Sustainability Report

Sustainable Growth

Robust Fundamentals

Sustainable Growth
GRI 3-1, 3-3

A strong foundation is necessary for sustainability, encompassing both stable structures and the right values.

Good governance guarantees clear and adequate objectives and processes, fair and equitable rules, and proper representation. It involves taking deliberate and dedicated action to benefit all stakeholders.

Enterprise Risk Management (ERM) aims to prevent adverse events, reduce negative impacts, and transform risks into value-creation opportunities.

Capabilities are the foundation for success, adding value and competitive advantage in the market. Though setbacks may be unavoidable, they offer opportunities for learning, and perseverance and dedication lead to success.

The Company
GRI 2-2, 2-6

D&L Industries is a Filipino company engaged in product customization and specialization for the food, chemicals, plastics, and consumer products ODM industries. The Company’s principal business activities include manufacturing of customized food ingredients, specialty raw materials for plastics, and oleochemicals for personal and home care use.

With a track record that spans over five decades, D&L has established itself as the dominant market leader in the industries it serves. It also enjoys long-standing customer relationships with the Philippine’s leading consumer and manufacturing companies.

As the majority of the products that the Company manufactures caters to basic industries which are considered essential, D&L sees continued strong demand for its products even amidst global geopolitical, energy, and food supply uncertainties, even as pandemic fears still linger.


The Company was incorporated on July 27, 1971. It was listed on the Philippine Stock Exchange on December 12, 2012. It is 72% beneficially owned by the Lao family, the rest by the public.

The Company’s registered office address and principal place of business is at 65 Calle Industria, Brgy. Bagumbayan, Quezon City, Philippines.


Business Presence
GRI 2-2, 2-6

Food Ingredients
Oleo-Fats, Incorporated
D&L Premium Foods Corp.*

Fats & oils, specialty food ingredients, food safety products

Serves the domestic market
Exports mostly to Asia, plus US & EU

Oleochemicals & Specialty Chemicals
Chemrez Technologies, Inc.
Oleochemicals (cocobiodiesel & high-value coconut derivatives)

Chemrez Product Solutions, Inc.
Resins, colorants, powder coating

Serves the domestic market
Exports to Asia and US, UK, EU, & AU

Specialty Plastics
First in Colours, Incorporated
Pigment blends, color and additive masterbatches

Predominantly domestic

D&L Polymer & Colours, Inc.
Engineered polymers for various applications such as auto, construction, electrical, etc.

Domestic, plus exports predominantly to Asia

Consumer Products Original Design Manufacturer
Aero-Pack Industries, Inc.
Natura Aeropack Corporation*

Consumer products for personal and home care applications in aerosol or bottle packaging

Predominantly domestic

*Pre-operating for the full year in 2022
Corporate Social Responsibility
GRI 2-2, 2-6

The Lao Foundation, Inc. (LFI) is an independent non-stock, non-profit organization which the Company partners with for its Corporate Social Responsibility (CSR) initiatives. Their work is discussed in Resilient Supply, Better Lives, and Outreach.

GRI 2-22, 2-24, 2-29

Altruism permeates D&L’s culture, from excellence in every act, to every choice in favor of the best outcome for the majority of stakeholders.

Values passed on from the first to the second generation of leaders permeate the inclusive culture of excellence the Company cultivates and nurtures, throughout and across, within and beyond, its boundaries.

Our Vision
To be the Philippines’ Majority Leader in Sustainable Ingredients, Materials and Solutions, and a Major Exporter in identified continents.
Our Mission

To excel and be the leader in the industries we serve.

We are dedicated to growth. We are not complacent, timid, or satisfied with the status quo.

We are research-oriented. We will keep abreast of the latest technology and have our fingers on the pulse of the market to identify the market needs that must be met.

We are committed to increase productivity and profitability, but not at the expense of ethics.

We will continuously enhance our reputation for quality and value. Our products and services must always represent good value for money and be competitive in the marketplace.

We will maintain our market leadership through creativity, innovation and excellence in performance tempered with experience.

We are proud of our employees. We consider them as our most valuable asset. We will maintain an atmosphere where our people can develop their abilities and potential while working together enthusiastically to achieve our goal.

We will contribute to the well-being of the communities in which we operate, and accept our responsibilities as citizens of the Philippines.


Our Beliefs

Progress and development can be realized only through the combined efforts and cooperation of each member of our organization from the highest to the lowest.

Dedication to meeting customers’ expectations and needs by providing them the best value from our products and the best service, through the combined efforts and cooperation of each member of the organization.

Passion for excellence in providing intelligent, responsible, and capable direction in the conduct of the business.

Conviction to manage company activities on the basis of the highest standards of conduct and ethics.

Our Corporate Values

Passion to lead

Drive to excel

Discipline and hard work

Positive attitude


Being honest, fair, and humble

Integrity and honesty

Fairness and humility


Caring together

Gratitude and appreciation

Harmony and cooperation

Courtesy and respect for others


Code of Business Principles

The Company recognizes that the most cogent proof of good corporate governance is that which is visible to the eyes of its investors. Therefore, the following provisions are issued for the guidance of all internal and external parties concerned, as governance covenant between the Corporation and all its investors.

At D&L, our values are at the core of our work and our operations. Our corporate Code of Business Principles (the “Code”) incorporates our commitment to this fundamental and basic belief and shows the way to doing things.

We enjoin our subsidiaries, affiliates, and member companies to adhere where ever and at all times to the set standards of conduct and behavior.

We strongly encourage our people as well as our suppliers, customers, contractors, and all those we partner with, to live up to the direction and guidance of the Code. We firmly believe upholding what is right and ethical greatly benefits all.

The Way We Commit to the Code

We call upon our people to comply and commit to the Code of Business Principles. We exhort them to conform to the norms of conduct prescribed therein. We encourage them to seek clarification and guidance from their supervisors, the Head of HR, the Legal Counsel, and the Compliance Officer. We do not tolerate non-compliance. We enforce heavy disciplinary measures on those who ignore and fail to follow the Code. We expect more from our managers and supervisors. We look at them to inspire, lead and model the way of ethical behavior.

Our business unit heads and managers are ultimately responsible in ensuring compliance. We expect them to actively and visibly provide support. We enjoin them to patiently but persistently promote and encourage employees’ adherence to the Code. We hope that our organizational leaders personally engage in assisting and training their own staff in the context of their specific duties and responsibilities.

We urge our employees to bring to the attention of their supervisor or of senior management any breach or suspected violation of the Code. We have support provisions to safeguard strict confidentiality. We also assure that those reporting do not suffer the consequence of disclosing in confidence what they know.

The Way We Do Business

We conduct business guided by the principles of honesty, integrity and transparency. We respect the legitimate rights and interests of those we transact with. We take into account the unique culture of the countries we operate in and comply with their laws and regulations.

The Way We Care for Our Stakeholders

Our People

Our employees are our greatest asset. We provide them with opportunities for continuing skills and capability development. We communicate with and consult them. We provide them with safe and healthy working conditions. More importantly, we recognize the dignity and uniqueness of their person. We respect their freedom and their valid and lawful rights. We do not resort to force or any form of coercion. We do not employ child labor or engage minors to work.

We do not discriminate. We treat all equally regardless of race, religion, color, status, sexual orientation, ethnicity, or nationality. Our screening, selection, and hiring and compensation policies are solely based on qualifications. Our training, development, evaluation, promotion, reward, retention and separation procedures follow the principles of meritocracy and objectivity.

Our Customers

We offer products and services of the highest standards of quality and safety. We are committed to creating value. We make sure they are properly and accurately labelled. We use available and appropriate media communications to advertise their unique proposition.

Our Community

We recognize our responsibility as good corporate citizens. Our aim is to contribute to the development of the communities we operate in. Our goal is to create lasting and deep impact benefits to society.

We take extra care to avoid disruptions, if not minimize them.

Our Environment

We care for the environment. We are committed to sustainable development. We meet the ever- increasing needs of the business but never forget the conservation and preservation of nature. Our long- haul horizon goes beyond the present and stretches to generations yet to come. Our efforts not to endanger but rather enhance the ecosystem continue. We also recognize the importance of biodiversity and support the global community in protecting it.

Our Business Partners

We acknowledge the contribution of our customers, suppliers and business partners. We are grateful. We are strongly committed to continue building lasting and mutually benefiting relationships with them. We urge them to partner with us in the pursuit and practice of the Code.

Our Shareholders

We adopt the principles and practice of internationally accepted prescriptions of good corporate governance. We regularly update our shareholders with timely, reliable and accurate information on the company’s operational performance and financial position. We continually communicate with them our key initiatives and major activities

The Way We Grow

We are dedicated to growth. In pursuit thereof, we continually innovate. We develop new ways and new products to meet the changing needs of our customers.

We adopt strict standards of sound science and apply very disciplined testing procedures to ensure high level product quality and safety

The Way We Deal with Politics

We cooperate with governments and other organizations in the protection and promotion of the company’s legitimate business concerns. We closely collaborate with them in the development of regulatory and legislative initiatives impacting our investments and interests. We do not in any way participate in party politics. We also neither make contributions in kind nor fund campaign connected activities

The Way We Handle Conflicts of Interest & Maintain Integrity

Our employees are expected to keep clear from financial, business, or other relationships and activities that might be opposed to, in competition with, and disadvantageous to company businesses and the proper performance of their duties. We exhort them to conduct themselves in a manner that avoids even just the appearance of a conflict of interests between their personal self-interests and those of the company.

We refrain from receiving gifts beyond accepted, common, and customary courtesy, in cash or kind, directly or indirectly, that might impair judgement, provide preferential treatment, and result in unfair competition. We also do not subscribe to tendering nor accepting payments as bribes. We strongly advise that any demand or offer be readily rejected and immediately reported to management.

Our corporate funds, assets, services, and facilities are not to be used for any unlawful, unethical, and personal enrichment purpose.

Corporate Governance
GRI 3-3, 2-9, 2-10, 2-11, 2-12, 2-13, 2-14, 2-17, 2-18, 2-19, 2-20, 2-22, 405-1 | SDG 5.1, 5.5, 8.5, 16.6, 16.7

D&L is committed to good Corporate Governance aligned with its purpose to Better Lives Through Sustainable Innovation for the Company’s long-term success shared with all its stakeholders and the nation.

The Company’s Corporate Governance provides for the system of stewardship, control and feedback that guides the organization in fulfilling its long-term economic, moral, legal and social obligations to all its stakeholders. It establishes the direction, feedback and control using regulations, performance standards, and ethical guidelines to hold everyone in the organization accountable starting from the Board of Directors (BOD) and Senior Management.

Commitment to Sustainability

D&L recognizes the interdependence between business and society, and promotes a mutually beneficial relationship that allows the company to grow its businesses, while contributing to the advancement of the society. The Company commits to its social responsibility in all its dealings with the communities in which it operates and ensures that its business activities serve the environment and all its stakeholders in a positive and progressive manner. In this regard, D&L not only complies with existing regulations, but also voluntarily employs value chain processes which take into consideration Environmental, Economic, Social and Governance (EESG) issues and concerns.

Board of Directors

D&L is headed by a competent BOD and is composed of directors, who individually and collectively, have working knowledge and experience relevant to the Company’s industries. The Company’s BOD has an appropriate mix of competence and expertise to fulfill its roles and responsibilities and respond to the needs arising from the evolving business environment and strategic direction.

To ensure the exercise of objective and independent judgement on all corporate affairs and for proper checks and balances, six (6) of the seven (7) Board seats are occupied by Non-Executives (NED), and four (4) of the six (6) NEDs are Independent Directors (ID). The BOD has three (3) female ID and sufficient diversity to ensure optimal decision-making is achieved to avoid the acceptance of a viewpoint or conclusion that representsa perceived group consensus. In addition, the BOD has a Lead Director among the IDs to ensure independent views and perspectives. The Lead Independent Director has sufficient authority to lead the BOD in cases where management has clear conflicts of interest.

The NEDs conduct separate periodic meetings with the external auditor and head of internal audit, compliance and risk functions without any executive directors for proper checks and balance, constructive scrutiny of performance and satisfy themselves on the integrity of Company’s internal control and effectiveness of the risk management systems.

Board of Directors
ChairpersonNon-executiveYin Yong L. Lao

Vice ChairpersonNon-executiveJohn L. Lao
MembersLead Independent DirectorAtty. Mercedita S. Nolledo
 Independent DirectorCorazon S. de la Paz-Bernardo
 Independent DirectorDr. Lydia R. Balatbat-Echauz
 Independent Director

Engr. Filemon T. Berba, Jr.†

Karl Kendrick T. Chua*

 ExecutiveAlvin D. Lao

Mr. Berba passed on last April 4, 2023. His position was vacant as of the publication of this Report [April 15, 2023].

* Mr. Chua was elected as Independent Director on June 5, 2023.

Board Committees

The Board established committees composed of board members that focus on specific board functions to aid in the optimal performance of the BOD’s roles and responsibilities. Each Committee has a Committee Charter that contains its purpose, membership, structure, operations, reporting process and other relevant information.

Audit Committee

The Audit Committee enhances the Board’s oversight capability over the Company’s financial reporting, internal control system, internal and external audit as well as compliance with applicable laws, regulations, and internal policies. It is responsible for overseeing the Senior Management in establishing and maintaining an adequate, effective internal control framework that will allow operational efficiency and safeguarding of assets

The Audit Committee is composed of four (4) IDs and all members have relevant background, knowledge, skills and experience in the areas of accounting, auditing and finance.

Audit Committee
ChairpersonIndependent DirectorCorazon S. de la Paz-Bernardo

MembersLead Independent DirectorAtty. Mercedita S. Nolledo
 Independent DirectorDr. Lydia R. Balatbat-Echauz
 Independent Director

Engr. Filemon T. Berba, Jr.†

Karl Kendrick T. Chua*

Related-Party Transaction Committee

The Related-Party Transaction (RPT) Committee evaluates relations between businesses and counterparties to continuously identify related-parties and review RPTs to ensure that these are undertaken on an arm’s length basis that is appropriately monitored, reported and disclosed. The RPT Committee further ensures that no corporate or business resources are misappropriated or misapplied, and determines potential reputational risks that may arise as a result of or in connection with the RPTs.

Related-Party Transaction Committee
ChairpersonIndependent DirectorDr. Lydia R. Balatbat-Echauz

MembersLead Independent DirectorAtty. Mercedita S. Nolledo
 Independent DirectorEngr. Filemon T. Berba, Jr.†
Corporate Governance Committee

The Company is committed to good corporate governance, which promotes the long-term interests of shareowners, strengthens Board and Management accountability, and helps build public trust in the Company.

The Corporate Governance (CG) Committee oversees the implementation of the corporate governance framework, principles and practices, and ensures its continued relevance in light of the Company’s size, complexity, business strategy and the regulatory environment. CG Committee also oversees the evaluation and assessment of the BOD and the Board Committees, nomination of BOD members and appointment and remuneration of key executives and officers.

Corporate Governance Committee
ChairpersonLead Independent DirectorAtty. Mercedita S. Nolledo

MembersIndependent DirectorDr. Lydia R. Balatbat-Echauz
 Independent DirectorCorazon S. de la Paz-Bernardo
 Non-executiveYin Yong L. Lao
Nomination Committee

The Nomination Committee determines the nomination, screening and selection parameters of the Company’s BOD, and ensures that the election and termination process conforms with applicable laws and regulations. The Nomination Committee further defines the general profile of board members in terms of knowledge, competencies and expertise that are appropriate and relevant to the Company’s businesses.

Nomination Committee
ChairpersonNon-executiveJohn L. Lao

MembersIndependent DirectorEngr. Filemon T. Berba, Jr.†
 ExecutiveAlvin D. Lao
Compensation/Remuneration Committee

The Compensation/Remuneration Committee establishes a formal and transparent procedure for developing a policy on the remuneration of directors and officers to ensure that their compensation is consistent with the Company’s culture, strategy and the business environment in which it operates.

Compensation/Remuneration Committee
ChairpersonNon-executiveYin Yong L. Lao

MembersLead Independent DirectorAtty. Mercedita S. Nolledo
 Non-executiveJohn L. Lao
Risk Oversight Committee

The Risk Oversight Committee (ROC) helps the BOD in assuring that there is an effective and integrated risk management process in place. The ROC oversees that a sound Enterprise Risk Management (ERM) framework is instituted to effectively identify, monitor, assess and manage key business risks. The risk management framework guides the BOD in identifying business unit and enterprise-level risk exposures, as well as the effectiveness of the risk management strategies.

Risk Oversight Committee
ChairpersonIndependent DirectorEngr. Filemon T. Berba, Jr.†

MembersLead Independent DirectorDr. Lydia R. Balatbat-Echauz**
 Independent Director

Corazon S. de la Paz-Bernandardo

Karl Kendrick T. Chua*

 Non-executiveJohn L. Lao
 ExecutiveAlvin D. Lao
** Dr. Balatbat-Echauz was elected as Chairperson on June 5, 2023.

Executive Committee

During the intervals between the meetings, the BOD lawfully delegated to the Executive Committee (EXCOM) the exercise of the powers of the Board related to the management and direction of the affairs of the Company. All actions by the EXCOM are reported to the BOD at its meeting and may be subject to revision and alteration by the Board, provided that no rights of third parties are affected by targets and budgets, should there be any such revision or alteration.

Roles and responsibilities that may be relegated to the EXCOM include governance, strategic and operational leadership, drive portfolio/investment decisions, resource allocation, setting and approval budgets and hard targets, approval of strategic transactions and performance review.

Executive Committee
ChairpersonNon-executiveDean L. Lao

MembersNon-executiveLeon L. Lao
 Non-executiveAlex L. Lao
 Non-executiveYin Yong L. Lao
 Non-executiveJohn L. Lao
 ExecutiveAlvin D. Lao


Advisory Board

Acknowledging the wisdom of the Founders, the Advisory Board was established as a source of insights and advice, help explore new opportunities by stimulating robust, high-quality conversations and stimulate critical thinking to increase the confidence of decision-makers who represent the Company to help the organization achieve its goals and objectives. The Advisory Board helps fill in the knowledge gap in the Company and acts like an impartial third-party or a sounding board.

Advisory Board
MembersNon-executiveDean L. Lao
 Non-executiveLeon L. Lao
 Non-executiveAlex L. Lao


Corporate Governance & External Parties

External Auditors

PwC Philippines – Isla Lipana & Co.

Government Agencies
Board of Investments (BOI)
Bureau of Animal Industry (BAI)
Bureau of Customs (BOC)
Bureau of Fire Protection (BFP)
Bureau of Internal Revenue (BIR)
Department of Environment and Natural Resources (DENR)
Department of Labor and Employment (DOLE)
Department of Trade and Industry (DTI)
Energy Regulatory Commission (ERC)
Fertilizer and Pesticide Authority (FPA)
Food and Drug Administration (FDA)
Intellectual Property Office (IPO)
Laguna Lake Development Authority (LLDA)
Land Transportation Office (LTO)
Local Government Units (LGUs)
National Privacy Commission (NPC)
Philippine Drug Enforcement Agency (PDEA)
Philippine Economic Zone Authority (PEZA)
Securities and Exchange Commission (SEC)
Investor Conferences
JP Morgan Philippine Conference
January 27, 2022 | Virtual
Credit Suisse Finding Alpha Conference
February 24, 2022 | Virtual
March 9-10, 2022 | Virtual
Jefferies – Regis CEO Roundtable Forum
March 24, 2022 | Virtual
Nomura Investment Forum Asia
June 10,2022 | Virtual
PSE Star Investor Day
August 17, 2022 | Virtual
PSE Star Investor Day
August 17, 2022 | Virtual
Non Deal Roadshow in London
September 19 – 21 | In-person, London
UBS Consumer Conference
November 15 | In-person, Manila
Membership Associations
GRI 2-28

Aero-Pack Industries, Inc.

Chamber of Cosmetics Industry of the Philippines, Inc. (CCIP)

Cosmetic Toiletry & Fragrance Association of the Philippines, Inc.

Chemrez Product Solutions, Inc.

Philippine Association of Paint Manufacturers, Inc. (PAPM)

Chemrez Technologies, Inc.

Chamber of Cosmetics Industry of the Philippines, Inc. (CCIP)

Entrepreneurs’ Organization Philippines (EO)

Metalworking Industries Association of the Philippines, Inc. (MIAP)

Philippine Oleochemical Manufacturers Association (POMA)

Philippine Parts Maker Association, Inc. (PPMA)

Private Label Manufacturers Association (PLMA)

The Philippine Biodiesel Association (TPBA)

United Coconut Associations of the Philippines (UCAP)

D&L Industries, Inc.

Association of Petrochemical Manufacturers of the Philippines (APMP)

Entrepreneurs’ Organization Philippines (EO)

Financial Executives Institute of the Philippines (FINEX)

Management Association of the Philippine (MAP)

Packaging Institute of the Philippines (PIP)

Wallace Business Forum (WBF)

D&L Polymers & Colours, Inc.

Technical Committee on Electric Wires And Cables (TC1)

First in Colours, Incorporated

Philippine Plastics Industry Association, Inc. (PPIA)

Oleo-Fats, Incorporated

American Oil Chemists’ Society (AOCS)

Packaging Institute of the Philippines (PIP)

Philippine Association of Food Technologists, Inc. (PAFT)

Philippine Chamber of Food Manufacturers, Inc. (PCFMI)

Roundtable on Sustainable Palm Oil (RSPO)

Sustainable Coconut and Coconut Oil Roundtable (SCCOR)

Awards & Recognition
Institutional Investor 2022
Honored Company
Small & Mid cap category

D&L Industries, Inc.

Institutional Investor 2022
Honored Company
Consumer Staples category

D&L Industries, Inc.

Institutional Investor 2022
Best IR Professional in Asia-ex China, Japan
Consumer Staples Category as voted by Buyside

1st place | Crissa Bondad

Institutional Investor 2022
Best IR Professional
Small and MidCap Category as voted by Buyside

3rd place | Crissa Bondad

Corporate Governance & Internal Parties

Policies and Procedures
These are the basic guidelines on how we should do things properly and with accountability.
Internal Audit
This team of competent auditors is our conscience. They tell us when something has to be improved in terms of control and recognize where good practices are. They report directly to the board’s Audit Committee. This protects the interest of our stakeholders in economic, environment and social aspects.
To ensure that its manufacturing practices comply with global best practices, the company keeps itself abreast and compliant with various global standards. In addition, the company also complies with the standards of its customers, which in some cases, especially for multinational customers, are stricter than the global standards.
Health, Safety, and Environment Committee
This team ensures that the company complies with the government-mandated requirements in the areas of health, safety, and environment.
Data Privacy Officer
This ensures that the company does not violate the rights to privacy of its employees, customers and other stakeholders.
SDG 12.8
COSMOSOrganic and Natural Certification for Cosmetics
FSSC22000 Food Safety System Certification
GMPGood Manufacturing Practices
HACCPHazard Analysis Critical Control Point
Halal (IDCP)Halal Certification from Islamic Da’wah Council of the Philippines
ISO 14001:2015Environmental Management System
ISO 17025:2017Laboratory Management System
ISO 45001:2018Occupational Health and Safety Management System
ISO 9001:2015Quality Management System
KosherKosher Certification
Non-GMONon-GMO Project Certificate of Project Verification
Organic EUOrganic Certification – European Union
Organic JASOrganic Certification – Japan Agricultural Standards
Organic NOPOrganic Certification – USDA-NOP (National Organic Program)

Enterprise Risk Management
GRI 3-3, 2-13, 2-24, 2-25

ERM is integral to an effective corporate governance process and the achievement of the Company’s value creation objectives. With an integrated approach, the BOD and Senior Management are in a position to make well-informed decisions, having taken into consideration risks related to significant business activities, plans and opportunities.

To ensure the integrity, transparency and proper governance in the conduct of its affairs, the Company continuously institutes a strong and effective internal control system and ERM taking into account its size, risk profile, nature and complexity of operations.

Governance guides the course of the organization and the effectiveness of ERM will be highly dependent on its integration to the Governance of the organization, thus D&L adopted the Integrated Corporate Governance and ERM Framework for better risk management.

An adequate and effective internal control system and ERM framework help sustain safe and sound operations as well as implement management policies to attain corporate goals. Moreover, an effective internal control system embodies the Management’s oversight and control culture, risk recognition and assessment, control activities, information and communication, monitoring activities and correcting deficiencies. On the other hand, an effective ERM framework typically includes activities such as identification, sourcing, measurement, evaluation mitigation and monitoring of risk.

Internal control is a process designed and effected by the Company’s BOD, Senior Management, and all levels of personnel to provide reasonable assurance on the achievement of Company objectives through efficient and effective operations; reliable, complete and timely financial and management of corporate information; and compliance with applicable standards, laws, regulations, as well as the Company’s policies and procedures.

Social Control

Integration with the Company’s culture and core values is the foundation and the Company’s first line of defense, having Risk Management in the employee’s DNA is key.

The Company has a Code of Business Conduct and Ethics that provides standards for professional and ethical behavior. The Code also articulates acceptable and unacceptable conduct and practices in its internal and external dealings. A code of Business Conduct and Ethics is an important tool to instill an ethical corporate culture that pervades throughout the Company.

Anti-Corruption Policy

The BOD sets the tone and makes a stand against corrupt practices. In this regard, the Company launched the iCARE (acronym from I Convey All Risks and Exposures) Program, a Whistleblowing Program that aims to create an open, transparent and safe working environment where all stakeholders can communicate their concerns like actual or suspected violation of the Company’s code of ethics and policies, criminal or unlawful acts or omissions, irregularities like fraud, embezzlement, harassment, theft, corruption, collusion and nepotism, bribery and other procedural malpractice. The iCARE Program encourages employees to report corrupt practices and outlines the procedures on how to combat, resist and stop these corrupt practices.

People Excellence and Succession

Policies, programs and procedures are established to encourage employees to actively participate in the realization of the Company’s goals and governance. These policies and programs covering among others health, safety and welfare, training and development and employee reward/compensation, encourage employees to perform better and motivate them to take a more dynamic role in the organization.

To ensure business continuity and uninterrupted operations, succession planning is instituted for the positions of directors, key officers and other identified critical roles and functions.

Output Control

The BOD oversees the development of and approves the Company’s business and strategy and monitors its implementation in order to sustain the Company’s long- term viability and success. Sound strategic policies and objectives guide the proper prioritization and allocation of resources for optimal value to the Company.

The President and CEOs of the business units lead in the realization of D&L’s Vision to be the Philippines’ Majority Leader in Sustainable Ingredients, Materials and Solutions, and a Major Exporter in identified continents.

With Capability as the Driving Force to pursue D&L’s Mission to Excel and Be the Leader in the identified Industries, the President and CEOs ensure the sustainability and continued relevance of the businesses by building Strategic Capabilities that include the development of integration plans to enhance synergies across Business Units (BUs); institution of a structured innovation process; establishment of talent development, engagement and succession plans; and building of capabilities in Business Intelligence and Operational Excellence.

Successes are measured through the following 5Ps:

PeopleEmpower and place the best people for every job to allow them to function effectively and keep them engaged.
ProductKeep the innovative product pipeline filled and commercialize the same with the shortest lead time through proper Product Life Cycle Management.
ProcessContinuous improvement and innovation for cost-efficiency and competitive advantage.
PlanetStrategic and sustainable innovation for business growth and preservation, ensuring that D&L’s businesses are not negatively impacted by the effect of industrialization on the environment (e.g. sustainable supply of major raw materials like coconut).
ProfitSustained growth for the benefit of all Stakeholders.

Process Control

Process Controls like decision authority, segregation of duties, physical and access controls, having review, approval and audit processes, etc. are established to ensure the integrity of transactions, avoid conflict of interest situations, efficient and effective operations as well as compliance with applicable standards, laws, regulations, and the Company’s policies and procedures.

Process Control includes the clear definition of roles and responsibilities which starts with the BOD. This allows the BOD to act on a fully informed basis, in good faith, with due diligence and care, and in the best interest of the Company and all stakeholders. The position of the BOD Chairman and the CEO are held by separate individuals, each one has clearly defined responsibilities to foster an appropriate balance of power, increased accountability and better capacity for independent decision-making. Identification and definition of clear roles and responsibilities are implemented across all levels in the organization to empower employees while ensuring accountability.

Management Information System

Transparency is one of the core principles of corporate governance, thus to ensure better protection of stakeholders’ rights, the Company’s Management Information System (MIS) is instituted to allow monitoring and immediate response should there be a red flag. MIS is continuously built to provide reliable, complete and timely financial and other relevant non-financial information critical for business management and decision-making.

The BOD establishes corporate disclosure policies and procedures that are practical and in accordance with generally acceptable practices to ensure comprehensive, accurate, reliable and timely reports to stakeholders that gives a fair and complete picture of the Company’s financial condition and results of business operations. In addition, material and reportable non- financial and sustainability issues as well as RPTs are reviewed based on materiality thresholds to guarantee fairness and transparency of disclosures.

The Company maintains a website to provide a comprehensive, cost-efficient communication channel for disseminating relevant information to allow informed decision-making by investors and other stakeholders. The BOD also established an Investor Relations Office to ensure constant engagement and communication with its shareholders. This is also maximized as an avenue to receive feedback, complaints and queries from stakeholders and assure their active participation with regard to the activities and policies of the Company.

Performance Management System

Rewards, recognition and remuneration are given to employees based on meritocracy established relating to performance and contribution to the achievement of the Company’s goals and objectives.

At the Board level, the BOD conducts an annual self-assessment of its performance, including the performance of the Chairperson, individual members and committees based on minimum criteria using a predefined process that also allows feedback mechanism from stakeholders.


Also in place is an independent internal audit function that provides an independent and objective assurance and consulting services designed to add value and improve the Company’s operations. It helps the Company achieve its objectives by bringing a systematic and disciplined approach to evaluating and improving the effectiveness of the Company’s governance, risk management and control functions.

Climate-Related Risks & Opportunities
GRI 3-3, 2-23 | SDG 13.1, 15.9

Risk management is seen in the company as a shared responsibility between Management and Employees. At the top level, the Board Risk Oversight Committee oversees the Company’s Enterprise Risk Management system to ensure its functionality and effectiveness.

Annually, or as soon as the need arises, the Committee reviews the Company’s risk appetite levels and risk tolerance limits based on changes and developments in the business, the regulatory framework, the external economic and business environment.

Management requires all department heads to assess risks facing their respective business units and establish both Risk Management and Business Continuity Plans. The target is to have the shortest possible downtime, and to minimize, if not entirely eliminate, negative impacts of adverse events on the business. Risk Management and Business Continuity Plans are reviewed at least annually to keep abreast with changing economic and environmental conditions.

This section identifies the climate-related risk and opportunities the company is currently exposed to. The risks outlined below are not exhaustive and instead identify only those that are highly relevant to the business.

Risk associated with natural and man-made disasters that may cause interruption in operations

Potential Impact

  • Destruction of property
  • Loss of life
  • Delays in delivery
  • Lost sales
  • Quality issues in finished goods
  • Customer complaints
  • Damage to Company reputation

Mitigating Impact

  • Improvements in company infrastructure to withstand extreme weather
  • Employee education and trainings on safety procedures during and after a disaster
  • Participation in company and nationwide drills
  • Adequate insurance coverage for identified assets
  • Regular review of IT Disaster Recovery and Business Continuity Plans
Risk associated with rising temperature due to climate change

Potential Impact

  • Higher than normal temperatures may lead to lower crop yield which may affect the supply of key commodities that the company uses
  • Higher raw material prices and supply chain disruptions

Mitigating Impact

  • Proactive monitoring of raw material prices, availability, and trend, and property imputing the impact of the same in selling price structure
  • Development of local and diversified sourcing
  • Leveraging on scale in order to negotiate prices
  • Leveraging on technical know-how to develop alternative raw materials
Opportunities in changing consumer preferences towards a more sustainable and environment-friendly consumption

Potential impact

  • Higher demand for the company’s natural, organic, and sustainable offerings across the different business segments commodities that the company uses
  • Higher margins and profitability
Opportunities in the regulatory space: Implementation of a higher biodiesel blend from the current 2% blend to the 5% blend mandated by the Biofuels Act of 2006

Potential impact

  • Higher demand for the company’s coconut biodiesel
  • Higher margins and profitability

GRI 3-3 | SDG 9.4, 15.9

D&L Industries recognizes that ensuring a sustainable future is a strategic action to future-proof the business. Identified as the Driving Force for the Company in the short to medium term, Capability3 is the cornerstone for delivering ever greater value to stakeholders when building new or reinvigorating existing infrastructure for sustainability.

3 A capability-driven company has built special capabilities into its production process that allows it to make products with features that are difficult for its competitors to duplicate.

Research and Development

One of the Company’s core advantages is its strong R&D capabilities, allowing it to customize solutions and offer innovative product offerings to its customers to help them stay ahead of the competition. D&L puts strong emphasis in keeping abreast of the latest technology and having its fingers on the pulse of the market to identify the market needs that must be met. About 14% of the company’s workforce are in technology-related roles.

In the past, the company has successfully helped its customers adapt to the changing consumer preferences. As a leading B2B company, D&L works hand in hand with its customers in tweaking their product formulation in order to make them more economical, appeal better to the market, and even more environmentally friendly. D&L anticipates more of these opportunities moving forward, especially in the field of making product formulation more sustainable.

As such, the Company is strategically positioning itself by investing further in R&D to equip itself and stay ahead of the curve in offering customers innovative and sustainable product solutions.

Next Generation Facility in Batangas

This 2023, the Company is gearing up to commercially launch its next generation manufacturing facility, the culmination of half a decade’s worth of planning and more than doubling production capacity. The new plant sits on a 26-hectare property in First Industrial Township-Special Economic Zone in Batangas.

The new plant will be instrumental to the Company’s future growth, in line with plans to develop more high value-added coconut-based products and penetrate new international markets. It will mainly cater to D&L’s growing export business in the food and oleochemicals segment. It will also add the capability to manufacture downstream packaged products, allowing the Company to capture a bigger share of the production chain. For instance, while the Company primarily sells raw materials to customers in bulk, the new factories will allow it to “pack at source”. This means that D&L will have the ability to process the raw materials and package them closer to finished consumer-facing products.

This will enable D&L to move a step closer to its customers by providing customized solutions and simplifying their supply chain, which is of high importance given global logistical challenges and concerns.

The new facility is envisioned to showcase state of the art technology in manufacturing, as well as global best practices in incorporating sustainability in operations. The following are some of the key sustainability features of the said facility.

Sustainably Designed Buildings and a Central Command Center

Energy and water efficiency, CO2 emission reduction, and excellent indoor air quality are incorporated in the overall design of the new facility. In addition, a central command center will house the monitoring of all key environmental elements. It will also house the centralized security, risk management, and business continuity departments of the Company.

Renewable energy sources

A significant portion of the new facility’s power requirement will be coming from solar power. In addition, the Company is also exploring other renewable energy sources as fuel for its manufacturing plants.

Chilled Water System

All cooling requirements of the new facility will be centralized. This is expected to translate into greater energy efficiency and lower maintenance costs.

Water Retention System

Surface run-off and rainwater will be collected in a water retention pond which can store up to 5 days’ worth of the plant’s water requirements. This is expected to mitigate risk of water scarcity.

Sensors Throughout the Facility

Several sensors will be installed throughout the facility to monitor various indicators such as water turbidity and acidity levels, effluent leakage and other possible contamination. With sufficient sensors installed, any abnormal reading will be easily detected and a corresponding corrective action can be promptly done.

Continuous Emission Monitoring System (CEMS)

While not required by the Department of Environment and Natural Resources (DENR), the Company intends to install its own CEMS to consistently test boiler emissions. This is part of the Company’s initiatives to track and reduce its overall emissions.

Noise Monitoring System

In order to monitor and minimize noise pollution, noise monitors and sensors will be installed in the noisiest part of the plant to ensure adherence to the limits set by the park and to also ensure the surrounding communities are not adversely affected.

Coconut Greenhouse

The Company is awaiting industrial park approval to plant hybrid coconut trees within the compound. The planned greenhouse will serve as an R&D facility for coconut farming technologies, as well as a showcase for the Company’s Coconut Sustainability Initiative (CSI).

The Sustainability Challenge for Brands
GRI 304-2

As the world slowly emerges from the throes of a global pandemic, the lingering effects of disrupted supply chains, mounting geopolitical uncertainties, and still unmitigated effects of climate change combine and continue to batter countries, companies, and consumers alike. Nations hold their breath on whether new COVID variants would again close borders and overwhelm hospitals. War in Ukraine continues to drive uncertainty in energy and global food supplies. Big business and small enterprises alike deal with wildly swinging labor supply and demand, even as ordinary shoppers flood the malls and online stores on weekends, but end the day with fewer purchases than they would like.In this environment, how can brands win?

On the one hand, supply chains stretch and snake their way around roadblocks to and from the usual places in East Asia and their home markets. On the other, regulators, activists, and consumers alike are demanding better, cheaper… and more sustainable, everything, really.

Sustainability adds a cost burden which must be borne.

The question is, how could brands mitigate the rising cost of sustainability?

The more disrupted the supply chain, the more nodes and stops there are, especially as new connections are needed to go around blocked normal routes. Each new intermediary adds cost.

One seemingly simple but oh-so-hard-to-find solution? A one-stop shop.

Groundbreaking at FIT

A Vision for Vertical Integration

The middle years of the past decade saw slow but consistent GDP growth of 2%-3% for the global economy. The Philippines, in turn, was roaring ahead versus much of the world in the 6%-8% annual GDP growth range.

With excess manufacturing capacity at the time fast disappearing, listed company D&L Industries, Inc. (PSE:DNL) strategically invested in a 26-hectare property at First Industrial Township, a PEZA export processing zone. With groundbreaking in August 2018, D&L sought to combine the capabilities of its largest business units into an integrated facility targeting the ever-growing demand in export markets in the Americas, Europe, and the Indo-Pacific.

In one fell but deliberate swoop, D&L would more than triple its capacity to fill the world’s shelves, cupboards, bedrooms, and homes with sustainable alternatives for the growing Gen Z and millennial consumer segments and their environmentally enlightened and socially responsible sensibilities. Boomers and Gen Xers alike would simply be swept along in their offspring’s wake of climate activism.

Then again, no one could have anticipated the ravages of COVID from March 2020 onwards. The Natura Aeropack and D&L Premium Foods factories in Batangas would face years of construction and supply chain delays hence, and here we are.

Fully vertically integrated, from sourcing coconut oil to consumer packaging in one location

Starting this 2023, Natura Aeropack offers the brand owner an integrated facility to serve its personal care and health & nutrition markets from one location. Housed at the First Industrial Township (FIT) economic zone in Tanauan, Batangas, just South of Manila, Natura Aeropack cuts through supply chain knots like a hot knife through vegan butter.

Strategically placed in the Philippines, a global leader in the supply of coconut oil, Natura Aeropack has forged backward links to oil mills and small farmers throughout the country. All told, the company sources thousands of metric tons of coconut oil per month, serving export markets for oleochemical ingredients and specialty oils & fats alike.

FIT is a nexus for a significant share of the Philippines’ coconut oil production. Within its research laboratories, scientists and specialists use high-tech tools to concoct, tweak, and deliver the exact color, aroma, flavor, texture, skin care, or other health benefit a brand owner seeks. Iterate to a formulator’s satisfaction. Test products to a marketer’s delight.

Thereafter, Industry 4.0 automation takes over, guided through production by skilled engineers at every step. At the other end of the line, organic lotions, scented soaps, or health supplements emerge, ready to fill the shelves and virtual stores of the brand’s markets.

Vertical integration brings ingredients, formulating & compounding, contract manufacturing, and OEM/ODM packaging together under the pivotal one roof, ready to ship to shelves worldwide.

Green chemistry, renewables, and carbon reduction

Three all-new factories provide oleochemical ingredients, specialty fats & oils, and OEM/ODM packaging to brand owners wherever their customers are in the world.

Copra from coconuts grown by small scale farmers are crushed into crude coconut oil (CNO) in strategic oil mills throughout the country, just one road or barge trip away to Natura Aeropack. Henceforth, this carbon-rich plant-based oil is refined, bleached, and deodorized (RBD) to various grades, up to the highest food-grade organically-certified coconut oil suitable for infants.

Whether as food-grade specialty fats & oils or as base or high-grade carriers for beauty products, all-natural coconut oil takes the place of less sustainable alternatives, be they palm oil or petroleum-based ingredients. No rain forests or endangered orangutans were harmed. No crude oil was extracted from the sands or the deep blue seas. Coconut oil has a far smaller carbon footprint and environmental cost than both palm oil and petroleum. Coconut oil is sustainability embodied.

The Natura Aeropack facility is engineered for safety, quality, and sustainability. From Autoclaved Aerated Concrete (AAC) used in construction for better thermal and acoustic performance to smart LED lighting and LEED Gold certification for employee work areas, painstaking attention to detail has been taken to ensure both active and passive measures are in place to ensure safety, enhance efficiency, and optimize operations.

Biomass replaces fossil fuels in boiler systems. Condensate water is collected and recycled from air conditioning, providing a swimming pool’s worth of distilled water every day. Waste water treatment replenishes the needs of the cooling tower used in production. When and where commercially available, renewable grid energy is preferred over non-renewable sources. Multimegawatt solar energy will be available once the panels are installed and commissioned later in the year or soon thereafter.

Climate disaster is real

Over the last decade, droughts have lasted longer, hurricane winds have become stronger, floods have destroyed more and more coasts along the Pacific, Atlantic, and Indian Oceans. Habitats for people, flora, and fauna are increasingly threatened by natural phenomena more devastating than the last. Without climate action, coastal cities and ecologies would be inundated in the next few decades. Entire species could disappear as food chains are disrupted.

In response, the United Nations has forged the Sustainable Development Goals (SDGs). As countries commit to the SDGs, more and more ordinary voices add to the clamor to mitigate climate risk, protect biodiversity and animal rights, and rights for people of all ages, sexual orientation, races, religion, and income opportunities.

Climate disasters do not discriminate between rich and poor. Hurricanes in the US Eastern seaboard, extreme drought and wildfires followed a year later by the worst flooding in decades in the Australian East, and frost devastating French vineyards have ravaged the haves in recent years. Equally tragic were the locust invasion in East Africa due to extreme rainfall, alternating floods and drought in Brazil, and thousands killed and millions displaced in Pakistan floods

Nothing galvanizes action stronger than disasters close to home. With heatwaves and wildfires in Europe and Australia, torrential rains and storm surges in the Americas and Asia, people everywhere are bombarded with bad news whenever they pick up their smartphones. In turn, activists like Greta Thunberg, David Attenborough, and Leonardo DiCaprio amplify these messages, using combinations of carrots and sticks to entice governments and brands towards further climate action, or to desist from non-sustainable policies, products, and practices.

Responsible brands can respond

Brand owners in the consumer products space can lead the drive to sustainability. As ESG resonates louder among higher income consumers, higher margin brands have the opportunity to deploy more sustainable ingredients and processes in their products.

Take the base and carrier oils in beauty and healthcare. Petroleum production and consumption is one of the most destructive human activities vis-à-vis climate change. Removing petroleum-based ingredients should be a brand’s number one priority.

Vegetable oils are a far better alternative, of which, the most prevalent and most affordable is palm oil. True, palm oil is a far better source of carbon as an ingredient than petroleum- based oil. However, in growing the palm oil industry to its current scale, vast tracts of tropical forests across Asia, Latin America, and West Africa were cut down. Orangutans have become endangered chiefly because their homes were converted into palm plantations.

In response to the global backlash against palm oil, RSPO certification seeks to greenwash away the sins of the industry. Tell that to the vanishing orangutans.

In stark contrast, coconut oil has none of the environmental trauma of palm oil. Allegations of harming biodiversity levied against the coconut oil industry are largely inflated, as anecdotal cases of endangered species in small tropical islands comprise a minuscule share of the global supply. As a leading producer of coconut oil, the Philippines has 346 million coconut palms growing in 3.64 million hectares (or 27% of agricultural land area) across most of the country. Most of these coconut plantations have been passed on from father to son across many generations, some even across centuries. No forests have been converted to coconut plantations in recent years.

Natura Aeropack and its siblings under listed company, D&L Industries, Inc., have expanded the scope of corporate social responsibility (CSR) into environmental, social, and governance (ESG) advocacies for the farmer communities from which they draw their coconut supply. Working with other stakeholders and adhering to emerging standards and best practices in sustainability, the company has conducted agricultural training for farmers and provided educational scholarships. Programs for traceability, coconut replanting, and other initiatives to improve the livelihood of small farmers are being planned and integrated into overall ESG programs.

Brand owners may even join in these smallholder initiatives, if they so wish to engage. Natura Aeropack could show them how.

Supply Chain Management
GRI 3-3, 308-1, 408-1, 409-1 | SDG 16.5

Sustainability in the supply chain has been of increasing importance and of growing concern in the past years, especially for manufacturing companies such as D&L. Much like many others, the company has followed that trend, and continues to improve its approach towards several sustainability topics.

The company’s Supplier Selection and Assessment procedure includes an initial and succeeding regular audit where potential suppliers’ manufacturing facilities and processes, employees’ welfare and human rights, health and safety programs, compliance to government regulations, waste management, and even their own supply chains are inspected and quantitatively evaluated. All materials purchased are traceable, and the company makes it a point not to purchase materials with banned or harmful minerals or chemicals. Certifications to guarantee the quality of the goods manufactured by D&L and the processes that went into them are very important to its business, so it is absolutely necessary for the company to go through great lengths, even at the beginning stages of procurement, to ensure compliance.

A Supply Chain Management System is in place across most of the companies under the group, and is compliant with the Quality Management System ISO 9001:2015, the Environmental Management System ISO 14001:2015, and the Occupational Health And Safety Management System ISO 45001:2018. It is the direction of D&L to qualify suppliers of direct and indirect materials to qualify on the said standards.

In addition, the subsidiaries of D&L also ensure that they are compliant with other rules, regulations and standards pertaining to their respective raw materials and products. The Food Division prioritizes suppliers that will support food safety concerns in order to maintain the Food Safety System Certification (FSSC), as it is fully recognized by the Global Food Safety Initiative (GFSI). The Chemicals Division is a qualified member of the Supplier Ethical Data Exchange (SEDEX) and the Sedex Members Ethical Trade Audit (SMETA), where an ethical standard practice is being followed across customers and suppliers. It also uses materials that conforms to the regulatory requirements of the Environmental Management Bureau and other controlled chemicals that may cause harm to the public and the environment.

The logistics department maintains proper storage separating food and non-food items to ensure the safety of the products. It is a medium-term goal to implement a warehouse management system tool to equip an error- free mechanism, and achieve near-perfect picking rates.

Moving forward, the company aims to move closer to a just-in-time inventory system in order to make more efficient use of its warehouses. It has also begun looking into materials and suppliers that support the call for a “circular economy”. Constantly looking towards global market trends, D&L ensures that it is always taking the necessary steps to improve holistically.

Procurement Practices
GRI 3-3, 2-6; 204-1

D&L believes that sustainable procurement practices are the backbone of truly sustainable operations. As such, the company is committed to constant improvements to make its procurement processes as efficient and sustainable as possible.

The company’s sustainable procurement practices start with a formal Supplier Selection and Assessment guidelines which are implemented across the organization. This ensures that the suppliers the company deals with are capable of supplying consistent high-quality raw materials and are legitimate entities that are fully compliant with all applicable laws and regulations.

The company also does a regular audit of the manufacturing processes including quality assurance, handling of complaints, employee welfare, supply & delivery assurance, and even resource conservation efforts and waste management program of its suppliers. As far as environmental sustainability is concerned, the company generally favors suppliers with good manufacturing practices and are compliant with global standards such as ISO 14001 (Environmental Management), ISO 50001 (Energy Management), and ISO 46001 (Water Efficiency Management).

To institutionalize further the company’s initiatives to make its supply chain more sustainable, its various business units are either in the process of formalizing or have already formalized their respective Responsible Sourcing Policies (RSP) which outlines the company’s general requirements and material specification requirements for all its suppliers. General requirements usually touch on social and environmental responsibility, health, safety and hygiene, and business integrity.

GRI 3-3, 2-16, 2-26, 205-2, 415-1 | SDG 16.5

D&L conducts its business guided by the principles of honesty, integrity and transparency. The company respects the legitimate rights and interests of those it transacts with. It takes into account the unique culture of the countries it operates in and comply with their laws and regulations. These principles are well-documented in the company’s Code of Business Principles.

Whistleblower Policy

With the objective of strengthening D&L’s culture and core values of integrity and honesty embodied in its Employee Code of Behavior, the iCARE Whistleblowing Program was launched. iCARE also aims to intensify each employee’s conviction and commitment to the highest standards of conduct consistent with its Professional Code of Conduct and Discipline.

iCARE is an avenue where concerned stakeholders can report actual or suspected violations of the Company’s code of ethics and policies, criminal or unlawful acts or omissions, irregularities like fraud, embezzlement, harassment, theft, corruption, collusion and nepotism, bribery, and other procedural malpractices. Reports are handled with strict confidentiality and whistleblowers are protected against possible retaliation, reprisal, or harassment.

Conflicts of Interest

The company’s employees are expected to keep clear from financial, business or other relationships and activities that might be opposed to, in competition with and disadvantageous to company businesses and the proper performance of their duties. The company exhorts employees to conduct themselves in a manner that avoids even just the appearance of a conflict of interests between their personal self-interests and those of the company.

Use of Corporate Assets

The company’s funds, assets, services and facilities are not to be used for any unlawful, unethical and personal enrichment purpose.

Insider Trading Policy

The company’s Insider Trading Policy states that all Covered Persons are prohibited from buying, selling, trading or otherwise dealing in the Securities while in possession of material non-public information. All Covered Persons are likewise prohibited from passing such material non-public information to any person who might use such information to deal in the Securities. A Covered Person should exercise prudence in evaluating whether the non-public information he possesses is material or not. Any doubt should be resolved in favor of treating such non-public information as material.

Material Related Party Transaction Policy

The company has formed a Related Party Transaction (RPT) Committee at the Board level which is composed solely of independent directors. The RPT Committee is tasked to review the material facts of all Material RPTs and either approve or disapprove such transactions. In assessing an RPT, the RPT Committee shall be guided by the arm’s length principle and consider such factors as it deems appropriate: including without limitation (i) the benefits to the Company of the transaction; (ii) the commercial reasonableness of the terms of the Material RPT; (iii) the degree of materiality of the transaction to the Company; (iv) the extent of the Related Party’s interest in the Material RPT; (v) if applicable, the impact of the Material RPT on the non-employee director’s independence; and (vi) the actual or apparent conflict of interest of the Related Party participating in the Related Party Transaction.

To further ensure that the Material RPTs are conducted at arm’s length, the RPT Committee shall engage an external independent party to evaluate the fairness of the terms of the Material RPTs and employ an effective price discovery mechanism such as, but is not limited to, acquiring the services of an external expert, opening the transaction to a bidding process or publication of available property for sale.

Material RPTs approved by the RPT Committee shall be elevated to the Board for final approval.

The Way the Company Deals with Politics

The company cooperates with governments and other organizations in the protection and promotion of the company’s legitimate business concerns. The Company closely collaborates with them in the development of regulatory and legislative initiatives impacting its investments and interests. The company does not in any way participate in party politics. It also neither makes contributions in kind nor fund campaign connected activities.


Path to Net Zero
GRI 3-3, 305-5 | SDG 6.4

D&L strives to reduce its carbon footprint throughout its operations, by renovating facilities, managing its use of resource, ensuring environmental compliance to regulations, and preserving biodiversity.

Cocomethyl Ester (CME), commonly known as coconut biodiesel, is the Company’s biggest contribution to the Philippines GHG reduction commitments from the inception of the B2 blend requirement under RA 9637 Biofuels Act of 2006.4

4 Republic of the Philippines, “Republic Act No. 9367,” Official Gazette, accessed March 31, 2023,

Facility Renovation

The LBL Building has been the headquarters for D&L since 1981. The heritage building was due for several upgrades in line with the growth of the business and new building codes. The Company has completed an extensive renovation of the building to invest in the company’s most important asset: its people.

Through efficient design, the capacity of the building was doubled, and staff facilities and workspaces were upgraded. All works were done while all business functions remained fully operational. In 2021, the Company celebrated the LBL Building’s 40th birthday with the following installations, sustainable features, and improvements:

Efficient Design & Systems for Employee Work Environment & Wellbeing
Fresh Air System with ERV (Energy Recovery Ventilator) for fresh air, filtering and removal of allergens/toxins for indoor workspaces. It is designed for 12 air exchanges/hour to exceed ASHRAE62.1- 2010 indoor air quality standard (2-3 air exchanges) for better staff health and focus
Activated main stair to encourage office hour exercise
Training & meeting rooms with video conferencing capabilities
Acoustic improvements all throughout the building
Phone booths to give staff a place to have calls privately
Clinic, Nursing Room, and PWD/All Gender toilet provision
CPS Pump to improve overall potable water distribution
Water purifier (reverse osmosis) to improve water quality and keep staff hydrated
IP phone system upgrade to save costs & improve call clarity
Use of in-house products eg. powder coating, waterproofing, paints/colorants & special paint effects

Sustainable Equipment, Fixtures & Materials
Electrical metering for monitoring of total building energy use
Installation of sewage treatment plant (STP) with effluent to water the gardens (only property on Calle Industria with a garden)
100% LED lights that are extremely energy efficient and low power consumption
Carpets made of renewable fibers using non-toxic glues for installation
Engineered wood made with non-toxic adhesives and finishes
Water-based, low-VOC paints which do not present an explosion hazard
UV resistant, non-toxic, low-VOC waterproofing
Aluminum Composite Panel Façade with solar reflectance instead of absorbing radiant energy
Low flow faucets with up to 20% water saving with sensors to prevent cross-contamination between users
Water closets with 0.8 gallon per flush (GPF) flow rate and 0.125 GPF for urinals
Safety and Security
24/7 CCTVs to keep track of what is happening at the premises
Addressable smoke detectors to quickly identify the location of a potential emergency
Additional fire exits
Non-smoking building & grounds policy
Automatic Fire Sprinkler System
FM200 Fire Suppression System for Server and UPS Rooms
Facility management technical team for proper maintenance of equipment
Ozone generators and air purifiers for additional sanitation of work areas

Resource Management
GRI 3-3, 302-1, 302-3 | SDG 7.2, 7.3, 12.4, 12.5, 13.1, 15.9

The company uses various types of energy sources for its operations. For the office buildings, the company uses purchased electricity. For the plant operations, the company uses boilers. Meanwhile, diesel is used to run generator sets during power outages.

The company is constantly looking for ways on how to further make its operations more efficient with lower energy consumed per unit of product manufactured. These initiatives include:

Installation of motion detector lights at warehouses
Use of LED lights which are more energy efficient than fluorescent and incandescent lights
Regular maintenance of air conditioning units
Optimizing the production schedule to yield the lowest possible energy consumption per unit of product manufactured
Identification of compressed air line leaks
Megger testing and preventive maintenance
Replacing old supply pump motors with high efficiency motors
Turning off lights and air conditioning during lunch breaks
Recycling of diesel fuel for equipment cleaning
Use of biodiesel waste as fuel for diesel boiler

To monitor the company’s progress and to champion the resources conservation initiatives, an Environmental Group within the company was formed. This group is composed of Pollution Control Officers from each business unit.

Water Consumption
GRI 3-3, 303-1, 303-3, 303-5 | SDG 6.4

In the Company’s day to day activities, water is primarily used for the operations of the cooling tower, for equipment cleaning, and for domestic uses in the office buildings such as for restroom usage, washing, and food preparation in the canteens.

The Company is proactively looking for ways on how to further reduce its water consumption. Similarly, the company’s Environmental Group, which is composed of the Pollution Control Officers from each business unit, is in charge of monitoring and championing the water conservation initiatives of the company. Some of these initiatives include:

Regular identification and repair of water leaks
Use of pressure water for product transition cleaning
Installation of stainless float valve at make-up water of cooling tower system to control water overflow
Use of knee valve faucet
Replacement of manual flush to electronic flush with automatic sensor
Recycling of condensate water from air conditioning units
Signages located at strategic areas to encourage employees to conserve water


Environmental Impact Management
GRI 3-3 | SDG 12.4, 12.5, 13.1, 15.9

Air Emissions/GHG
GRI 3-3, 305-1, 305-2, 305-6

In the normal course of operations, the Company generates greenhouse gas (GHG) emissions. Direct emissions from boilers, oil heaters, generator sets, trucks, and service vehicles represent the company’s Scope 1 emissions. Meanwhile, the energy used to light up its facilities and office buildings comprise the company’s Scope 2 emissions.

The Company is committed to reducing its emissions over time and making its operations more environmentally friendly. To reduce emissions, the company has instituted various initiatives from energy conservation to prudently replacing equipment to make operations more efficient.

Air Pollutants
GRI 3-3, 305-7

D&L is fully-compliant with all the operating condition requirements by the Department of Environment and Natural Resources (DENR) and the Environmental Management Bureau (EMB). As far as air emissions and pollution are concerned, the company is strictly abides by RA8749 or Philippine Clean Air Act.

Solid Waste
GRI 3-3, 301-1, 301-2

Waste is generated by plants and offices. In order to properly manage waste, each plant has a designated Material Recovery Facility (MRF), in compliance with R.A. 9003 for Solid Waste management. Before waste materials get transferred to the MRF, each operating section already does the first layer of waste segregation. A designated person is responsible in each MRF who receives and further sorts the waste to facilitate systematic disposition.

Wastes are classified as hazardous, non-hazardous, sellable, and garbage. Hazardous wastes are hauled by accredited treaters before being hauled off site. Non-hazardous waste may be recycled for internal use. Sellable wastes such as old plastic and steel drums, wooden and plastic pallets, cartons, packaging materials, and metal debris are sold to recycling companies. The rest are considered trash and hauled by accredited garbage collectors. The company enforces strict accreditation policies to ensure that all plant and office wastes are disposed of in accordance with the standards of the regulating government agencies.

Lastly, to increase awareness and to encourage employees to help minimize waste, the company has various programs in place such as Trash to Treasure, War on Waste (WOW), and Reduce, Reuse, Recycle, Repair, Repurpose (5R).

Hazardous Waste
GRI 3-3, 306-1, 306-3, 306-5 | SDG 6.3, 6.6, 12.4, 15.1

Hazardous wastes are properly managed in compliance with government requirements. To ensure safe handling, procedures were established in the storage, treatment, and disposal of these materials. All facilities comply with the ISO standards for Environmental Management (ISO 14001:2015) and Occupational Health and Safety (OHSAS 18001:2007).

Each company has obtained its Generator Registration Certificate from the DENR. Waste classified as hazardous based on the DENR-EMB standards are disposed of by DENR-accredited third-party treaters which have passed the stringent accreditation process of this government agency.

As part of risk assessment during the design and development stage for both finished products and packaging, the Company strictly adheres to health, safety, and environment standards to further reduce hazardous waste.

GRI 3-3, 303-4

In addition, the company invests in various infrastructure to make its operations more sustainable. For instance, its water treatment facility is much stricter than the standards set by the Department of Environment and Natural Resources, ensuring that water released is the cleanest possible.

Environmental Compliance
GRI 3-3, 2-27 | SDG 12.4, 12.5, 13.1, 15.9

The Company is compliant with all environmental laws and regulations that are applicable to its business operations. Management provides a clear statement of the Company’s responsibility towards creating, maintaining, and ensuring a healthy, safe, and clean environment for sustainable growth.

In summary, the Company is committed to:

Comply with applicable laws and regulations and other requirements and measures considered necessary to its business operations;
Create Health & Safety programs that ensure the well-being of its employees;
Conserve natural resources through efficient equipment utilization, wise use of resources, recycling, and reducing wastage, discharge, and emissions;
Continuous Health, Safety and Environment (HSE) education programs for employees, outsourced personnel, and suppliers;
Implement creative shared values with local communities through fire drills, HSE training, Emergency Response, Medical Missions, and Tree Planting activities, and promote green surroundings at its manufacturing locations as the company works in harmony with local government units, stakeholders and NGOs; and
Promote awareness and shared responsibility for occupational health, safety and environmental protection among its contractors, suppliers, and customers.

Ecosystem & Biodiversity
GRI 3-3, 304-2 | SDG 6.6, 15.9

Embedded in the Company’s Code of Business Principles is its commitment to sustainable development. D&L cares for the environment and strives to meet the ever-increasing needs of the business but never forgets the conservation and preservation of nature.

The Company’s long-haul horizon goes beyond the present and stretches to generations yet to come. The company endeavors not to endanger but rather enhance the ecosystem. The company also recognizes the importance of biodiversity and supports the global community in protecting it.

D&L is fully-compliant, and in many cases implements stricter measures than what is required by relevant laws such as:

RA 9003: Ecological Solid Waste Management Act of 2003
RA6969: Toxic substances and hazardous and nuclear wastes control act (1990)
RA8749: Philippine Clean Air Act
RA 9275: Philippine Clean Water Act of 2004
RA11285: Energy Efficiency & Conservation Act


B5 by the Numbers
Emissions, Economy, Health

GRI 305-5
By mandating B2 blend biodiesel for transportation, the Philippines has already reduced its carbon footprint by 16.31%, or 0.0125 kg CO2E per liter, vs. B0 fossil fuel diesel. Over the 8.8 billion liters of biodiesel used by vehicles in 2021,5 we have already reduced our carbon footprint by 4.6 million tons (MtCO2E).
If we could use B5 throughout 2022, we would have further reduced our carbon footprint by another 588 thousand tons, on top of the 4.8 million tons CO2E for the year if we remained on B2.
If we started in 2022, a yearly ramp from B3 to B4 to B5 would further reduce our GHG emissions up to 2030 by a total of 6.5 million tons CO2E.6
Simply by ramping up to B5, we would achieve 14% of the energy sector’s 45.9 MtCO2E target under the country’s Nationally Determined Contributions (NDC),7 in accordance with the Paris Agreement.
What does a reduction of 6.5 million tons of carbon dioxide over the next nine years mean?
For the biodiesel industry, it means an additional 3.1 billion liters of B100 CME sold, equivalent to an additional 186 billion pesos to GDP.
For the farmers, it means an additional 21.7 billion coconuts harvested and sold. On average, that amounts to over 1.9 billion additional coconuts per year until 2030, or up to 2.3x more income for the farmers in a year, compared to now, not even factoring the rise in coconut prices due to the increased demand.
For the jeepney & truck drivers, B5 allows them to drive 6% further in average traffic,8 compared to B2. This increased mileage somewhat offsets the increase in fuel prices due to the shift to B5, but the cleaner burn also helps declog diesel engines and fuel lines, and decreases maintenance costs.
For each of us 110 million Filipinos, it means the air we breathe is up to 6.6 kilograms CO2E cleaner each year by 2030. Simply shifting from B2 to B5 reduces particulate matter from 1.47% to 3.14%9, more than double the PM reduction just by using the higher biodiesel blend.