Oatly offers a more environmentally friendly dairy alternative for consumers. Their plant-based products have been developed to ‘have maximum nutritional values and minimal environmental impact.’ Oatly believes that: ‘companies have as much responsibility as politicians’ for building a society that everyone can admire.
However, while Oatly has championed sustainability and sustainable business they have come under recent criticism. In 2020, Oatly accepted a $200 million investment from private equity firm Blackstone. This move was criticized due to Blackstone’s controversial environmental reputation. One such example is Blackstone’s ownership (more than 50%) of Hidrovias, a company which’s operations have been linked to significant deforestation in the Brazilian state of Pará.
Although Blackstone is a passive investor, many have looked to boycott Oatly as a result of this relationship. Oatly however, believes that through their relationship with Blackstone they are making seemingly ‘dirty’ money green as they champion environmentalism. Overall, Oatly is leading from the front with their plant-based oat drinks. Their products, transparency, and focus on sustainability have warranted an overall rating of 2.4 planets.
Oatly’s oat milk is made of natural products that are sourced responsibly. The ingredients used are listed below:
An oat base (10%) is created using a combination of water and oats. This is then supplemented with rapeseed oil, calcium carbonate, calcium phosphates, salt, vitamins (D2, riboflavin, B12), potassium iodide.
Oatly takes great pride in their transparency and list where their ingredients originate from and the companies which supply them. For example, for a customer in the United Kingdom the oats and rapeseed oil originate from Sweden and Finland. Oatly supplements their oat drink with vitamins, calcium, and supplies their 1.5% fat content from rapeseed oil and oats.
Oats are the foundation of Oatly’s products because of the perceived benefits that they have. Oats are a good crop as they help with soil regeneration, they can be grown anywhere, and their environmental impact is much lower than alternatives like soy and coconut. An additional added benefit is the low allergy rate that people have to oats.
Thus, their sustainably sourced produce and emphasis on transparency warrant an overall planetary rating of 2.7.
The idea for a milk equivalent drink made out of oats was developed by researchers in the 1980s and inspired Oatly to develop a similar production process. Oatly offer videos on their website for consumers to understand the process within which their oat products are made.
The process starts with oat kernels that have been cleaned, treated, and peeled being delivered to Oatly’s factories. These kernels are milled and mixed with water. Next, this oat solution is treated with natural enzymes which break down the oat starch giving it a sweeter flavour. Insoluble parts are separated as the base for the solution is finalized. Once this has occurred, further ingredients and vitamins are added depending upon the product. The product is then heat-treated to extend its shelf-life which ensures less product is wasted. Finally, the oat drink is homogenized.
Oatly believes in making products that have a low environmental impact. As such, they have taken the step to add a climate footprint label on each of their products. This defines a product’s environmental footprint and is expressed in kilograms of CO2e per kilogram.
To determine this figure, Oatly has used a life cycle assessment approach whereby they consider all steps of the product life cycle. Some of the key processes that determine this calculation are agriculture (emissions such as N20, CO2, and emissions from machinery and vehicles), transportation of ingredients, the Oatly factory (gas and electricity consumption), and packaging and distribution. The overall footprint of their oat drink is 0.31kg CO2e per kg.
While Oatly, much like many FMCGs rely on a large supply chain that causes emissions and environmental impacts, they have been forthright in documenting the process within which products are made. By championing an environmental footprint sticker on their products, they empower consumers to make conscious decisions and demand more transparency in the environmental costs of the products they purchase.
In 2019, Oatly set out to universalize the rights and conditions of their employees globally taking inspiration from the UN Sustainable Development Goals (SDG). They believe in ensuring that as an employer they offer more than the legal minimum. For example, in the United States Oatly covers 100% of the premium for their employees on the medical plan. Oatly claims this is 40% more than the average company would pay.
Furthermore, Oatly believes strongly in the importance of equality and diversity within their company. In 2019, they reported that 51% of their employees were men and 49% were women. Oatly further published their total carbon footprint from business trips and pledged to continue to find ways of mitigating the impact of business ventures.
Overall, Oatly has worked hard to be an equitable, sustainable, and innovative company. This is apparent in their attitude to their own sustainability and their transparency in publishing annual reports. By aligning themselves with the UN SDGs they are ensuring workers’ rights across the globe.
Food and Agriculture Organization of the United Nations
UN Sustainable Development Goals.