but an economic opportunity?
Absolutely. We view sustainability as a growth driver, a sentiment shared across our organization. Our sustainability initiatives are transparently shared with suppliers and customers, aiming to create mutual value. The foundation of this is our focus on building internal capabilities, supported by proper tools for measuring, reporting, and planning. Innovation and strategic partnerships play a crucial role, bringing about more sustainable business practices that are economically beneficial.
Examples of such innovations include our collaboration with and investment in Manna Drones for drone deliveries in Ireland, reducing CO2 emissions while making home deliveries fast and efficient, and exploring hydrogen production in Vienna. The latter not only replaces natural gas but powers hydrogen fuel cells for our truck engines, reducing emissions. We are also collaborating with Portsmouth University on research into PET recycling using enzymes.
How do you see the role of innovation in reducing emissions and promoting sustainability?
Our investment in innovation and partnerships has been instrumental in advancing our sustainability agenda. Next to the collaborations already cited, solutions like KeelClip and LitePac Top are a testament to our commitment to reducing packaging waste. The former eliminated the cans’ plastic film and replaced them with cardboard, while the latter, launched in Austria recently, is a more sustainable secondary packaging solution for 1.5 liters PET multi-packs. These innovations are pivotal in reducing emissions and waste, marking significant strides towards our overarching sustainability goals.
How does Coca-Cola HBC approach collaboration to address global challenges like climate change?
The magnitude of global challenges like climate change transcends the capacity of any single entity. We are intertwined in an ecosystem where the actions of one affect all; hence, collaboration is indispensable. Our optimism for a sustainable future is fueled by the rapid and impactful innovation combined with a pervasive passion for sustainability across all levels of society and business.
