Nature's Path Sustainability Report 2010

LEAVING THE EARTH BETTER N AT U R E ’ S PAT H S U S TA I N A B I L I T Y R E P O R T

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An introductory letter from the Stephens family Dear Reader, Nature’s Path was founded in 1985 with the mission of leaving the soil better than we found it. At the time we were the first company in North America to manufacture certified organic cereal. Twenty-five years later, we are proud to still be family owned and operated, and we’re as committed as ever to making great tasting certified organic foods. Over the years we’ve evolved our mission to leaving the Earth better than we found it. Our Earth is not only fertile soil, but the vibrant communities and neighborhoods where the families that purchase our products live, the wild places of this world that are vital to the health of the planet, and the minds and hearts of our team members that make it all possible.

In the past two years we took some incredible steps toward sustainability

including significant progress towards our waste diversion goals, packaging reductions and community engagement. We are happy to announce the opening of our new facility in Sussex, Wisconsin, which has

allowed us to expand our efforts, support new communities, and engage new team members in our vision. With the start up of our Sussex plant we saw some decreases in resource efficiency. For us, this is yet another opportunity to improve.

Through this report we would like to take you on a journey along the Path our products take from farm to table and beyond. We hope you enjoy the read.

Step 1.

Feed the soil Step 2.

Cultivate the team Step 3.

Produce thoughtfully Step 4.

Care for our customers Step 5.

Give Back

Arran Stephens & Family

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Our journey at a glance Step 1. It starts with the Soil

2009

2010

Organic Acreage supported

31,444 acres

40,910 acres1

Lbs of pesticides prevented

171,290 lbs

222,855 lbs

Lbs of synthetic fertilizer saved from use

12,846,736 lbs

16,714,157 lbs

Step 2. Our Team

2009

2010

Percentage of full-time team members with access to benefits and 401K

100%

100%

Percentage of Nature’s Path full-time team members earning a living wage2

100%

100%

Creating a safe workplace: Reduce accident rate (injury severity rating)3

5.35

2.26

Team member volunteer hours

N/A

172

Maintaining team member gender diversity

(Industry avg. is 36%)4

41% female diversity

Step 3. Making more with less

2009

2010

Energy (per unit of product)

1,964 BTU / Lb

2,003 BTU / Lb

Electricity (per lb of product produced)

0.20 Kwh / lb

0.23 Kwh / lb

Natural Gas (per lb of product produced)

0.0013 Therm / lb

0.0013 Therm / lb

Direct Emissions (per unit of product produced)

.15 Lbs CO2/lb

.15 Lbs CO2/lb

Water –(gallons per pound produced)

0.07 Gal /lb

0.12 Gal / Lb

Divert waste (by weight and by percentage)

2008*

2010

Diverted

73%

88%

Disposed

27%

12%

Waste and byproducts per pound of product produced

N/A

0.102 lbs / lb

Waste and byproducts per pound of product produced

N/A

0.102 lbs / lb

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Step 4. Products, Packaging & Transportation

2009

2010

Loads

1875

2007

Average Miles

1,918

1,831

Average Weight

11,736

14,076

Ratio of Lbs CO2 vs. Weight

0.256

0.215

Cartons (paperboard), lbs/ lb produced

0.16

0.15

Films, lbs/ lb produced

0.02

0.02

Corrugated Board lbs /lb produced5

0.07

0.08

Total Efficiency

0.24

0.26

Reduce Packaging - total lbs saved

N/A

389,882 lbs

Packaging materials (lbs per lb produced):

Step 5. Give Back

2009

2010

Food donated

81,140 lbs

314,094 lbs

Value of food and money given to charities

$975,000

$2,604,692

With money

$440,252

$655,840

With food

$407,096

$1,570,470

$127,652

$210,549

With marketing support

1 Organic acreage calculation does not included acres needed for the production of rice syrup, soy oil, peanuts, cocoa, raisins, maple syrup, honey, grape juice and fruits. It does include acreage from summer fallow. 2 A living wage is a total hourly compensation that fully covers the costs of living of one person and one child in the region where they work. It includes hourly wage and employee benefits. 3 The number of worker-days lost as a result of disabling injuries per thousand worker-hours of exposure. 4 Non-Durable Good, Food Manufacturing female diversity rate as stated by the US Bureau of Labor statistics for 2010 is 35.8% 5 Rounding errors accounts for .01 discrepancies between actual total lbs figure reported and total pounds achieved from adding the sums.

www.naturespath.com/sustainability

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STEP ONE

FEED THE SOIL. // A LW AYS O R G A N I C // I N D U S T RY L E A D E R S H I P

step one : feed the soil

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Organic agriculture is the foundation upon which our business is built. It’s a system that models itself on the way nature creates balance and fertility.

Healthy, humus-rich soil teems with billions of micro-organisms making it more fertile–resulting in robust, healthy plants. Excessive weeds are controlled with non-toxic methods like tillage, rotation of crops and hand weeding. Organic production focuses on building the natural strength and vigor of plants. This is brought forward into our products, and into the homes and kitchens of our customers.

We are proud of the growth of the organic movement, but are also very aware of the challenges faced by our industry. The increasing threats of climate change, global instability and diminishing resources have an undeniable impact on food production. At the same time, consumers are challenged with conflicting information from “natural” product claims, lack of access to information about their food, and genetically modified ingredients (GMOs) that continue to encroach into our food system. It is because of these many challenges we believe the world needs organic food. More than ever, it’s good for us and good for the earth!

Nature’s Path Marketing Team member, Kyla Hochfilzer at work in the Richmond staff garden

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step one : feed the soil

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Nature’s Path is always organic What does organic mean? It means that no synthetic pesticides, fertilizers, antibiotics or hormones are used in making and growing the food. It means that genetically modified organisms (GMOs) and irradiation is not part of the recipe. It means that when we say we are always organic, you can be secure that our claim is backed by a third party certified seal, with annual audits and on-site inspections. Buying organic is part of building a healthier soil, a healthier Earth, and a healthier you.

Where We’ve Been: • Nature’s Path has been organic since our founding in 1985 and third party certified since 1990. In 2009, we were proud to support the founding of the first National Canada Organic/Biologique Canada certification, and were the first manufacturer to use the logo in Canada. This is a big step forward for the organic sector in North America and we are happy we could do our part.

• Founder Arran Stephens served on the board of the Organic Trade Association during the critical period when the USDA Organic Foods Production Act was first developed in 1990 • Everything we make is certified organic, which guarantees that a minimum of 95% of our ingredients are certified organic.

• In 2010, our use of organic products supported more than 40,00 acres being used for organic production. This prevented the use of 222,000 lbs of pesticides, and prevented over 16.5 million lbs of synthetic fertilizers from going into the soil and our Earth.

for stricter restrictions on contamination of organic by GMO products. Thanks to our effort, our consumers have made us the #1 non-GMO verified brand in North America!

• Our sustainable purchasing policy gives preference to company clothing that’s certified organic cotton, and/or hemp and with ethical sourcing concerns in mind.

W h e r e W e ’r e G o i ng : • Increase the percentage of our company meals, promotional items, and other marketing materials that will be certified organic and/or fair trade. We have instituted a sustainable purchasing policy to help achieve this goal.

• Expand presence in the non-GMO movement within our industry and with consumers. Invest in expanding our stake in organic farming with a purchase of more farmland to further support and work cooperatively with the next generation of organic farmers.

• We strive to source ingredients as locally as possible and work hard to find creative solutions to farmers’ supply chain challenges (like our farm partnership and supporting transitioning farmers That said, we still source some ingredients internationally, the biggest single ingredient being evaporated cane juice.

–– North American Sourced: 78% –– Internationally Sourced: 22% • In 2010, our products became Non-GMO Project Verified and we continue to advocate

www.naturespath.com/sustainability

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Founders, Arran & Ratana Stephens conducting interviews with media at the Nature’s Path Richmond BC office

step one : feed the soil

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industry Leadership Nature’s Path believes strongly that we must all work together as an industry in order to achieve success in growing the organic movement.

As such, we are actively involved in the industry associations and working groups in the U.S. and Canada.

Below are some of the industry boards that we are actively working with and some of the research institution we support. Research into the benefits of organic agriculture, both for our health and the health of the planet, and vital for understanding how our industry can do better.

O r G A N i C i N D US T rY • Our Organic Program Manager serves on the following boards: – Organic Trade Association (OTA) Director 2006 -2009, outgoing as Vice President for Canada – Canadian OTA Organic Advisory Council (member) – OTA Task Force, nanotechnology and Organic – OTA Task Force, GMO – Non GMO Project Director 2009 – present (Secretary) – Organic Agriculture Centre of Canada Director 2005 – 2011, outgoing as Chair – Organic Advisory Council of the Canadian Health Food Association (member) – Organic Value Chain Round Table (OVCRT, Government/Industry Round Table member) – Voting member of the Canadian General Standards Board (CGSB) Organic Technical Committee – Chair of the CGSB Permitted Substances List revisions working group • Our Director of Marketing and Communications serves on the Non GMO Project Communication Committee

FO O D S YS T e M A N D SU S TA i N A B i L i T Y • Food Trade Sustainability Leadership Association • Board member City of Vancouver Food Policy • Council Member Whole Grains Council OrGANiC reSeArCh iNSTiTUTeS SU PP O r T e D • Rodale Institute • The Organic Centre • The Centre for Food Safety • Organic Agriculture Centre of Canada i N A D D i T i O N: • Founder Arran Stephens serves on the following non-profit boards: – The Rodale Institute – The Richmond Food Security Society

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STEP TWO

CULTIVATE OUR TEAM. // B E N E F I T S // F E E D B A C K P R O G R A M S , T R A I N I N G & E D U C AT I O N A L A S S I S TA N C E P R O G R A M S

Ray and Holly Peterson, Nature’s Path organic farmers in Thompkins Saskatchewan.

The Peterson family grow organic Kamut®, soft white wheat, peas and lentils.

step two: cultivate our team

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To be sustainably and socially conscious are two of the core values we aspire to. For us, embracing sustainability means incorporating the concept and practice into everything we do as a company. Working towards sustainability isn’t the job of one person alone; it is an effort that requires everyone to play their part. A large focus of our work in 2010 was engaging team members in the effort. In some cases this meant strengthening what we were already doing well, such as sustainability and lean training programs. In others, it meant introducing new programs like our employee volunteer and health and wellness programs. There is still more work to do, and we continue to strive forward!

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(opposite) Nature’s Path Marketing Team member, Emily Forbes at work in the Ricmond staff garden. (Above) Nature’s Path volunteers at the Compassion Into Action Fundraiser for the Greater Vancouver and Richmond Food Banks.

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Benefits Nature’s Path’s benefits include paid vacation, and generous, above industry standard benefits. Nature’s Path has established Team Member Incentive Plans based on company profitability, which rewards employees for their overall success. They are also comprised of bonuses and benefits such as dental, vision care, medical, etc. Some non-traditional offerings include:

• We continue to encourage our team members to commute by bike, carpool, and public transportation with incentive programs like up to $500 for a bicycle from our Get Fit program and a $1000 employee grant toward the purchase of a hybrid. (Also, those who carpool and have hybrids get much nicer parking spaces.)

• We introduced the “Green My Ride” program in Richmond and Delta, subsidizing staff use of green commuting and supporting the community. For every green ride a team member takes, $.75 is provided to them, and $.75 is pooled to donate to a local needy cause. In fact, many staff choose to donate the full amount.

• In our Blaine plant we continue to provide financial assistance for enrollment in a smoking cessation programs.

• We have provided an organic garden for team members use in our Richmond and Blaine locations, and are planning one for Sussex this year.

• Paid time-off is available for team members who do volunteer work.

Employees are given a $1000 incentive towards the purchase of hybrid vehicles and special parking spaces are allocated for owners of both hybrid and biodiesel vehicles

step two: cultivate our team

Feedback Programs, Training and Educational Assistance Programs Through sustainability training workshops, team members are encouraged to deepen their understanding of what sustainability means at Nature’s Path and how their work affects the sustainability performance of the company. During the training, participants are challenged to identify projects aligned with our sustainability progress indicators and to be actively involved in development and implementation. All of this is linked to our Nature’s Path performance management process, where team members’ efforts in sustainability and social consciousness are pillars on which we are all equally measured.

Where We’ve Been: • We created the PATHS management system (Performance Drive, Always Improving, Team Focused, Honorable and Respectful and Sustainability and Socially Conscious).

PATHS runs throughout the organization and provides a framework for team members, ensuring consistency and clarity in everything we do.

• We launched the Team Member Volunteer Program with the Compassion into Action event, which raised money for the Vancouver Food Bank in 2010 (see the appendix for more details). Just over 172 hours of volunteer time was donated by staff.

• We developed the Self-Directed work team program in our Blaine location.

W h e r e W e ’r e G o i ng : • Achieve 100% employee training in sustainability in all locations.

• Expand the self-directed work teams program in Blaine, Washington incorporating Lean and Sustainability training into the team function.

• Launch Compassion Into Action volunteer events for Sussex and Blaine locations, and expanding the program in Richmond and Delta.

• Develop a comprehensive health and wellness program for all team members to assist them in achieving wellness goals for themselves and their families.

• We incorporated sustainability and volunteer stories into our company Newsletter “Along the Path” to better share our stories between team members.

• We opened a new facility in Sussex, Wisconsin and hired 60 new team members.

Award-Winning Efforts • Thanks to all of our efforts, in 2009 and 2011 we were named one of Canada’s Top 50 Greenest Employers by Mediacorp Canada Inc. • BC’s Top Employers 2011

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STEP THREE

PRODUCE THOUGHTFULLY. // E N E R GY & C L I M AT E C H A N G E // W AT E R // W A S T E

step three: produce thoughtfully

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The fact that we, as a manufacturer, consume resources is a given. To make a box of organic cereal we first start with a healthy mix of organic whole grains, bring avorful organic fruits, nuts, seeds, and sweeteners like organic honey, fruit juice and cane syrup to the mix, and add a dash of organic spices and healthy fiber and protein. The next step is manufacturing using energy, water and fuel to create something new. We take this brand new whole grain organic cereal, package it, send it to a store, and it ultimately arrives in a kitchen or a pantry for you to enjoy.

Imbedded in all of these steps are energy and resources, and this has an impact on our world. Our goal here at Nature’s Path is to be a leader in reducing our impact and doing more with less.

O U r C h A LLe N G e S

In both our Blaine and Delta plants, energy, water and gas efficiency projects have resulted in a reduction in energy and resource use. We are implementing these same innovations to our new facility in Sussex, Wisconsin. Overall efficiency reductions in our existing facilities were in some cases overshadowed by the inputs needed to get our new facility up and running. As a result, we saw a slight increase in use of kWh per pound, while maintaining a steady total CO2 production per pound since 2009.

Reducing the resources used by our Sussex plant is part of our plan, and is an opportunity for us to achieve even greater reductions in 2011.

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energy and Climate Change We currently purchase electricity from our utilities providers and buy Renewable Energy Certificates (RECS) that support green energy projects in the states and province that we operate in. These certificates mean that the electricity we purchase was generated at a renewable energy facility (wind, solar or biomass). Our goal is to be certified climate neutral by 2020, and investing in green power helps bring us closer to that goal. However, it’s equally important to first look at how efficiently we use what we buy. In 2010, we invested in energy saving projects in our Blaine plant, with the intention of expanding successful projects across the company.

Where We’ve BeeN:

W h e r e W e ’r e G O i N G :

• We completed a major lighting retrofit project in our Blaine facility. Our estimated savings from this project are 422,398 kWh per year. This is enough energy to power 38 average U.S. homes for a year.

• Bring energy reduction practices to our new facility in Sussex in 2011 and 2012.

• We developed a condensate capture and reuse system for our boiler. We lose a lot of pre-heated water through condensation.

We have installed a system that allows us to capture and re-use this water for our cleanup process. Annually, we estimate savings of 1,235 therms of natural gas per year.

• Expand the use of the infrared technology into our other ovens to reduce overall gas use.

• Invest in lighting upgrades across our facilities • Invest in energy metering in our facilities to track our resource use

• We installed near-infrared technology in one of our ovens which allows us to cook our cereals at the most optimum temperature.

Through this technology, and through optimizing our oven fan speeds, we have seen a 7MMbtu/hr savings in natural gas use.

• We have reduced our CO2 emissions from .23 lbs CO2/ lb product produced to .15 lbs CO2/ lb of product through energy saving project and the purchase of Renewable Energy Certificates.

(Above) We continue to monitor and adjust the gas-powered ovens in our various manufacturing facilities.

Awards in Sustainability BC Food Processors – Energy & Sustainability Award 2010 Washington Manufacturing Energy Efficiency Award, 2010 – Runner Up

step three: produce thoughtfully

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Water Organic farming practices promote watershed protection and reduce water needed in growing crops. By purchasing and supporting organic farming we support positive practices. Inside our plants, our primary uses of water in our production are for making our products and cleaning.

Our water use increased in 2010 with all the work that was done bringing the Sussex plant online. Water saving activities in Blaine reduced our water use per pound of product in that location, but overall we have seen an increase in water use. This is an area where we are looking for big improvements in the future.

Where We’ve Been:

W h e r e W e ’r e G o i ng :

• Through our paper reduction activities in our granola bars, granola boxes and corrugate boxes, we saved over 1,023,254 gallons of waste water per year. This is enough water to grow over 250 bushels of corn, or grow and make over 2,500 cotton t-shirts.

• Improve our water use systems in our new Sussex location, and working to reduce our current water use in Delta and Blaine.

• In September 2010, we installed a condensate waste water system that allows us to capture and re-use condensate water from boilers for our clean-up process. We estimate that this system will save over 594,000 gallons of water per year.

• Install waste water meters in our three plant locations in the future, in order to incorporate waste water reuse and reductions into our waste plans. Once this is complete, we will be able to more accurately assess our water use.

M O RE O N PAG E 38

www.naturespath.com/sustainability

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Waste At Nature’s Path we’re working hard to reduce the amount of waste produced in packaging and making our products. Our goal was to become zero waste by 2010, meaning we aim to have nearly all our waste diverted away from landfills. How have we done? We increased our overall diversion rate from 73% to 91% in the existing plants reported on in 2008.

Bringing our new plant in Sussex online in 2009 had an impact on this rate, reducing our overall waste diversion rate in 2010 to 88%. As we bring our systems in waste management online in Sussex this year we expect to see significant improvements. Some of this increase in waste diversion has come from increasing what we measure. Our original waste audit in 2008 didn’t capture all the recycled waste that we provide to local farmers for animal feed. This recycling program accounts for a major portion of the waste generated and diverted.

In 2008, our diversion rate was 73% with a high of 83%. As of 2010 our diversion rate is 88% with a high of 93% — a 10% improvement! This is the result of both our extensive recycling programs and finding ways to stop waste at the source through improving our manufacturing processes.

We’re also re-using equipment when possible, and composting most of our office-created food scraps. We use the compost we create as a highgrade fertilizer for our staff gardens! Instead of throwing away used fixtures and sales materials, we use companies like DeBrand Inc. to resell fixtures to point of sale suppliers or recycle old signage into things we can use again!

Our number one priority is to reduce our waste, but for the waste we do produce we have established a goal of a 99% diversion rate by 2014 across our company.

step three: produce thoughtfully

Where We’ve BeeN:

W h e r e W e ’r e G O i N G :

• In order to accurately measure our progress towards a 99% diversion rate, we have hired a third party contractor to do a waste audit every two years. MJ Waste Solutions’ Waste Audit and Waste Reduction Report for all four facilities in March 2010 found big improvements over 2008.

• Develop a revitalized communications program to improve recycling participation and the waste diversion rate at all Nature’s Path facilities.

• Waste diverted from landfill due to conservation measures was 4,358,519 lbs, with a total diversion rate of 88%. To put this in context, that is the same as the average yearly garbage output of around 2,700 people.

• In both Blaine and Richmond, we have placed onsite composting of food scraps and organic waste. This compost is used to support the on-site organic staff gardens

• Divert 95% of our waste from landfill in 2012, and 99% by 2014.

• Implement on-going data tracking systems for our waste reduction programs, making it easier to spot short term challenges or technical problems before they grow.

• In our Richmond office, implement a “ZeroWaste” office program, invest in new desk side recycling containers, and improve our centralized waste collection areas.

• Engage with team members in how to achieve our waste reduction goals.

M O r e O N PAG e 38 Waste material is a reality of producing products. However, recent changes we’ve made to our packaging have saved 389,882 pounds of waste.

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STEP FOUR

CARE FOR OUR CUSTOMERS. // C O N S U M E R H E A LT H & N U T R I T I O N // PA C K AG I N G // D I S T R I B U T I O N — P R O D U C T S TO M A R K E T

step four: care for our customers

Consumer health and Nutrition This report is all about our path to sustainability as a company. The foundation of this is our commitment to organic. On top of helping keep our Earth healthy, organic products are good for our bodies as well! We are all about offering great taste and nutrition. We love to talk about how we make new products as efficiently and sustainably as possible, but we also want you to know that our products are the best when it comes to health, taste, and organic goodness.

In the spirit of continual improvement, we also strive to listen to our customers concerns whether it’s in regards to decreasing the salt or sugar content or offering more products in Eco-Pac bulk.

Our goals in 2011 are: • Incorporate whole-grain into more of our EnviroKidz cereal.

• Introducing more of our granolas and cereals in Eco-Pac bulk packages.

• Continue to use fair trade certified cocoa powder and eco-social certified sugar and palm products, and use more where possible.

Award-Winning Taste In 2009 and 2010, our products won 7 awards for low-calorie snacks and nutrition for families from magazines such as Shape, Fitness, Women’s Health, Women’s Running and Good Housekeeping.

OUr ThirD PArTY CerTiFiCATiONS iNCLUDe: Organic by QAI (Quality Assurance International, Certified USDA (United State Department of Agriculture) Organic , Non-GMO Project Verified, and Kosher Certified

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We’re always striving to make food that’s both delicious and good for you. here’s a breakdown of how our products rank nutrition-wise.

VEGAN 80 PrODUCTS Or 72%

Fiber amounts over 5g per serving are considered “High Fiber” While amounts less than 140mg per serving are considered “Low Sodium”.

step four: care for our customers

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Packaging Our commitment to our customers continues to influence our approach to packaging. Our consumers don’t need excess packaging in order to enjoy our products! All the cardboard and paperboard we purchase must be FSC certified, printed with soy based inks and be 100% recycled with a minimum of 60% post consumer content. The use of recycled cardboard reduces water use, energy use and prevents the cutting of virgin forests. All of our plastic is BPA-free, and we continue to strive towards innovation in the use of new materials in this area.

As we continue to grow as a company, our focus is to reduce the overall packaging used per pound of product. The response from consumers on our packaging efforts continues to inspire us to do more.

Award-Winning Packaging Natural Products Expo West – Green Pack Award 2010, Sustainable Packaging Two “Responsible Packaging Awards” in 2010, one for our Eco-Pacs & another for our reduced packaging, FSC-Certified, 100% recycled Granola Bar boxes Where We’ve BeeN: • Through box size reduction and changing the thickness of our packing, we have continued to see a reduction in paperboard used.

• In 2009, we re-launched our granola bars in a new box that uses 36% less paperboard.

We also launched a smaller granola box that used 10% less paperboard. In total, these reductions reduced our paperboard use by 256,000 lbs in 2010.

• We reformulated three of our corrugated cases to reduce packaging for shipping.

On those three outer cases, we reduced corrugate use by a total of 143,882 pounds.

• We adapted our Eco-Pacs to a new “block bottom” format that allows the bags the stand up on end and reduced plastic by 10% per bag.

• Since 2009, our ratio of pounds of paperboard used per pound of product has reduced from 0.16 to 0.15 lbs. As well, our ratio of plastic films used has stayed steady at .002 lbs per lb of product, even with expansion of the Eco-Pacs and new products being launched.

W h e r e W e ’r e G O i N G : • Focus on our cardboard usage and work to reduce our overall cardboard use in shipping and transporting of our products.

• Since the last report, we have signed an agreement with our plastics supplier to work together towards identifying and implementing the most responsible plastic packaging possible.

M O r e O N PAG e 39

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Distribution – products to market Our products are sold in 42 countries around the world. Almost as important as what is in our products is how those products make it to our customers. As such, our distribution partners are a key to our success in achieving our lean operations goals. We are proud to work with CH Robinson Worldwide Inc, whose stated sustainability position is as follows:

“CH Robinson works closely with our customers, their suppliers and our contract carriers to develop and manage strategies that support efficient operations and sustainable supply chain goals.”

We have been working with CH Robinson on our journey towards reducing carbon emissions and improving sustainability of our supply chain. They have helped us be more efficient by reducing transportation miles and optimizing the way we load the trucks. In conjunction with our packaging reduction initiatives, through our truck loading efficiency efforts we continue to fit more products per load, meaning fewer trucks on the road. Our biggest effort is our increase in “Intermodal” shipping (a.k.a. shipping by trains). Since 2009 we increased our number of intermodal loads by 64%. Over 25% of total trips and 56% of products by weight were distributed by rail in 2010.

All of this means that our consumers can be confident that the product they buy has the smallest possible footprint.

step four: care for our customers

Where We’ve BeeN:

W h e r e W e ’r e G O i N G :

• In 2010, 56% of our finished products were shipped by rail, 39% by truck or van, 5% by refrigerated transport and 3% by ship (measured by weight).

• Increase our intermodal transport by 10% in 2011.

• We increased the average weight of our shipments this year by 20%, but only increased our amount of shipments by 7%.

This is a big gain in efficiency.

• Through use of intermodal and shipping efficiencies, we successfully reduced our ratio of lbs CO2 vs. weight by 16% since 2009!

• We introduced a tree planting program with CH Robinson; for each full shipment that we make, one tree is planted by Tree Canada.

Not only does this help offset some of our carbon production, it also is a great way to give back to the Earth. In 2010, we planted over 1,793 trees.

• Regionally procure 100% of products that can be grown in North America, and as close to our manufacturing facilities as possible (currently 78%).

• Begin to track and account for our employee travel and business travel in our footprint for transportation, incorporating it into our sustainability targets in 2011.

M O r e O N PAG e 39 For each shipment with CH Robinson we plant another tree.

In 2010, that amounted to nearly 1,800 new trees!

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STEP FIVE

GIVE BACK.

Kids learn about organic farming at our Compassion Into Action Event

step five : give back

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Nature’s Path Foods is committed to giving back. It is a big part of who we are as a company, as families and as individuals. Since our founding in 1985, we have donated millions of dollars in organic products, a share of our profits, and part of our team members’ time to worthy causes around the world. Nature’s Path Foods is committed to donating $2 million in food, cash and in-kind support each year to those causes.

In addition to our charitable giving, we also support numerous worthy causes through marketing sponsorships, research grants and working cooperatively with sustainability and community leaders. That is one of the reasons we launched both Gardens for Good and Compassion Into Action programs in 2010. Both programs help further engage the communities where we live and work and support organic gardening and food banks.

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Nature’s Path spokesperson and environmentalist, Erin Schrode at the Nature’s Path sponsored youth empowerment event, We Day

step five : give back

Where We’ve BeeN:

W h e r e W e ’r e G O i N G :

• This year, in partnership with Organic Gardening Magazine, we launched the Gardens for Good program. We provided a donation of $10,000 in cash and $50,000 in-kind food to organic community gardens in three communities across North America.

Our consumers supported this in a big way, where the 267 garden applications received over 23,300 votes to help choose the winner.

• Continue to grow and expand our team member volunteer program, starting new programs in Wisconsin and Washington State.

• Nature’s Path provides the space inside our EnviroKidz™ Boxes to not-for-profit organizations we support in order to educate consumers about their organizations and work.

• We donate 1% of sales from all EnviroKidz™ branded products to non-for-profits that contribute to habitat restoration, species conservation and at-risk youth. Since its inception in 2000, the EnviroKidz™ Give Back Program has donated over $1.2 million.

• 2010 marked a year of increased need across the globe, with rising food prices, floods in Pakistan and devastating earthquakes in Haiti. Nature’s Path Foods matched donations that team member make to support relief effort like those in Haiti and Pakistan.

• We launched Compassion into Action in the fall of 2009, and this has now become an annual tradition for Nature’s Path. This event is a way for our team members to volunteer their time to help out local food banks. In two years, we have contributed over 200 hours of volunteer time and raised $300,000 in cash and food for the Vancouver and Richmond food banks. This is on top of our commitment to donate $1 million dollars a year to food banks across North America in food and cash.

In 2010, our total donation of cash to worthy causes around the world was $1 million dollars. In-kind donations of food to food banks and those in need totaled $1.5 million in retail value, and over 314,000 lbs.

• Partner with the Whole Planet Foundation on supporting poverty alleviation. In 2011, $1 from the sale of each box of our new Love Crunch cereal will be donated to supporting micro-finance in the developing world through the foundation. In total, $25,000 will be donated this year.

• In Canada, for every box of Love Crunch sold, one box of cereal or granola bars will be donated to Food Banks Canada.

33

34

APPENDIX

appendix

35

Putting Compassion into Action We launched Compassion Into Action in October 2009. The idea was to allow our team members to give back to the communities that support us. We worked with breakfast food partners Olympic Dairy, SoNice, Happy Plant and Ethical Bean coffee to provide a free organic breakfast to local residents who came down and donated a non-perishable food item to the food bank. On top of that, we worked with Nature’s Path suppliers to run food drives and provide donations of product to the Vancouver food bank.

In the end, we raised over $324,000 in cash and food for the food bank. Our team members set up breakfast and served over 1,200 people an organic start to the day. We look forward to building on this program next year, and expanding it to the other communities surrounding our operations.

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appendix

37

EnviroKidz™ Recipients Nature’s Path sets aside 1% of the sales from EnviroKidz branded products to give back annually to non-profit organizations that support kids and the environment. We also provide groups with the opportunity to have their cause and conservation efforts featured on the back and inside of our boxes. This provides these groups with exposure to millions of consumer impressions every year. To date, Envirokidz has raised more than $1.4 million for endangered species, and as sales increase each year so does our contribution.

The EnviroKidz donation’s mission is two pronged: first, the empowerment of the children of today to learn and be able to change their present and future world. Second, protect endangered species and environments.

Awareness, education and action are what our EnviroKidz partners are committed to doing, and they are making impacts around the world with their efforts. We are proud to support all of our EnviroKidz partners, and some of the projects we funded in 2009 and 2010 include: • The Amazon Conservation Team (www.amazonteam.org) Created several student workbooks for school ages children in the US to teach about the Amazon and the people who live there • The Dian Fossey Gorilla Fund (www.gorillafund.org) Supported the foundation’s work in Africa protecting endangered gorilla populations • The Australian Koala Foundation (www.savethekoala.com) Funded the Adopt-a-Koala foundation, helping to secure much needed land and untouched eucalyptus forests for koalas in Australia • The Lemur Conservation Foundation (www.lemurreserve.org) Supported the construction of a school in Madagascar to educate local youth and promote environmental awareness.

• Defenders of Wildlife (www.defenders.org ) Supported the efforts of the Wildlife Volunteer Corps Project to get youth into the field supporting conservation.

www.naturespath.com/sustainability

38

Pounds of CO2 per Pound of Product

0.23

0.15

0.15

2008

2009

2010

2010 Waste Diversion ratios & Breakdown of Diverted Waste

PAPer PLASTiC DiSPOSeD

12%

1%

reCYCLeD

88%

2%

CArDBOArD

17%

hOG FeeD

80%

BreAKDOWN OF DiverTeD WASTe

Metric Tonnes of Diverted Waste 2008

2010

207

5,807,254

Recycled

566

0.102

Total Waste Generated

774

86%

Waste Diversion Rate

73%

88%

Disposed

appendix

Percentage Pounds of CO2 Per Mode of Transport vAN vAN

51 29%% LTL vAN

13% LTL reeFer 2% ShiP 1%

reeFer

4%

iNTerMODAL

29%

Loads

Total Miles

Avg. Miles

Total Wt

Avg. Wt

Total lbs CO2

Ratio CO2/Wt

2008

1,875

3,595,111

1,918

21,992,410

11,736

5,638,817

0.256

2010

2,007

3,675,422

1,831

28,250,886

14,076

6,086,393

0.215

% DIFF

7%

2%

-5%

28%

20%

8%

-16%

*The above table only includes data collected on North American shipments

Pounds of Packaging Per Pound of Product

0.16

0.15

2008 2009 0.07 0.02

CArTONS

0.08

0.02 FiLMS

COrrOGATeD CArDBOArD

www.naturespath.com/sustainability

39

NATURE’S PATH FOODS 9100 VAN HORNE WAY, RICHMOND BC CANADA, V6X 1W3 WITH ADDITIONAL FACILITIES IN DELTA, BC, BLAINE, WA, & SUSSEX, WI

NATURESPATH.COM

Committed to a Triple Bottom Line:

Sustainability, Social responsibility, + Financial viability.