What changed in this filing

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Item 1. Business

2021-11-15 compared with 2020-11-16 · 87 added, 56 removed, 159 unchanged (47% of the section changed)

13 unchanged sentences

the cost and availability of live cattle and hogs, raw materials and feed ingredients;

availability of team members to operate our production facilities;

and operating efficiencies of our facilities.

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Fertile eggs are incubated at the grandparent hatchery and produce pullets (i.e., parents).

Pullets are sent to breeder houses, and the resulting eggs are sent to our hatcheries.

Pullets are raised to 20 weeks of age, sent to breeder houses, and the resulting eggs are sent to our hatcheries.

Once chicks have hatched, they are sent to broiler farms.

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• Cobb-Vantress, a chicken breeding stock subsidiary, has business interests in Argentina, Brazil, China, Colombia, the Dominican Republic, India, the Netherlands, New Zealand, Peru, the Philippines, Spain, Turkey, and the United Kingdom.

Tyson Asia-Pacific, consists of vertically-integrated chicken production operations in Thailand, further-processing operations in Malaysia and a beef production operation in Australia.

Tyson China-Korea, with locations in China and South Korea, consists of vertically-integrated chicken production and further-processing operations, and a joint venture interest in a non-consolidated chicken processing business.

Tyson Europe, sells chicken products throughout Europe produced from our other global operations and co-packer arrangements, and has a chicken further processing operation in the Netherlands.

• Tyson Asia-Pacific, consists of vertically-integrated chicken production operations in Thailand, multi-protein further-processing operations in Malaysia, a beef production operation in Australia, and joint venture interests in two non-consolidated poultry businesses in Malaysia.

• Tyson China-Korea, with locations in China and South Korea, consists of vertically-integrated chicken production operations, multi-protein further-processing operations, and a joint venture interest in a non-consolidated chicken processing business.

Tyson China also sells beef, pork, and prepared foods products imported from Tyson production facilities in the United States and other global operations.

• Tyson Europe, sells chicken products throughout the United Kingdom and Europe produced from our other global operations and co-packer arrangements, and has a chicken further processing operation in the Netherlands.

• Vibra Agroindustrial S.A., a joint venture in Brazil in which we have a minority interest, is a vertically-integrated chicken processing business.

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We conduct continuous research and development activities to improve product development, to automate manual processes in our processing facilities and grow-out operations, and to improve chicken breeding stock.

With regards to our food products we have two primary research and development locations, our Discovery Center in Springdale, Arkansas, and an Innovation Center located in Downers Grove, Illinois.

With regards to our domestic food products we have two primary research and development locations, our Discovery Center in Springdale, Arkansas, and an Innovation Center located in Downers Grove, Illinois.

The centers include more than 80,000 square feet of United States Department of Agriculture (“USDA”) pilot plant space, two consumer sensory and focus group areas, two packaging labs and 25 research kitchens.

The centers enable us to bring new market-leading retail and foodservice products to the customer quickly and efficiently.

Additionally, in fiscal 2020, we opened the Tyson Manufacturing Automation Center to grow the development of new manufacturing solutions and to enhance team member training on new technology.

Additionally, we have a Manufacturing Automation Center in Springdale, Arkansas, designed to grow the development of new manufacturing solutions and to enhance team member training on new technology.

Further, we have research and development capabilities located in several international locations where we operate.

ENVIRONMENTAL REGULATION AND FOOD SAFETY

Environmental Regulation

Our facilities for processing beef, pork, chicken, turkey and prepared foods, milling feed and housing live chickens and swine are subject to a variety of international, federal, state and local environmental laws and regulations, which include provisions relating to the discharge of materials into the environment and generally provide for protection of the environment.

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The cost of compliance with such laws and regulations has not had a material adverse effect on our capital expenditures, earnings or competitive position, and except as described below, is not anticipated to have a material adverse effect in the future.

Congress, the United States Environmental Protection Agency and some states continue to consider various options to control greenhouse gas emissions.

It is unclear at this time what options, if any, will be finalized, and whether such options would have a direct impact on the Company.

Due to continuing uncertainty surrounding this issue, it is premature to speculate on the specific nature of impacts that imposition of greenhouse gas emission controls would have on us and whether such impacts would have a material adverse effect.

We work to ensure our products meet high standards of food safety and quality.

In addition to our own internal Food Safety and Quality Assurance oversight and review, our beef, pork, chicken, and prepared foods products are subject to inspection prior to distribution, primarily by the USDA and the United States Food and Drug Administration ("FDA").

In addition to our own internal Food Safety and Quality Assurance oversight and review, our beef, pork, chicken, and prepared foods products are subject to inspection, primarily by the USDA and the United States Food and Drug Administration (“FDA”).

We also participate in the USDA's Hazard Analysis and Critical Control Points (“HACCP”) program or FDA's Hazard Analysis and Risk-Based Prevention Controls (“HARPC”) program as applicable and are subject to the Sanitation Standard Operating Procedures and the Public Health Security and Bioterrorism Preparedness and Response Act of 2002.

Additionally, our foreign operations are subject to various other food safety and quality assurance oversight and review.

Greenhouse Gas Emissions

Congress, the United States Environmental Protection Agency, some states and non-U.S.

governments continue to consider various options to control greenhouse gas emissions.

It is unclear at this time what options, if any, will be finalized, and whether such options would have a direct impact on the Company.

Although we have not incurred significant costs or capital expenditures, due to continuing uncertainty surrounding this issue it is premature to speculate on the specific nature of impacts that imposition of greenhouse gas emission controls would have on us and whether such impacts would have a material adverse effect.

Tyson closely monitors developments in this area, and voluntarily sets goals to reduce greenhouse gas emissions in accordance with the Science Based Targets initiative (SBTi) criteria.

We continue to evaluate the plans and associated costs of achieving our greenhouse gas emission reduction goals.

Sustainability

We have aligned our business priorities with our sustainability strategy by empowering people, conserving natural resources and innovating smart, responsible agriculture.

We strive to empower people by being a transparent people-first business that values inclusion and equal opportunity, investing in communities, fighting hunger and empowering our team.

We aim to conserve natural resources by conserving water, reducing greenhouse gas emissions, minimizing manufacturing and food waste and designing and using packaging that is reusable, recyclable or compostable.

Additionally, we undertake efforts to innovate smart, responsible agriculture by cultivating a food system that prioritizes sustainable agriculture in our global supply chain through land stewardship, animal welfare, education, transparency and traceability.

We have also partnered with World Resources Institute to assess water risk and develop a water stewardship strategy, completed construction of Tyson Foods Center for Sustainable Broiler Research, announced our global forest protection standard following deforestation risk assessment and achieved a 7.7% reduction in water use against a 2015 baseline year.

Additionally, we established sustainability governance and oversight through the Governance and Nominating Committee of our Board of Directors.

This Committee advises the Board on matters relating to corporate responsibility and sustainability, including environmental, social and governance matters affecting the Company.

It also oversees the Company’s key programs and oversees and reviews, at least annually, the Company’s integration of sustainability principles into our business strategy and decision making.

HUMAN CAPITAL MANAGEMENT

Employees and Labor Relations

As of October 2, 2021, we employed approximately 137,000 team members.

Approximately 120,000 team members were employed in the United States, of which approximately 114,000 were employed at production facilities, and approximately 19,000 team members were employed in foreign countries, primarily in Thailand and China.

Approximately 120,000 team members were employed in the United States, of whom approximately 114,000 were employed at production facilities, and approximately 17,000 team members were employed in other countries, primarily in Thailand and China.

For fiscal 2021, our domestic workforce experienced a 3% decrease in retention rate from fiscal 2020.

Approximately 33,000 team members in the United States were subject to collective bargaining agreements with various labor unions, with approximately 8% of those team members at locations either under negotiation for contract renewal or included under agreements expiring in fiscal 2022.

The remaining agreements expire over the next several years.

Approximately 5,000 team members in foreign countries were subject to collective bargaining agreements.

Approximately 5,000 team members in other countries were subject to collective bargaining agreements.

We believe our overall relations with our workforce are good.

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We maintain a safety culture grounded on the premise of eliminating workplace incidents, risks and hazards.

We have created and implemented processes to help eliminate safety events by reducing their frequency and severity.

We also review and monitor our performance closely.

We created and implemented processes to help eliminate safety events by reducing their frequency and severity.

We also review and monitor our safety performance closely.

Our goal is to reduce Occupational Safety and Health Administration (“OSHA”) recordable incidents by 10% year over year.

During fiscal 2021, our recordable incident rate declined 1% compared to fiscal 2020.

In response to the global novel coronavirus pandemic (“COVID-19” or “pandemic”), we have implemented and continue to implement safety measures in all our facilities.

As an expansion of our We Care workplace safety program and continued efforts to boost the overall health and wellness of our workforce, we are piloting health clinics near our production facilities, giving team members and their families easier access to high-quality healthcare.

Inclusion and Diversity:

We embrace the diversity of our team members, customers, stakeholders and consumers, including their unique backgrounds, experiences, thoughts and talents.

As an expansion of our We Care workplace safety program and continued efforts to boost the overall health and wellness of our workforce, we continue to pilot health clinics near our production facilities, giving team members and their families easier access to high-quality healthcare.

In response to the global novel coronavirus pandemic (“COVID-19” or “pandemic”) and its related variants, we implemented and continue to implement various safety measures in all of our facilities.

To protect our team members, their families and our communities, we require our team members in the U.S.

to be fully vaccinated against COVID-19.

We also expanded our medical team with the addition of a Chief Medical Officer position and created over 200 nurse and administrative support staff positions to assist our efforts to protect frontline team members during the COVID-19 pandemic while also enhancing our culture of health, safety and wellness.

In addition, we partnered with third-party experts to assist in our efforts to educate our U.S.

team members about COVID-19 vaccines, provide our U.S.

team members, their families and members of their household access to COVID-19 vaccines and case assessment of team members and their families affected by the pandemic.

Diversity, Equity and Inclusion

We embrace the diversity of our team members, customers, stakeholders and consumers, including their unique backgrounds, experiences, perspectives and talents.

Everyone is valued and appreciated for their distinct contributions to the growth and sustainability of our business.

We strive to cultivate a culture and vision that supports and enhances our ability to recruit, develop and retain diverse talent at every level.

We have a goal to build a highly engaged team by increasing retention year over year.

For fiscal 2020, our domestic workforce realized a 1% increase in retention rate from fiscal 2019.

As of October 3, 2020, our domestic workforce was approximately 40% gender diverse, and of our domestic team members, our workforce was approximately 33% white, approximately 27% Hispanic or Latino, approximately 25% Black or African American, and approximately 11% Asian American.

We strive to cultivate a culture and vision that supports diversity, equity and inclusion in our community and enhances our ability to recruit, develop and retain diverse talent at every level.

In fiscal 2021, we appointed our first Chief Equity, Inclusion and Diversity Officer and established a company-wide Diversity, Equity and Inclusion Council.

We worked to build a highly engaged team by improving the recruitment, retention and advancement of diverse team members year over year.

In fiscal 2021, we reorganized our Business Resource Groups (or “BRGs”) and added three new BRGs:

African Ancestry Alliance, Asians & Allies and LatinX.

In fiscal 2021, to support organizations working to combat racial hate crimes and protect the civil and human rights of Asian American and Pacific Islanders, we committed to awarding a series of grants to several national non-profit organizations, including Asian Americans Advancing Justice, Asian Americans Advancing Justice–Chicago and the National Association of Asian American Professionals.

Consistent with our commitment to diversity, we implemented a goal to have at least 80% of our candidate slates for domestic team member positions at the director level and above be diverse.

In fiscal 2021, we exceeded our goal, with approximately 92% of our candidate slates for such domestic positions diverse as of October 2, 2021.

As of October 2, 2021, our domestic workforce identified as approximately 39% gender diverse, approximately 32% white, approximately 28% Hispanic or LatinX, approximately 25% Black or African American, and approximately 10% Asian American and Pacific Islander.

In addition, as of October 2, 2021, approximately 31% of our domestic team members in management roles identified as women and approximately 30% identified as ethnically diverse.

Talent and Development

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We focus on the team member experience, removing barriers to engagement, further modernizing the human relations process, focusing on hourly team member retention and continually improving equity and effectiveness of all talent practices.

Through our Upward Academy Program, we offer English as a second language and financial literacy training to all team members.

As of October 3, 2020, we have launched the program in 59 Company locations.

Consistent with this focus, in fiscal 2021, we conducted our first-ever worldwide engagement survey that included frontline team members for the purpose of evaluating our internal performance and how we compared to other companies in various areas.

In addition, through our Upward Academy Program, we offer English as a second language, financial literacy and digital literacy training to all team members.

As of October 2, 2021, the program is operating at 44 Company locations.

To complement Upward Academy, we have also launched Upward Pathways, a frontline career development program that helps team members further hone professional skills and creates opportunities for our team members to advance to higher-paying, more senior-level positions within the Company through job skills training and workforce certifications at no cost.

We have a goal to be the employer of choice within our markets and peer groups and strive to grow and develop the different capabilities and skills that we need for the future, while maintaining a robust pipeline of talent throughout the organization.

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PATENTS AND TRADEMARKS

We have filed a number of patent applications relating to our processes and products that either have been approved or are in the process of review.

We have filed a number of patent applications relating to our processes and products that either have been granted or are in the process of review.

Because we do a significant amount of brand name and product line advertising to promote our products, we consider the protection of our trademarks to be important to our marketing efforts and have registered and applied for the registration of a number of trademarks.

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On this website, we make available, free of charge, annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, iXBRL (inline eXtensible Business Reporting Language) reports, and all amendments to any of those reports, as soon as reasonably practicable after we electronically file such reports with, or furnish such reports to, the Securities and Exchange Commission.

Also available on the website for investors are the Corporate Governance Principles, Audit Committee charter, Compensation and Leadership Development Committee charter, Governance and Nominating Committee charter, Strategy and Acquisitions Committee charter, Code of Conduct and Whistleblower Policy.

Our corporate governance documents are available in print, free of charge to any shareholder who requests them.

Also available on the website to review and print for investors are the Corporate Governance Principles, Audit Committee charter, Compensation and Leadership Development Committee charter, Governance and Nominating Committee charter, Strategy and Acquisitions Committee charter, Code of Conduct and Whistleblower Policy, and other corporate governance policies.

CAUTIONARY STATEMENTS RELEVANT TO FORWARD-LOOKING INFORMATION FOR THE PURPOSE OF “SAFE HARBOR” PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

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Among the factors that may cause actual results and experiences to differ from anticipated results and expectations expressed in such forward-looking statements are the following:

(i) the outbreak of the COVID-19 global pandemic and associated responses has had, and is expected to continue to have, an adverse impact on our business and operations;

(ii) our ability to make effective acquisitions or joint ventures and successfully integrate newly acquired businesses into existing operations;

(iii) the effectiveness of our financial fitness program;

(iv) the implementation of an enterprise resource planning system;

(v) access to foreign markets together with foreign economic conditions, including currency fluctuations, import/export restrictions and foreign politics;

(vi) cyber incidents, security breaches or other disruptions of our information technology systems;

(vii) risks associated with our failure to consummate favorable acquisition transactions or integrate certain acquisitions' operations;

(viii) the Tyson Limited Partnership’s ability to exercise significant control over the Company;

(ix) fluctuations in the cost and availability of inputs and raw materials, such as live cattle, live swine, feed grains (including corn and soybean meal) and energy;

(x) market conditions for finished products, including competition from other global and domestic food processors, supply and pricing of competing products and alternative proteins and demand for alternative proteins;

(xi) outbreak of a livestock disease (such as African swine fever (ASF), avian influenza (AI) or bovine spongiform encephalopathy (BSE)), which could have an adverse effect on livestock we own, the availability of livestock we purchase, consumer perception of certain protein products or our ability to access certain domestic and foreign markets;

(xii) changes in consumer preference and diets and our ability to identify and react to consumer trends;

(xiii) effectiveness of advertising and marketing programs;

(xiv) significant marketing plan changes by large customers or loss of one or more large customers;

(xv) our ability to leverage brand value propositions;

(xvi) changes in availability and relative costs of labor and contract farmers and our ability to maintain good relationships with team members, labor unions, contract farmers and independent producers providing us livestock;

(xvii) issues related to food safety, including costs resulting from product recalls, regulatory compliance and any related claims or litigation;

(xviii) compliance with and changes to regulations and laws (both domestic and foreign), including changes in accounting standards, tax laws, environmental laws, agricultural laws and occupational, health and safety laws;

(xix) adverse results from litigation;

(xx) risks associated with leverage, including cost increases due to rising interest rates or changes in debt ratings or outlook;

(xxi) impairment in the carrying value of our goodwill or indefinite life intangible assets;

(xxii) our participation in multiemployer pension plans;

(xxiii) volatility in capital markets or interest rates;

(xxiv) risks associated with our commodity purchasing activities;

(xxv) the effect of, or changes in, general economic conditions;

(xxvi) impacts on our operations caused by factors and forces beyond our control, such as natural disasters, fire, bioterrorism, pandemics or extreme weather;

(xxvii) failure to maximize or assert our intellectual property rights;

(xxviii) effects related to changes in tax rates, valuation of deferred tax assets and liabilities, or tax laws and their interpretation;

and (xxix) those factors listed under Item 1A.

(i) the COVID-19 global pandemic and associated responses thereto have had an adverse impact on our business and operations, and the extent that the COVID-19 pandemic continues to impact us will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, and public adoption rates of COVID-19 vaccines and their effectiveness against variants of COVID-19, including the Delta variant;

(ii) the effectiveness of our financial excellence programs;

(iii) access to foreign markets together with foreign economic conditions, including currency fluctuations, import/export restrictions and foreign politics;

(iv) cyber incidents, security breaches or other disruptions of our information technology systems;

(v) risks associated with our failure to consummate favorable acquisition transactions or integrate certain acquisitions' operations;

(vi) the Tyson Limited Partnership’s ability to exercise significant control over the Company;

(vii) fluctuations in the cost and availability of inputs and raw materials, such as live cattle, live swine, feed grains (including corn and soybean meal) and energy;

(viii) market conditions for finished products, including competition from other global and domestic food processors, supply and pricing of competing products and alternative proteins and demand for alternative proteins;

(ix) outbreak of a livestock disease (such as African swine fever (ASF), avian influenza (AI) or bovine spongiform encephalopathy (BSE)), which could have an adverse effect on livestock we own, the availability of livestock we purchase, consumer perception of certain protein products or our ability to access certain domestic and foreign markets;

(x) changes in consumer preference and diets and our ability to identify and react to consumer trends;

(xi) effectiveness of advertising and marketing programs;

(xii) significant marketing plan changes by large customers or loss of one or more large customers;

(xiii) our ability to leverage brand value propositions;

(xiv) changes in availability and relative costs of labor and contract farmers and our ability to maintain good relationships with team members, labor unions, contract farmers and independent producers providing us livestock;

(xv) issues related to food safety, including costs resulting from product recalls, regulatory compliance and any related claims or litigation;

(xvi) compliance with and changes to regulations and laws (both domestic and foreign), including changes in accounting standards, tax laws, environmental laws, agricultural laws and occupational, health and safety laws;

(xvii) adverse results from litigation;

(xviii) risks associated with leverage, including cost increases due to rising interest rates or changes in debt ratings or outlook;

(xix) impairment in the carrying value of our goodwill or indefinite life intangible assets;

(xx) our participation in a multiemployer pension plan;

(xxi) volatility in capital markets or interest rates;

(xxii) risks associated with our commodity purchasing activities;

(xxiii) the effect of, or changes in, general economic conditions;

(xxiv) impacts on our operations caused by factors and forces beyond our control, such as natural disasters, fire, bioterrorism, pandemics or extreme weather;

(xxv) failure to maximize or assert our intellectual property rights;

(xxvi) effects related to changes in tax rates, valuation of deferred tax assets and liabilities, or tax laws and their interpretation;

(xxvii) the effectiveness of our internal control over financial reporting, including identification of material weaknesses;

and (xxviii) those factors listed under Item 1A.

Risk Factors.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business