C L IF BAR & COMPANY
ALL AS PIR ATION S A N N UA L R E P ORT
2016
This ad first ran in 2003.
5 ASPIRATIONS
5
Welcome to the 2016 All Aspirations Annual Report
Sustaining Our Business, Our Brands, Our People, Our Community, and the Planet.
At our end-of-year company meeting, we have a tradition of presenting two words that describe insights learned over the previous 12 months—without telling each other ahead of time which words we’ve chosen. Over the years there have been some meaningful pairs, like listen and create, wonder and balance. This year we reflected not just on 2016, but also on our upcoming 25th year in business, and two words emerged: for Kit, patience, and for Gary, grace. We’ve learned over the past two decades that both are essential in business and life. We’re not necessarily born with either, but both can be learned—and improved with practice, especially in tense moments that test our resolve. How do we respond to gridlocked traffic, a toddler in meltdown, or a mechanical glitch that monkey-wrenches our deadlines? Oh, this is an opportunity to practice patience. When we practice patience, what people often see is grace— and out of this comes a different path forward. It takes patience and grace—and other year-end words like listen and create, anticipate and community—to build and grow a business committed to Five Aspirations rather than a single bottom line of profit. In doing so, we often need to practice patience and grace in the moment, taking time to breathe and to listen, so we can make the right choice for the long term. As we move into our 25th year, we thank all of you who have been part of the adventure so far! We hope you enjoy the story of our journey in business on the following pages. And as we look forward to the next 25, we hope you’ll join our collective efforts to build a healthier, more just and sustainable world, the kind of world we’d like to pass on to our children.
Kit and Gary, Owners and Chief Visionary Officers, Clif Bar & Company
25 Years Strong...and We’re Just Getting Started In 2017 Clif Bar & Company celebrates its 25th birthday. What started as an epiphany to make a better tasting energy bar while on a 175-mile bike ride has grown into a company with more than 1,000 people, 17 USDA-certified organic products, and a dynamic business model built not on one bottom line but on Five Aspirations: Sustaining Our Business, Brands, People, Community, and Planet. We will remember 2016 as a special year in our company’s history. It’s a year that marks significant growth across all of our Aspirations. We welcomed 600 team members from our two bakeries in Twin Falls and Indianapolis into the Clif Bar family; we introduced the USDA-certified organic CLIF® Nut Butter Filled energy bar—the largest product launch in our 25-year history; and we were inspired by thousands of athletes that we met at events that Clif Bar sponsored—from the Boston Marathon to the Ironman World Championship in Kona, Hawaii. Amidst the backdrop of these Clif Bar milestones, 2016 also marked a year of greater uncertainty for the things that we hold dear. At this moment, our Five Aspiration business model has never been more relevant: We need to stand up for the planet and take action on climate change, stand up for organic food and farming and the chance to increase organic acreage, and, through programs like the LUNAFEST® film festival and the CLIF Pro Team, stand up with women to effect positive change. The opportunities we’re addressing in our company reflect the opportunities we’re facing in the world at large, and they hold the potential, which we need now more than ever, to bring us together. I’m proud of what we’ve accomplished so far. We’ve demonstrated that a business based on five bottom lines can thrive and have impact at scale. As we look to the next 25 years, it is my hope that the Five Aspirations will serve as a model for how business can be a catalyst for creating a healthier, more sustainable food system. We hope that you and other companies will join us on this journey.
Kevin Cleary, CEO, Clif Bar & Company
OUR BUSINESS
Building a resilient company, investing for the long term. C L I F BA R GROWS ...AN D G RO WS ...AN D GR OWS I N 2 0 1 6 This year we began operating two baking facilities, and grew to more than 1,000 employees! In February we welcomed 340 people in Indianapolis to our Clif family. We already owned the Indiana building and equipment, and in 2016 we assumed full control of baking operations. And in August, we opened the brand new Clif Bar Baking Company in Idaho: 260 employees are now making CLIF BARs® and CLIF Kid Zbars® in Twin Falls. What do bakeries based on Five Aspirations look like? They’re state-of-the-art facilities that use less water and energy* to make top-quality bars in people-friendly environments! Both bakeries required big investments of time and dollars, but they allow us to increase value not only for our Business Aspiration but for all Five Aspirations. Now we can further control our destiny through even higher product quality, employee well-being and satisfaction, sustainable baking practices, and volunteer programs that give back to our local communities.
*“ Based on benchmarking data from the U.S. Green Building Council, Twin Fall’s energy consumption per unit of production is 21% below the norm. Water use is 37% less, and refrigerant emissions are 40% lower.” – Food Processing magazine, which named Clif Bar’s Idaho bakery “Green Plant of the Year”
10-year compounded annual growth rate
million pounds of organic ingredients purchased to date
market share in the Health & Lifestyle Bar category
OUR BRANDS
Creating brands with integrity, quality, and authenticity. F I LL IT ! B I GGEST PRO DUCT LAUNC H I N C LI F BAR ’S H I ST ORY CLIF BAR® has been our flagship brand from the start, an energy bar made from whole ingredients created to meet the needs of athletes. Where can we go from there, especially when CLIF is ranked #1 in the energy bar category? We can fill it! Or, as bloggers are saying, we can innovate (again)! Food Navigator USA raved about our new CLIF® Nut Butter Filled: Clif Bar—a company that helped transition the bar category from strictly slick slabs of finely blended ingredients to one with products made from recognizable grains and inclusions that more closely resembled real food—is at it again with a new line that promises the next evolution for the category.* Nut Butter Filled is also: • USDA Organic • 7g protein (9% DV) • Low glycemic And, to quote another review, “It’s freakin’ delicious.”†
*www.foodnavigator-usa.com/Manufacturers/Could-the-launch-of Nut-Butter-Filled-CLIF-Bars-usher-in-a-new-era †
CLIF Bar is #1 among energy bars**
www.stack.com/a/7-reasons-athletes-are-going-to-love-clifs-nut-butter-bars
**A.C. Nielsen, TTL Energy Endurance Category, Total US XAOC, 52 Weeks Ending 12/24/16
OUR PEOPLE
Working side by side, encouraging each other, our company is our people. THE CLIF FAMILY MORE THAN DOUBLES IN ONE YEAR Talk about adventure! Growing 150% in one year—from 400 to 1,000 employees—at two Clif Bar bakeries in Idaho and Indiana was exciting and challenging, and we couldn’t have done it without the concerted efforts of our Clif team. Integrating 600 people into our company was an extraordinary opportunity to reimagine how large baking facilities work. We looked to our Five Ingredients, developed by Clif people in 2010 to define what’s essential for success at Clif: Create, Connect, Inspire, Be yourself, and Own it. We’re creating bakeries that are welcoming places, with health and wellness amenities. To connect, Clif leadership visited frequently to hear our new employees’ ideas and requests. Indy and Idaho workers inspired all of us with their volunteer efforts for local nonprofits. And all employees will have an ownership stake in our company through Clif’s Employee Stock Ownership Plan.
Clif Bar’s alternative ribbon-cutting ceremony in Twin Falls included climbing ropes, carabiners, and Governor “Butch” Otter.
of leadership positions filled by women
of Clif people made up of ethnic minorities
OUR COMMUNITY
Promoting healthy, sustainable communities, local and global. E XC E E D ING E XP ECTATION S: 104, 3 2 8 M E A LS IN 2 4 H OUR S It’s not so hard to schedule a company-wide day of service for Clif headquarters— we can close down our Emeryville office for a day—but how can folks in our bakeries, working around the clock to make our bars, take part in a company-wide volunteer day? In 2016, Clif people in our Indiana and Idaho bakeries began integrating this Clif tradition in their own ways. On March 30, during the Indy bakery’s first-ever CLIF® CORPS event, 211 people volunteered a total of 562 hours to benefit the Million Meal Movement. “Initially we thought we would only be able to pack 60,000 meals in 24 hours,” said General Manager Dave T. “In the end, we packed 104,328.” Meanwhile, in Idaho more than 200 employees planted 2,000 trees in a single day. And back in Emeryville, 320 employees volunteered at Fernandez Ranch to preserve and restore open space for the John Muir Land Trust.
Community spirit was truly at an all-time high in 2016: By October we’d already surpassed our goal of 11,440 volunteer hours, and by year’s end we reached 14,985.
volunteer hours to date
cash and product donations over the past 13 years
OUR PLANET
Conserving and restoring our natural resources; growing a business in harmony with nature. STA RT GL OBAL C O O LING This year set a global heat record for the third year in a row. Now more than ever, it’s time to Start Global Cooling. Here’s what we’re doing: • Organic is a powerful part of the climate solution: Since 2003 we’ve purchased 750 million pounds of organic ingredients. • We source 100% green power for electricity at all Clif Bar facilities. In addition, we invest in Help Build™ carbon offsets (200,000 metric tons to date) that support 35 farmer-, community-, and school-owned wind turbines—and make Clif operations climate neutral. • Our employees have purchased 240 fuel-efficient, hybrid, and all-electric cars through our Cool Commute program. • Clif Bar’s 50/50 by 2020 program has been recognized by the White House and the EPA for demonstrating climate leadership. • We’re planting trees in partnership with American Forests—92,000 to date.
We’re greening our supply chain! As of December, 15 of 50 of our supply chain facilities are using 50–100% green power for electricity for Clif Bar products and services. We offer free expert consulting to help our partners achieve these goals in ways that make business sense. And we’re now 24% of the way toward our goal: 50/50 by 2020.
of all ingredients we use are organic and/or certified sustainable
of our waste stream is diverted from landfills or incinerators
green power for electricity for all Clif facilities
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THE EPIPHANY:
Gary and his mom mix up the first CLIF BARs in her kitchen.
CLIF BAR debuts. The name honors Gary’s father, Clifford, who took him on Sierra adventures and encouraged him to follow his passions in life. By year’s end, the company sells one million bars.
Get sweaty, stay healthy! Our new onsite fitness center offers personal trainers and classes for employees, who are paid to work out 30 minutes a day on company time.
Clif is not for sale. Gary and Kit walk away from $120 million offer, deciding to keep Clif Bar a privately held company and grow a different kind of business.
LUNA® gives women a voice with LUNAFEST®, a national traveling film festival of short films by, for, and about women, and also a fundraiser for local nonprofits.
One bottom line is not enough—we’re guided by Five Aspirations: Sustaining our Business, Brands, People, Community, and the Planet.
CLIF BARs are the first major energy bar to be certified organic.
Active kids need their own nutrition bar. And just like that, CLIF Kid Zbar® arrives on the scene.
During a one-day, 175-mile bike ride, Gary realizes he can’t choke down one more bland energy bar. The idea for CLIF BAR® is born!
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Start Global Cooling: Clif Bar’s climate action program takes off.
MEANWHILE in the rest of the world
FEEDING THE 1989 The World Wide Web is founded
1992 Johnny Carson does final Tonight Show
Clifsters pledge to “give” the equivalent of one full-time employee’s hours—2,080—to community service each year.
Gary publishes Raising the Bar, a book about bikes, a breakthrough business, and Gary’s lifelong love of the jazz trumpet (not your average business book).
Clif Bar is dog friendly from the start: Scrubby, a beloved pit bull-Lab mix, is one of the first on the scene (and Clifsters learn to keep a close eye on their lunches when he’s around).
CLIF BARs debut in Canada. Turns out lots of our northern neighbors are happy to fuel their outdoor adventures with Clif energy.
Women everywhere celebrate the launch of LUNA®, the first nutrition bar designed specifically for women.
Spread the news: Weekly companywide meetings begin, and each starts with bagels and donuts.
Going…going…Green! Clif’s sustainability program launches on Earth Day.
Clif Bar wins the Green Cross Millennium Award for Environmental Leadership, EPA Green Power Partner of the Year, and Governor’s Environmental and Economic Leadership Award.
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1993 The European Union is formed
1994 Nelson Mandela becomes president of South Africa
1995 Sony PlayStation, Yahoo, and Craigslist debut
1997 Kyoto Protocol is adopted
1998 Google founded
Toyota introduces the 1st hybrid automobile
Final episode of Seinfeld
1999 First episode of The Sopranos
2001 Wikipedia launches
2002 Jane Goodall appointed U.N. Messenger of Peace
2003 Skype launches
2004 Twin robot geologists explore Mars
Full sequence of human genome
Wangari Maathai wins Nobel Peace Prize for sustainable development, democracy, peace
Tesla founded
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Kit and Gary establish the Clif Bar Family Foundation to support grassroots nonprofits that champion the environment, strengthen our food system, and advocate for healthy communities.
Outside magazine ranks Clif Bar & Company the #1 Best Place to Work among companies with 50 to 249 employees.
A new—green!—home: We renovate an old manufacturing plant, and install the largest smart solar array in North America! Base Camp, our own child care center, is onsite. (In 2012 our Emeryville office is certified LEED platinum!)
Clif Bar turns 20! In celebration, each employee receives a shiny red bike personalized with their name and their start date.
The White House recognizes Clif Bar & Company for demonstrating leadership in renewable energy (our 50/50 by 2020 program promotes green power all along our supply chain).
We bought 113 million pounds of organic ingredients.
Clif Bar founds In Good Company®, a program that brings together employees from like-minded businesses to volunteer in communities around the country.
113 Organic ingredients (million pounds)
Employees are owners too. Kit and Gary keep sharing the love with an Employee Stock Ownership Plan (ESOP) that gives employees 20% ownership of the business.
Investing in Organic
ADVENTURE Athletes love our new CLIF® BLOKS™ energy chews—quick energy delivered in streamlined packaging. And certified organic.
2006 2005 YouTube launches Hurricane Katrina strikes
Clif Bar spearheads creation of the nation’s first endowed university chair in organic plant breeding, which goes to UW-Madison. Wait, there’s more! We’re working to endow a total of five chairs for organic research at public land-grant universities.
Brilliant! People in the U.K. can finally buy CLIF BARs, our first foray beyond North America.
SEED MATTERS! Clif Bar Family Foundation commits $1 million to organic seed research (including the nation’s first graduate fellowships in organic plant breeding— 14 fellowships by 2016).
Our groovin’ company band, Grove Valve Orchestra, wins the Battle of the Corporate Bands at the Rock & Roll Hall of Fame in Cleveland, Ohio.
The East Bay Leadership Council recognizes Clif Bar as 2015 Outstanding Corporate Philanthropist (100–500 employees).
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2006 Pluto reclassified as dwarf planet Twitter takes off
2007 Apple introduces the iPhone
2008 Svalbard Global Seed Vault established in Norway
2009 White House plants organic garden 6,909 living human languages catalogued
2010 The millennium’s longest solar eclipse occurs (11 minutes, 8 seconds)
2011 Space shuttle Discovery completes its final mission
2013 President Obama announces a comprehensive climate change strategy
2014 Nepal requires Everest climbers to pack out trash
2015 San Francisco records no January rainfall for 1st time in over 150 years
2016 National Park Service celebrates 100 years
California imposes mandatory water rationing for 1st time in history
Paris Agreement takes effect
—NEWS FROM—
2016 Welcome to all of our new employees! This year we opened a bakery in Idaho, acquired another in Indiana, and welcomed 600 team members into the Clif Bar family.
How’s our growing family doing? Here are a few words from our new employee-owners:
“I have actually found a company where I can feel like a real person and not just a number on a clock card, a company where I want to achieve and do my best.” Vicki from Continuous Improvement, Clif Bar Baking Company of Indianapolis
The Clif Bar Baking Company of Twin Falls wins 2016 Green Plant of the Year. New Nut Butter Filled: our largest product launch ever.
TWIN FALLS
“Everyone is there to help with any issue just as a family should!” New summit! We’ve purchased 750 million pounds of organic ingredients to date.
Tony from Warehouse, Clif Bar Baking Company of Twin Falls
EMERYVILLE
“It’s inspiring to see our Clif family branching out. Our roots make us strong.” Jesse from Food Supply, Clif Headquarters, Emeryville
INDIANAPOLIS
L to R: Fireclay Tile, a White Road Investment’s portfolio partner, makes handcrafted tiles in California from recycled materials; the Clif Family Farm turned up the heat in 2016 with four flavors of hot sauce; City Slicker Farms, a Clif Bar Family Foundation grantee, makes fresh produce available and affordable for West Oakland residents.
What’s happening in the larger Clif community? WHITE ROAD INVESTMENTS We started White Road Investments (WRI) six short years ago as an alternative investment firm to fund mission-driven companies. By now, our peloton of partners has grown to 13, including BioLite, a company that makes stoves, chargers, and lights that support cleaner indoor air, cleaner energy, and safer, healthier cooking conditions for families in developing countries. This year BioLite was part of a study in Ghana designed to reduce exposure to cooking smoke for pregnant mothers and newborn babies. On the home front, Fireclay Tile continues to make beautiful tiles from 100% recycled glass, including old CRT (cathode ray tubes—think old TV and computer screens), which means less leaded glass going to landfills. The combined revenue of White Road portfolio partners now exceeds a quarter billion dollars. CLIF FAMILY WINERY® AND FARM Last spring we planted four heirloom pepper varieties at Clif Family Farm® to create our first single-varietal hot sauces, each with a flavor and heat level that highlights the pepper’s unique qualities. Flavors include Jimmy Nardello’s, Picante Calabrese, Golden Greek Pepperoncini, and Lemon Drop. They make delicious condiments for many dishes Chef John McConnell serves on the Bruschetteria Food Truck, frequently parked by the patio behind our Velo Vino tasting room in St. Helena. CLIF BAR FAMILY FOUNDATION In 2016, the Foundation awarded more than $4 million to 400+ pioneering organizations working to strengthen our food system and our communities, enhance public health, and safeguard our environment and natural resources. Our SEED MATTERS® graduate-student fellowship program has helped reinvigorate long-neglected organic crop breeding in universities in six of the nation’s agricultural regions.
Gary Erickson & Kit Crawford, Owners and Chief Visionary Officers | Kevin Cleary, Chief Executive Officer Thao Pham & Elysa Hammond, Co-editors | Mija Riedel, Managing Editor | John Marin, Senior Creative Director Bill Ribar/Formative, Design | Sandy Biagi, Print Management Special thanks to our contributors: Gregg Bagni, Imke Beator, Shirin Belur, Rich Boragno, Robert Burns, Veronica Cipto, Kevin Cleary, Deven Clemens, Darcy Colwell, Cassie Cyphers, Liza Darnell, Shannon DiDonato, Linzi Gay, Marjorie Goux, Dan Hickle, Lauren Kanouse, Dean Mayer, Keith Neumann, Amy Norris, Margot Northover, Katrina Okano, Claudia Perkins, Monica Pomeranz, Susan Marie Potucek, Allen Rosenfeld, Scott Schoenwaelder, Samantha Stearns, Justin Stekoll, Lashunda Tate, John Taylor, Dave Tintelnot, Kate Torgersen, Keely Wachs, Nellie Williams, Lindsey Young. Distributed by Clif Bar & Company • Emeryville, CA 94608 U.S.A. • 1-800-CLIFBAR M-F 8-5 PST • clifbar.com © 2017 Clif Bar & Company. Trademarks and registered trademarks are owned by Clif Bar & Company, or used with permission. All other trademarks and/or names are the property of their respective owners and are used for historical reference only. CBC16 1688 Printed on 100% recycled paper, 10% post-consumer content, made with wind power, processed chlorine-free with vegetable-based inks.