Yum! Brands today released its 2013 Corporate Social Responsibility report, outlining the company's efforts in four areas — food, people, community and environment.
To complement the report, Yum! has declared April as "CSR Month" and will be sharing videos, infographics and facts about its initiatives.
A highlight of this year's report is the company's supply chain section, particularly in light of last year's supply chain crisis that affected its KFC China brand.
In December of 2012, KFC China was accused of having excessive levels of antiobiotics in its poultry supply (a practice that expedites chicken's growth cycle). To underscore the effect of this news, January's same-store sales declined 41 percent at KFC in January.
Yum!'s China division operates its own independent chain supply system, with more than 500 suppliers listed, the report said.
The company also conducts supplier assessments through its STAR (Supplier Tracking and Recognition) system, an audit system that monitors standards for all suppliers. In 2012, the report adds, Yum! began integrating the Global Food Safety Initiative into its STAR system, to ensure that suppliers are certified, adding another layer of quality assurance.
The 2013 China supply chain crisis is not referenced directly in the CSR, however the company did outline its emerging issues program and crisis management program.
It also stated: "We have become more aware of, and attentive to, our social and environmental impacts. We have been responsive to issues as they arise, yet we cannot always control or avoid them at every stage of the supply chain. We fostered a trusting partnership and we are asked to provide input when challenges arise."
Other than indirectly addressing supply chain issues, the company also highlighted a number of milestones in 2013 relating to its food offerings. Among them:
Menu initiatives in 2013
- In 2013, KFC introduced the Li'l Bucket Kids Meal, with a variety of options under 300 calories. Although Kids Meals represent less than 2 percent of the KFC U.S. business, the company said it continues to look for ways to "offer more choice, more transparency and more nutritional improvement to our youngest customers."
- In 2013, KFC Germany launched its third non-fried product – the Grilled Gourmet Chicken Burger.
- KFC France launched a new oven-cooked sandwich called the Brazer Parmesan.
- KFC Thailand launched Foilicious, which is chicken on the bone oven-cooked in foil.
- Pizza Hut Australia, Europe and Canada all launched new "balanced" offerings. In Australia, a new "Light & Delicious" line was added, including a gluten-free base.
- In Thailand, KFC established in-store nutritional information via counter materials, brochures and a QR code.
- In China, KFC donated 1.5 million Yen to support the Health and Nutrition Fund.
Looking ahead to 2014:
- Pizza Hut plans to remove another 1.5 million pounds of salt from its core ingredients, in addition to the 500,000 pounds of salt it removed from the menu in 2012.
- KFC UK plans to reduce salt in the Original Recipe chicken without impacting taste, by "exploring an innovative technology that uses salt crystal." The goal is a 15-percent reduction by the end of 2014.
- Yum! has a goal to phase out palm oil "wherever feasible" within the next four years. Currently, about 70 percent of the system is palm oil-free.
- For its animal welfare efforts, Yum! says its partnership with its suppliers has resulted in "a balanced approach to benefiting animals, suppliers and our consumers who appreciate knowing that their food is coming from an ethical source."
- In the "near future," Yum! will adopt a single poultry welfare audit throughout the system, and will constitute audits and policies for beef and pork.
- In reference to the hot-button topic of Genetically Modified Foods, Yum! said the "perceptions vary from market to market and we strictly follow all government regulations wherever we operate." In North America, for example, GMOs are "generally accepted." In Europe, consumers are more resistant to GMOs and in these markets, Yum! requires its suppliers to provide non-GMO ingredients.
The report also provides updates on the company's culture, environmental/sustainability efforts and philanthropic cause – World Hunger Relief — which has raised nearly $185M for those in need around the world.
"We are proud to share the accomplishments of our brands as they support the commitments we've made to be socially responsible and work to become the defining global company that feeds the world," Jonathan Blum, SVP, chief public affairs and global nutrition officer, said in a news release.
Alicia has been a professional journalist for 15 years. Her work with FastCasual.com, QSRweb.com and PizzaMarketplace.com has been featured in publications around the world, including NPR, Good Morning America, Voice of Russia radio, Consumerist.com and Franchise Asia magazine.