LIC 2023 Sustainability Report
There's always room for improvement
Livestock Improvement Corporation Limited (LIC)
Sustainability Report
For the year ended 31 May 2022
The DNA of a
more profitable and
sustainable dairy
herd for New Zealand
farmers
Livestock Improvement
Corporation Limited (LIC)
Sustainability Report
For the year ended 31 May 2023
This report presents information about LIC’s environmental, social and economic performance
for the year ended 31 May 2023 and has been reviewed by LIC’s Board of Directors. LIC has
reported in accordance with the GRI Standards for the period 1 June 2022 to 31 May 2023.
This is our third sustainability report outlining the
progress we have made over the past year as we
continue on our sustainability journey.
We are a member of the Climate Leaders Coalition
and the Sustainable Business Council (SBC).
This report is intended to meet our commitment to
report on LIC’s environmental, social and economic
performance, but it’s also an opportunity to
demonstrate how we are responding to sustainability
challenges facing our farmers and the New Zealand
dairy sector.
At LIC we are passionate about New Zealand’s
primary sector and believe we can be world-leading in
our management of impacts on the environment and
create real value for our farmers as a result.
This report outlines how we are helping farmers
understand and improve their emissions. It
demonstrates that with a sharper focus on herd
improvement NZ farmers can produce high quality
milk products from sustainable, high performing cows.
We have received certification from Toitū’s
carbonreduce programme following the audit
of our FY19 to FY23 GHG inventory report. Our
external auditors KPMG have also performed
procedures to ensure that financial data included
in this Sustainability Report is consistent with LIC’s
Annual Report.
We are committed to open and transparent reporting
on sustainability and will continue to further develop
our reporting framework over time.
About this report
LIC Sustainability Report.
Contents
Who we are 4
Why sustainability matters to LIC 5
Key highlights 6
Letter from the Chair & Chief Executive 7
Our strategy 9
Environmental sustainability 14
Reducing the environmental footprint of our national herd 17
Reducing the environmental footprint of our business 25
- Science-based emissions targets 25
- Our emissions 26
Social sustainability - caring for our people 32
Governance structure 33
Caring for our people 35
Employee data 39
Economic sustainability 41
Delivering a strong result for our farmers 42
Our business 46
How we work 48
How we create value 51
Engaging with our stakeholders 53
Materiality assessment 55
GRI content index 56
For the year ended 31 May 2023
3
Who we are
We exist to deliver superior genetics
and technological innovation to help
our shareholders sustainably farm
profitable animals.
LIC is a New Zealand dairy farmer-owned co-
operative and world leader in pasture-based dairy
genetics and herd management.
LIC is headquartered in the Waikato, with over 25 sites
across New Zealand, Australia, UK and Ireland. With
origins dating back to 1909, LIC has a long history
of delivering world-leading innovations for the dairy
sector. This is even more relevant to farmers today
given the rapid change the sector is undergoing and
the growing climate challenges we’re facing. Who we
are and what we do has never been more important
for Kiwi farmers, our sector and New Zealand.
As a farmer-owned co-operative, all of our profit
is returned to our farmer shareholders in dividends
or reinvested into new solutions and research and
development (R&D).
LIC shares are listed on the NZX. To be a shareholder
in LIC, you have to farm dairy cows in New Zealand,
supply a New Zealand milk processor and buy a
minimum amount of qualifying products and services
from LIC in any one year.
LIC Sustainability Report.
4
Why sustainability
matters to LIC
Kiwi farmers, our sector and the New Zealand Government are focused on a more sustainable
approach to farming, so we must continue to improve our environmental credentials.
Sustainability is not only important to us as a business,
but also because of the critical role we play in helping
dairy farmers meet their own sustainability goals.
Our strategy focuses on building a strong, sustainable
co-operative, leading the world in our field and
delivering outstanding value for our shareholders
and sector. As a co-op, we understand the
role we must play in driving positive change
through collective action on climate change
in New Zealand and supporting our farmer
shareholders on the journey. We are
committed to driving sustainability
improvements and reducing emissions
on-farm, with projects and initiatives in
both these areas well underway.
LIC’s biogenic methane emissions
will reduce over the long term,
however, we have increased
the number of trial animals
significantly in recent years
for critical research and
development initiatives and lower methane-emitting
bulls will be bred to include in our bull team over time.
We support our 9,000+ shareholder farmers through
genetics, genomics, milk testing and diagnostics to
produce the most sustainable and efficient animals,
and the highest value product.
For the year ended 31 May 2023
5
Key
Highlights
Environment
Supporting shareholders to
produce the most sustainable and
efficient animals and reducing
emissions at LIC
Organisational
Health Index (OHI)
Up five points from last
year - our highest ever
result and putting us in
the first quartile of all
companies surveyed by
McKinsey worldwide
Average increase
in genetic gain
(genomic Breeding Worth)
Per annum for long-term
user of LIC genetics
(2018 – 2022)
Change 2022/23 compared to 2018/19 (base year)
Up 0.4% from 388 kgMS
prior rolling
3 year average
1.3% decrease
on previous year
Total revenue
from continuing
operations
Up 5.1% from $263.2
million last year
(excl. Automation*)
MILLION
MILLION
Lost time injury
frequency rate
(Per 100 full time
equivalent employee)
Up from 1.81 last year
Full year
dividend
or 16.38 cents
per share
Full time
equivalent
employees
Plus close to 1,750
seasonal workers
R&D and
investment
in business
Investment & capital spend
$20.6m up 15% from last year
R&D investment
$18.6m up 2.2% from last year
Footnote - OHI is a McKinsey tool which measures the impact of our organisation practices and culture on performance against 768 other international organisations.
1
Source: New Zealand Dairy Statistics 2021-22
80
$
276
.5
$
39
.2
Reduction
in LIC’s CO
2
Emissions
Rolling 3 year
average milk
production
Cows in
national herd
If we’re
milking fewer
cows, we
need to milk
better ones.
12.7
%
Increase in LIC’s
biogenic methane
CO
2
Emissions
9.0
%
2.23
900
+
Caring for our staff and our farmer shareholders
Delivering value to our farmer shareholders by
investing in initiatives to help them breed the most
profitable and sustainable animal
Social
Economic
MILLION
$
23
.3
$
18gBW
389
kgMS
1
4.84
1
MILLION
6
LIC Sustainability Report.
Letter from the Chair & Chief Executive
Welcome to LIC’s third annual Sustainability Report. Over the last three years we have engaged
with our stakeholders to get the feedback needed to ensure that this report stands up against
our reporting commitments and the standards we have chosen to report under.
Our ongoing focus on sustainability is vital to
achieving our goal of becoming carbon neutral by
2050, and we’re pleased to report on the progress
we’ve made in the last year.
This report is an important way for us to be
transparent, hold ourselves accountable and measure
the progress we are making on our sustainability
journey as we deliver on our commitments to our
farmer shareholders.
Sustainability is at the heart of everything
we do for farmers today and in the future
The most significant impact we can make as a
business is through reducing the environmental
footprint of the national dairy herd.
While making meaningful contributions to New
Zealand’s emissions targets is a long-term game, now
is the time to help our farmer shareholders breed more
efficient and climate-friendly cows. We continue to
roll up our sleeves and sharpen our focus on providing
farmers with the tools they need to do just that.
While we are continuing to provide farmers with
precision genetics and technology tools today, we are
also keeping a watchful eye on what farmers need in
the future. To this end, we continue to invest heavily
in R&D to help farmers do what they do best, but for a
changing world.
Partnering to breed a low methane cow
We are always looking at how we can innovate
alongside our sector partners to provide our farmers
with a range of products to help them solve climate
change challenges. The successful programmes
we have built with our partners, all of whom are at
the leading edge of the global dairy sector, are
enabling us to make significant progress towards
achieving our commitment to help farmers reduce
emissions on farm.
Our methane research programme, in
partnership with CRV and Pāmu, and with
funding from the NZ Agricultural Greenhouse
Gas Research Centre (NZAGRC), is progressing
well. We continue to investigate the link between
methane emissions from bulls and their genetics
with the intention of breeding more climate-
friendly cows that produce less methane.
The programme is now in its third year, and we
have found that a bull’s genetics do play a role in
how much methane they emit. The lowest bulls in the
trial emitted around 15%-20% less methane than the
average after accounting for food eaten.
In the last year, these bulls were mated with heifers
from Pāmu farms with the calves born this spring. We
are looking forward to testing the methane emissions
from these offspring to ensure the genetic variation is
representative of their fathers and will be reporting on
these results.
7
For the year ended 31 May 2023
We hope to produce a methane breeding value and
give Kiwi dairy farmers the opportunity to access low
methane elite genetics by 2026. This has the potential
to make a real difference to farmers by helping to
ensure emissions reductions don’t come at the cost of
reducing milk production.
Developing a genetic solution for
heat tolerance
Another commitment we have made significant
progress on within the last year is our heat tolerance
research programme. The aim of the programme is to
provide New Zealand farmers with high genetic merit
dairy cows with improved heat tolerance.
Heat stress has significant welfare implications
for animals. For dairy cows it can also impact feed
intake, milk production, fertility and calf birth weight.
Introducing the ‘slick’ gene into the country’s dairy
herd could allow for a significant improvement in dairy
cow performance in hotter temperatures over the
long term.
Over the last year, we invested $18.6 million into our
R&D efforts, which include both our methane and heat
tolerance programmes. We are committed to these
investments and constantly innovating to create a
sustainable future for New Zealand’s dairy sector and
the farmers within it.
Today, our commitment remains to breed
the best cows, faster
The dairy sector needs to continue to evolve – for
climate change and because of it, and therefore the
production efficiency of our national herd has never
been more important.
Efficient cows produce more milksolids per kg of feed
eaten, have a fertility advantage, and have a lower
emissions footprint per kg of milksolids.
Farmers using our genetics are breeding genetically
superior animals, and at a faster rate. In fact, long-
term users of LIC genetics have almost doubled the
rate of genetic gain in their herds over the last 10
years – these gains are cumulative and permanent,
delivering long-term benefits into the future.
Throughout the last year we have worked hard
to support both our team and farmers through
managing cost pressures and increasing weather
events. We would like to thank our team and farmer
shareholders for their ongoing support and hard work.
As we transition to welcoming a new LIC Board Chair,
we feel the co-op is in a strong position to navigate
the unique challenges facing the dairy sector both
now and into the future. We look forward to keeping
you updated on LIC’s sustainability journey and how
we are continuing to push for more improvement that
will support New Zealand farmers to reduce intensity
of emissions and retain their position as the world’s
most efficient dairy milk producers.
Murray King David Chin
Chair Chief Executive
8
LIC Sustainability Report.
Our strategy
How we
drive value for
our farmers
Our Farmers
Deepen our understanding of the
current and future needs of all of
our farmers.
Animal
Most sustainable & efficient animal.
Highest value products.
Data & Digital
Modernising the animal data
& digital capabilities.
Innovation
Research & development.
Responsive innovation.
Doing what we are good at.
Playing to our strengths.
Creating value for our farmer shareholders
is at the heart of everything we do.
Our strategy focuses on building a strong
sustainable co-operative, leading the world in
our field and delivering outstanding value for our
customers, shareholders, and sector, next year, in
five years and for another 100 years.
Our three commitments.
Our strategy makes three commitments
to our farmer shareholders.
Operational Excellence
We commit to getting the basics
right and delivering for you, on time,
every time.
Faster Genetic Improvement
We commit to having your back when
it comes to helping you meet the
environmental challenges you face,
in particular animal efficiency, and
nitrogen and methane mitigation.
Software Reliability
and Performance
We commit to being better at
delivering our software to you. We
renew our commitment to continuous
improvement and transparency around
delivery of new features.
For the year ended 31 May 2023
9
Measuring our
three commitments
If we can measure it, we can manage it.
Our farmers rightly ask how they can hold us
accountable for delivering on the commitments –
this has been a priority for us this year. There are
measures and targets in place for each commitment
and progress is monitored throughout the year.
The measurements provide our business with clear
goals and expectations for what delivering on our
commitments looks like.
The measurements and targets are not about
perfection, they are the improvement we are aiming
for. We report to farmer shareholders annually at
events such as our Annual Meeting.
While these metrics have been recognised as
important to farmers and these targets are where
we believe we can improve and make a difference,
we know that the needs of farmers can change.
The measurements and targets are reviewed and
updated as needed annually.
LIC Sustainability Report.
10
2022-23
Commitment
Measurements
We’re pleased to report that we have
achieved the majority of our targets this year.
99
.97%
ACHIEVED
Herd
Testing
Provide a result for
99.9% of all cows
within 72 hours
99
.2%
ACHIEVED
Milk
Pregnancy Testing
10 working day
turnaround time for test
results (from the sample
being collected on-farm)
Artificial
Breeding
Deliver a Non Return Rate
(at an AB Tech group level)
within +/- 9%
of the AB Supervisor
average for the area
ACHIEVED IN
99
.9%
of AB Tech groups
(1 AB technician near
low group)
Key: Target met Some exceptions Target not met
Operational excellence:
98
.6%
ACHIEVED
Johne’s
Disease Testing
10 working day
turnaround time for test
results (from the sample
being collected on-farm)
10
10
75
.44%
ACHIEVED
Customer
Experience Centre
Answer 70% of calls
within 30 seconds
98
.25%
ACHIEVED
Artificial
Breeding
98% of frozen semen
straws on-farm at least
one day prior to the
required-on-farm date
(for all orders placed 7 days in
advance of the required-on-farm date)
95
%
ACHIEVED
GeneMark
®
5-week turnaround
time for test
(from booking week)
5
97
.3%
ACHIEVED
GeneMark
®
Provide results first time
for 97% of all samples
when wet tissue sampling
units are used
For the year ended 31 May 2023
11
35
gBW
ACHIEVED
Sire Proving
Scheme Bull Team
genetic gain
16 gBW
increase
per annum
18
gBW
ACHIEVED
Rate of genetic
gain on farm
17 gBW 5 year rolling
average gain (for herds
within >80% replacements
sired by LIC bulls)
22
gBW
ACHIEVED
Premier Sires Bull
Team genetic gain
15 gBW
increase
per annum
18
gBW
ACHIEVED
Rate of genetic
gain on farm
17 gBW 3 year rolling
average gain (for herds
within >80% replacements
sired by LIC bulls)
16
gBW
ACHIEVED
Rate of genetic
gain on farm
15 gBW 10 year rolling
average gain (for herds
within >80% replacements
sired by LIC bulls)
1, 2
Indirect estimate based on genetic data correlation
6.31
ACHIEVED
2
Nitrogen
mitigation
1.5g reduction in
urinary nitrogen per
kgMS produced (as per
HoofPrint
®
index for the
Premier Sires teams)
7.1
ACHIEVED
1
Methane
mitigation
2g reduction in methane
per kgMS produced
(as per HoofPrint
®
index for
the Premier Sires teams)
Key: Target met Some exceptions Target not met
Faster Genetic Improvement:
LIC Sustainability Report.
12
99
.54%
ACHIEVED
97
.79%
ACHIEVED
MINDA
®
availability
MINDA
®
performance
Available
99% of time
95% of events are
processed through
the holding pen
within 5 minutes
100
%
ACHIEVED
0
.2%
ACHIEVED
MINDA
®
Roadmap
EZ Link
®
performance
All features in MINDA
®
Roadmap released
<1% poor feedback
on EZ Link performance
99
.53%
ACHIEVED
Integrated
software partners
LIC systems are available
to receive information
from integrated partners
99% of time
Key: Target met Some exceptions Target not met
Software Reliability:
5
For the year ended 31 May 2023
13
Environmental Sustainability
The dairy sector needs to continue to evolve, for climate change and because of it. At LIC, we are committed to reducing the environmental
footprint of our business with an aim of becoming carbon zero by 2050. We are constantly refining our practices in pursuit of that goal.
The most significant impact we can make is
through reducing the environmental footprint of the
national dairy herd. Herd improvement is what we
do - we provide farmers with the precision genetics
and technology tools they need to improve their
herds and be more sustainable, while remaining
profitable and productive. We’re amplifying this
through genomic science to deliver results for
farmers at a faster rate.
Farmers, the wider agricultural sector, and the New
Zealand Government are aligned on the importance
of improving the efficiency of the national dairy herd
to achieve our environmental goals.
The results some farmers are achieving show that if
we sharpen our focus on herd improvement, we can
reduce intensity of emissions and continue to have
the world’s most efficient dairy herd. High producing,
climate-friendly cows aren’t just a
hope for the future - they exist in the national
herd today and are well within reach for every
dairy farmer. We simply need more of them.
LIC Sustainability Report.
14
Enteric methane
Enteric methane is a key emission from ruminant livestock and the main
greenhouse emission produced in pastoral dairy farming. Using our genetic
data, LIC has been able to model the genetic potential enteric methane
emissions relative to milksolids production. The consistent trend over the past
eight years can be attributed to better genomic selection and uptake of the
genomically selected Forward Pack products by farmers. Forward Pack and
genomic selection results in shorter generation interval, which is now showing
a consistent trend, greater than the 30 year average trend. The step change in
the 2022/23 season is mostly driven by the improvements in the calculation of the
fertility breeding value and selection of the mating teams based on these new
values. Fertility is a key trait for driving environmental efficiency as cows which
can consistently get in calf early will have more days in milk per season and more
seasons of lifetime production.
By assessing genetic data, we estimate that over the
past 30 years the genetic improvement in our Premier
Sires
®
semen delivered on-farm has resulted in a 11%
reduction in enteric methane and 14% less urinary
nitrogen emitted per kilogram of milksolid produced.
During the 2022/23 season, LIC has delivered more
methane efficient genetics to farmers than any other
year. The increased rate of genetic improvement in
production and fertility traits without any increase in
animal size, and the shorter generation interval that
genomic selection enables has created a consistent
trend of New Zealand farmers breeding more
emissions efficient cows, and year-on-year they’re
doing it faster.
New Zealand dairy farmers continue to embrace
a range of tools to improve herd sustainability and
productivity. The latest New Zealand Dairy Statistics
report (2021-22), produced by LIC and DairyNZ,
shows the number of cows herd tested was the
highest on record, and this is one of a number of tools
that farmers are using to help improve milk quality
and production. The number of cows artificially
inseminated remained steady at 3.94 million. This
reflects a continued trend of New Zealand farmers
remaining focused on improving the production
efficiency of their herds, and utilising data and
insights to support on-farm decisions.
Furthermore, the trend of declining cow and herd
numbers also continued but was accompanied by a
4.1% decrease in kilograms of milksolids processed
compared to the previous season, although the rolling
three year average production of milk solids per cow
was still up 0.4% compared to the prior period.
Key Metrics
1990199520002005201020152020
0.32
0.30
0.28
0.26
0.24
0.22
0.20
Enteric Methane – Premier Sires 1989 to 2022
Enteric Methane per Milksolid
(Kg CH4/Kg MS)
Mating Year
Team Weighted Average, All Breeds, LIC gBV’s 14 July 2022
For the year ended 31 May 2023
15
Urinary nitrogen
Urinary nitrogen deposited from cattle, particularly
lactating cows, is a source of surplus nitrogen which is
susceptible to be lost as a contaminant to its surrounding
environment either as nitrous oxide, a potent greenhouse
gas, or leached from the soil as nitrate. Similar to methane,
the recent trends of improved efficiency are greater
than the long-term trend and the step change for the
2022/23 season resulted from the improvements made
to the fertility breeding value. Traits such as urination
frequency and urinary nitrogen concentration may
be heritable and have the potential to be used
for genetic selection to lower nitrogen output
per cow. LIC is currently investigating ways of
measuring urination traits and whether there
is sufficient variation between individuals to
be able to generate a Breeding Value. This
would allow farmers to select sires that
produce daughters which have lower
urinary nitrogen output to mitigate
nitrogen loss to the environment.
Nitrogen – Premier Sires 1989 to 2022
Urinary Nitrogen per Milksolid
(Kg Nu/Kg MS)
Mating Year
Team Weighted Average, All Breeds, LIC gBV’s 14 July 2022
1990199520002005201020152020
0.24
0.22
0.20
0.18
0.16
0.14
0.12
0.24
0.22
0.20
0.18
0.16
0.14
0.12
Enteric Methane per Milksolid
(kg CH4/kg MS)
genomic Breeding Worth
gBW (LIC SSAM - 07 September 2023)
Lifetime Enteric Methane per Milksolid Production related to gBW
0.05
0.00
0.10
0.15
0.20
0.25
0.30
0.35
0.40
0.45
-600-400-2000200400600800
LIC Sustainability Report.
16
Reducing the environmental footprint of our national herd
We’re helping farmers breed better cows and
get the best from them.
As part of our commitment to faster genetic gain, our
team of scientists has investigated the full spectrum of
MINDA
®
herds in search of the ‘best cows’ and whether
a clear correlation existed between genomic Breeding
Worth (gBW) and milk production efficiency.
All cows aren’t created equal
The research reaffirms that the best cows (with high
gBW) are more efficient at turning feed into milk – they
produce more, have a fertility advantage and are more
emissions efficient. If we’re going to help our sector
meet its environmental goals, New Zealand farmers
must breed more of those highly efficient cows that sit
at the top, and fewer of those who sit at the bottom.
We don’t need more cows – we need
the best cows
At an individual farm level there can be many variable
factors, but it is conceivable that by 2030 a farmer’s
whole herd could be performing at the level of their
top 25% cows today. The goal is to maintain total milk
production from fewer cows – therefore reducing on-
farm emissions intensity.
For the year ended 31 May 2023
17
188kgMS*
1950
397kgMS*
2020
kgMS
2030
Breeding the best cows, faster, is the key to helping farmers solve the challenge of
being profitable and
sustainable. We’ve made good progress over the years, but to
continue on this trajectory we need to sharpen our focus.
Long term users of LIC genetics are already doing this – they’ve
almost doubled the speed of improvement in their herds over the
last decade. They’re breeding better cows faster, and genomics is
the key contributor.
Over the past 30 years we have invested significantly in genomics and, alongside
farmers’ herd management decisions, it has played a key role in the faster rates of
genetic improvement we’ve seen.
The increased utilisation of genomics in our breeding programme and increased
farmer uptake of young genomically selected sires has gone hand-in-hand with
higher rates of increased genetic gain in farmers’ herds.
Genomic records, ancestry information and technology allow us to accurately
identify elite bulls at a young age so we can start using those animals to breed the
next generation of cows sooner. The use of genomics in our breeding programme
means we can reduce the generation interval from five years to two.
Farmers are making the switch to high gBW genomic bulls for the value that they
deliver on farm. Genomic sires feature in our premium artificial breeding offerings,
including the Premier Sires
Forward Pack, A2/A2, Alpha
®
and liquid sexed semen.
During the 2022-23 year, 79% of fresh semen straws used for breeding replacements
were from our premium bull teams (2.3 million straws), up from 71% the year prior (2.1
million straws).
Long-term users of LIC genetics are ahead of the pack and moving at pace to
increase the speed of improvement in their herds.
Average Genetic Merit of animals born each year, sired by LIC bulls (gbw)
3year average rate of gentic gain from animals sired by LIC bulls (gBW)
270
250
230
210
190
170
150
130
110
90
22
20
18
16
14
12
10
201220132014201520162017
2018201920202021
2022
LIC Sustainability Report.
18
Key updates and refinements to our herd improvement toolbox
1. Enhancing our GeneMark
®
DNA parentage service
Genomic evaluation for dairy cows
Our Genomic Evaluation service adds an animals’ DNA
information to their evaluation so farmers get a more
reliable prediction of their performance before they
start milking, allowing farmers to identify their herds’
future potential superior performers when they are
young calves as well as the top cows to breed from to
increase the rate of genetic gain on farm.
The service uses the same technology we use to select
elite young bulls for our breeding programme.
Traditionally, farmers have had to wait a few years
until their heifers are milking and have had a couple
of herd tests to get a reliable understanding of their
performance. By drawing on information from an
animal’s DNA, we’re able to fast-track that process
and provide farmers with an early indication of their
highest genetic merit animals so they can make a
concerted effort to breed replacements from them. This
service is available to farmers who use GeneMark
®
and
we are continuing to look for ways to improve the timing
of delivery of this service to our farmers.
Identify calves with genetic variants
During the course of a five-year research programme,
LIC scientists discovered multiple genetic variants that
impact animal health to the tune of up to $10 million
in lost production each year across the national dairy
herd. Animals that are tested through GeneMark
®
are now automatically screened for six variants that
have the most impact free of charge and farmers
are informed of any affected animals in their herd.
Identifying these animals via GeneMark
®
will help
ensure that farmers rear only the healthiest, highest
performing animals.
2. Animal health testing
Johne’s disease is a contagious infection estimated
to cost New Zealand more than $40 million in lost
production each year. It is caused by a bacterium
which infects the gut of dairy cows and other ruminant
animals. Common side effects include lower milk
production, difficulty reproducing and rapid weight loss.
This disease is common in dairy cows, but it can be
difficult to detect. LIC provides individual animal testing
for Johne’s disease; in the year ended 31 May 2023
testing increased by 16% to a record level of over 1.1
million tests.
LIC is developing and trialling a prototype dashboard
that combines the Johne’s test results with other animal
data held in MINDA
®
. The purpose of the dashboard is
to identify any trends in relation to Johne’s disease. The
dashboard will help farmers optimise value from their
livestock by presenting information in an accessible
way to assist vets and farmers to monitor and enhance
their on-farm Johne’s control strategies, creating the
opportunity to drive down Johne’s prevalence and
improve animal health and production.
For the year ended 31 May 2023
19
3. Sexed semen
LIC’s fresh sexed semen orders have increased by 35%
from the previous year with 272,264 sexed semen straws
sold, up from 201,550 the previous year.
We have a state-of-the-art laboratory solely dedicated
to the production of sexed semen, which sits alongside
our bull farm and semen processing lab and is the
world’s biggest fresh sexed semen sorting facility.
Our fresh sexed semen is accelerating genetic gain
within our dairy herds by enabling farmers to get
more high-quality replacement heifer calves from top
performing cows. We are the only provider of fresh
sexed semen in New Zealand, which delivers a higher
conception rate than frozen sexed semen options.
A resulting pregnancy has a 90% chance of producing a
heifer, providing more high genetic merit heifer calves to
enable the best to be selected and be part of the next
generation of our national dairy herd.
While we expect to see some variation in conception
rates year-on-year, this season the non-return rate
for sexed semen was below what we usually expect.
Several enhancements and changes to our processes
have been made to increase potential for improved
results going forward. We have continued to monitor
sexed semen non-return rate performance throughout
the subsequent winter mating period, and it’s pleasing
to see results have been within the expected range.
4. HoofPrint and BeefPrint
Our HoofPrint
®
and BeefPrint
®
indexes rank our artificial
breeding bulls on their environmental efficiency. The
10-point ranking systems enable farmers to select bulls
based on their predicted ability to generate offspring
with a lower environmental impact – the higher the
score, the more environmentally efficient they are.
HoofPrint
®
ranks and compares enteric methane and
urinary nitrogen per kilogram of milksolids produced.
BeefPrint
®
is based on the same methodology
principles, although it ranks beef bulls for their lifetime
enteric methane and urinary nitrogen per kilogram of
meat produced.
77
8
9
BEEFPRINT
®
LIC Sustainability Report.
20
5. FarmWise
®
consultants
Our FarmWise
®
consultants are increasingly
focused on helping farmers adjust to changing
seasons and weather patterns. They tailor
solutions appropriate to the farm and region,
including changes to calving and milking
patterns, stocking rates, cropping and
alternative pasture species. Anticipating
and planning for change rather than
relying on historical methods and
thinking will be critical to navigating
climate change.
Looking to the future
Our R&D investment and focus on innovation
is helping Kiwi dairy farmers retain their
position as the most efficient milk producers in
the world, playing a critical role in helping the
sector meet its climate targets.
We are one of the largest investors in R&D in the
primary sector. In the reporting period we invested
$18.6 million, the equivalent of 6.7% of revenue.
We invest in the areas where we have unique
capability to maximise the value our customers
generate from their livestock and their product; taking
innovations from lab to paddock to make farmers’
lives easier.
For the year ended 31 May 2023
21
Methane
measurements
from
daughters
Our methane research programme has
confirmed that bulls’ genetics play a role in
how much methane they emit, highlighting the
potential for farmers to breed low methane-
emitting cows in the future.
In its first year, the programme, backed by the New
Zealand Agricultural Greenhouse Gas Research
Centre and partnering with CRV, measured the feed
intake and methane emissions from 281 young bulls
set to father the next generation of New Zealand’s
dairy cows. We found there is genetic variation in the
amount of methane emitted after accounting for the
feed eaten by the bulls, with the lowest bulls emitting
around 15-20% less methane than the average. The
second year of the research has measured methane
emissions from approximately 300 young bulls from
LIC’s 2022 Sire Proving Scheme and CRV’s 2022
Progeny Scheme.
In partnership with Pāmu, we are breeding from bulls
that we have identified to be high or low methane
emitters. Now that their daughters have been born,
we will measure their emissions as growing yearlings
and during their first milking season to ensure they
are representative of their fathers. The target is to
generate 200 daughters from 25 of the highest and
200 from 25 of the lowest methane sires from 1,050
pregnancies. We will track these animals from birth,
eventually measuring their methane emissions as
young animals and then measuring a portion of
them as lactating animals. We will also be measuring
standard measurements such as growth rates,
reproductive performance and milk production.
0
20
40
60
80
100
120
140
036912151821242730333639424548
g CH4/kg DM
Estimated
timeline to offer
low-methane
genetics”
2022
Inseminations
with bulls that
are either high or
low for methane
production.
400 heifer
calves born
2027
LIC Bull
Catalogue includes
low methane
emitting bulls
2023
2026
Include
methane
variation in bull
selection
2024
2025
First daughter
lactations:
for herd testing
and analysis of milk
composition
Variation in methane emissions of trial bulls
Methane
Research Programme
LIC Sustainability Report.
22
LIC is conducting a seven-year breeding programme assessing the impact of the ‘slick’ gene
in cattle, which produces a short hair coat and improves heat tolerance. Heat stress has
significant welfare implications for animals. For dairy cows it also impacts feed intake, milk
production, fertility and calf birthweight.
The pilot trial found cows with the ‘slick’ gene had
lower rumen temperatures (0.5-1.0°C) compared to
their non-slick counterparts when the Temperature
Humidity Index (THI) exceeds 73 (around an ambient
temperature of 26°C and a humidity of 60%).
The aim of the breeding programme is to provide
New Zealand farmers the opportunity to have high
genetic merit dairy cows with improved heat tolerance
by 2029. Before we offer heat tolerant genetics to
farmers, we want to make sure cows that have the
‘slick’ coat also have high genetic merit and milk
production expected of New Zealand dairy cows.
We are using genomic technology to speed up the
breeding programme as they can screen an animal’s
DNA at birth to determine whether it possesses
the slick gene. Additionally, artificial insemination
and embryo transfer are part of the breeding
programme strategy.
The current step in the breeding programme is
to mate slick genetics with elite cows on selected
commercial farms in New Zealand. This step will
significantly increase the rate of genetic improvement
of animals with slick genetics, while increasing the
number of slick animals on the ground and the
diversity in LIC’s breeding programme.
The trial work remains ongoing to ensure that when
these genetics are released to New Zealand
farmers LIC has a robust understanding
of the performance of the slick gene,
including performance in cooler
temperatures. Preliminary
results suggest that animals
with the slick gene do not
have compromised welfare
in cold conditions.
Increasing heat tolerance in cows
For the year ended 31 May 2023
23
Farmers are proactively looking at ways to
mitigate consumer, environmental and animal
welfare concerns.
That’s why over the past few years we have been
running a breeding programme to develop an easily
identifiable dairy-beef product with good calving
ease and growth traits, targeting the crossbreed and
Jersey markets. This programme could support an
increase in value from calves but is reliant on the full
supply chain being in place, including rearers, finishers
and processors, as well as beef being a financially
viable option.
The performance of animals being bred are being
compared to other beef breeds each season.
We continue to lead the ‘Resilient Dairy’ research programme, with investment and support from
MPI and DairyNZ. The seven-year Sustainable Food and Fibre Futures programme, launched
in June 2019, seeks to enhance the health and wellbeing of the national dairy herd and drive a
step-change in sustainable milk production by producing better cows.
This programme involves investing in new disease
management technologies and advancements
in genomic science to produce better cows with
improved health, wellbeing and environmental
resilience. We are using our genomics sequencing
technology to find genetic strands and discover which
cows have particular viruses or bacteria.
Milkomics™
The Milkomics
™
workstream has identified and
quantified a significant number of species in milk,
including bacteria, viruses, protozoans and fungi.
Our team is currently undertaking work to establish
national baselines for the species present. Knowing
what microbes and viruses are present within the
herd and at what level means that pathogens can
be dealt with in a timely and appropriate fashion. By
comparing the qualitative and quantitative profile
of targeted pathogens with profiles obtained from
a national, regional and/or farm level it should be
possible to identify potentially problematic microbes
and viruses and establish a plan to eradicate these
from the herd if appropriate.
Facial eczema
Facial eczema is a disease caused by the ingestion of
toxic spores of a fungus that grows on pastures in New
Zealand. The fungus prefers warm, moist conditions
and is seen mostly in the North Island, typically over
the summer and autumn. The disease causes liver
damage, in the worst cases affected animals die.
The challenge in collecting facial eczema phenotypes
is the incidence varies from season to season. Herds
can be impacted one year and not impacted again
for several years. However, climate change is likely to
increase the presence of the fungus.
A milk biomarker test previously developed was a
breakthrough in the collection of phenotypes and
is being further developed under this programme.
The test has been validated and used to investigate
the genetic susceptibility of facial eczema and the
biomarker has been used to identify herds with liver
damage to blood sample. Over 10,000 individual cows
have been blood sampled over the past three years
and testing has confirmed we can measure genetic
variation in facial eczema, with around 23% estimated
due to genetics. We have calculated breeding values
for sires in the population we have sampled and are
considering the best way to use this data to breed
animals that are less susceptible to the fungus.
Future progress
Resilient Dairy is a long-term research programme
and we look forward to updating shareholders as
more findings from the programme become available.
Dairy-beef productResilient Dairy: Innovative breeding for a sustainable future
LIC Sustainability Report.
24
Reducing the environmental footprint of our business
We have committed to becoming carbon neutral by 2050, in line with the New Zealand
Government’s Climate Change Response (Zero Carbon) Amendment Act 2019 and in
accordance with our pledge as a signatory to the Climate Leaders Coalition.
In October 2021, LIC pledged its support for Pathways
to Dairy Net Zero, a new global initiative which aims
to accelerate climate change action and reduce
greenhouse gas (GHG) emissions across the dairy
sector. A number of leading global organisations,
including 11 of the 20 largest dairy companies in the
world, have also declared their support for the effort.
The latest full report detailing our Greenhouse Gas
(GHG) emissions, as required under our commitment
to the Climate Leaders Coalition, is available on
our website.
We have a public, science-based, emissions reduction
target, we are working with suppliers to reduce their
emissions, and we consistently build sustainability into
our purchasing decisions.
Science-based emissions targets
LIC has set emission reduction targets based on
science using the SBTi (Science Based Target
initiatives) methodologies and the NZ Government
Climate Change Response (Zero Carbon) Amendment
Act 2019, to reduce our greenhouse gas emissions
and limit the temperature increase to 1.5°C of
pre-industrial levels:
Reduction of Scope 1 & 2
emissions* by 2030
(against our 2018/19 base year)
Reduction of Scope 3
emissions* by 2030
(against our 2018/19 base year)
Reduction of biogenic
methane by 2030
(against our 2018/19 base year)
46
.2%
28
.9%
10
%
*Excluding biogenic methane
For the year ended 31 May 2023
25
We first measured our emissions in the
2018/19 financial year (1 June 2018 – 31
May 2019). These measurements serve as
our base year for all future emissions to be
compared against.
From our base year 2018/19 to 2022/23 we’ve had an
overall reduction in our total CO
2
emissions of 12.7%,
the equivalent of 1,616 tCO
2
. The largest emission
reduction was from Scope 3, with a reduction of 1,541
tCO
2
. However, when compared to the prior year,
emissions increased by 4.32%, the equivalent of 460
tCO
2
, primarily due to increased air travel following
relaxation of Covid-19 travel restrictions.
Our 2022/23 biogenic methane emissions have
increased by 9.0% from base year, the equivalent of
290 tCO
2
. However, most of the increase was due to a
significant increase in trial animals compared to base
year, which will decrease again over time.
The table to the top right highlights the scope of our
emissions profile and how we are tracking on the
individual targets compared with the base year.
The table to the bottom right are LIC’s top ten
emissions sources showing the last five years.
Our emissions
2018/19 Base year2022/23 Year 4Reductions/Increases
Scope 1
Direct emissions tCO
2
-e
4452.04386.6
-1.5%
Scope 2
Indirect emissions tCO
2
-e
377.1363.5
-3.6%
Scope 3
Indirect emissions tCO
2
-e
7914.76374.2
-19.5%
Scope 1
Biogenic methane - Direct emissions CH4 (tCO
2
-e)
3231.13521.2
9.0%
Scope 3
Biogenic methane - Indirect emissions CH4 (tCO
2
-e)
12.212.5
2.6%
ScopeEmission source2018/192019/202020/212021/222022/232022/23*
Scope 1
Diesel2756.02618.72762.62548.32578.1
-6.5%
Petrol regular568.1542.0581.9487.6488.7
-14.0%
Excreta N
2
O689.3728.5711.9729.7802.4
16.4%
Indirect N
2
O emissions140.5146.2151.7152.1150.7
7.3%
Scope 1 Biogenic methaneEnteric fermentation methane3193.53246.83189.13369.73483.0
9.1%
Scope 2Electricity377.1401.4368.5345.9363.5
-3.6%
Scope 3
Air travel domestic (medium aircraft)234.1186.9162.061.3243.6
4.1%
Air travel long haul (business)791.8617.0
No flightsNo flights
262.2
-66.9%
Employee commuting4727.83841.94275.74440.04080.1
-13.7%
AB & Field Assist travel1417.81485.11339.21351.41329.4
-6.2%
*Change from base year
LIC Sustainability Report.
26
• Due to EVs/Hybrids, fuel emissions continue
to decline with petrol emissions having a 14%
reduction from base year and diesel reducing by
6.5% (as shown in diagram to the right). However,
LIC diesel emissions increased by 1.17% from the
previous reporting year and are likely to stagnate
until viable vehicle alternatives are available to
reduce our fleet diesel emissions. Petrol emissions
increased from the previous year by 0.23% post-
Covid-19 restrictions.
• Total Scope 1 agricultural biogenic methane
emissions increased by 9.0% from base year in
the 2022/23 reporting year due to increased stock
numbers, including animals in LIC trials across
NZ that are not on LIC farms. The number of beef
and heat tolerant trial animals increased from
788 in the base year to 5,065 animals in 2022/23,
equating to an additional 555 tCO2 emissions. The
volume of trial animals is expected to reduce in
the future.
• Employee commuting emission source data was
improved following a staff survey to determine
travel distance, fuel type, vehicle size, and age.
Based on 308 responses we improved data
quality for those individuals. Data for all other
staff members commuting was calculated using
estimated data of 34.35 km round trip and average
fuel emission factor.
• Following improvements to data capture for waste
in the 2021/22 reporting year, LIC opted to assess
biogenic methane derived from our landfilled
waste using a 2019/20 base year. Biogenic
methane emissions from waste were reduced
by 88.3% from the new base year in the 2022/23
reporting year, however increased by 10.1% when
compared to the 2021/22 reporting year.
Further initiatives we have underway or planned for 2023/24 to help reduce our emissions are outlined below:
Objective2018/19 Base year
Reduce fuel emissions
– Scope 1 emissions
• Replacing fuel-based vehicles with EVs/Hybrids wherever practical – target of
50% of 30 vehicles to be replaced in 2023/24
• Install further EV charging stations at LIC locations and in employee homes for
LIC EV vehicles
• Purchase electric ATV for Awahuri bull farm
Reduce use of artificial
fertilisers – Scope 1 emissions
• Whole farm soil testing to enable targeted fertiliser applications on
paddock basis
Energy reduction plan
– Scope 1 emissions
• Installation of a large-scale solar panel system at Newstead to assist in
offsetting the increased consumption of charging EVs
• Energy audit at Newstead
• Finalise energy emission reduction pathway
Reduce biogenic
methane emissions
• Methane reduction research programme to breed for lower methane emitting
bulls in future
• Install a Ravensdown Eco-pond at Innovation dairy Farm, an upgrade to
the existing Cleartech system with a target 5-7% reduction in associated
methane emissions
Improve Scope 3
data capture
• Survey staff on transport information to and from work
Staff engagement
• Organised events to engage with staff in reducing their carbon footprint
including guest speakers
GHG emissions CH4 (tCO
2
-e)
Season
05001,0001,5002,0002,5003,0003,5004,000
2018/19
2019/20
2020/21
2021/22
2022/23
DieselPetrol regularPetrol premiumPetrol premium
For the year ended 31 May 2023
27
To ensure we are accurately reporting GHG
data we use Toitū Envirocare’s external carbon
calculator. Some data quality improvements
have been made since our last report,
particularly in relation to waste and recycling
data. Our full GHG Inventory Report is reviewed
by LIC’s Senior Leadership Team and published
on the LIC website.
LIC’s Board has endorsed seeking third party
verification of our GHG data, particularly in
preparation for LIC’s Climate Reporting Entity
obligations for the year ended 31 May 2024.
In April 2022 we had our FY19 base year GHG
inventory report audited by Toitū and have
received certification to Toitū’s ‘carbonreduce’
programme. Third party verification also
supports our commitment to the Climate Leaders
Coalition. In FY23 our FY20, 21, 22 and 23 data
was also independently verified by Toitū to
ensure continuing accuracy of reporting data.
There were no major non-conformances found
during the audits. Minor non-conformances
have been amended. Toitū is independent to
LIC and their assurance statements in relation
to LIC’s GHG data are available on the
LIC website.
We are not currently utilising carbon credit
offsetting. The Board will review our position on
offsetting over time as our emission calculations
continue to mature. LIC’s farms are also likely to
be impacted in future by the agriculture farm-
level proposed emissions pricing scheme.
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
11,000
12,000
13,000
14,000
15,000
16,000
17,000
Emissions CH
4
(tCO
2
-e)
Scope 1 – Direct emissions
Scope 2 – Indirect emissions
Scope 3 – Indirect emissions
Scope 1 – Biogenic methane – Direct emissions
Scope 3 – Biogenic methane – Indirect emissions
2018/192019/202020/212021/222022/23
Emission ScopesLIC GHG inventory inclusions
Scope 1
Direct GHG
emission sources
Diesel, petrol, reticulated
natural gas and LPG,
agricultural emissions
from our farms excluding
biogenic methane.
Scope 2
Indirect GHG
emission sources
Purchased electricity
Scope 3
Other GHG
indirect
emission sources
Air travel – international and
domestic, freight, electricity
and natural gas distribution
losses, staff commuting,
business travel not in LIC owned
vehicles, rental cars, water
supply, waste and recycling of
paper, card and glass.
Scope 1
Direct biogenic
methane
emissions
Methane from our livestock
and the onsite wastewater
treatment plant at our
Newstead Head Office
Scope 3
Indirect biogenic
methane
emissions
Wastewater treatment,
composting, and waste
LIC Sustainability Report.
28
What we’re doing to improve business sustainability
Environmental Management System
We have an Environmental Management System as
a framework to manage our environmental impacts.
This includes an Environmental and Sustainability
Management Committee, which has representatives
from each business unit. The committee reviews
the environmental aspects and the inherent and
residual risk of all activities, products and services
of our business and suppliers and contractors, and
evaluates current/suggested controls to avoid,
mitigate or remedy any adverse effects of each
aspect. The members of the committee maintain
LIC’s Environmental Aspects Register for each area of
the business.
Solar panels
LIC has committed to reducing its Scope 2 GHG
(Greenhouse Gas) emissions from electrical power
usage by 46.2% by 2030. Rooftop solar power
panels have been installed at Innovation Farm and
installation of rooftop solar power panels at the
Newstead site will begin in 2023/24. Further to the
environmental benefits, solar power provides added
resilience to the organisation’s power supply, with an
additional power source to electricity through the grid.
Energy provider
In the 2022/23 year LIC ran a procurement process to
select our primary electricity provider. A key part of
the process was evaluating Scope 1 & 2 emissions of
providers and we selected a provider using renewable
energy sources and with minimal Scope 2 emissions.
Initiatives to support our staff and suppliers to
reduce their greenhouse gas emissions include:
• Vehicle tracking to enable vehicle efficiency
• Allowing employees to charge their EVs
while at work
• Soft plastics recycling, e-waste and battery
collections on site
For the year ended 31 May 2023
29
• Introduced Environmental Training Module
– the course offers a brief overview of LIC’s
Environmental Management System and
Environmental Policy
• Polystyrene recycling at Newstead and Riverlea –
includes polystyrene from either work or personal
activities
Vehicles
To help reach our targets, we’re transitioning our
fossil fuel company cars to include options of EV and
hybrid models and we continue to grow the number
of vehicles that are EV or hybrid, with the current fleet
including 10% EVs and 13% hybrid vehicles.
We have 67 EV chargers installed, including 34 home
chargers for employees with company vehicles and 1
super-fast (60kw/hour) charger at our head office in
Waikato. Staff with personal EVs are able to charge
their vehicles on site at no cost to them with the aim of
encouraging staff to select an EV when purchasing a
new car. We have upgraded the power infrastructure
at head office, which will allow for an additional 26
chargers to be installed as demand increases. By the
end of FY24, we aim to have 76 – 80 chargers at our
sites throughout the country.
Travel
We encourage video conferencing for meetings
involving our people and partners to reduce travel
where possible and support flexible working with the
benefit of reduced emissions from commuting.
Farms
We have an ongoing programme of investment
to continue to upgrade our waste management
infrastructure across our farms, as well as shade
planting for animal welfare and riparian planting
to lessen the impact of our farming activities on the
environment. Each LIC farm has its own individual
environmental management plan and staff are
trained to ensure compliance.
We also use fencing to keep our animals away from
waterways and sensitive areas on our farms.
Other improvements currently being considered
or implemented include using an alternative slow-
release fertiliser and upgrading tractors to lower
environmental impact options.
As a result of a heavy rain event in June 2023, an
effluent storage tank on one of our farms overflowed,
with a small spill close to a main drain site. Immediate
action was taken to stop the overflow and spread
effluent and the Waikato Regional Council compliance
team was promptly contacted and visited the site.
Effluent spread records and effluent management
procedure documents were in place, samples were
taken and no further action was required by Council.
Water management
We have consents to discharge trade-waste
from operations at Riverlea in the Waikato and in
Christchurch and have a wastewater treatment
plant at head office and a number of bore water
tanks on farm.
The Christchurch City Council lowered the limit on oil
and grease to be below 200 mg/L in April 2022, as
part of their bylaw changes. The discharge from the
Christchurch site has historically operated above this
limit, and we have had recorded levels which exceed
this new bylaw level in every month subsequent. We
continue to work with council on corrective actions
to the discharge process and treatment facilities to
assess what is possible before a review is made of the
consent limits to be applied to the site.
The other instances of measurements exceeding
bylaws as part of the monthly monitoring programme,
pertain to a biochemical oxygen demand high limit in
April 2023 and a high pH limit in March 2023, both of
which were one off events. Previous instances in 2022
of high pH were attributed to use of an alternative
detergent (supply difficulties due to international
supply chains post Covid-19), and detergent supply
has now resumed back to the original supplier.
Subsequent levels of the discharge pH have been
within the target range except for one incursion which
was subject to a measurement query. No formal
breach notifications were received for either site.
LIC Sustainability Report.
30
Waste management
We recycle farm materials such as silage wrap and
plastic drums and are seeking new ways to reduce
water and energy use across all our sites.
E-waste, such as obsolete laptops and phones, is sold
where possible or recycled.
Our animal health laboratories at Riverlea receive
numerous polystyrene cool store boxes and we have a
recycling process to manage this waste.
AB Operations has a very diverse range of activities
to produce and deliver semen products to our
customers. Each of these activities generates some
sort of waste that can be reduced and/or recycled.
Once the waste streams have been identified then
future work can begin to identify alternative materials
where appropriate
Our Australian subsidiary, Beacon Automation Pty Ltd,
produces heat patches and is working on identifying
options to recycle plastic waste from the production
process and produce products that could be more
environmentally-friendly.
Waste left on farm
When AB services are performed on farm, our
technicians leave materials that have been used
during the process, such as gloves and wipes,
although we are looking at options to safely recycle
items such as gloves. For biosecurity reasons, we have
made a conscious decision to leave this waste on
farm for farmers to dispose of responsibly, to minimise
the chance of disease spread between farms as
these materials are often contaminated with organic
matter. Where we perform other services on farm that
collect biological material, such as herd testing, strict
processes are followed to minimise the chance of any
transfer of disease between farms.
To minimise the risk of disease transferral:
- Our AB Technicians ensure that boots are cleaned
and disinfected on entering a farm, use single use
gloves that cover up shoulder and chest area,
single-use disposable sheaths and isopropyl wipes
to clean equipment between farms;
- Our bulls are tested regularly for M.bovis, as well
as an additional antibiotic added to semen diluent
that targets M.bovis; and
- New young bulls are quarantined from
existing bulls for a period of time, bulls
used for international markets are
quarantined and tested as required under
regulations and double-fencing is used to
separate individual bulls in the core bull
team, as well as daily monitoring for
any health concerns.
For the year ended 31 May 2023
31
Social sustainability – caring for our people
We are focused on fostering a culture that
embraces change, builds capabilities, encourages
people and ultimately drives results to deliver greater
customer value. We invest in our people to develop
their talent and ensure they are in a positive and safe
working environment.
Alongside our full-time employees, in peak season
we also employ close to 1,350 seasonal employees
in the Artificial Breeding (AB) area and 400
other seasonal or casual workers throughout
the year to help in other areas of the business,
such as herd testing. Each year, our qualified
AB technicians visit farms in their local area,
artificially inseminating millions of cows, with
the peak season being between September
and January.
For LIC, social sustainability is all about caring for our people, ensuring that they have the
tools and support they need to continue to deliver value to our farmer shareholders.
Key Metrics
900+
full-time equivalent
employees of which
571 are women
9,000+
farmer
shareholders
80
*
Organisational Health
Index (OHI) up five
points from 75 last
year and our highest
ever result
3.79
**
Total Reportable
Incident Rate
(per 100 full time
equivalent employee)
up from 2.13 last year
* Placing us in the top quartile of businesses surveyed globally.
** The prior year set a high benchmark as LIC was still affected by Covid-19 lockdowns during that period.
LIC Sustainability Report.
32
Governance
Structure
Our governance structure includes a Board
of Directors, Shareholder Reference Group,
and Senior Leadership Team. These groups
all contribute to driving value for our farmer
shareholders.
Board of Directors
Our Board is responsible for the overall governance of
LIC on behalf of our farmer shareholders to improve
the prosperity and productivity of our customers.
LIC Directors set the vision and long-term goals
of the co-operative. This includes the strategy to
achieve that vision, as well as the monitoring of its
implementation. Information on sub-committees of
the Board is available in the governance section of
LIC’s annual report.
The Board must be comprised of at least six elected
farmer directors, and up to four independent
directors to allow specialist expertise to be added
when needed, while balancing the number of Elected
Directors between the North and South Island.
At the annual meeting in October 2022, Board Director
Gray Baldwin retired from his role after 10 years
serving the co-op. South Island shareholders elected
Corrigan Sowman as their new Board Director.
In May 2023, Board Chair Murray King announced
his intention to step down from the Board at the
AGM in October 2023 and Corrigan Sowman has
been appointed as Chair-designate. Murray King’s
retirement in October will conclude over 14 years’
service after being elected to the Board of Directors in
2009 and appointed Chair in 2011.
Left to right: Candace Kinser, Ken Hames, Ben Dickie, Matt Ross,
Murray King, Tim Gibson, Alison Watters, Corrigan Sowman, Sophie Haslem
For the year ended 31 May 2023
33
Shareholder Reference Group
Our Shareholder Reference Group is an independent body
of shareholders who work collaboratively with our Board and
management. The group serves to promote the interests of
shareholders and help us deliver on our purpose and vision.
The Shareholder Reference Group is solely comprised of farmer
shareholders. It is made up of 12 members across four territories. Eight
members are elected by shareholders and four are appointed by
the existing members of the Shareholder Reference Group to ensure
diversity and a broad range of skills in the Group.
Senior Leadership Team
Our SLT is tasked with working alongside the Board to develop and
implement our short and long-term strategy and to establish the key
metrics that we will be measured against, so that we know we are
delivering on the commitments made to shareholders.
Brent Mealings replaced David Hazlehurst as Chief Financial Officer (CFO)
in August 2023.
Malcolm Ellis, GM NZ Markets, has resigned and Kellie Burbidge has been
appointed to the role and will join LIC on 30 October 2023. The GM NZ
Markets is responsible for the strategic direction of the farmer-owned co-
op’s sales, marketing, and customer relationships. This includes leading a
nationwide team of sales managers and the National Accounts, Marketing
& Products, and Customer Experience Centre portfolios.
From left to right: Richard Ridd, Mark Benns, Johan van Ras, Michelle Oldham-Smith, Mark Hooper,
Phil Lowe, Nathan Keoghan, Ben Smith, Aleisha Broomfield, Jared Clarke, Melanie Tonkin, Andrew Wiffen.
Absent: David Hands.
Left to right: Brent Mealings, Malcolm Ellis, Roz Urbahn, David Chin, Mark Julian, Emma Blott, Richard Spelman,
Dhaya Sivakumar.
LIC Sustainability Report.
34
Caring for our people
Wellness
Creating a supportive and sustainable internal culture
across our business has been vital to achieving the
successful results we’ve seen in recent years.
‘Well Aware’ is our centralised health and wellness
strategy incorporating physical, mental and social
wellbeing. A Well Aware Hub on the LIC intranet has
enabled us to provide a one-stop shop for a well body,
well mind, and a balanced life for our staff.
‘Mental Wellbeing at Work’ is the flagship programme
of the ‘Well Aware’ strategy and is available to all
permanent and fixed contract staff. It is designed
to ensure our employees thrive within a work
environment through our holistic approach to
wellbeing and connection to support services we have
available under each area (well body, well mind, well
life). In addition, Well Aware also has a compulsory
module called ‘Supporting Mental Wellbeing at work’
for all permanent and fixed contract people leaders.
This module is led by a registered EAP psychologist
and is designed to specifically upskill our people
leaders on how to appropriately support employees
experiencing an emotional/mental crisis. The ‘Well
Aware’ strategy promotes health and wellbeing
at every level, leading to an engaged, safe and
sustainably high-performing workforce.
The programme also organises a series of guest
speakers to provide staff with additional information
to support mental, emotional and physical wellbeing
at work. Examples of these include: how to claim back
your energy; this changes everything: the menopause
talk; the power of financial wellbeing; and from
burnout to thriving.
Organisational Health
The focus is always on improving with the support of
our employees. We use the McKinsey Organisational
Health Index (OHI) methodology to survey employees
on the impact of our organisation practices and
culture on performance against international
benchmarks. The survey results provide a rich source
of data to identify key areas for improvement across
the organisation.
At the time of the survey, there were 840 permanent
employees invited to participate in the survey and
87% responded, which is our highest completion
rate. There were over 2,000 individual comments,
recommendations and opinions provided by
employees at all levels. Top quartile was reached with
a result of 80, which is an uplift of +5 on last year at
75. Eight out of nine outcomes were in the top quartile.
29 out of 37 practices were in the top quartile.
Health Journey
20162017201820192020202120222023
80
75
70
65
60
55
50
45
54
66
68
7070
75
80
No OHI survey
conducted in
2020 due to onset
of Covid–19
+5
02
2
+12
+5
Benchmark: Top quartile Second quartile Bottom quartile Comparison: Significantly stronger Comparable
Organisational Health Index
For the year ended 31 May 2023
35
Diversity, Equity & Inclusion
Given the size and nature of our business we have a
diverse workforce. To continue recognising diversity in
the workplace and creating an inclusive environment,
we have a staff-led Diversity, Equity and Inclusion
(DEI) Committee to champion these concepts.
Regular communications are sent out to all of LIC
on key events and topics of interest. The Diversity,
Equity & Inclusion newsletter highlights cultural and
international events and celebrations, and provides
information on topics relating to diversity, equity and
inclusion. An example of this is Diwali – information
around the celebration was provided on the staff
intranet (The Shed) and a special lunch was held
at Newstead.
The Committee identified two main areas of focus
for the year. These were:
• Implementation of a Te Ao Māori Strategy; and
• Establishment of a Women in Leadership Group
Te Ao Māori Strategy: LIC has partnered with
Tutira Mai NZ, a leading cultural competency and
Māori advisory consultancy organisation to design
and implement a Te Ao Māori Strategy. Work has
commenced on this and will be rolled out in the next
2-3 years.
Women in Leadership Group: This group has been set
up with the aim of fostering a community of women
and empowering them to become leaders in their
respective fields. The group seeks to build strong
connections across various industries, and to provide
mentorship and development advice from experts
with diverse backgrounds and skill sets.
Other examples of diversity and inclusion focus
during the year include:
• A Reflection Room designed for prayer and
mediation is now available at Newstead for staff
of all faiths to use
• Establishment of a dedicated Parent’s room
at Newstead
• To celebrate World Day for Cultural Diversity, all our
people leaders were asked to encourage staff to
wear their own cultural dress to work and organise
a shared lunch with food from their culture
• LIC hosted a Pink Ribbon Breakfast
• Support of International Women’s Day by having
Best Dressed and Best Decorated Workspace
competitions.
The latest OHI survey collected demographic
statistics, which will be again used to identify areas
where further objectives could be focused.
Engagement with Diversity Works NZ is ongoing and our membership
of this organisation allows access to a wide range of resources.
Ethnic Diversity %
Based on responses to the 2023 OHI survey
59
5
5
6
6
4
10
4
Asian British European Indian
Māori NZ European Other (includes Pacifica)
Prefer not to disclose
LIC Sustainability Report.
36
Health & Safety
The health and safety of our staff, our customers, contractors, and anyone else we come in
contact with, remains our highest priority. Our health and safety system provides the framework
to keep workers healthy and safe, regardless of their location.
Our Health, Safety and Wellbeing policy sets out our
commitments and reflects our intent to continue to
develop our health and safety culture. The focus is
on becoming more proactive - where we continue to
take personal ownership, learning safety lessons from
our safety events, and anticipate future safety risks
and needs.
In order to test our health and safety framework, we
conduct an annual effectiveness review.
The biennial ComplyWith survey highlighted three
Health & Safety-related gaps, which will be a focus for
the Health & Safety team in 2023/24:
• The lack of exposure monitoring processes for
hazardous substances
• Our health monitoring processes are not well
implemented; and
• Overlapping safety duties and the need to consult,
co-operate and coordinate activities with our
customer farmers with whom we share the same
duty to keep our/their workers safe.
The annual ACC Accredited Employers Programme
audit was completed over three days in February
2023. LIC successfully passed the audit, retaining its
secondary level accreditation.
The auditor commended LIC on a notable increase
in mid-managerial understanding of H&S processes
and requirements when compared to previous audits,
which is pleasing as it reflects the effort the Health
& Safety team has put into developing the safety
leadership of our managers. The auditor highlighted
three areas for improvement: how emergency
evacuations are managed at Newstead, how LIC
manages its overlapping safety duty with our supplier
and contractors, and how WellNZ apply weekly
compensation indexation and interest payments.
Plans are already underway to address these areas.
Some of the specific focus areas for the Health &
Safety team this year included:
1. Leadership development
• Additional training for managers has been
implemented on both health and safety and
supporting workers facing mental health
challenges.
• The HSE Manager facilitated a risk management
training session with the AB leadership team.
• The HSE team supported the Hub project leaders
to ensure LIC adheres to good practice contractor
management practices and meets its ‘overlapping
duties’ requirement. External Permit Issuer training
for project leaders was also completed.
2. Working together
As part of our focus on improving our staff
engagement, we have invested in improving our
workers’ voice in health and safety and wellbeing.
LIC has one elected H&S representative for every 19
permanent workers. Our Health & Safety Governance
Forum, chaired by our Chief Executive Officer and
attended by a range of managers and employee
representatives from business units, allows workers
and senior leaders to collaborate on health and
safety matters. The forum specifically reviews critical
risks reporting from each business unit and tracks
improvement against the 48-hour event reports and
seven day event investigation timeframes.
3. Critical risk management
Senior leaders and board members are spending time
with workers to understand our critical risk profiles,
and gain assurance that the controls are effective.
During the year, 15 senior leader and 9 board member
site visits were carried out, reviewing all critical risks
in a range of locations. The improved understanding
of our risk profiles allows us to ensure adequate
resources are made available. A number of health and
safety site visits, including 11 H&S audits, by the team
provides another layer of assurance that critical risks
are identified and controlled.
Business unit health and safety plans now include
consideration of our identified critical risks.
For the year ended 31 May 2023
37
4. Asking the right questions
We have set specific health and safety objectives
designed to focus our attention on improving our
systems and practices. Our progress against these
objectives is reviewed on a quarterly basis by the
Health & Safety Governance Forum. The objectives
for 2023/24 have been refreshed and health and
safety reporting to senior leaders and board members
continues to be reviewed and improved.
5. Supporting our injured and ill workers
As a member of the ACC Accredited Employers
Programme we are responsible for the vocational,
medical and social rehabilitation of our workers. There
has been a steady improvement in rehabilitation and
return to work rates for our injured employees over the
last three years. In the last year both the number of
claims and the associated rehabilitation costs have
decreased. For the last three years, we have attained
secondary level accreditation against ACC audit
standards.
6. Improving the safety of our AB technicians
Providing secure, appropriate Artificial Breeding (AB)
facilities is not only critical to creating a safe working
environment, but it also gives our AB technicians
the best opportunity to get cows in-calf. To help our
farmers get the best results from our AB service and
ensure the safety of our AB technicians, we have
developed a national standard which details the
minimum requirements that an AB facility must meet
for us to provide our AB technician service.
We are working with farmers to
further remove the risk of working
from heights, which we consider to be
a critical risk, in relation to herringbone
sheds. The first step is to cease the AB
service from the pit of a herringbone shed
on a trolley from May 2023, and subsequently
move away from working from the pit of the
herringbone shed altogether by May 2025.
LIC has also signed the Farm Without Harm
pledge by Safer Farms, reinforcing our dedication
to creating safer conditions across our farms and
protecting our people from preventable harm.
LIC Sustainability Report.
38
Employee Data
This employee data relates to the total
LIC group and is sourced from our Human
Resource (HR) system. The data for
permanent and fixed-term employees is
reported on a full-time equivalent (FTE) basis.
We employed a total of 1,747 seasonal workers
throughout the year ended 31 May 2023 (1,774 for
prior year), particularly during peak season for a
relatively short period of time, primarily as artificial
insemination technicians, with 1,355 technicians
and assists in this area and 392 other seasonal
or casual workers throughout the year to
help in other areas of the business, such as
herd testing.
The reporting period is for the financial
year ended 31 May 2023 (FY23), with
final permanent and fixed-term
employees reported as at 31 May and
comparatives for the prior period.
Our only significant location is
New Zealand, with less than 5%
of employees employed in any
other individual country.
PermanentFixed term/CasualTotal
FY22FY23FY22FY23FY22FY23
Female461.2487.263.783.5529.6570.7
Male299.3323.022.513.8320.8336.8
Total760.5810.286.39 7. 3850.4907.5
FTEs by employment contract by gender
Full-timePart-timeTotal
FY22FY23FY22FY23FY22FY23
Female490.5533.739.137.0529.6570.7
Male307.8326.813.010.0320.8336.8
Total798.3860.552.147.0850.4907.5
FTEs by employment type by gender
Number of FTEs (Permanent and fixed-term/casual)
FY22FY23
New Zealand810.6882.4
Australia22.016.3
UK & Ireland17.88.8
Total850.4907.5
FTEs by employment contract by region
For the year ended 31 May 2023
39
Our HR system does not currently capture gender
options alternative to male/female. Some age data is
not available as employees are not obliged to disclose
date of birth.
There were 14 permanent employees (1.5%) covered
by a collective bargaining agreement at 31 May 2023,
and a further 26 (1.5%) seasonal workers during the
period. For employees not covered by collective
bargaining agreements, individual contracts are
entered into at the time of employment.
During the year, there were 28 females (no males)
on parental leave and 14 females returned from
parental leave.
If significant operational changes are proposed
within the organisation, LIC will consult with
potentially impacted employees for a two week
period on the proposed changes, with a minimum of
six weeks in total from notice of proposed change
until implementation of any final changes. For
any employees covered by collective bargaining
agreements, notice period and provisions for
consultation and negotiation are specified in those
agreements.
LIC engages with suppliers to provide workers, such
as IT contractors, recruitment firms and directly with
independent contractors. This number is not material
compared to the number of LIC employees.
The ratio of the annual total compensation for the
organisations highest-paid individual to the median
annual total compensation for all permanent
employees (excluding the highest-paid individual) for
the year ended 31 May 2023 was 6.34 : 1.
<30 yrs age30-50 yrs age>50 yrs ageAge not disclosedNZ region FY23%
Female50593311563%
Male14332016837%
Total6492234183100%
%35%50%13%2%
<30 yrs age30-50 yrs age>50 yrs ageAge not disclosedNZ region FY23%
Female29381928863%
Male9261605137%
Total3864352139100%
%27%46%25%2%
New permanent employee headcount hires, by gender and age group for primary region
Employee headcount turnover, by gender and age group for primary region
LIC Sustainability Report.
40
Economic Sustainability
Delivering value for our farmer shareholders is at the centre of everything we do, and strong
financial performance enables us to do just that – through our herd improvement products
and services, a solid dividend and, importantly, the right R&D investment to keep their
herds profitable and sustainable into the future.
Key Metrics from
2022/23 full year results
$
276
.5m
Total revenue
from continuing
operations
(excl automation*)
Up 5.1% from $263.2
million last year
$
382
.3m
Total assets
Strong balance
sheet with no debt
at year end
0.9% decrease from
$385.6 million last year
$
27
.4m
Net Profit After
Tax (NPAT)
Up 2.4% from
$26.7 million last year
$
23
.7m
Underlying
Earnings*
Down 7.6% from $25.7
million last year
* For notes to the financial information please reference our FY23 Annual Report.
$
23
.3m
Dividend
16.38 cents
per share
$
17-22
m
Expected
Underlying
Earnings
for 2023-24
For the year ended 31 May 2023
41
Delivering a strong result
for our farmers
On 19 July 2023 the LIC Board announced its financial result for the
2022-23 year, fuelled by an increased farmer uptake in premium
genetics and herd improvement services to breed highly efficient
cows, with a lower emissions footprint.
It was also announced that LIC would return $23.3 million in dividend to its co-
operative shareholders, equating to 16.38 cents per share, paid on 18 August 2023.
Reporting increased revenue (up 5.1%) but a drop in underlying earnings
(down 7.6%) compared to the same period last year, the Board believes the
co-op has delivered a solid financial performance, considering the challenging
economic conditions.
The Board were pleased to present another strong result to our farmer
shareholders for the sixth successive year, despite facing rising costs due to
increased inflation.
This result is a credit to our farmers for their continued support of their co-op,
who like us have been faced with a challenging economic landscape. It enables
LIC to deliver a solid dividend to shareholders at a time when increased cost
pressures are being felt on-farm and ensures we can continue to invest in critical
R&D and technology to support a more profitable and sustainable dairy sector for
Kiwi farmers.
Tax
LIC’s Audit, Finance and Risk board sub-committee oversees tax compliance,
including LIC’s Tax Policy and annual Tax Management Plan, which identifies
areas of tax change. LIC seeks to comply with all aspects of the New Zealand and
international tax acts for jurisdictions that our subsidiaries reside in. Management
has responsibility to ensure that it has a broad understanding of all major
tax issues that arise from the ordinary business, major transactions, business
structures or strategies undertaken by LIC. LIC uses external tax experts and tools
to ensure appropriate tax compliance governance and controls are in place.
230
241
249
263
277
20192020202120222023
Revenue ($ millions)*
20192020202120222023
Operating Expenses ($ millions)**
199
209
217
230
246
Financial Metrics
These charts represent our key financial
metrics to provide a historical summary of
our performance.
LIC Sustainability Report.
42
20192020202120222023
EBIT ($ millions)**
31.2
32.2
31.9
33.4
31.0
20192020202120222023
Earnings per share $
0.16
0.12
0.16
0.19
0.19
20192020202120222023
Funding ($ millions)
5
16
19
64
55
-5
-2
0
00
CashDebt
20192020202120222023
Return on equity %
7.6%
6.0%
7.8%
9.1%9.2%
20192020202120222023
R&D spend ($ millions)*
12.0
14.8
17.1
18.2
18.6
20192020202120222023
% Premium (incl Genomic) Replacement Straws
39%
54%
60%
71%
79%
* Data excludes Discontinued Business operations – the Automation business was divested in June 2021
** Excludes bull team & nil paid share revaluations and Discontinued Operations
$0.00
$0.50
$1.00
$1.50
$2.00
May-19May-20May-21May-22May-23
LIC Share Price $
For the year ended 31 May 2023
43
0
50
100
150
200
250
300
3.50
4.00
4.50
5.00
5.50
6.00
6.50
7.00
7.50
8.00
8.50
9.00
9.50
10.00
07/0808/0909/1010/1111/1212/1313/1414/1515/1616-1717/1818/1919/2020/2121/2222/23
New Zealand Milk Price Payouts kg/MS
Fonterra Milk PriceFonterra DividendLIC Revenue $m (excl. Automation)
LIC Sustainability Report.
44
20192020202120222023
Revenue *NZ$000229,763240,932 249,013 263,182276,506
R&D spendNZ$000(11,985)(14,844)(17,124)(18,184)(18,577)
Net profit after taxNZ$00022,170 17,487 22,94426,72327,352
EBIT **NZ$00031,205 32,224 31,904 33,37230,955
Underlying earningsNZ$00019,530 22,685 22,26125,67723,732
Dividend declared***
NZ$m15.618.1 17.8 26.223.3
Cents per share10.9812.75 12.51 18.43 16.38
Gross yield %16.923.014.716.522.8
Operating cashflowNZ$00055,16752,018 40,456 57,13036,791
Net capital & investment spendNZ$000(36,810)(21,401)(16,115)(17,889)(20,581)
Total AssetsNZ$000380,735 379,940382,005 385,610382,291
Total Equity/Net AssetsNZ$000291,437 290,242294,123293,057297,494
Sales data
Premium (incl Genomic) straws 1,291,315 1,666,5641,792,648 2,071,321 2,303,537
Other replacement straws2,020,991 1,397,386 1,206,049 864,709 616,923
Total straws (NZ)4,664,542 4,438,732 4,343,830 4,322,316 4,418,263
International straws1,013,564 857,427 1,059,777 1,055,168 1,035,888
Herd testing samples10,955,997 10,407,918 11,170,13411,199,277 11,274,641
GeneMark
®
testing671,892 768,943 629,166 728,876 757,851
Animal health testing873,389 1,045,487 1,294,996 1,571,509 1,723,489
MINDA
®
animals7,005,405 6,998,649 7,006,900 6,912,997 6,807,164
Trends
For our full financial results please refer to our FY23 Annual Report
* Excludes Discontinued Business operations – the Automation business
was agreed to be divested in June 2021
** Excludes bull team & nil paid share revaluations and Discontinued
Operations
*** There was an additional Special Dividend of $14.2 million, or 10 cents per
share, paid in January 2022 following the Automation divestment. The
2023 dividend includes an additional amount of $4.3 million to return
cash retained from dividends paid in 2022 to repay nil paid shares (2022
included a similar additional amount of $5.7 million). Gross yield % is
calculated using the share price on the dividend record date.
For the year ended 31 May 2023
45
MINDA
®
Herd
management
software
Our Business
We are the DNA of the New Zealand dairy sector,
breeding up to 75% of cows in the national dairy
herd. We take our role seriously as an important
player in the team supporting farmers with the right
herd improvement tools to breed more efficient and
climate resilient cows.
Our primary sector is the New Zealand dairy sector.
Our core customers are New Zealand dairy farmers.
Other customers include veterinarians who support
farmers, users of dairy herd data and beef producers.
Keeping New Zealand farmers profitable and
sustainable is critical. We are 100% owned by New
Zealand dairy farmers and therefore invest to fund
research and technology which will benefit not only
this generation of farmer shareholders and their
herds, but successive generations and their herds.
This long-term improvement and sustained return on
investment is the pure essence of what it means to be
a co-operative.
LIC exists to deliver superior genetics
and technological innovation to help
our shareholders sustainably farm
profitable animals.
Artificial
Breeding (AB)
AB dairy and beef genetics
and technician services,
with products such as
Premier Sires
®
, Sexed Semen,
Short Gestation Length,
Alpha
®
, Customate, training
of AB and DIY technicians,
Deep Freeze storage
Heat
detection
products
LIC heat patch,
LIC Bulls-i
®
,
Kamar
®
Heatmount
detectors
DNA
Testing
Helping farmers take the
guesswork out of matching
calves to parents, reduce
stress at calving time and
identify their best calves
Animal
Health Testing
Bovine Viral Diarrhoea (BVD),
Johne’s disease,
milk pregnancy testing,
Staph aureus
LIC Sustainability Report.
46
Farm
Accessories
Electronic plate
meters,
EID readers
and wands
Herd
Testing
Milk samples,
including EZ Link
®
scanning and herd
test assist service
Field
Assist
Increase efficiency
of farm operations,
including assisting
with herd records, herd
testing, weighing
and DNA sampling
SPACE
TM
Satellite and
pasture cover
evaluation
reporting
FarmWise
®
Consulting service
for farm visits and
project work
Tags
Full range of NAIT
approved electronic
(EID) tags and
management tags
from Allflex,
Z Tags and Flexa
For the year ended 31 May 2023
47
How we work
LIC is structured to best support farmers and
our operational teams to effectively supply
products and services to customers, as well
as to leverage opportunities to deliver genetic
improvements to farmers and better returns to
shareholders.
NZ Markets
Sales operations,
contact centre, customer
training, marketing,
communications, pricing
and market research,
oversight of product
development, including
MINDA
®
herd management
Operations
& Service
Artificial breeding
collection & insemination,
herd milk testing, genetic
diagnostics, animal health
testing, LIC bull and
dairy farms, FarmWise
®
consultants
Research &
Development
Genetic, genomic and
reproduction research and
development and analytics;
both inhouse and in
collaboration with university
and sector partners; animal
evaluation, bull selection
Technology
Development and
support of customer facing
systems such as MINDA
®
and LIC internal systems
and IT infrastructure
Commercial
International genetics
sales, business
development, new
ventures, investments and
partnerships, leverage of
beef opportunities, farm
assistance
Support Services
Payroll, finance &
accounting, procurement,
legal, intellectual property,
governance, shareholder
services, risk management,
property management,
Business Information Unit,
transformation, enterprise
project management office
People &
Performance
People & Performance
partners; employee
experience, organisational
development, health,
safety and environment
LIC Sustainability Report.
48
Key categories of goods and services we procure
Labour hire
Professional consulting services
IT software and hardware
Laboratory supplies
Building materials and products
Farm supplies
Recruitment services
The most critical component of LIC’s supply chain is
our permanent and seasonal employees, as well as
our bull team. For our external suppliers our Strategic
Procurement team has policies and processes in place
to identify and manage critical risks that could impact
our supply chain. An example is our New Zealand
and international air freight and technology services.
Where there is a higher risk to our products and
services, particularly during peak season or where
components are sourced internationally, at least
one year of input components are held in advance
of need, such as consumables used for artificial
insemination and diagnostics testing.
The Procurement Policy requires that all procurement
decisions should also take into consideration the
potential impact to the environment, sustainability,
health and safety and compliance with any other
relevant legislative obligations and we continue
to work with suppliers in relation to sustainability
measures. For example, during the year a
procurement process was run for LIC’s printer lease
and environmental impact of the suppliers was a key
consideration. Canon New Zealand was selected, who
are Toitū carbonzero certified, have demonstrated
emission reductions, have plans to further reduce and
are commited to recycling of e-waste.
The Strategic Procurement team sent a survey during
the period to approximately 90 of our larger NZ based
suppliers, those in the top 20% of LIC’s annual spend.
Despite repeated reminders, the response rate was
disappointingly only 16%.
Partnerships
Partnerships are critical to our work and are a
strategic priority to develop. We work with others
to deliver to farmer needs, partnering with other
organisations to deliver a seamless service to
farmers. We already work closely with other sector
participants, including:
• DairyNZ and NZ Animal Evaluation Ltd (subsidiary
of DairyNZ)
• Government ministries and agencies on joint
funding of R&D, such as MPI, MBIE and Callaghan
Innovation
• Milk processors
• Specialist beef operations
• Sexing Technologies, providing the critical
technology for our sexed semen product
• Rural professionals, such as vets
• Animal wearable device companies
• Research specialists, such as at Auckland
University and Massey University
• Gates Foundation and Alliance Biodiversity
International & CIAT, project on herd management
in Ethiopia
Our Supply Chain
We are focused on building relationships with other
sector companies such as processors, fertiliser
companies and device companies.
New and ongoing initiatives with partners of
note include:
Farmlands, Silver Fern Farms and
LIC – Leadership and Governance
Development training
We have partnered with Farmlands and Silver Fern
Farms to offer shareholders of all three companies
the opportunity to learn more about governance in
co-operatives and develop skills needed to operate
at board level through a unique leadership and
governance development programme called “To
the Core”.
Fonterra’s Governance Development Programme
We also partner with Fonterra who offer one LIC
shareholder a place in its Governance Development
Programme to build their governance capabilities
and leadership skills. Running for approximately one
year, the content is provided by Fonterra and Massey
University’s College of Business.
NZ Post
We have partnered with NZ Post to facilitate recycling
of soft plastics for sites that do not have a drop-off
centre. Staff can purchase a courier bag (made of
80% recycled plastic), which NZ Post will pick up and
send for recycling.
Rural Support Trust
We have partnered with Rural Support Trust to provide
farmer facing staff with a resource that offers guidance
on providing mental health support to farmers.
For the year ended 31 May 2023
49
Womens Refuge
LIC have joined a host of other leading brands,
businesses and government departments across
New Zealand in facilitating access to this important
charitable organisation.
House of Science Central Waikato (HSCW)
The House of Science Central Waikato (HSCW) is
committed to bringing scientific literacy tools to
schools across the Waikato region. Their vison is to
raise science literacy which will have huge economic
and social benefits to New Zealand. We are proud to
continue our collaboration that started in 2021 with
HSCW and support them in a variety of ways. This
includes providing HSCW with a LIC vehicle to deliver
science kits to rural schools in the Waikato. Some of
our fantastic R&D staff also volunteer their time each
week to put together the science kits.
LIC supports the dairy sector, rural communities and
our farmers by sponsoring a variety of initiatives,
events, programmes and organisations. This provides
opportunities and promotes excellence within the
sector. Examples include:
• New Zealand Dairy Industry Awards
• Lincoln University
• Southern Dairy Hub
• South Island Dairying Development Centre
• South Island Dairy Event
• Owl Farm at St Peter’s School, Waikato
• Dairy Women’s Network
• Kellogg Rural Leadership Programme
• Massey University Dairy #1 Farm
• Ayrshire NZ Conference
• Jersey NZ Conference
• Smaller Milk and Supply Herds Conference
• Once a Day Conference
• Distributing computer equipment no longer needed
to rural schools
• Support of calf club and pet days in schools
Our vet Dr Tracey Reynolds is a member of the
2023 Kellogg Rural Leadership Programme and
has published a study paper Know your why –
motivations for a sustainable future. The report aims
to understand the motivations behind the adoption
of new innovations by dairy farmers and learn how
to accelerate the uptake of practices that reduce
greenhouse gas emissions, thereby ensuring the long-
term sustainability of farming in New Zealand.
Our employees are given one day off annually to do a
variety of volunteer activities in the community.
We are also members of Cooperative
New Zealand, the Sustainable Business
Council, Toitū, and the Climate
Leaders Coalition.
Refer to our website for further details.
LIC Sustainability Report.
50
How we create value
Value for our farmer shareholders is at the
heart of our strategy.
We drive value, innovate, and deliver a positive impact
for our customers and shareholders by focusing on
helping our farmers optimise value from their livestock
by helping them to produce the most sustainable and
efficient animals and the highest value product.
We estimate that LIC delivers at least $525 million
of value on farm from the products that farmers
purchase from us:
• Genetic improvement of the dairy herd generates
the majority of the value, based on the increase in
gBW over time.
• Increasing the six-week in-calf rate improves
reproductive performance through more days
in milk, decreased number of empty cows culled
and increased value from more calves bred from
artificial insemination. Prior improvements in LIC’s
bull semen have also increased conception rates
over time.
• Health data provided to identify mastitis reduces
the costs of treatment and reduces the number
of cows culled due to this issue. Other disease
testing identifies cows for farmer culling decision-
making and reduces further spread of disease
within a herd.
• Production Worth data is used to identify lower
performing cows, enabling informed farmer
decision making. Short Gestation Length (SGL)
beef inseminations provide an additional 8 days of
milk on average.
• SPACE
TM
provides reporting on accurate pasture
cover data.
• We are working towards being able to calculate
the value of environmental improvements through
genetic improvements reducing enteric methane
and nitrogen impacts.
Genetic Merit
$
350
m
Reproductive
performance
$
35
m
Health
(Johnes, BVD, Mastitis)
$
65
m
Production
(Culling & SGL)
$
65
m
SPACE
TM
$
10
m
LIC contribution to value on Farm
For the year ended 31 May 2023
51
Shareholders /
Customers
Delivering quality
products and services,
advancing genetic
improvement of herds,
re-investing profits in
further R&D or returning
to shareholders
through dividends
Relationships
Positive relationships
with shareholders,
farmers, vets,
government and
regulators, sector and
research partners,
employees and the
farming community
Employees
Providing a safe
workplace with
development
opportunities and strong
engagement
Intellectual
capital
Our collective
know-how, systems
and intellectual
property that more
than 50 years of R&D
has generated
Sector Partners
Collaborating
on research and
development, providing
quality data inputs
Financial
capital
Our farmers and
shareholders create
a strong financial base
to operate and invest
for the future, as well
as our banking partner
debt facilities
Government
& Regulators
Complying with
regulatory and
financial reporting
requirements, reducing
our own environmental
footprint and that
of the national herd,
responsible taxpayer
Assets &
infrastructure
Our property, equipment
and animals allow us
to run our business and
distribute products and
provide services
Community
Providing employment,
lowering our
environmental footprint,
support through
sponsorship and
scholarships
People
We rely on our talented
employees, sector
partners and suppliers to
help deliver our products
and services
Natural
environment
New Zealand’s natural
environment is a key
factor, particularly rain,
sun and quality soil
supporting grass growth
for animals
The resources we rely on:
Value created for
our stakeholders
LIC Sustainability Report.
52
Engaging with our stakeholders
The Board and Senior Leadership Team
regularly consider different stakeholders and
mechanisms to engage with them, as well
as making decisions on when not to engage.
This is commonly discussed at regular
management and Board meetings, with
recommendations made to Board, or requests
from the Board.
Over the period our 12 month rolling average Net
Promoter Score (NPS) improved to -3.5 from the
prior year rolling average of -10. NPS is a measure
of customer experience that ranges between -100
and +100.
For the year ended 31 May 2023
53
Our farmer
shareholders & customers
Our
People
Suppliers
& Partners
Regulators &
other agencies
Communities
Goal
Deepen our understanding of the
current and future needs of all
our farmers
Develop talent and foster a culture
that embraces change, builds
capability and drives better results
Work with others to deliver farmers’
needs, including partnering to deliver
a seamless service
Ensure long-term sustainability of our co-operative, farmers, environment and
the NZ dairy sector
How we engage
• In person with tailored advice
• Customer call centre
• Net Promoter Score and
other surveys
• Fieldays, events and training
• Feedback groups
• Annual meeting, Shareholder
Reference Group, Roadshows
• Publications (such as The Bulletin)
• Digital channels
• Organisational Health Index
annual survey
• Employee events and in-person/
online updates
• Wide range of training &
development
• Internal communication, including
Chief Executive email updates
• Strategic procurement team
• Supplier evaluations
• Partnership relationships
• Collaboration with innovators &
researchers
• R&D investment
• Direct engagement with government
and agencies by CE and
relevant employees
• Submissions on proposed law and
regulation
• Support of sector groups
• Scholarships and internships
• Social media channels
Needs & expectations
• Deep customer relationships
• Quality products and services, on
time consistently
• Reliable MINDA
®
software that is
easy to use
• Ongoing genetic improvement
• Innovation
• Prompt issue resolution
• Positive culture
• Safe, diverse and inclusive
environment, where wellbeing
is important
• Investment through training and
development
• Market-comparable remuneration
and benefits
• Innovative working tools
• Reliable and sustainable supply
chain, providing quality inputs
• Strong, productive partnership
relationships
• Robust science-based R&D projects
• Strong governance and
management of legal requirements
• Insightful input on issues and
proposed change
• Appropriate and prompt response
to incidents
• Positive, proactive relationships
• High quality external reporting
• Positive employment and growth
opportunities
• Responsible organisation (e.g. as a
taxpayer, purchaser)
• Respond appropriately to
issues raised
• Transparent reporting
• Key partner to farming community
• Respect for diversity
Response
Our primary focus is delivering value
for our farmer shareholders and we
commit to operational excellence,
faster genetic improvement and
software reliability and performance
We live our corporate values:
“Integrity, Innovation, Spirit of
Co-operation, In tune and Passion”;
we work on providing a safe and
positive environment where our people
can thrive
We work with others to build long-term
trusted relationships, and will have
increasing focus on relationships with
other organisations in the agri sector
Collaborative interactions with
Government and agencies, respect for
our licence to operate, strong focus on
compliance
We help farmers to meet the current
and future challenges, in particular
water quality and methane, through
research, investment and tools
LIC Sustainability Report.
54
Materiality Assessment
In 2021 the Board and management
partnered with an external firm to refine
our strategy. The strategy was informed by
feedback from farmer shareholders, other
stakeholders and local and global trends.
The strategy is to do what we’re good at and play
to our strengths. It is built on four solid foundations,
Environment, Sustainable Co-operative, People and
Partnership, and at its core is about delivering value for
farmer shareholders.
When refining our strategy we also made three
commitments to our farmer shareholders. The second
commitment, faster genetic improvement, commits
to having farmers’ backs when it comes to helping
them meet the environmental challenges they face, in
particular animal efficiency, and nitrogen and methane
mitigation. The strategy and commitments drive a
focus on improving sustainability within LIC as well as
helping the dairy sector to reduce its impact on the
environment.
Management and the Board also worked together
to carry out a materiality assessment on topics
where the company may have significant economic,
environmental and social impacts. We identified
potential topics of importance based on our strategy
foundations, reports and guidance from the dairy
sector, farmer feedback and issues identified by
risk assessments. Materiality was determined by
considering the significance of our impact, the
importance of the issue to stakeholders and our ability
to control and/or influence the issue. Farmer elected
directors provided important input in relation to
importance of issues for stakeholders and LIC regularly
holds farmer engagement meetings in different regions
to continue to gather feedback in reviewing the below
topics. The business is currently running a series of
workshops with farmers on key drivers for ‘breeding the
herd for your farming future’.
TopicImpactReport referenceGRI Standard
Climate change
Supporting shareholders to produce the most
sustainable and efficient animals. Reducing
our emissions at LIC.
Reduce negative impacts
from direct and indirect
GHG emissions
Reducing the environmental
impact of our national herd
Reducing the environmental
footprint of our business
302-1,
302-3, 302-4,
305-1 to 6
Animal health & biosecurity
Providing animal health products and
information services to identify diseases and
health conditions. Working with farmers to
minimise risk on farm of disease spread.
Increase/continue positive
impact on animal welfare
Reducing the environmental
impact of our national herd
Employment and sustainable
income creation
Caring for our staff and our farmer
shareholders through meaningful employment
and sustainable income creation.
Increase/continue positive
impact on staff and farmer
shareholders
Social sustainability – caring for
our people
Delivering a strong result for
our famers
201-1
Health, safety & wellbeing
Protecting the health and safety of people at
work, including their wellbeing.
Increase/continue positive
impact on staff
Social sustainability – caring for
our people
403-2
Human rights
Protecting the employment rights and
working conditions of our people, including
diversity and inclusion.
Increase/continue positive
impact on staff
Social sustainability – caring for
our people
406-1
Water
Using water responsibly, including water
quality, availability and disposal.
Reduce negative impacts on
environment
Reducing the environmental
footprint of our business
303-2
Waste
Improvement of waste management and
disposal practices.
Reduce negative impacts on
environment
Reducing the environmental
footprint of our business
306-3
Responsible procurement
Influence our key suppliers in relation to
sustainable business practices.
Reduce negative impacts on
environment and increase/
continue positive social impacts
Our business – our supply chain
For the year ended 31 May 2023
55
GRI content index
The report has been prepared in accordance with the Global Reporting
Initiative (GRI) Standards - core option.
GRIDisclosure titleLocation or reference - in Annual report
or links to materials on LIC website
2-1Organisational detailsWho we are - pg 1
2-2Entities included in the organisation’s
sustainability reporting
The report includes the full LIC
consolidated group of entities. A list is
available in the Annual report, corporate
governance report
2-3Reporting period, frequency and
contact point
About this report – pg 2, for enquiries
contact Communications@lic.co.nz
2-4Restatements of information
There have been some restatements of
historical GHG data as improvements have
been made to data collection
2-5External assuranceAbout this report – pg 2, Reducing the
environmental footprint of our business –
pg 25, LIC website
Activities and workers
2-6Activities, value chain and other business
relationships
Our Business – pg 46
2-7EmployeesEmployee data – pg 39
2-8Workers who are not employeesInformation unavailable/incomplete:
description included in Employee data
– pg 40. Data currently gathered has
insufficient detail to correctly identify
workers who are not employees
Governance
2-9Governance structure and compositionGovernance and structure – pg 33. There
is limited disclosure on under-represented
social groups (due to the nature of
our business farmer representation is
the most critical representation) and
only general information provided on
competencies.
2-10Nomination and selection of the highest
governance body
Annual report, corporate
governance report
GRIDisclosure titleLocation or reference - in Annual report
or links to materials on LIC website
2-11Chair of the highest governance bodyAnnual report, corporate
governance report
2-12Role of the highest governance body in
overseeing the management of impacts
Annual report, corporate governance
report, Governance structure - pg 33
2-13Delegation of responsibility for
managing impacts
Annual report, corporate
governance report
2-14Role of the highest governance body in
sustainability reporting
Governance and structure –
pg 33, Annual report, corporate
governance report
2-15Conflicts of interestAnnual report, corporate
governance report
2-16Communication of critical concernsAnnual report, corporate governance
report, there is no specific disclosure
on the number and nature of critical
concerns communicated due to
confidentiality constraints – material
matters related to this report
are disclosed
2-17Collective knowledge of the highest
governance body
Annual report, corporate
governance report
2-18Evaluation of the performance of the
highest governance body
Annual report, corporate
governance report
2-19Remuneration policiesAnnual report, corporate
governance report
2-20Process to determine remuneration
Annual report, corporate governance
report, Annual Meeting
2-21Annual total compensation ratioInformation unavailable/incomplete:
due to a change in Chief Executive,
comparisons to the prior year are not
available, Employee data – pg 40
2-22Statement on sustainable
development strategy
Letter from the Chair and Chief
Executive – pg 7
LIC Sustainability Report.
56
GRIDisclosure titleLocation or reference - in Annual report
or links to materials on LIC website
Strategy, policies and practices
2-23Policy commitments
Annual report, corporate governance
report; Code of conduct & ethics
2-24Embedding policy commitments
2-25Processes to remediate negative impacts
2-26Mechanisms for seeking advice and
raising concerns
2-27Compliance with laws and regulationsNot applicable: there have been
no significant instances of
non-compliance, fines or non-monetary
sanctions; minor breaches reported
under Reducing the environmental
footprint of our business – pg 30
2-28Membership associationsAbout this report – pg 49
Stakeholder engagement
2-29Approach to stakeholder engagementMateriality assessment – pg 55
2-30Collective bargaining agreementsEmployee data – pg 40
Material topics
Economic topic disclosures
201-1Direct economic value generated
and distributed
Trend data, pgs 42 – 45, Annual Report,
Financial statements
201-4Financial assistance received
from government
NEW MATERIAL TOPIC.
Annual Report discloses R&D grants
and tax incentives received from
NZ Government in Note 1 to the
financial statements, no government
ownership of LIC
207-1Approach to taxNEW MATERIAL TOPIC.
Economic Sustainability – Tax pg 42
207-2Tax governance, control;
and risk management
NEW MATERIAL TOPIC.
Economic Sustainability – Tax pg 42,
Annual Report external audit report
includes audit of tax disclosures
GRIDisclosure titleLocation or reference - in Annual report
or links to materials on LIC website
Environmental topic disclosures
302-1Energy consumption within
the organisation
Reducing the environmental footprint
of our business - pg 25,
GHG Inventory Report
302-2Energy consumption outside of
the organisation
302-3Energy intensity
302-4Reduction of energy consumption
305-1Direct (Scope 1)
GHG emissions
305-2Energy indirect (Scope 2)
GHG emissions
305-3Other indirect (Scope 3)
GHG emissions
305-4GHG emissions intensity
305-5Reduction of GHG emissions
305-6Emissions of ozone-depleting
substances (ODS)
306-3Waste generated
Social topic disclosures
401-1New employee hires and
employee turnover
NEW MATERIAL TOPIC.
Employee data – pg 40
401-3Parental leaveNEW MATERIAL TOPIC.
Information unavailable/incomplete: not
all data tracked currently.
Employee data – pg 40
402-1Minimum notice periods regarding
operational changes
NEW MATERIAL TOPIC.
Employee data – pg 40
403-2Hazard identification, risk assessment,
and incident investigation
Critical Risks management - pg 37
415-1Political contributionsAnnual Report, corporate governance
report – donations
For the year ended 31 May 2023
57
GRIDisclosure titleLocation or reference - in Annual report
or links to materials on LIC website
GRIDisclosure titleLocation or reference - in Annual report
or links to materials on LIC website
Topics determined to be not material
Economic topic disclosuresExplanation
201 - 2Financial implications and other risks and
opportunities due to climate change
Information unavailable/incomplete:
In 2024 LIC will report on this topic as
part of Climate Statement reporting
requirements
201-3Defined benefit plan obligations and other
retirement plans
Not applicable: LIC does not operate a
defined benefit or retirement plan
Market PresenceExplanation
202-1 Ratios of standard entry level wage by
gender compared to local minimum wage
Information unavailable/incomplete: NZ
is only material market – not considered a
material issue
202-2Proportion of senior management hired
from the local community
Not applicable: all senior management
employed in NZ (most significant
market) are local
Indirect Economic ImpactsExplanation
203-1Infrastructure investments and
services supported
Not applicable: no significant
infrastructure investments, no impact on
communities and local economies
203-2Significant indirect economic impactsNot applicable: no significant indirect
economic impacts identified
Procurement practicesExplanation
204-1 Proportion of spending on local suppliersNot applicable: majority of spending is
with local suppliers
Anti-corruptionExplanation
205-1Operations assessed for risks related to
corruption
Not applicable: corruption not
considered an issue in NZ, which is only
material market
205-2Communication and training about anti-
corruption policies and procedures
Not applicable: corruption not considered
an issue in NZ
205-3Confirmed incidents of corruption and
actions taken
Not applicable: no incidents
Anti-competitive behaviourExplanation
206-1Legal actions for anti–competitive
behaviour, anti-trust and
monopoly practices
Not applicable: no legal actions
Ta xExplanation
207-3Stakeholder engagement and
management of concerns related to tax
Not applicable – NZ is only
material market
207-4Country-by-country reportingNot applicable: NZ is only material market
MaterialsExplanation
301-1Materials used by weight or volume
Not applicable: as mostly services
provided (ie not manufacturing goods)
301-2Recycled input materials used
301-3Reclaimed products and their
packaging materials
EnergyExplanation
302-5Reductions in energy requirements of
products and services
Not applicable: GHG reporting is not
considered material by product/service
Water and effluentsExplanation
303-1Interactions with water as a
shared resource
Information unavailable/incomplete:
not considered to have material
water-related impact. This report
does note consents to discharge
tradewaste
303-2 Management of water discharge-
related impacts
Information unavailable/incomplete:
not considered to have material
water-related impact. This report
does note any breaches
303-3Water withdrawalInformation unavailable/incomplete:
not considered to have material
water-related impact.
303-4Water dischargeMATERIAL TOPIC IN PRIOR YEAR.
Information unavailable/incomplete:
not considered to have significant
water-related impact.
303-5Water consumptionInformation unavailable/incomplete:
not considered to have significant
water-related impact.
BiodiversityExplanation
304-1Operational sites owned, leased,
managed in, or adjacent to, protected
areas and areas of high biodiversity value
outside protected areas
Not applicable: LIC does not have sites
that are adjacent to a protected area or
areas of high biodiversity.
LIC Sustainability Report.
58
GRIDisclosure titleLocation or reference - in Annual report
or links to materials on LIC website
GRIDisclosure titleLocation or reference - in Annual report
or links to materials on LIC website
BiodiversityExplanation
304-2Significant impacts of activities, products,
and services in biodiversity
Not applicable: no material impacts.
304-3Habitats protected or restoredNot applicable: no such habitats.
The report notes riparian planting carried
out on farms.
304.4IUCN Red List species and national
conservation list species with habitats in
areas affected by operations
Not applicable: operations do not affect
any such areas. NZ has 67 species
currently on the Red List. LIC does not
believe our operations affect the habitats
of species on the Red List.
EmissionsExplanation
305-7Nitrogen oxides (NOx), sulfer oxides (Sox),
and other significant air emissions
Not applicable: LIC does not have
material air emissions
WasteExplanation
306-1Waste generation and significant
waste-related impacts
Information unavailable/incomplete:
data is included in GHG emission
calculations to the extent available and
the report notes action being taken to
reduce waste.
306-2Management of significant
waste-related impacts
306-4Waste diverted from disposal
306-5Waste directed to disposal
Supplier Environmental AssessmentExplanation
308-1New suppliers that were screened using
environmental criteria
Information unavailable/incomplete:
the report notes that consideration
of sustainability factors is part of the
Procurement policy and practices for
strategic procurement processes.
308-2Negative environmental impacts in the
supply chain and action taken
Information unavailable/incomplete:
no material impacts identified
EmploymentExplanation
401-2Benefits provided to full-time employees
that are not provided to temporary or
part-time employees
Not applicable: not considered to be
material differences
Occupational Health and SafetyExplanation
403-1Occupational health and safety
management system
Information unavailable/incomplete:
key information considered material is
provided in Health and Safety section of
the report, but not to the detail specified
of these disclosures.
403-3Occupational health services
403-4Worker participation, consultation and
communication on occupational health
and safety
403-5Worker training on occupational health
and safety
403-6Promotion of worker health
403-7Prevention and mitigation of occupational
health and safety impacts directly linked
by business relationships
403-8Workers covered by an occupational
health and sagety management system
403-9Work-related injuries
403-10Work-related ill health
Training and EducationExplanation
404-1Average hours of training per year
per employee
Information unavailable/incomplete:
not considered a material issue.
404-2Programmes for upgrading employee skills
and transition assistance programmes
404-3Percentage of employees receiving
regular performance and career
development reviews
Information unavailable/incomplete:
not considered a material issue – LIC
has a specific tool for completing
and overseeing reviews and
development plans.
Diversity and Equal OpportunityExplanation
405-1Diversity of governance bodies
and employees
Information unavailable/incomplete:
gender information is provided in report
(annual report for governance body) but
other diversity factors are not considered
a material disclosure.
405-2Ratio of basic salary and remuneration of
women to men
Information unavailable/incomplete:
not considered a material issue.
For the year ended 31 May 2023
59
GRIDisclosure titleLocation or reference - in Annual report
or links to materials on LIC website
GRIDisclosure titleLocation or reference - in Annual report
or links to materials on LIC website
Non-discrimination
406-1Incidents of discrimination and corrective
actions taken
MATERIAL TOPIC IN PRIOR YEAR
Not applicable: none identified
Freedom of Association and Collective BargainingExplanation
407-1Operations and suppliers in which the right
to freedom of association and collective
bargaining may be at risk.
Not applicable: none identified
Child LabourExplanation
408-1Operations and suppliers at significant
risk for incidents of child labour
Not applicable: primary market in NZ,
none identified
Forced or Compulsory LabourExplanation
409-1Operations and suppliers at significant
risk for incidents of forced or
compulsory labour
Not applicable: primary market in NZ,
none identified
Security PracticesExplanation
410-1Security personnel trained in human rights
policies or procedures
Not applicable: LIC does not employ
security personnel.
Rights of Indigenous PeoplesExplanation
411-1Incidents of violations involving rights of
indigenous peoples
Not applicable: No incidents reported
Local CommunitiesExplanation
413-1Operations with local community
engagement, impact assessments and
development programmes
Not applicable: no such operations
413-2Operations with significant actual and
potential negative impacts on local
communities
Supplier Social AssessmentExplanation
414-1New suppliers that were screened using
social criteria
Information unavailable/incomplete: due
to the sources of supplies, not considered
a material issue. This report includes
general content on suppliers.
414-2Negative social impacts in the supply
chain and actions taken
Customer Health and SafetyExplanation
416-1Assessment of the health and safety
impacts of product and service categories
Not applicable: not considered material
issue. H&S changes in relation to delivery
of AB services on farm in Herringbone
sheds is included in the report.
416-2Incidents of non-compliance concerning
the health and safety impacts of products
and services
Not applicable: no incidents reported.
Marketing and LabellingExplanation
417-1Requirements for product and service
information and labelling
Not appliable: products and services
relate to animals so not considered
material issue.
417-2Incidents of non-compliance concerning
product and service information
and labelling
Not applicable: no incidents reported
417-3Incidents of non-compliance concerning
marketing communications
Customer PrivacyExplanation
418-1Substantiated complaints concerning
breaches of customer privacy and losses
of customer data
Not applicable: no complaints received
LIC Sustainability Report.
60
605 Ruakura Road
Newstead 3286
Hamilton
New Zealand
07 856 0700 | lic.co.nz
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