Independent Accountants' Review Report
To the Management of The Hershey Company
We have reviewed The Hershey Company's ("Hershey") Schedules of Select Sustainability Indicators (the "Subject Matter") included in Appendix A as of and for the year-ended December 31, 2023, in accordance with the criteria also set forth in Appendix A (the "Criteria"). Hershey's management is responsible for the Subject Matter in accordance with the Criteria. Our responsibility is to express a conclusion on the Subject Matter based on our review.
Our review was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants (AICPA) AT-C section 105, Concepts Common to All Attestation Engagements, and AT-C section 210, Review Engagements. Those standards require that we plan and perform our review to obtain limited assurance about whether any material modifications should be made to the Subject Matter in order for it to be in accordance with the Criteria. The procedures performed in a review vary in nature and timing from and are substantially less in extent than, an examination, the objective of which is to obtain reasonable assurance about whether the Subject Matter is in accordance with the Criteria, in all material respects, in order to express an opinion. Accordingly, we do not express such an opinion. Because of the limited nature of the engagement, the level of assurance obtained in a review is substantially lower than the assurance that would have been obtained had an examination been performed. As such, a review does not provide assurance that we became aware of all significant matters that would be disclosed in an examination. We believe that the review evidence obtained is sufficient and appropriate to provide a reasonable basis for our conclusion.
We are required to be independent of Hershey and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements related to our review engagement. Additionally, we have complied with the other ethical requirements set forth in the Code of Professional Conduct and applied the Statements on Quality Control Standards established by the AICPA.
The procedures we performed were based on our professional judgment. Our review consisted principally of applying analytical procedures, making inquiries of persons responsible for the subject matter, obtaining an understanding of the data management systems and processes used to generate, aggregate and report the Subject Matter and performing such other procedures as we considered necessary in the circumstances.
As described in Appendix A, the Subject Matter is subject to measurement uncertainties resulting from limitations inherent in the nature and the methods used for determining such data. The selection of different but acceptable measurement techniques can result in materially different measurements. The precision of different measurement techniques may also vary.
The information included in Hershey's ESG Report, other than the Subject Matter, has not been subjected to the procedures applied in our review and, accordingly, we express no conclusion on it.
Based on our review, we are not aware of any material modifications that should be made to the Schedules of Select Sustainability Indicators for the year-ended and as of December 31, 2023, in order for it to be in accordance with the Criteria.
Philadelphia, Pennsylvania
May 15, 2024
1
A member firm of Ernst & Young Global Limited
Appendix A - The Hershey Company Schedules of Selected Sustainability Indicators
Schedule of
Select Environmental Metrics
for the year-ended December 31, 2023
Indicator name1 | Source | Reported | Units of | Criteria | Reporting | ||
value | measure | Boundary | |||||
Energy | Coal | 2,933 | Gigajoules | 2016 GRI 302-1: | Hershey | ||
consumption | (GJ) | a. | Total fuel consumption within the | selected an | |||
within the | organization from non-renewable | organizational | |||||
organization | Fuel Oil 2 | 9,932 | sources, in joules or multiples, and | boundary based | |||
including fuel types used. | on the | ||||||
b. | Total fuel consumption within the | company's | |||||
Gasoline | 77,833 | organization from renewable sources, in | operational | ||||
joules or multiples, and including fuel | control.5 | ||||||
types used. | |||||||
Jet Oil | 57,978 | c. | In joules, watt-hours or multiples, the | ||||
total: | |||||||
i. | electricity consumption2 | ||||||
ii. | heating consumption | ||||||
Natural Gas | 3,103,913 | ||||||
iii. | cooling consumption | ||||||
iv. | steam consumption | ||||||
d. | In joules, watt-hours or multiples, the | ||||||
Propane | 2,344 | ||||||
total: | |||||||
i. | electricity sold | ||||||
ii. | heating sold | ||||||
Biogas | 58,231 | ||||||
iii. | cooling sold | ||||||
iv. | steam sold3 | ||||||
e. | Total energy consumption within the | ||||||
Biomass | 50,521 | ||||||
organization, in joules or multiples. | |||||||
f. | Standards, methodologies, assumptions, | ||||||
and/or calculation tools used.1 | |||||||
6 | 2,249,874 | ||||||
Electricity | g. | Source of the conversion factors used.4 | |||||
Total
5,613,559
- For facilities that do not receive invoices or meter readings necessary to obtain actual energy consumption, Hershey utilizes an estimation methodology that considers historical and known data. This methodology is utilized for smaller offices and is not considered material to Hershey's reported energy and electricity consumption.
- Heating, cooling, and steam consumption are not applicable because Hershey only consumes electricity.
- Hershey does not report 2016 GRI 302-1d (total electricity sold, heating sold, cooling sold, and steam sold) because Hershey does not sell electricity, heating, cooling, and steam. Total energy consumption within the organization as defined by GRI 302-1e is therefore calculated without excluding sold energy.
- Refer to Note on Sources of conversion factors for sources used.
- The reporting boundary of the Subject Matter within the Schedule includes all global facilities and offices under the operational control of Hershey, including acquired manufacturing facilities from Weaver Popcorn Manufacturing.
- Sources include hydroelectric, renewable electricity contractual instruments, zero emissions contractual instruments, and traditional grid electricity.
2
Schedule of
Select Environmental Metrics
for the year ended December 31, 2023
Indicator name1 | Reported | Units of | Criteria | Reporting |
value | measure | Boundary | ||
Percent of total electricity consumption | 20.2 | Percentage | Hershey calculates the percent of total electricity | Hershey |
that is supplied as grid electricity7 | (%) | consumption that is supplied as grid electricity as the | selected an | |
total purchased grid electricity consumption divided | organizational | |||
by total electricity consumption. | boundary | |||
Percent of total electricity consumption | 26.6 | Percentage | Hershey calculates the total electricity consumption | based on the |
that is identified as renewable electricity8 | (%) | that is identified as renewable electricity as the total | company's | |
renewable electricity purchased divided by total | operational | |||
electricity consumption. | control.2 | |||
Percent of total electricity consumption | 53.2 | Percentage | The Company calculates the total electricity | |
that is covered by the purchase of a zero- | (%) | consumption that is covered by the purchase of a | ||
emissions energy based contractual | zero-emissions energy based contractual instrument | |||
instrument9 | as the total energy purchased through zero-emissions | |||
energy based contractual instruments divided by | ||||
total electricity consumption. | ||||
Percent of total electricity consumption | 79.8 | Percentage | The Company calculates this as the sum of percent | |
that is identified as renewable electricity | (%) | of total electricity consumption that is identified as | ||
and percentage of total electricity | renewable electricity and percent of total electricity | |||
consumption that is covered by the | consumption that is covered by the purchase of a | |||
purchase of a zero-emissions energy | zero-emissions energy based contractual instrument. | |||
based contractual instrument6,7 | ||||
Energy intensity | 5.26 | GJ / Metric | 2016 GRI Standard 302-3: | |
ton of | Energy intensity ratio is calculated from the total | |||
product | energy consumption10 within the organization | |||
produced | divided by the total product produced in metric tons. | |||
Number of renewable energy contractual | 130,400 | # of RECs | Hershey calculates the number of renewable energy- | |
instruments generated through renewable | based contractual instruments generated through | |||
energy Power Purchase Agreements | renewable energy Power Purchase Agreements | |||
(PPAs) as the number of Renewable Energy Credits | ||||
generated through directly invested renewable | ||||
energy Power Purchase Agreements during the | ||||
reporting period. |
- Grid electricity is defined as electricity provided and consumed by the Company through connection with a third-party utility provider. This excludes third-party auxiliary power providers, such as direct line transmission from renewable sources of energy.
- Renewable electricity consists of both contractual instruments and electricity from renewable sources of energy provided through direct line transmission. The contractual instruments align with the WRI/WBCSD GHG Protocol Scope 2 Guidance Quality Criteria and are derived from renewable energy. Renewable energy is defined by the Company as sources that are replenished at a rate greater than or equal to their rate of depletion (i.e., geothermal, wind, solar, and hydro). In certain instances, the retirement of these contractual instruments may occur subsequent to the date of this report. When this is the case, the contractual instrument has a set date for retirement or is contractually obligated to be retired. Direct line renewable electricity is purchased by the Company directly as renewable electricity maintaining the related emissions attributes. The renewable energy based contractual instruments and the direct line renewable electricity used in this indicator are included in the Scope 2 MBM GHG emissions calculation.
- Zero-emissionsenergy based contractual instruments are defined as contractual instruments that align with the WRI/WBCSD GHG Protocol Scope 2 Guidance Quality Criteria but fail to meet the definition of renewable energy. Most commonly this energy is contractual instruments linked to nuclear energy. The zero-emissions energy based contractual instruments used in this indicator are included in the Scope 2 MBM GHG emissions calculation.
- Energy consumption includes natural gas, coal, gasoline, jet fuel, oil #2, coal, propane, biogenic sources, and electricity and aligns with the sources and energy consumption included in the calculation of energy consumption by source.
3
Schedule of
Select Environmental Metrics
for the year ended December 31, 2023
Indicator name11 | Reported value | Units of measure | Criteria | Reporting Boundary |
Scope 1 (Direct) | 178,001 | Metric tonnes carbon | World Resources Institute ("WRI") | Hershey selected an |
Greenhouse Gas (GHG) | dioxide equivalents | / World Business Council for | organizational | |
Emissions12,13,14 | (MT CO2e) | Sustainable Development's | boundary based on the | |
("WBCSD") The Greenhouse Gas | company's operational | |||
Protocol: A Corporate Accounting | control.15 | |||
and Reporting Standard (GHG | ||||
Scope 2 (Indirect) GHG | 61,592 | MT CO2e | ||
Protocol) and WRI WBCSD GHG | ||||
Emissions, market- | ||||
Protocol Scope 2 Guidance: An | ||||
based method11,16,17 | ||||
Amendment to the GHG Protocol | ||||
Scope 2 (Indirect) GHG | 224,083 | MT CO2e | ||
Corporate Standard | ||||
Emissions, location- | ||||
based method11,14 | ||||
Biogenic carbon | 7,214 | MT CO2e | ||
dioxide emissions | ||||
GHG emissions | 0.224 | MT CO2e / Metric ton | 2016 GRI Standard 305-4: | |
intensity | of product produced | GHG emissions intensity ratio is | ||
calculated from the total Scope 1 | ||||
and Scope 2 MBM emissions10,14 | ||||
divided by the total product | ||||
produced in metric tons. |
- For facilities that do not receive invoices or meter readings necessary to obtain actual energy consumption, Hershey utilizes an estimation methodology that considers historical and known data. This methodology is utilized for smaller offices and is not considered material to Hershey's reported GHG emissions.
- Scope 1 GHG emissions includes natural gas, refrigerants, coal, gasoline, jet fuel, oil #2, coal, propane, and biogenic emissions for CH4 and N2O.
- The majority of the reported CO2e emissions included in the reporting boundary are from CO2 with the remainder being composed of CH4 and N2O, HFCs, PFCs, SF6 and NF3.
- Hershey calculates their Scope 1 GHG emissions inclusive of company-owned passenger vehicles. In certain regions, the exact fuel consumed as part of Hershey's operational boundary holds a degree of uncertainty. As a result, Hershey leverages estimation based upon known historical data in order to maintain a representative footprint of their Scope 1 GHG emissions.
- The reporting boundary of the Subject Matter includes all global facilities and offices under the operational control of Hershey, including acquired manufacturing facilities from Weaver Popcorn Manufacturing.
- Hershey applies The GHG Protocol Scope 2 Guidance for both the market-based and the location-based emissions by multiplying purchased electricity by the emissions factors indicated in the table in the notes section titled "Sources of emissions factors and global warming potentials."
- For some Hershey owned facilities, renewable energy attributes and zero-emissions attributes are purchased as contractual instruments. These attributes are registered and retired in an energy market's attribute tracking system. In certain instances, the retirement of these contractual instruments may occur subsequent to the date of this report. When this is the case, the contractual instrument has a set date for retirement or is contractually obligated to be retired. The company adjusts its Scope 2 MBM emissions as recommended by the GHG Protocol Scope 2 Guidance by treating the underlying power associated with the attributes as null power in the calculation of Scope 2 MBM emissions.
4
Schedules of
Select Diversity Equity and Inclusion Metrics
as of December 31, 2023
Metrics18,19 | Reported value | Units | Criteria | ||||
Gender and POC20 | Female | Male | POC (U.S. | % | 2016 GRI Standard 405-1 Diversity of governance | ||
by level: Executive | (Global) | (Global) | only) | bodies and employees: | |||
team only | a. | Percentage of individuals within the | |||||
18.2% | 81.8% | 36.4% | organization's governance bodies in each | ||||
of the following diversity categories: | |||||||
i. | Gender; | ||||||
Age group: Executive | < 30 | 30 - 50 | > 50 | ii. | Age group: under 30 years old, | ||
team | 30-50 years old, over 50 years | ||||||
old; | |||||||
0.0% | 36.4% | 63.6% | iii. | Other indicators of diversity | |||
where relevant (such as minority | |||||||
or vulnerable groups). | |||||||
Gender and POC by | Female | Male | POC | % | b. | Percentage of employees per employee | |
level | category in each of the following diversity | ||||||
categories: | |||||||
i. | Gender; | ||||||
ii. | Age group: under 30 years old, 30-50 | ||||||
Non-Management | 49.6% | 50.4% | 30.7% | ||||
years old, over 50 years old; | |||||||
iii. | Other indicators of diversity where | ||||||
Management | 39.4% | 60.6% | 17.7% | ||||
relevant (such as minority or | |||||||
vulnerable groups). | |||||||
Senior Management | 34.4% | 65.6% | 19.4% | ||||
Age group by level | < 30 | 30 - 50 | > 50 | ||||
Non-Management | 27.6% | 43.9% | 28.4% | ||||
Management | 7.4% | 66.2% | 26.4% | ||||
Senior Management | 0.0% | 57.4% | 42.6% | ||||
- Employees include both full-time and part-time employees.
- Employee gender and ethnicity are based upon employee self-identification data as of December 31, 2023.
- Other indicators of diversity are defined as Person Of Color. POC includes US employees identified as Black, African American, Hispanic/Latino, Asian/Asian Pacific Islander, Hawaiian Pacific Islander and those who identify as two of more races.
5
Note on Non-financial Reporting:
Non-financial information is subject to measurement uncertainties resulting from limitations inherent in the nature and the methods used for determining such data. The selection of different but acceptable measurement techniques can result in materially different measurements. The precision of different measurements techniques may also vary. Certain subject matter is disclosed based on criteria definitions established by the Global Reporting Initiative (GRI) and is not meant to be interpreted as being in accordance with or with reference to GRI reporting requirements.
Note on Sources of emissions factors and global warming potentials:
Indicator name | Emissions factors | Global warming | |
potentials | |||
GHG emissions - | 2023 UK Department for Environment, Food and Rural Affairs (DEFRA) | 2014 IPCC Fourth | |
Scope 1 | Assessment Report | ||
GHG emissions - | 2022 | Edison Electric Institute (EEI) Electric Company Carbon Emissions | |
Scope 2 (market- | and Electricity Mix Reporting Database for Corporate Customers | ||
based) | 2022 | Constellation New Energy supplier-specific emission factors | |
Mexico Emission Factor of the National Electrical System 2022 | |||
Hydro-Quebec CO2 Emissions 2022 | |||
Malaysia Sustainable Energy Development Authority 2016 | |||
2023 | CO2 Baseline Database for the Indian Power Sector | ||
Other supplier specific emission factors | |||
If above not available, the following: | |||
2022 | Data Year RE-DISS Residual Mix Emissions Rates for Europe | ||
2022 | Green-e Energy Residual Mix Emissions Rates21 | ||
2023 | International Energy Agency (IEA) Data Services | ||
GHG emissions - | 2022 | The Emissions & Generation Resource Integrated Database (eGRID) | |
Scope 2 (location- | 2023 factors, International Energy Agency (IEA) Data Services | ||
based) | |||
Note on Sources of conversion factors:
Indicator name | Conversion factors |
GHG emissions | Greenhouse gas reporting: Conversion factors as of September 20, 2022 |
- Scope 1 | |
Total energy | U.S. Energy Information Administration (EIA) Unit Energy Conversion Calculator |
Consumption | U.S. Environmental Protection Agency (EPA) Natural Gas Conversions |
British Oil and Gas Company (BP) - Statistical Review of World Energy - Approximate Conversion Factors |
21 The emission factors applied to electricity consumption in the U.S. is the Green-e residual mix emission factor, which is an adjusted grid-average emission factor that accounts for all unique Green-e Energy certified sales. A complete adjusted emission factor (i.e., residual mix that accounts for all voluntary renewable energy claimed) is not available for the U.S. at this time.
6
Attachments
- Original Link
- Original Document
- Permalink
Disclaimer
The Hershey Company published this content on 10 June 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 10 June 2024 16:51:07 UTC.