1. Overview

2021/2022 was another successful year for Takasago Sustainability Key Initiatives,TaSuKI.

While we still suffered from supply chains chaos and severe travel restrictions, a few key milestones were set for existing initiatives, and new promising sourcing opportunities were identified.

This feeds the pipeline for strategic ingredients directly procured “from source” by Takasago and confirms that TaSuKI is fully aligned with its clients and consumers’ aspirations for supply continuity, traceability and sustainability.

2. Ongoing Projects

France Lavandin Grosso

Pioneering 10 Years «Farm to Fragrance» Lavandin Agreement - “TaSuKI Originals, Care and Comply“

2021/2022 is the second year of our 10-year sustainable and ethical sourcing agreement with the Cooperative Corporation of Perfume Plants of Provence (SCA3P) for the purchase of Lavandin Grosso essential oil.

 It is time for a first review. We are proud to confirm that achievements have by far exceeded expectations:

• Contract implementation was flawless and despite unprecedented logistics headwinds, supply was smooth. For the first two years of the contract, all Takasago affiliates were served on time in full and quality was 100% compliant.
• The most remarkable achievement was on the sustainability front. As we anticipated, the lavandin grosso essential oil market price collapsed. While most farmers had to sell below soaring (production and carry) costs, Takasago fulfilled all price and quantity commitments. We bought from SCA3P farmer’s cooperative at pre-agreed fair and equitable cost + price, not at market price.

 The experiences made during 2021/2022 (and most likely continuing in 2022/2023) are living proof that long-term commitments such as our 10-year cost + arrangement with SCA3P are mutually beneficial. As opposed to the usual yearly spot negotiations, this helps the farmers who supply Takasago survive this disastrous situation and ensures that Takasago is able to secure supply when the market turns short (and given circumstances, it will).

Florida Grapefruit

Sustainable Grapefruit: New Groves Plantation - TaSuKI Originals, Care and Comply

The long-term Sustainable Grapefruit project is on track. The agreement signed back in 2019 continues at a good pace creating new groves during the first 7 years of execution. The new groves commitment is resulting in a strong partnership with the citrus industry.

 The entire value chain has been integrated and is aligned in the same direction. In 2022, we expect to have more than 55% of the trees projected under this agreement in the orchards. The remaining 45% will be planted in the next 4 years, up to 2026. Trees already planted will start producing grapefruit within the next 3 years. We are anticipating the resulting sustainable grapefruit oil and have already developed unique grapefruit oil grades for both our Flavors and Fragrances Creation Teams.

Madagascar Vanilla

News from Takasago Madagascar - TaSuKI Originals, Care and Comply

The 2021-2022 period was quite intense for Takasago Madagascar and vanilla.

As shared in our previous Sustainability Report release, Takasago began the process of obtaining the Fair For Life certification of its vanilla from Madagascar. In full alignment with the TaSuKI Comply principles, we are therefore very proud to confirm that on Feb 25th Takasago Madagascar obtained FFL certification from Ecocert.

This is the accomplishment of a major milestone towards meeting Takasago’s sustainability objectives, particularly the ESG compliance of TaSuKI’s strategic ingredient supply chains.

Like France lavandin grosso and Florida grapefruit, it fully aligns with clients and consumers aspirations, as, according to Takasago’s 2021 Vanilla Study:

• About 73% of consumers agree that their beloved vanilla should be sourced sustainably
• Consumers, especially in Europe, believe that the best quality vanilla is produced in Madagascar which supplies about 80% of the world’s high-quality vanilla beans.

A second critical milestone was achieved in 2022. On April 4th, Takasago officially became a member of the Sustainable Vanilla Initiative (SVI).

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The Sustainable Vanilla Initiative (SVI) is an industry membership forum for companies committed to work on sustainable production in the vanilla industry, with an initial focus on Madagascar, the world’s largest vanilla producing country.

SVI aims to:

• Grow the supply and market for sustainable / traceable vanilla
• Improve and sustain vanilla households’ incomes / livelihoods
• Improve quality by significantly reducing early harvesting of green vanilla
• Address the concerns about child labor in vanilla production

The initiative currently has 28 members ranging from major consumer goods manufacturers and global flavors and fragrances companies to international vanilla bean traders and cooperatives selling vanilla extracts. Collectively, members represent over 70% of worldwide vanilla bean purchases.

The initial priorities of the Sustainable Vanilla Initiative strategy will be to contribute to the above 4 goals by supporting companies to scale successful supply chain partnership programs, where needed to invest in pre-competitive programs that complement the company led programs, and to improve sector governance, bringing a clear and organized industry voice and support to Madagascar to work in publicprivate cooperation.

The rationale behind Takasago’s becoming a member was a desire to share our 10 years of vanilla expertise in Madagascar, a need to ensure alignment with Industry sustainability best practices and a desire to join forces to help move the vanilla sourcing sustainability agenda forward.