Our Sustainability Priorities
“We are in the process of integrating sustainability into many aspects of our global business. As we do so, we understand the value of concentrating our actions and investments on where we can make the greatest positive impact on farmers and the entire field of agriculture. Across AGCO, we are prioritizing the following four sustainability imperatives.”
Our Sustainability Priorities
Alignment With UN SDGs
We recognize the importance of the United Nations Sustainable Development Goals (SDGs), which aim to make significant progress on global economic, social, and environmental challenges by 2030. From fostering sustainable food production to encouraging effective partnerships, our sustainability priorities align with six of the United Nation’s Sustainable Development Goals (SDGs).
Megatrends Informing Our Sustainability Priorities
We're committed to doing our part to address the biggest issues facing our industry and our world.
Population growth and food security
From 7.3 billion in 2015 to 9.8 billion by 2050, the planet’s growing population will put additional stress on the environment and societies.
55% of the world’s population lives in cities, growing to 68% by 20501. Concomitant with increasing sizes of farms is an increasing risk of labor shortage in rural areas.
Speed and scale of changing consumer preferences
Consumers continue to seek transparency in food production. And increasing demand for animal protein has driven a greater need of feed and grain2.
Precision farming investments will continue to improve yield and reduce costs and environmental impacts.
Shifting socioeconomics and growing divides
Emerging and developed markets continue to see gaps in nutrition and health, educational systems, economical resilience and environmental rights.
Increasing focus on animal welfare
As human standards of living rise around the globe, driving demand for animal protein, so do concerns about animal welfare and how to find more sustainable and productive ways to raise healthy animals.
Land is simultaneously a source and a sink of CO2. Land degradation in agriculture systems can be addressed through sustainable land management, with an ecological and socioeconomic focus, with co-benefits for climate change adaptation4.
Climate-related risks pose a threat to economies around the world. Extreme events—fires, freezes, floods, high winds—are occurring with unprecedented frequency and already reshaping the world’s socio-economic outlook. The food sector contributes over 20% of total GHG emissions, with the agri-food chain accounting for ~30% of the world’s total energy demand3.
Sources: 1 United Nations, 2 World Health Organization, 3 FAO – Energy-Smart Food for People and Climate, 4 International Panel on Climate Change - Climate Change and Land
Identifying What Matters Most
Our success depends on understanding and responding to the changing world in which AGCO operates. In 2020, we updated our materiality assessment to identify the environmental, social, economic and governance issues that are perceived as being most important to our stakeholders. In addition, we also benchmarked the key sustainability focus areas of our peers and researched industry megatrends to establish a broad view of current sustainability issues. The resulting insights informed our sustainability approach, strategy, and reporting. This ensures that we consider the issues that matter most to our stakeholders, and which we can influence.
At AGCO, we consider a broad range of stakeholders as we each have a vested interest in securing the global food supply for current and future generations. We regularly engage with countless individuals, organizations, government bodies and other entities to discuss their priorities and the important work we can do together.
What We Heard
Stakeholders prioritized the shift towards environmental efficiency and decarbonization in the manufacturing sector, as regulatory requirements for greenhouse gas emissions, fuel use and resource efficiency will intensify in the future.
“The industry needs to focus towards clean tech and sustainable products, and increasingly quantify the external environmental impact of new products.”
Climate risk is expected to have a significant impact on agriculture, as increased severe weather events will affect farmer livelihood and food security. Additionally, stakeholders mentioned the transition towards sustainable farming practices to reduce environmental impact.
“Changing climates will affect how and where agriculture can be done, therefore AGCO should consider this a top-of-mind priority.”
Stakeholders indicated that AGCO should focus heavily on research and development partnerships to keep pace with innovation so that digital technology can be leveraged to help guarantee food security.
“The future farmer will resemble a computer scientist, leveraging technology to increase productivity in order to meet the rising demand for food.”
|Stakeholder||Why It Matters||How We Connect|
We aim to listen and react to our customers and earn the right to be a trusted partner. This ensures the long-term sustainability of our business in a competitive and changing marketplace.
Voice of customer activities; Customer satisfaction surveys; Events and field days/crop tours; Customer/farm visits; Corporate/brand websites/social media; Training events
Our dealer partners are often our first line of engagement with customers, and we work together to develop a deep understanding of our customers’ needs.
Dealer relationships; Dealer surveys; AGCO Academy training events
To remain innovative and build competitive advantage, we must attract and retain talented people who are passionate about our purpose.
InsideAGCO (employee intranet); MyAGCO (employee app); Town hall meetings; Employee surveys; One-to-ones; AGCO University training events
As smart farming brings greater technological complexity, we seek to make our supply chain more sustainable, we need strong and collaborative relationships with suppliers around the world.
Global supplier conference; Regional supplier days; Supplier training events; Procurement initiatives; Buyer relationships; E-sourcing portal; Supplier e-communications; Supplier audits
Investors are increasingly interested in greater disclosure and transparency, particularly related to ESG topics and performance, which they link to long-term value.
Annual general meetings; Direct engagement; Sustainability report; Amplified ESG disclosures
Promotion of technological innovations, participation in industry-government-academia collaborative projects.
Collaboration on initiatives
We work actively with journalists, media and opinion formers to share information on our progress.
Press conferences; Direct engagement; Corporate and brand websites/social media
|Public Institutions: Government, Trade Associations||
We work with a variety of public and institutional representatives to provide information about our business to advance policies that support AGCO to realize its vision and purpose.
Participation in business and industry associations; Regular dialogue; Participation in steering/working groups; Collaboration on initiatives
|Non-Government Organizations (NGOs)||
NGOs and research institutions have the power to influence public opinion, as well as to provide us with insight and guidance on emerging issues and the latest thinking on topics material to our business sustainability.
Collaboration on initiatives
Our outreach follows traditional venues and pathways, such our crop tours, supplier days and distributor conferences, but more and more, and especially in this year of an unrelenting global pandemic, we engage digitally.
Fendt virtual events include: a dealer meeting engaging 400 dealers and streamed in 6 languages; a press conference of 430 journalists; and a Fendt 200 Vario launch garnering 86,000 YouTube views within 24 hours in March 2020
AGCO virtual supplier days worldwide, 1750 Supplier delegates, May-July 2020
Connecting with 65,000 farmers from approximately 170 countries at Massey Ferguson virtual event, including MF 8S product launch and virtual showroom, July, 2020
Meeting customers in China via mixed reality and 3D holographic technology at China International Agricultural Machinery Expo (CIAME), Nov 2020
About This Report
AGCO established a new global sustainability function in 2020. This is our first sustainability report since 2014. In the report, we have set out our strategic priorities for sustainability. We have not sought external assurance from third parties with respect to the information presented in this report.
This report covers activities for the fiscal year ending December 31, 2020 (FY2020) unless otherwise stated. This Sustainability Report provides a concise overview of our strategic priorities for sustainability as well as initial commitments and goals which we will evolve in future reports. We see this as an iterative process and will seek feedback from stakeholders as to how we can evolve and improve our reporting and disclosures each year.
Materiality, as used in the context of this Sustainability Report, and our reference to materiality, is different to the definition used in the context of our filings with the SEC. Issues deemed material for the purposes of this Report, and for the purposes of determining our Sustainability strategies, may not be considered material for financial purposes nor for SEC reporting purposes.
For more information on our ESG disclosures including the GRI Standards and SASB, please visit our website.