Nestlé and Mars have entered into agreements with New Zealand-based dairy cooperative Fonterra to support initiatives aimed at reducing emissions in the dairy industry. Through these collaborations, the companies plan to provide financial incentives and technological support to dairy farmers, with the goal of lowering greenhouse gas emissions from their supply chains. As dairy production remains a significant contributor to their carbon footprints, both companies seek to align their business strategies with long-term sustainability objectives.
Similar sustainability efforts have been observed in recent years, with several food companies implementing initiatives to reduce their environmental impact. Nestlé has previously introduced projects focusing on regenerative agriculture, while Mars has committed to sourcing more sustainable dairy ingredients. The latest agreements build upon these prior commitments, reinforcing a broader industry trend in which major corporations actively seek to curb their carbon emissions through targeted collaborations with supply chain partners.
What Does the Agreement Include?
Under the agreements, financial support will be allocated to farmers implementing measures to reduce emissions. The funding will be divided into two key areas: providing new tools and technology for improving emissions efficiency and offering incentive payments to farmers who achieve lower emissions levels. These efforts are expected to contribute to Fonterra’s long-term sustainability goals and reduce the environmental impact of dairy production.
Nestlé New Zealand CEO, Jennifer Chappell, stated:
“As we strive towards achieving net zero emissions by 2050, we are committed to reducing our Scope 3 emissions. We will continue to support farmers, in partnership with Fonterra, fostering new economic opportunities and helping them lower their greenhouse gas emissions.”
How Much Will Mars Invest?
Mars announced that it will invest $27 million over five years as part of its Moo’ving Dairy Forward initiative. This investment is expected to cut its Scope 3 emissions from dairy production by more than 150,000 metric tons by 2030. The initiative focuses on supporting farmers in adopting sustainable practices while ensuring long-term economic viability.
Amanda Davies, Chief R&D, Procurement and Sustainability Officer at Mars Snacking, stated:
“Through this initiative, we’re investing roughly $27 million in Fonterra farming families over the next five years to deliver critical financial support and significant emissions reductions. It’s a true win-win, because we know making dairy more sustainable takes real effort and real investment.”
Fonterra has been working towards emission reduction goals through its Climate Roadmap, introduced in 2023. The cooperative aims to cut on-farm emissions intensity by 30% by 2030, using a 2018 baseline. Additionally, Fonterra has set a broader objective of reaching net zero emissions by 2050. The partnerships with Nestlé and Mars add financial backing to these efforts, reinforcing their commitment to sustainability.
Fonterra CEO Miles Hurrell emphasized:
“We’re growing relationships with customers who value the hard work farmers put into producing sustainable, high-quality milk, along with the Co-op’s quality of on-farm data and ongoing commitment to improvement. This helps us make progress towards achieving our on-farm emissions target and deliver the highest returns for our farmer shareholders’ milk.”
The agreements reflect a broader industry trend where multinational food companies take active roles in addressing supply chain emissions. As regulatory pressures and consumer expectations grow, corporations are increasingly investing in sustainability initiatives. The collaboration between Nestlé, Mars, and Fonterra highlights the role of financial incentives in encouraging lower-emission farming practices. Going forward, the effectiveness of such initiatives will depend on their implementation and ability to bring measurable reductions in carbon emissions.
