Vinamilk dedicated to long-term roadmap in aid of net-zero goals

November 29, 2023 | 10:14
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There are long-term financial and operational commitments required to respond to the government’s net-zero goal. Le Thanh Liem, CFO of Vinamilk, shared with VIR’s Thai An the challenges that his business faces in the journey towards green and sustainable development.

What has been the highlight in Vinamilk’s journey towards net-zero in 2023?

Vinamilk dedicated to long-term roadmap in aid of net-zero goals
Le Thanh Liem, CFO of Vinamilk

It has been a difficult time for all businesses, and Vinamilk is no exception. Although this year’s operating results are not as expected, we have not cut or halted activities related to environmental, social, and governance (ESG) and net-zero.

The most special point in 2023 is that for the first time, Vinamilk had one factory and one farm awarded carbon-neutral certification in May 2023. This is also the first factory and farm to meet such standards in Vietnam.

Vinamilk also continues its tree planting projects to aim for carbon neutrality. The most recent project is to regenerate 25 hectares of mangrove forest in Ca Mau National Park. Over 100,000 seedlings will grow in this area, and we will continue to maintain it in the following years.

Another activity that has lasted for many years and has become a consistent direction of Vinamilk is the Stand Tall Vietnam Milk Fund programme. Over 42 million milk boxes worth approximately $38 million have been sponsored and shared by the company with Vietnamese children over the past 16 years.

Some say investing in green development and ESG is costly and ineffective. How much does Vinamilk care about such activities?

The journey towards ESG and sustainable development is like a marathon and businesses, depending on their capabilities, need to build a specific and long-term action plan.

Over the next 3-5 years, we plan to build our own strategy on investing in wastewater treatment systems, ensuring gas emissions into the environment, and focusing on green and sustainable development through afforestation and tree planting projects.

To aim at reducing emissions, Vinamilk also conducts annual greenhouse gas declarations to adjust investment levels. Although we do not have specific numbers yet, we are starting with the smallest actions such as using recyclable packaging, using green materials, and preparing a long-term roadmap to build sustainable resources and allocate funds appropriately for investment.

Certainly, the initial investment costs for these activities will be high, but if not done immediately, 5-7 years later, Vinamilk’s operational efficiency and long-term orientation will be affected.

Vinamilk has just experienced a relatively favourable third quarter. What factors confirm the business has overcome its most challenging period?

In that period, Vinamilk’s production and business activities had many positive changes. In particular, the brand restructuring has helped Vinamilk’s image become new, youthful, and more attractive to consumers.

Vinamilk’s third quarter business results were supported by export activities, with export results growing by 5 per cent over the same period. For the domestic market, developments in the macroeconomy and policies to reduce interest rates and taxes from management agencies have helped businesses’ operations gradually stabilise and consumers’ incomes increase, the purchasing power of the domestic market is also gradually improving.

Vinamilk is confident that the business situation will gradually improve in the fourth quarter, but it is necessary to wait for macroeconomic developments and the influence of the political situation in the world.

What is your opinion on Vinamilk’s business prospects in 2024?

The 2024 plan built by Vinamilk is still based on the 2022-2026 plan, which continues to develop product lines according to the approved strategic direction. At the same time, Vinamilk will continue to restructure product lines, bringing them under the main brand of Vinamilk for better consumer recognition.

With the macroeconomic situation like the last months of 2023, I hope that some government policies such as reducing interest rates and continuing to reduce VAT by 2 per cent will continue to be applied as a solution to boost purchasing power and the recovery of the economy.

Vinamilk will continue to develop and create a sustainable development foundation, focusing on key pillars including developing and maintaining existing market share, and developing new products to the market to meet consumer needs.

In addition, the company also continues to invest in developing segments serving the supply of input materials such as dairy farms, aiming for sustainable and environmentally friendly green farms. We continue to set challenging goals so that all Vinamilk employees strive to complete them.

Vinamilk invests in sustainable development solutions Vinamilk invests in sustainable development solutions

Investing money in implementing sustainable solutions is the long-term direction, responsibility and benefit of many businesses, including Vinamilk.

By Thai An

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