Arla Foods has set a target of cutting the greenhouse gases from its production, transport and packaging by 25% by 2020.

The Denmark-based dairy giant admitted the target was "ambitious" but said it wanted to play its part in combating climate change.

"We don't have all the answers yet, but we're sending out a strong signal now to employees and business partners that, as a major company, we take our GHG emissions very seriously," said Arla Foods CEO Peder Tuborgh. "We want to offer customers and consumers more climate friendly products and contribute to national and international climate targets." 

The company said its current emissions are estimated at 1.5m tonnes a year.

Tuborgh said Arla would look to set up research project with rivals in the UK, Swedish and Danish dairy markets to reduce the greenhouse gases from dairy farms.