Greening Retail 2009

8/8/2019 Greening Retail 2009

http://slidepdf.com/reader/full/greening-retail-2009 1/68

Greening Retail

Best Environmental Practices of Leading Retailers from Around the World

2009

www.greeningretail.ca



Greening Retail



Greening Retail

Greening RetailBest Environmental Practices of

Leading Retailers from Around the World

2009

Partners

Ted Rogers School o Management, Ryerson University

Centre or the Study o CommercialActivity, Ryerson University

Retail Council o Canada

ESADE in Spain

University o StirlingHitotsubashi University

Evans & Company Consultants nc.

Sponsor

Environment Canada

Founding Sponsor

A program of:

Prepared by

Wendy Evans, President, Evans & Company Consultants nc.Marion Denney, Evans & Company Consultants nc.

Based on case studies by

Dr. Hersch Jacobs, Ted Rogers School o Management, Ryerson UniversityDr. Leigh Sparks, University o Stirling, ScotlandDr. Kernaghan Webb, Ted Rogers School o Management, Ryerson UniversityMarc Vilanova, ESADE, Spain and Hitotsubashi, JapanWendy Evans, President, Evans & Company Consultants nc.



Greening Retail



Greening Retail

ForewordsGreening Retail is an important tool or the entire retail sector. This thoughtul and thorough bodyo work careully analyzes some o the best practices rom around the world. n addition to articulatingthe benets that greening will provide to our environment, health and communities, this reportarticulates the economic success that will come with sustainable practices.

The 5 participating retailers are to be applauded or their active and willing participation in thisreport and or openly sharing their best practices with the retail community. We have much to learnrom each other and by sharing and collaborating, we will continue to move orward as a green andsustainable industry.

Mitchell GoldharPresident & CEO

SmartCentres

Toronto and Region Conservation (TRCA) is committed to embracing sustainability in all aspects o our operations and to serve as a resource or all organizations in which we have contact. Because theretail sector has the ability to play a pivotal role in the transormation o our communities and in thecreation o a sustainable uture, we are reaching out to retailers internationally through the GreeningRetail program.

The research outlined in this summary report and in the 5 case studies helps us to identiy the most

efective actions or retailers toward environmental sustainability. Through it we have identied someo the best environmental practices o retail companies and the steps they are taking in order toimplement these practices. Along the way, we have discovered that not only are these practices bet-ter or the environment, they also make good business sense.

The retailers described herein are helping us get closer to our objective or sustainable communi-ties; TRCA aims to acilitate broad community understanding, dialogue and action toward integratedapproaches to sustainable living and city-building that improves the quality o lie or residents andbusinesses while enhancing the health o our ecosystems.

The Greening Retail program is an example o the collaboration necessary to achieve our aims; we are

pleased to be part o the partnership that is undertaking this important initiative.

Brian DenneyChie Administrative Ofcer/Secretary-Treasurer

Toronto and Region Conservation



V Greening Retail

AcknowledgementsThe study was undertaken in partnership with Toronto and Region Conservation, Ted RogersSchool o Management at Ryerson University, University o Stirling in Scotland, ESADE in Spain, andHitotsubashi University in Japan.

We are very grateul to SmartCentres or unding this important research and or the leadership andinterest o Sandra Kaiser, VP Corporate Aairs.

n addition, we greatly appreciate the time and insights o the executives o the 5 companies romaround the world who agreed to participate in this research. Without them this research would nothave been possible.



Greening Retail V

Table of ContentsExecutive Summary. VI

1.0 Introduction. 1

2.0 Overview. 3

2.1 Background and Program Objective3

2.2 Methodology. 3

3.0 Findings - Best Environmental Practices. 5

3.1.0 Leadership: Corporate Policies, Governance, Structure and Reporting. 5

3.1.1 Leadership: Corporate Policies, Governance and Structure. 5

3.1.2 Company Culture.

113.1.3 Incentives and Staff Training. 12

3.1.4 Corporate Social Responsibility Reporting14

3.1.5 Benchmarks and Measurement Indicators. 16

3.1.6 Return on Investment. 20

3.1.7 Customer Education and Marketing. 22

3.2.0 Environmental Practices for Merchandise, Facilities and Operations. 25

3.2.1 Supply Chain and Purchasing. 25

3.2.2 Green Products 27

3.2.3 Green Sites. 29

3.2.4 Energy Efficiency and Conservation. 32

3.2.5 Green Energy. 35

3.2.6 Transportation. 36

3.2.7 Solid Waste – Three Rs: Reduce, Reuse, Recycle. 39

3.2.8 Water Quality and Conservation.41

3.2.9 Environmental Charity Giving. 43

4.0 Conclusions.

45

Appendix 1. 48

Appendix 2. 51

Appendix 3. 54



V Greening Retail

Executive SummaryBecause o its broad reach, the retail sector has the potential to eect signiicant change in society ina way that no other industry can. Virtually all Canadians are impacted by retail, whether by our weeklytrip to the ood store, or to ashion stores, home urnishings stores, the corner convenience store, orthe country general store. Retail is perhaps the greatest purveyor o culture in Canada, as it is in most

countries around the world.

With more than . billion square eet o space in Canada and sales o $45 billion in 008, there is nodoubt about the size and importance o this sector. Corporately, retailers can deine environmentallyoriented purchasing requirements; they can educate consumers at the store level; they are thegatekeepers or goods and services consumers are oered. Thus retailers have the ability to inluencebehaviour and consumption patterns on many levels.

The initial Greening Retail study, published in 006, showed that Canadian retailers and theirsuppliers were responsible or over 40 million tonnes o carbon emissions, 6 million tonnes o wasteannually, and millions o kilometres traveled by trucks, rail and air delivering merchandise rom

around the world to every corner o Canada.

The Five % Solution: just 5 per cent o retailers and their suppliers reduce their energyconsumption by 0 per cent, the estimated energy savings in one year would be equivalent to theenergy required to power hal a million homes—all o Ottawa, our nation’s capital—and would resultin a reduction o .4 million tonnes o greenhouse gases, the equivalent o removing 33,000 carsrom the road or a year. The objective o the research project described herein was to examine the environmental bestpractices o 5 o the leading retailers in the world to identiy in detail their strategies and tactics,and communicate these to other retailers. This initiative is designed to assist the industry in adopting

sustainable practices, and demonstrate that undertaking these initiatives can enhance their bottomline and thus makes good business sense. n selecting the retail leaders to interview, every eort was made to obtain a representative samplethat relects the broad spectrum o retail in terms o merchandise, size, ormat, ownership structureand geography. t included retailers in North America as well as in Europe and Asia, where sustainablepractices appear to be more advanced. Personal interviews were conducted with key executives o the participating companies in Canada, the United States, England, reland, France, Australia andJapan. Most took place in person, while a ew were by telephone.



Greening Retail V

The following table lists the corporate participants and their head office locations:

Company Country Company Country

Aeon Japan Monoprix France

Alliance Boots U.K. Monsoon U.K.

Carreour France Mountain Equipment Co-Op Canada

Home Depot Canada and U.S. Musgrave Group relandH-E-B U.S. Tesco U.K.

KEA Sweden Wal-Mart Canada and U.S.

LUSH U.K. Woolworths Company* Australia

Marks & Spencer U.K.

* unrelated to the U.K. or U.S. Woolworth Company

The scope o the study makes it a challenge to distil the breadth and depth o inormation rom eachretailer; however, we believe that the ollowing are the most salient themes and indings:

One size does not fit all. Company strategies varied widely according to such actors as merchandisecategory, number o stores, ormat, size and ownership structure.

First at the plate. The earliest adopters o environmental best practices tended to be the grocerychains, ollowed by department stores and other large space users, and then specialty stores. Othercompanies embraced sustainability rom the outset. t was ingrained in their culture, oten romthe ounder.

Common threads. Although the ramework or achieving best practices varied among the retailers,there were common threads including:

• A deeply held conviction by the CEO/owner/ounder/senior management that the company

must reduce its impact on the environment• An environmental strategy and plan• An environmental management structure• Sta who were appointed with environmental responsibilities at the head oice and store level• External advisors to assist in developing the strategies and providing advice• Sustainable strategies, actions and indicators integrated into existing operations and

management structure• Policies with broad sustainability principles and speciic unctional or issue-related policies• Policies disseminated internally and, most oten, externally• Regular updates o sustainability policies and achievements, typically every one to three years.

Governance models. Successul models vary rom ormal to inormal. Franchise and internationalcompanies have adopted dierent models to implement best practices.

Key sustainability strategies. Three strategic ocuses have emerged, either individually or incombination: operational, market transormation and supply chain.

Corporate social responsibility (CSR) reporting. Thirteen o the 5 companies produce CSR reportsand the other two will be doing so in the near uture.



V Greening Retail

“What gets measured gets managed.” Over 80 per cent o the companies measure and track energy usage, waste produced and diverted, CO

emissions, transportation and water usage. Energy

and waste top the list. Many publish goals or reduction and track progress rom benchmarks.

Return on investment. RO is a central ocus o environmental best practices. Both large and smallleading retailers realize that sustainability provides a very healthy return on investment and urtherdierentiates their businesses. There were three main approaches to measuring success:

• Cost savings—ocuses on reducing costs• Carbon emissions reduction—success is a reduction in CO

emissions

• Revenue generation—success through the sale o green products.

The low-hanging fruit. Many companies began the sustainability journey by undertaking the leastexpensive actions and subsequently graduated to the more costly measures. The top three ROactions or most are as ollows:

• Appointing champions throughout the organization with responsibility or achievingsustainability goals

• Reducing energy• Reducing waste.

The Three R’s—Reduce, Reuse, Recycle. Retailers acknowledge that major savings can be realizedrom waste reduction and recycling, but many have just begun to explore the options available in thissigniicant area o opportunity. Monetizing waste is a proitable business.

Supply chain. Managing the supply chain is critically important because research indicates thatbetween 80 and 90 per cent o the retailer’s total ootprint comes rom the products that are carried.

Procurement policies rule. Virtually every retailer has established a procurement policy thatcontains speciic environmental standards.

Green products. Over hal o the companies have developed their own private brand green products.

Incentives and staff training. With some exceptions, most companies do not employ incentivesto reward sta or sustainability achievements. Most hold workshops and training sessions onenvironmental programs.

Customer education and marketing. Most retailers communicate their environmental policies andinormation to customers and ind this a valuable way to develop and promote their brand and buildcustomer loyalty.

Energy efficiency and conservation. The our ocal points or retailers in conserving energy arelighting (changing habits, reduction o wattage and retroits), various building improvements,rerigeration, and tracking usage and reductions.

Green energy. Almost all retailers are interested in developing their own green energy sources, butconsider the expenditure too high. Over hal purchase green energy produced o-site.



Greening Retail X

Transportation. mproved logistics and modal shits top the list o transportation carbonemissions reduction.

Water quality and conservation. With increasing water shortages, more retailers are beginning toocus on using water more eiciently.

Environmental charity giving. All the retailers report supporting charitable causes and orming

partnerships with environmental nongovernmental organizations (NGOs). Participation in localcommunity environmental projects is eective or sta retention and creating good will in themarketplace.

Recommendations and next steps.

• dentiy the best environmental practices o leading shopping centre developers around theworld to assist the retail industry to adopt sustainable practices.

• Assess the easibility o developing environmental sustainability guidelines or the retail andshopping centre sector.

• Communicate the research indings to the sector using reports, the nternet, conerences and

workshops.• Undertake demonstration projects with strategic retailers and shopping centres.



X Greening Retail

Tesco

“All too oten politicians and businessmenhave said to me: ‘You’re a businessman, sosurely you’re opposed to the green agenda?’They think: ‘You cannot make a proit andgo green.’ They think: ‘A consumer society

cannot be a green society.’ And they believethat developing economies cannot aord togo green.

From my perspective this is all muddledthinking. undamentally disagree and saythat i we want long-term growth, we mustgo green.”

Sir Terry Leahy, CEO o Tesco



Greening Retail

1.0 Introduction

The retail sector is perhaps the greatest purveyor o culture in Canada, as it is in most countriesaround the world. Virtually all Canadians are impacted by retail, whether by our weekly visitto ood stores, to ashion stores, home urnishings stores, the corner convenience store, or thecountry general store. Retailers communicate through the nternet, television, newspapers, socialmedia, magazines, radio, shop windows and word-o-mouth, making it the most extensive o anycommunication and distribution network in our society.

n the initial Greening Retail study, published in 006, we identiied the extent o the environmentalootprint o Canadian retailers and their suppliers. Over 40 million tonnes o greenhouse gasesare released annually. Millions o tonnes o waste are sent to landill, and millions o kilometres are

travelled by ship, truck, railcar and airplane as merchandise is delivered rom companies around theworld to stores in every corner o the country. Retailers are increasingly becoming aware o their environmental impact and taking action.Corporately, retailers can deine environmentally oriented purchasing requirements and, at the storelevel, they can educate consumers. Retail businesses act as the gatekeeper or the goods and servicesoered to consumers and, as such, have the ability to inluence behaviour and consumption patterns.

With over . billion square eet o space in Canada and sales o $45 billion in 008, there is no doubtabout the size and importance o this sector. Retailers can make a dierence.

The 5% Solution just 5 per cent o retailers and their suppliers in Canada participated in energy reduction programsand achieved energy savings o 0 per cent, the estimated opportunity or energy savings in one yearwould power 465,000 homes—a city the size o Ottawa—and

• eliminate .4 million tonnes o greenhouse gas emissions or• be the equivalent o taking 33,000 cars o the road or a year.



Greening Retail

One o the questions we set out to answer in this research was: what is the best way to engage thepower o retailers in order to transorm the sector and society?

When we began looking at the issues o sustainability about our years ago, some retailers asked i there was any market research that suggested that consumers were interested in the environment,since that would spur them on to adopt sustainable practices. Ater searching ar and wide, there wasprecious little to indicate that consumers elt strongly about environmental responsibility or would

pay a premium or green products. n a brie our years there has been an about-ace.

Witness recent headlines in the February 28, 2009 issue of The Globe and Mail :

Canadians won’t quit on the environment.

A new poll conducted by psos Reid showed that “even in the worst o economic times as joblosses mount and gloomy headlines dominate, Canadians have not abandoned their concernor the environment which was their top policy priority beore the inancial crisis took hold lastautumn.” Sean Simpson, research manager at psos Reid, said; “Canadians are saying, no it’s stillimportant, the government should still be ocusing on the environment even though it has to

stabilize the economy…… 75% o Canadians say we should only adopt the stimulus measuresthat are environmentally sustainable, while 7% say it’s more important or the governmentto ocus on jobs and climate change. ….. they are saying maybe we can have the best o both worlds.”

A newly released study compiled by 4 agencies o the UN and reported in the March , 009 editiono The Globe and Mail , cites that “the world aces a bleak uture over its dwindling water supply…Today water management crises are developing in most o the world…in a single week in November006, there were local news stories about shortages in 4 countries including parts o Canada, theUnited States and Australia. Shortages are beginning to constrain economic growth in China, ndia,

ndonesia and commercial centres in Australia and the western U.S.”

With consumers demanding environmental responsibility, coupled with the indings o our ongoingresearch that there is a signiicant positive RO in adopting sustainable practices, the stars should bealigned and the road clear or retailers. One o the barriers to adopting environmental best practicesis that one size does not it all, and successul strategies vary rom one type o retailer to another.What’s good or the goose is not necessarily good or the gander. The highly successul LUSH Nakedcampaign or example, when associates were naked under their aprons to make a statement aboutpackaging (or the lack thereo), would all lat in a Home Depot store. n the ollowing, we havetried to identiy and present the best practices o a representative group o retailers o dierentstructures, sizes, cultures and regions to help other retailers in their eorts to successully adopt

sustainable practices.

For those who don’t believe in climate change, or at least that humans have anything to do with it—itdoesn’t matter. There are still compelling reasons or adopting best environmental practices. Thisproject demonstrates to retailers that undertaking these initiatives can enhance their bottom line andthus makes good business sense.



Greening Retail 3

2.0 Overview

2.1 Background and Program Objective

The Greening Retail program consists o three streams o activity: research to identiy anddocument best practices; communications and marketing to disseminate the research indings;and demonstrations to pilot best practices with key retailers and shopping centres. (Details o theinitial research project are included in Appendix .) The objective o the second research projectis to examine 5 o the top best-practice environmental retail leaders in the world to identiy theirstrategies and tactics in detail and communicate them to other retailers to assist the industry toengage in sustainable practices.

The third research project will identiy best environmental practices o our to six o the leadingdevelopers and shopping centres rom around the world. Additional research projects will beundertaken as issues and research opportunities are identiied in consultation with the sector.

Communications and marketing o the research indings has been ongoing through the publicationo reports, the creation o the Greening Retail website, and presentations at workshops andconerences. Demonstration o best practices will involve working with two to three retailers andshopping centres to implement projects and disseminate the results to the sector.

2.2 Methodology

For the Retailer Best Practices research, the methodology consisted o ive components o

primary research:

1. Selection of 15 Target Companies

n choosing the inal companies to be studied, an eort was made to provide as representative asampling as possible to relect the broad spectrum o retail in terms o merchandise, size, ormat,ownership structure and geography. Please see Appendix or the description o characteristics andthe list o participating retailers by company, size, category, country o origin and key data.



4 Greening Retail

2. Background Research

Following the selection o retailers, background research was undertaken on each target company,largely through the nternet. The companies were asked to participate and share their insights,strategies and tactics regarding environmental best practices. Only one company declined toparticipate.

3. ProtocolA protocol was developed and tested, and interviews were conducted with key executives o theparticipating companies in Canada, the United States, England, reland, France, Australia and Japan.Most were in person, and a ew were by telephone.

4. Reporting

Following the interviews, a report was prepared on each company and a summary report writtento identiy the overall indings and best practices o all the retailers. Each o the company reportsis published as a separate case study. A structure similar to that used in our initial research projectemploying the 4-point ramework was used to report best practices or each o the retailers as wellas the overall results.

Throughout the report, the best practices are presented in tabular orm. Colour shading is used torepresent the number o companies reporting each o the practices. The darker shades o greenindicate a higher number o retailers reporting each practice.

Key to Colours in Charts

Number of Companies Reporting Each Best Practice

12 – 15 companies – dark green (>75%)

8 – 11 companies - lime green (approx. >50% to <75%)

4 – 7 companies - medium green (approx. 25% to <50%)

1-3 companies - light green (< 25%)

5. Interactive Database Summary

Over the past two years, Toronto Region Conservation (TRCA) has been collecting brie stories o bestenvironmental practices rom retailers around the globe and has, to date, collected inormation onalmost 500 cases. These have been summarized according to the 4-point ramework, and the storiesare available in an interactive database on the TRCA website at www.greeningretail.ca.

The results o the current research build on this base o inormation and provide insight into key

leadership issues and the strategies, actions and tools employed to achieve best practices inenvironmental sustainability.



Greening Retail 5

3.0 Findings – Best Environmental Practices

3.1.0 Leadership: Corporate Policies, Governance,Structure and Reporting

3.1.1 Leadership: Corporate Policies, Governance and Structure

While the participating retailers vary in their approach to sustainability, clear policies and governanceare critical to all o them or achieving their goals.

Evolution of Best Practices

• Best practices have evolved at dierent rates depending on the merchandise, category orormat, and the ounder’s interest in sustainability.

• The earliest adopters have tended to be in the grocery sector as they consume large amounts o energy, are large space users, and there is ample opportunity to develop “green” products. Thenext major group has been the department store sector. They are also large space users, butare not generally as energy intensive as the grocery sector. Other big box stores have ollowed.The home improvement segment has a particularly large role to play since the productsinluence consumer buying decisions and the ability to reduce their personal ootprint in theirown homes.

• Other companies have pursued environmental sustainability programs rom the beginning. thas been ingrained in the culture o the company, oten as a result o the philosophies o theounders. Alliance Boots, LUSH and H-E-B are examples.

• To others, the impetus has come later. For example, Wal-Mart’s CEO, Lee Scott, became convincedthat adopting sustainable practices was the socially responsible thing to do, as well as anoutstanding opportunity to reduce operating costs and increase Wal-Mart’s competitive edge.



6 Greening Retail

• While reasons vary or pursuing environmental best practices, the common thread is alwaysthat it makes good business sense.

• The ramework or achieving environmental best practices varies with ownership structure, sizeo company, and to some extent geography and ormat. There are, however, similarities acrossthe companies. These are described below.

Summary of Top Leadership Characteristics Top 15

Corporate Structure

Environmental Guidance rom Leadership 5

Environmental Management System (EMS)

Appoint Sta with Environmental Responsibility

Draw up an Environmental Plan 0

ntegration o ndicators & Business Operation 0

Form Committee with Environmental Responsibilities 6

Recruit External Corporate Advisors 6

dentiy RO 5

Policies

Policies with Broad Principles 0

Policies or a Speciic Area 8

Review & Update Policies Regularly 8

Disseminate Policies nternally 7

Disseminate Policies Externally 6

There are a number o characteristics with respect to corporate structure and policies that weredemonstrated in the best practice companies. The ollowing orm the oundation o the sustainabilityprograms and their implementation:

• A deeply held conviction by the CEO/owner/founder/senior management that thecompany must reduce its impact on the environment and “do the right thing”.

• An environmental strategy and plan. The European and Asian companies generally startedalong this path signiicantly earlier than the North American irms, some developing ormalstrategies in the mid to late-990s, whereas the North American irms tended to develop these

policies during the last three to our years. A number o the retailers began inormally pursuingsustainable practices during the 970s and 80s, and some even earlier. t is ingrained in the DNAo companies such as Alliance Boots and KEA.

• An environmental management structure. Some o the companies have highly ormalizedreporting, while others do not, oten depending on company size and culture.

• Staff assigned with environmental responsibilities. Most oten there is a very small numbero people whose sole responsibility is dealing with sustainable issues because environmental



Greening Retail 7

goals are integrated into the job descriptions o management and sta across the organization.Even in large organizations, there may only be one or two people totally dedicated to CSR/environment. For example, Alliance Boots has one person or the entire U.K. operation.

• Cross company and cross-divisional committees have been created to develop andimplement the strategy and action plans. n virtually every company, there is an individualappointed at the store level who is responsible or implementing sustainability plans. n

some cases, store personnel develop their plans. They are oten given an identiiable namesuch as Green Helpers (LUSH), or GreenTeam Captains (Home Depot). Big boxstores tend to have teams o people thatimplement the environmental plan.

• External advisors. Virtually all thecompanies have recruited externalcorporate advisors to assist in developinga strategy or provide expert advice onthe technical aspects o energy saving,

rerigeration, lighting, heating, watermanagement and so orth.

• Sustainable strategies, actions and

indicators have been integrated

into the operations o the businessto a greater or lesser degree. Largeinternational conglomerates, such asAeon, develop strategies at the holdingcompany level and implement them atthe divisional and regional levels. n othercompanies, such as H-E-B, initiativescan be developed centrally in theEnvironmental Oice or can originate ina division and be implemented with theassistance o the central EnvironmentalManager. n no case is a separate part o the organization ully responsible or theCSR/environmental programs.

• Policies with broad sustainability principles have been developed in all o the companies.While some developed policies over a decade ago, others may have been pursuingsustainability practices or a long time, but have not developed ormal policies until morerecently, such as H-E-B and LUSH.

• Specific functional or issue-related policies such as energy reduction, waste reduction,operations, and transportation have been developed in varying degrees by the companiesstudied. Some companies are more “project” versus “issue” directed. n some cases, companiesmight pursue the higher RO actions irst. Others, such as Monsoon, choose speciic areaso concentration.



8 Greening Retail

• Internal policy dissemination has been a part o all the sustainability strategies o theparticipating companies. The communication channels vary in ormality and eiciency, andmay include monthly newsletters, ormal training programs, cross-company conerence calls,and integration o policies and targets into management and sta evaluations.

• External policy dissemination is universal among the companies, but varies with the cultureo the company, the philosophy o senior management and whether it is privately or publicly

held. Several companies, such as LUSH and KEA, have not wanted to be “boastul” abouttheir achievements and so have only recently incorporated sustainability into their marketingprograms or publicly announced their policies.

• Regular review and updates of sustainability policies. Some conduct annual reviews, whileothers conduct reviews every two to three years.

Structure and Governance

The organizational structure used to achieve environmental sustainability goals varies rom inormalto highly ormal among the leading retailers interviewed. Both can be eective. Models also dier

in structure between national and international companies and between corporate and ranchisecompanies.

Leadership and Governance Models

• Informal versus formal

An example o an inormal model is LUSH. t has a very lat organizational structure. A small group o employees called ‘the Maia’ meets regularly in the head oice and makes the important decisionsor the company. ts membership can vary rom time to time, and dierent individuals are invitedto present their ideas or consideration, approval and implementation, including those dealingwith sustainability. Green helpers, volunteers selected on the basis o their interest and passion orenvironmental issues, have been identiied or each o the 88 shops in the U.K. and are responsible or

implementing sustainability programs.

On the ormal side are these models:• A hierarchy o speciic committees• The appointment o management whose prime responsibility is to promote sustainability• Speciic goals and action plans assigned to dierent individuals or departments• Monthly or quarterly reporting• Oversight at the board o directors’ level.

Alliance Boots has a particularly well-evolved CSR governance structure or sustainability. Their CSRcommittee o the board meets quarterly and oversees the development o sustainability strategy

and goals, and the measurement o success in achieving their targets. Reporting to the board is a CSRaction group consisting o eight leaders. Below this are our CSR activity areas, and below them aremanagers responsible or implementing the programs and achieving the goals in each o their areasacross the company. A CSR scorecard using the traic light system to highlight action requirements isused to track success. To ensure implementation, CSR/environmental goals are written into employeeobjectives and are broken down into actions with key perormance indicators (KPs). Each director hasa KP document and i the environmental objectives are not achieved, it will be reported to the boardby the CSR committee and corrective action will be taken.



Greening Retail 9

Source: Richard Ellis Presentation at Responsible Retail Summit in London, January 2008

Other variables in developing a structure or implementing environmental best practices are as ollows:

• National versus international companiesSingle country retailers, especially where stores are corporately owned, can simpliy theimplementation o environmental practices. The action plans are oten centrally developed in headoice and implemented in the ield through a strong corporate culture. The practices may be variedto meet local conditions such as diering energy sources.

mplementing environmental best practices in international companies is oten more challenging dueto these types o dierences:

• Culture• Local practices• Levels o inrastructure available or recycling, transportation, sources o energy (renewable

versus non-renewable)• Ownership structure, that is, wholly owned or minority ownership.

n general, companies have addressed sustainability in international divisions by developing overallcompany goals, communicating them to the international divisions, and requiring the environmentalleaders in those divisions to develop action plans to achieve the overall goals within varying time rames.

CSR Management Process



0 Greening Retail

Aeon, whose name in Japanese means “eternity”, practises what they call a “glocal strategy.” Theyapply common or global standards within the local cultural and geographic context. Wal-Mart hasdeveloped sustainability goals or the entire company and each country division is responsible orachieving those goals in varying time rames according to local standards and resources. They use theprograms emanating rom the U.S. head oice whenever possible. Some o the oreign operations o Alliance Boots are minority-owned. The company uses suggestion and inluence rather than edictsto promote environmentally responsible behaviour. n addition, environmental leaders rom the

international divisions travel to the Boots head oice and work with designated individuals there todevelop action plans speciic to their own country.

• Franchise versus corporate structure

Most o the companies studied are corporately owned, simpliying implementation o environmentalstrategies. n the case o ranchise operations such as Carreour and Musgrave (the latter is a grocerydistribution company supporting over 3,000 ranchisees), dierent tactics must be used to promotesustainability. All Carreour ormats rom the hypermarket to the convenience stores are ranchiseesor partnerships. Operational teams that specialize in each ranchisee ormat monitor the stores toensure the transmission o group values and expertise. They use training programs, and all involveranchisees in the group’s quality and sustainability approach. Since 004, ranchisees have been

required to sign the Carreour Quality Charter and observe the Quality Benchmarks. The ranchiseescommit to the reduction o environmental impacts in our dierent areas:

. Purchasing rom environmentally responsible suppliers

. Using logistical support that ensures the most eicient delivery with the ewest greenhouse gasemissions

3. Providing eective store management to reduce energy, promote waste reduction, controlpollution and carry environmentally riendly products

4. Designing and siting stores using environmentally responsible principles, in keeping with theircommunity responsibility.

Thus, through detailed agreements with their ranchisees, Carreour has been able to implementsustainability strategies within this structure.

Sustainability Strategies

All the retailers studied have developed a sustainability strategy within the overall company strategy,however the ocus varies.

Strategic focal points

Three themes have emerged:

• Operational• Market transormation• Supply chain.

None are exclusively one or the other, but oten a hybrid with some areas being more advancedthan others.



Greening Retail

• Operational. This is the most common strategy. The operational approach ocuses largely onbricks and mortar, in both stores and warehouses, and centres on acility retroits and energysavings. The grocery chains typically pursue this route irst.

• Consumer market transformation. This strategy ocuses on transorming the market withthree main approaches: ) merchandising and marketing, ) operations and 3) research anddevelopment. Home Depot provides

an example o this strategy. Consumerengagement or market transormationprograms through merchandising andmarketing are the most advanced methodsand orm the cornerstone o their strategy.Their vision has been to search out anddevelop sustainable products and providethem to their customers at good pricesin their Eco Options program. HomeDepot’s objective is to maximize socialinluence and reduce the consumer’s

environmental ootprint through theproitable sale o these products coupledwith consumer education.

• Supply chain market transformation. This orm o market transormation ocuses on thesupply base and more broadly includes transportation. Research has shown that the largestportion o a retailer’s environmental ootprint is its supply base. Wal-Mart estimates it to be90 per cent o their ootprint. Private brand retailers have tended to be the pioneers o thisstrategy since they have more direct control over their manuacturers and have merchandisemade to their speciications. KEA, or example, has a very extensive and sophisticated network o controls, purchasing requirements (-Way) and auditing processes. Other companies such asLUSH, also selling private or own brand products, have strict guidelines on product contents,packaging (minimal) and manuacturing. Wal-Mart, with more national brand products, isdeveloping a supplier scorecard system or their environmental supply-chain strategy.

3.1.2 Company Culture

All the best practice retailers have developed,or are in the process o developing, a culture o sustainability within their companies.

Focal Points and StrategiesEmployed

• Sustainability is identiied as a corecorporate value in all the companies.All carry this theme through all o their environmental activities andcommunications.

Home Depot

“t is our goal to change markets by how wemerchandise and market. t is our goal to reduceour ootprint by the way we build and manageour assets. t is our goal to create new marketsto drive change…home mprovement is ourbusiness…and we want every home to minimizeits impact on the environment.”

Annette Verschuren, President, Home Depot

Canada, Industry Speech 2007

Aeon

The centre o the new business strategy waslaunched in 007 and aims to take Aeon to

“a new era o sustainable growth.”

“The two most important aims o our companyare corporate growth and the reduction o ourenvironmental impact.”

Motoya Okada, President, Aeon



Greening Retail

• Tradition. Some companies have had a long history o pursuing environmental programs. As aresult, it is well ingrained in the company’s operations and understandings. For example, Aeonhas been running programs or 5 years.

• Founder’s philosophy. Some companies, such as Musgrave, H-E-B, KEA and LUSH, haveimbued their employees with the ounder’s long-held ethical thinking.

• Employee engagement strategies. More recent adopters o environmental best practicescreate a sustainability culture in their organization. For example, Wal-Mart employees

develop Personal Sustainability Projects or PSP’s, and Woolworths Australia has an Eco-Ambassador program.

• Companywide communication. Many communicate their sustainability goals to everyemployee to develop a common understanding and a culture o sustainability.

• Facilities to encourage employee participation. A number o companies actively encourageand acilitate sustainable practices or employees. For example, Mountain Equipment Co-op(MEC) provides change rooms, showers and lockers or their employees, and now 8 per centuse alternative transportation to travel to work.

The development o a sustainability culture is considered very important. On Alliance Boots’ websiteis the statement that “carbon consciousness becomes an integral part o how we do business, a key

consideration in every decision we make, and a priority understood and shared by all our people.”They want “00,000 ambassadors o the environment.”

3.1.3 Incentives and Staff Training

Incentives

The majority o best practice companies do notprovide monetary incentives to their employeesor the achievement o sustainability objectives.Providing monetary incentives does, however,

ensure compliance with overall objectives. Severalcompanies have considered it and may do so in theuture. While a number o companies use systemsin which selected employees have CSR/sustain-ability goals incorporated into their objectives,only three companies have incentive paymentslinked to the achievement o these goals.

Environmental best practices generally result indecreased costs and increased proits. Severalo the retailers noted that because managers

receive bonuses based on proits, they have built-in incentives to achieve overall sustainabilityobjectives. When store manager bonuses are based on store proits, another tactic is holdingmanagers responsible or the energy consumption in their stores by applying the costs to the storeproit and loss statement.



Greening Retail 3

Key Focal Points for Staff Training

Sta training is key to achieving environmental goals and is instrumental in the development o corporate culture in the best practice companies.

• Specific training. The majority have training programs and workshops either solely dealingwith sustainability or CSR, or embedded in a broader company training program.

• Employee orientation. Over a third o the leading retailers include environmentalsustainability as part o their employee orientation program or sta and management.

• Distribution of materials. Over a third o the retailers distribute a wide range o inormationand promotional materials to head oice, store and warehouse employees. These may includebrochures to teach employees how to save energy and reduce waste both at work and at home,energy packs with stickers to provide reminders or sta, or company policies and updates onenvironmental practices or all sta.

Best Practices Used to Communicate Information and Training

Summary of Top Practices Top 15

Hold Workshops and Training Courses Make it Part o Orientation 6

Distribute Materials 6

Create Competition Among Employees 3

Provide ncentives and Disincentives 3

Use the ntranet

Undertake Awareness Campaigns

Community Volunteer Programs

Video Conerencing

Film/DVDs

Newsletters

Develop Guide to Best Practices

Eco Ambassadors

Personal Sustainability Projects

Franchise Quality Charter

• Intranet. Woolworths Australia places inormation on their intranet site to educate employeesabout environmental issues and programs.• All inormation is increasingly distributed electronically to reduce paper usage and waste.

• Community Volunteer Programs. An innovative way o teaching employees aboutsustainability is through volunteer programs where associates are paid to volunteer orcommunity environmental activities. At Alliance Boots or example, a Personal DevelopmentProgram is created or every employee and he/she spends ive paid days volunteering or alocal environmental or social community project. Mountain Equipment Co-op also underwritesenvironmental community volunteer work or their employees.



4 Greening Retail

• Videoconferencing Several companies, such as Carreour and Wal-Mart, usevideoconerencing quarterly to share sustainability ideas and goals with other divisions orcountries.

• Films/DVD. Some companies develop ilms or DVDs or use in training and communication,particularly in the larger and more geographically diverse companies such as Carreour.

• Newsletters. Many use monthly or quarterly newsletters containing environmental tips,company sustainability goals, achievements and upcoming programs.

• Guide to Best Practices. Carreour developed The Guide to Best Sustainability Practices anddistributed it to over ,000 directors, department heads and store managers. t was translatedinto English and then distributed to all international divisions.

• Eco-Ambassadors. Environmental leaders and representatives at the store level are otenused to deliver training programs, and to communicate policies and environmental communityinitiatives. Woolworths Australia has designated 600 Eco Ambassadors to educate and buildawareness o company programs. These are individuals who have some decision-makingauthority (such as store managers or storekeepers) that have been selected to receive trainingrom the Woolworths Academy and the Group Sustainability Department. They in turn transmittraining modules, inormation and advice about environmental programs. Woolworths hasrecognized the value o word-o-mouth and the inluence o collegial pressure in the successul

implementation o company strategies.• Personal Sustainability Projects. Wal-Mart has created a Personal Sustainability Projects

(PSP) program. Every employee is encouraged to develop a personal sustainability goal. The77,000 sta members in Wal-Mart Canada have collectively registered over 60,000 PSPs ina cyber suggestion box. This highly successul program has turned associates into “militantenvironmentalists,” according to company management.

• Franchise Quality Charter. Carreour uses a Quality Charter agreement outlining thecompany’s environmental policies and requirements to ensure that ranchisees understand andcommit to the company programs.

3.1.4 Corporate Social Responsibility ReportingProducing a CSR report is a best practice implemented by all but two o the companies studied, and itis expected that these two will be producing reports in the near uture.

nterestingly, French law requires the top 40 companies in France to produce CSR reports. n NorthAmerica and elsewhere, reporting on corporate social responsibility is becoming an expected normor public companies.

Some o the early adopters began with a statement o principles. Home Depot started preparingCSR reports in 99, but most began reporting ater 000 including several who have only publishedreports or about the past two years. The European-based companies tended to begin reporting

earlier than those in North America.

Producing a CSR report requires the development o environmental and other targets and someorm o tracking progress or the identiied targets. This provides a good discipline or the companiesinvolved. While a ew produce a new report annually, most publish a new report every two to threeyears, with annual updates between reports.



Greening Retail 5

Standards and Certification usedby Best Practice Companies inEnvironmental/CSR Reporting

There were a number o standards or certiicationsthat the retailers reported using as a basis or CSRreporting or as a guide or environmental practices.

Those cited include the ollowing:

Best Practices Top 15

International/National Standards

Carbon Trust 3

GR

National Agencies

United Nations Global Compact

Kyoto Credits

Ethical Stock ndices

SO 4000

SA8000

WWF

• Global Reporting Initiative. Two o thecompanies have based their CSR report on theGlobal Reporting nitiative (GR) ramework.This is regarded as the international gold standard or environmental reporting. Musgrave

Group uses the GR ramework. Their 88-page report was audited against AA000 standards.• ISO14001 is the standard on environmental management established by the nternational

Standardization Organization: using that system, companies can manage their environmentalimpacts. This system is veriied and certiied by an independent organization.

• United Nations Global Compact. n 004, Aeon became the irst Japanese retailer to signthe United Nations Global compact, a voluntary initiative to encourage businesses worldwideto support and implement 0 principles covering areas o human rights, labour standards,environment and anti-corruption.

• SA8000 is an international standard designed and applied by Social Accountabilitynternational, covering areas such as human rights and work environments. SA8000 is certiiedby independent organizations.

• Carbon Trust. A number o the U.K. companies use the services o the Carbon Trust to measureCO

emissions and their consulting services to assist in reducing these emissions. The trust was

set up by the U.K. government in 00 as an independent company to accelerate the move toa low carbon economy by working with organizations to reduce carbon emissions and developcommercial low carbon technologies. There are oices in the U.K., the U.S. and China. For moreinormation, the website is www.carbontrust.co.uk .



6 Greening Retail

3.1.5 Benchmarks and Measurement Indicators

According to the well-known aphorism, “what gets measured gets managed.” All the best practiceretailers studied measure key indicators to a greater or lesser degree. This may range rom trackingour or ive items, to the best in class—Marks and Spencer— who track no less than 00 keyperormance indicators, with virtually all being environmental measures. KEA has tracked progresson an annual basis since 003 and publishes its goal or 009.

Top Five Focal Points

While the individual measures vary signiicantly,there are general themes that emerge in this area.The top two elements tracked are energy usageand waste (3 o the 5 companies), ollowedclosely by carbon emissions, transportation andwater usage ( o 5). t should be noted thatevery retailer measures energy and waste insome orm, however they may not know the totalconsumption or the entire company.

As noted, o the5 retailers calculate their totalCO

emissions and most consider this central to

their overall environmental strategy. Concern orthe environment as well as the threat o potentialimpending legislation have been the impetus orthose embracing this measure.

While the North American companies in the studymeasure environmental targets and results, theEuropean companies generally have broader anddeeper key perormance indicators.

There is increasing pressure or all to measure andreport. Legislative and mandatory requirementsare growing and there has been a rapiddevelopment o volunteer codes o conductsuch as GR and SO. The U.K., European andAsian markets are more regulated than those inNorth America with respect to environmentalrequirements. The new U.S. government may

become signiicantly more stringent in itsenvironmental controls, in turn aecting Canada.Please see Appendix or a note on regulationand the environment.



Greening Retail 7

Best Practices Top

15

Most Common nternal Benchmarks &Measurement ndicators

Energy Usage 3

Waste Production/Diversion 3

CO

Emissions Calculations

Transportation

Water Usage

RO/KPs 9

Packaging Waste 9

Number O Green Products 6

Plastic Carrier Bags 6

Suppliers Audited 5

Capital mprovement Cost And Return 5

Reorestation 4

Recycled Paper 4

Charitable Donations 4

Local Suppliers Supported 3

Sta Participation Targets 3

Time/Equip/Maintenance Savings 3

Customer Participation Calculation

Animal Testing Cost O Training

Cost O Measuring And Assessment

Most Frequently Used DetailedIndicators

For the areas most commonly measured,there are a wide range o indicators that varyaccording to speciic company attributes. Theollowing are those most requently used:

Energy use

What is Measured Measures Source of Data

by store, warehouse, head oice. Oten urtherbroken down by: light, heat/air conditioning,rerigeration, hot water, etc.

kilowatt hours per squaremetre or square oot(some use cubic metre)

store/head oiceelectricity bills

Benchmarks and MeasurementIndicators

Areas most commonly measured are includedin the ollowing:



8 Greening Retail

Waste reduction This includes recycled, reclaimed, or used in energy production.


stores % diverted # skids/bags sent tolandill, waste haulersmeasure in tonnage(some use cost per bin

o waste created by astore)

warehouse/distribution centre % diverted

recovered/reused products in store (damaged goods) %

ood waste sent to landill tonnes

ood waste diverted rom landill %

construction waste sent to landill tonnes

construction waste recycled %

clothing hangers reused/recycled %

CO2

emissions


direct emissions metric tonnes consultants or online tools

indirect emissions metric tonnes

• CO

emissions, or Carbon Footprinting, is a sophisticated measure that requires extensivecalculations. Most companies hire outside consultants to assist in this endeavour, or examplethe Carbon Trust in the U.K. However, there are online tools available. Emissions are otenbroken down into owned assets (direct) and non-owned assets (indirect), which include thesupply chain.

• n addition, CO

emissions are oten calculated by area such as: transportation o products,business travel, employee transportation to and rom work, products, and energy, which may

be urther divided into lighting, rerigeration, heating and so orth. As an example, WoolworthsAustralia identiied their supermarket division as responsible or three-quarters o thecompany’s carbon emissions, and it breaks down as ollows:

• rerigeration 48% • power generator 8%

• lighting % • bakery 3%

• air conditioning 9% • hot water %

• The most signiicant componento carbon emissions or retailers is

rom the supply chain. Wal-Martcalculated that approximately 90per cent o carbon emissions arerom the products it carries, versus0 per cent rom its own operations.Similarly, Alliance Boots calculatedthat products were responsibleor 80 to 90 per cent o their total

Alliance Boots

“At a time when climate change is o increasingconcern to us all, continuously improving our carbonmanagement is clearly our highest environmentalpriority. And nowhere is the connection betweenwhat’s good or the environment and what’s good orour business more apparent.”

Alliance Boots website 2008



Greening Retail 9

carbon ootprint. Some companies, such as Tesco and Alliance Boots, have initiated carbonlabelling or some o their leading private brand products.

Transportation (can also be measured by CO- emissions/shipping unit in kilograms by country)

What Is Measured Measures Source Of Data

customer & employee travel to store by

transit/non-motorized

% o total in-store and employee surveys

business travel and reduction # km and % reduction business travel records

company cars # km and % reduction company car records

goods transported by road, rail, sea, air % or km by mode (distance& mode)

logistics manager/buyer withsuppliers to track

Water usage


water consumption cubic m/sq.m o sales or total area water bills

Packaging


amount o packaging made rom recycled materials % - enlist suppliers’assistance in collectingpackaging inormation- make this requiredinormation orinvoicing

packaging reduction projects #

packaging savings derived rom projects tonnes

packaging that is recyclable (and has recycling labels) %

hangars recycled % o total

Products


green products overall number and % buyers work withsuppliers in sourcinggreen products

ood & non-ood number and %

renewable materials %

wood % sc certiied (orestry stewardship council) or romrenewable sources

ish % msc certiied (marine stewardship council)

various other commodities such as organic cotton, air trade products, etc.



0 Greening Retail

Carrier bags


# plastic bags given to customers # track purchasing orders and bag inventory atstore level

reduction in bags used %

# bags recycled %

charge or bags y/n

Supply chain


environmentally/ethically responsiblesuppliers**

% o total Buyers working with suppliers, identiication o ET or other ethical sourcing designation. Largecompanies develop own auditing system or usethird-party auditors.

audit suppliers/actories # and %

** Note: this may be suppliers who are signatories to the Ethical Trading Initiative (ETI) or various other agreements or

scorecard systems.

Paper


recycled paper purchased % o total used Buyer to stipulate purchasing speciicationsand track. Provide recycling bins and requireemployees to use.

paper that is recycled

Charitable Donations

Set targets or charity donations and expenses. These are oten per cent o pretax proits.

3.1.6 Return on Investment

The return on investment is a central ocus o environmental best practices.

Leading retailers large and small are realizing that sustainability provides a very healthy return oninvestment and creates ever-greater eiciencies that urther dierentiate sustainable businessesrom the rest.

LUSH noted that the smaller environmentalprojects, such as lighting, generally producea positive return within a year; the larger ones

within our years. Wal-Mart, the largest andone o the most eicient low-cost retailersin the world, recognizes that environmentalsustainability provides a road map to greatereiciencies and higher proits and is puttingmore distance between them and theircompetitors. t is changing the way they dobusiness, is a huge business opportunity,

Carrefour

“The health o a company is no longer solelyanalyzed on its inancial situation but also on itsSustainable Development Policy…Sustainabledevelopment is not philanthropy. t is the measureo good risk management and long-term vision.”

Robert Halley, Chairman o the Supervisory Board,

Carreour Sustainability Report



Greening Retail

reduces their environmental impact in a proitablemanner, and allows or more growth.

Realizing the competitive advantage that adoptingsustainable practices provides, some companiesare reluctant to disclose the RO o their practices.

Three Key Strategies

There are three key approaches to realizing andmeasuring return on investment:

• Costs. The companies all track cost savingsand RO to a greater or lesser degree. Someare more organized and track them roman overall company standpoint, while mostdo this on a project-by-project basis. Theactions with the best RO vary by company,

geographic region and commodities sold.

• Carbon emissions. While all o thecompanies track dollar costs and savings,our use carbon emissions as their majorindicator—Woolworths Australia, AllianceBoots, MEC and KEA. Each understandsthat carbon equals costs, and that areduction in carbon delivers cost savings.Woolworths, or example, did a cost-beneitanalysis o the best options to reduce

carbon and ranked the opportunities asollows: ) existing stores, ) new stores,3) electricity to natural gas and 4) purchaseo energy rom renewable sources.

The comparison o top cost-saving versus top carbon-reducing actions or Boots yields the ollowing:

Carbon-Reducing Cost-Saving

. renewable energy (but more expensive) . reduce energy consumption. reuse boxes or use plastic . transportation logistics3. reduce waste and packaging 3. reduce waste and packaging

• Revenue generation. Two o the companies have ound that the most signiicant return oninvestment is derived rom the sale o environmentally riendly products. Home Depot’s EcoOptions products have become a major and ast-growing revenue source, and Aeon’s saleso green products is over $35 million. n the case o MEC and LUSH, the majority o theirproducts are environmentally riendly and are the basis o their business model. Others sellgreen products that are an increasingly important revenue source, but still a relatively smallpercentage o the total sales.

Marks & Spencer on Plan A

“This has helped to deliver not only beneits tothe environment and people across our supplychain but also savings to our customers andour business. Progress made on energy saving,reducing waste and increasing eiciency meanthat months in, Plan A is cost neutral. Weknow our customers expect us to take the leadon ethical and environmental issues, and we willcontinue to deliver.”

Sir Stuart Rose, chairman o Marks & Spencer



Greening Retail

Top Six ROI Focal Points

n general, the top RO actions are as ollows:• Appointment o a champion(s) and

individuals throughout the organizationwho are responsible or achieving speciicsustainability goals

• Energy reduction (tends to be ranked

higher or North American companies)o Lighting retroits – T5s, T8s, CFLso Rerigeration retroitso Heat/air-conditioning retroits and

replacemento Energy monitoring systemso Motion sensors

• Waste reduction (tends to be ranked higheror European companies)

• Packaging reduction• Transportation logistics

• Sale o environmentally riendly products.

3.1.7 Customer Education andMarketing

Many companies realize that there is greatpublic relations value in pursuing environmentalsustainability and that it engenders goodwillamong customers and environmentalists.

Key Focal Points

There are ive key strategies embraced byretailers regarding customer education andmarketing as ollows:

• The development o environmentallyriendly products, both private and nationalbrand, is one o the key customer educationand marketing strategies. This is central toseveral companies whose emphasis is onmarket transormation.

• Undertaking consumer research andgaining eedback on store and other greenbrand products, and tracking consumers’level o interest in sustainability issues andresponding to same.

• Using external media as well as in-storepresentation, signage and merchandisingprograms to promote sustainability.



Greening Retail 3

• Reporting on CSR activities. While this is geared more to the investment community than thegeneral public, it becomes part o the public messaging and creates market transormation.

• Supporting and partnering with national and local community charities and events. Summary of Top Practices


Product Labels

Website 0

Posters in Store 9

Regular Publications 8

Community Events 8

Create Community Dialogue 6

Through Sales Associates 4

n-Store Demonstrations andWorkshops

4

Multi-Strategy Campaign 4

Partner With Others 4

Free Merchandise 3

Solicit Customer Feedback

ncentives and Disincentives

Use the Media

Market Research

Loyalty Cards

Note – All companies are aware o the pitalls o over-promising, under-delivering and thepossibility o being accused o ‘greenwashing’ in this era o increased liability and emphasis oncorporate governance. Some companies, such as Alliance Boots, have integrated sustainabilityinto much o their messaging and are building consumer trust and creating brand dierentiationthrough the articulation o sustainability policies, strategies and actions.

Broadly, external dissemination may take the orm o: ) a sustainability report within the overallcorporate social responsibility report, ) integrating sustainability into marketing and advertising, and3) pursuing sustainable practices in partnership with charitable organizations.

[picture 094008]

• Product Labels. The development o a private label ‘green line’—or example, Wal-Mart’s ‘Forthe Greener Good’ and Home Depot’s ‘Eco Options’—not only provides a platorm to growsales and proits, but is generally supported by external and in-store advertising and marketingto communicate with and educate consumers about these products and their environmentalattributes. Marks and Spencer have a campaign entitled ‘Look behind the label’ to publicizetheir environmentally riendly products and help consumers to understand the salient eatures,such as no artiicial colouring, or the beneits o washing clothing at 30°C versus 40°C.



4 Greening Retail

• Website. Two-thirds o the companies provide inormation, marketing and education on theirwebsites about sustainable products. Home Depot, who has a particularly inormative website,oers inormation about a wide variety o merchandise, such as windows and their insulatingqualities, comparisons o solar panels, and the relative energy consumption o dierent types o lighting.

• Paper Publications. About hal o the retailers use a variety o in-store posters, merchandising,brochures, newsletters, and newspaper and magazine articles to promote sustainability.

LUSH, or example, mounts store window campaigns ocused on environmental issues, suchas eaturing innovative uses o rubbish in their Christmas windows. These campaigns areconsidered very important and are governed by the executive committee.

• In-Store Demonstrations and Workshops. n-store demonstrations and workshops are alsoused to educate consumers about sustainable products and how to install them, or example, inthe home improvement sector.

• While not generally directed at the consumer market, CSR reporting, undertaken by most o the companies studied, can have an impact on the consuming public through investment andmedia reports and it becomes part o the overall public messaging employed by companies

• Community Events. Participation in community and charitable events dealing withenvironmental causes is another popular method o communicating to the public about their

commitment to sustainability. Over hal o the companies mentioned this, and employees areoten paid or their time to volunteer in such events and spread environmental inormation aswell as creating goodwill. This oten includes partnering with other organizations, as Wal-Martdoes with local schools in the ‘Kids Recycling Challenge’.

• Through Sales Associates. Sales associates can be excellent purveyors o customer education.The objective o Alliance Boots is that each o their 00,000 employees is an ambassador o theenvironment. LUSH staged a highly successul event called the Naked Campaign, where all theirsales associates were naked except or their aprons that were printed with “Ask me why ’mnaked?” The message was all about packaging!

• Customer Feedback. Soliciting customer eedback is anothermethod employed by some companies to dialogue with andmarket to consumers. LUSH invites a panel o customers to givethem inormation about their latest (environmental) products:what they are doing right, as well as what they are doing wrong.Others employ market research to understand customers’ viewson their sustainability programs.

• Multi-Strategy Campaign. Several companies run majorcampaigns in support o their sustainable products and provideincentives or customers to purchase ‘green’. Home Depot has runseveral campaigns where they oer to take back customers’ oldenergy-intensive products and receive a discount on their newitems. Two examples o this are ‘Mow Down Pollution’ and the LED Christmas light exchange.

• External media is employed by some to educate customers. Woolworths Australia runs radioadvertisements to encourage recycling and the responsible use o plastic bags.

• Loyalty Cards. The innovative use o loyalty cards is seen at Tesco who tracks consumerpurchases o green products and provides an incentive in the orm o double points or thepurchase o these products.





6 Greening Retail

suppliers they trust or who are certiied by a third party. n other cases, the retailer sources productsonly with a ew selected suppliers who are exclusive to the retailer.

Focal Points in Supply Chain and Purchasing Practices

• Product ingredients and materials. These stipulations tend to be very speciic to the type o retail product. For instance, all products or LUSH must be vegan. Grocery stores may call or

natural ingredients in products. Stores have strict policies on materials that may be toxic (e.g.,ensuring there are no toxic or dangerous materials in cosmetics).

• Product quality and safety. Standards are set to ensure products unction as they should,have saety eatures in the event o ailure or accident, and do not become dangerous whenbroken (e.g., toys).

• Pollution during manufacture and production. Standards are set prohibiting the use o pesticides. Only non-polluting dyes are used in garment manuacturing.

• Sustainable product sourcing. At KEA, or example, all wood must come rom managed orests.• Sustainable business practices. This reers to the practices o suppliers in their own premises

regarding energy eiciency, building, water conservation and saety.• Human rights issues. These may include air wages, no child labour and no strict disciplinary

practices.

Top Practices

Establish a Procurement Policy 4

Set Out Standards or Suppliers

Audit Suppliers 7

Support Suppliers in Going Green 6

Form Supply Chain Partnerships 6

• Procurement Policies. Almost all retailers included in this study have a clear procurementpolicy that both their buyers and suppliers understand. This is particularly important when theretailer purchases products through agents. Store-hired buyers, agents and suppliers must allbe aware o the policies. Woolworths in Australia ound some o their private label products didnot adhere to policy. The controversy led to new policies to ensure the authenticity o suppliers’claims. t also led to the development o training modules to help buyers better understandsustainable sourcing and third-party certiication provided by suppliers.

• Set out Standards for Suppliers. The vast majority o the leading retailers interviewed alsoset standards or their suppliers. Aeon, or example, has a 3-point code o conduct designed toincorporate the requirements o the CSR and environmental standards ollowed by Aeon.

• Audit Suppliers. To ensure that suppliers are meeting the required standards, just under hal o

the retailers interviewed reerred to their auditing process. Carreour has developed a suppliersel-assessment orm that allows suppliers to monitor themselves. n this manner, they areprepared or audits and external audits.

• Monitor Suppliers. KEA has a ormal auditing process based on strict, internationally-recognized standards that are very highly regarded. Beyond their regular audits, they havesurprise audits. These provide them with a clearer picture o how well the standards are beingollowed on a regular basis.



Greening Retail 7

• Those retailers who did not speciically mention monitoring or auditing their suppliers weremore likely to have relatively ew suppliers that were not part o their own store brands. n othercases, they purchased rom suppliers who had demonstrable, recognized external certiicationo their own.

• Support Suppliers in Going Green. Retailers, such as Aeon and Carreour among others,support suppliers in their eorts to go green by providing web-based tools and training thatassist them in measuring their own progress. MEC is working with speciic retailers in ndia to

assist them in developing new dyes or garments that are less damaging to the environment.• Supply Chain Partnerships. Six o the 5 retailers interviewed cited supply chain partnerships.

Wal-Mart is one o the leaders in orming partnerships to solve environmental issues. Forexample, they worked with manuacturers such as GE, Royal Philips and Osram Sylvania toreduce mercury in the CFLs sold in their stores. They are in the process o developing a supplierscorecard, which will eventually result in an environmental ranking o all vendors.

3.2.2 Green Products

One o the greatest impacts that retailers have onthe environment is through the products they put

on their shelves. Shoppers around the world areincreasingly concerned about the environmentalimpacts o the products they choose. And manyastute retailers are heeding the growing desire orgreener products: these are creating a niche thatwill soon be mainstream.

Customers rely on retailers to research theproducts they sell and to provide transparent,relevant inormation about the liecycle o aproduct. Although very ew (i any) products

create no negative environmental impactsthroughout their liecycle, green productlabels can inorm buyers about some o theirenvironmental beneits and/or drawbacks.

Retailers recognize that the “greenest” productsoten carry a premium price due to higher costs inproduction and sourcing o green products. Theseproducts tend to appeal to a narrower range o customers, such as young proessionals, womenand higher income groups generally.

Focal Points in Greener Products

• Store environmental brand(s). The mostcommon practice is or retailers to developtheir own store brand o green products.

• Eliminating undesirable products. Retailers can reuse to stock products that are known tobe harmul to the environment.



8 Greening Retail

• Foundation of green products. Some stores have built their business based on greenproducts and green practices in product development and sourcing.

Top Practices


Store Environmental Brand(s)

Oer Range o Green Products 9

Apply Standards or Own-brand Green Products 8

Good/Better/Best Store Brand Products 6

Form Partnerships 5

Eliminate Most Undesirable Products/FeatureDesirable Products

5

Specialize in Green Products 3

• Own-Brand Products. Typically retailersdevelop a name and brand identity thatrelects the environment. Oten the namewill include the word “green” or “organic”.Two examples are Aeon’s Green Eyeproducts and Carreour’s AGR Bio and ÉcoPlanète brand.

• Good/Better/Best Store Brand Products.

Some stores have evolved a step strategy,with “good”, “better” and “best” product

rankings. This communicates the messagethat all products are at least “good”regarding environmental practices. Anintermediate “better” category broadensthe market size willing and able to purchasegreener products. The “best” categorywith the highest price point appeals to anarrower market.

• H-E-B offers a range of organically grown

products. By studying the demographics,H-E-B varies the assortment o organic

products by market. They have ound theoptimal demographics or sale o organicproducts are as ollows:o Aluent areaso Young amilieso Childreno Women, especially those with or planning

to have children.



Greening Retail 9

• Eliminating undesirable products is common practice that has been in place or a long time.All retailers consciously remove any product shown as posing an environmental or human risk.

• Feature Desirable Products. Home Depot Canada’s primary strategy is its SustainabilityMarket Transormation. The chain has not only eliminated products that use excessive energy,they also have exchange programs encouraging customers to bring in their old goods andupgrade to the new, more environmentally riendly products. The program has been atremendous success and improves the environment in many ways. Home Depot manages the

disposal o the old product and brings awareness to the public o the environmental impact o some older types o products. n addition, the program helps replace some o the older, moreenvironmentally damaging products in the marketplace.

• Wal-Mart has greatly increased the shel space allocated to energy eicient light bulbs in placeo traditional bulbs. They have also ensured that environmentally riendly products throughoutthe store are given the premium shel space, at eye level and in the easiest locations orcustomers to ind.

• KEA’s products are made o materials that reduce environmental impact (e.g., wood rommanaged orests only).

• Alliance Boots looks or natural products that can be used or a variety o purposes and do notdeplete the source. An example is the success story o Sweet Gale, a wild plant indigenous to

Scotland, traditionally used or insect repellent and ood lavouring. Boots discovered that itcan also be used to treat a range o other things rom acne to anti-aging. To harvest the plant,they need only clip the top 0 centimetres, and the water used in processing the plant can berecycled, which reduces transportation costs. Waste materials can be used in other extracts, andthe production supports a mixed agricultural economy in the Highlands.

• Specialize in Green Products. Some retailers have designed their stores rom the beginningwith particular environmental concerns in mind. LUSH Cosmetics, or example, built its entirebusiness on developing products that do not use harsh chemicals and involve absolutely noanimal testing at any point in their development.

3.2.3 Green Sites‘Green sites’ reers to how retailers choose thelocations or their stores and headquarters, howthey develop the site, and how they maintainthe grounds surrounding their buildings. t iscomparable to the ‘Sustainable Sites’ section o the U.S. Green Building Council’s LEED or RetailNew Construction, which is a useul resourceor retailers.

A retailer’s buildings and grounds have many

environmental impacts on the local community.Retailers with comprehensive environmental goalsand practices can consider how best to integratetheir sites into the surrounding communitiesand ecosystems.

Even among the top retailers in this research, ewer retailers ocus as much on green sites as on otherissues. The reason may be that land available or retail development has typically undergone an



30 Greening Retail

environmental assessment process and deemedsuitable beore the land becomes accessible toretailers. Traditionally, retailers have ocusedtheir site selection primarily on the availability o a viable market, good road access and visibility.These actors are o continuing importance.Retailers can also evaluate environmental actors

beore inalizing their site selection. n this manner,environmental sensitivity and the additional costso modiying the building and site development tominimize environmental impacts can be evaluatedas part o the site selection process.

n the past, there was oten a standard store andsite ormat developed in all locations, with somemodiication o size irrespective o the storeenvirons. Some o the leading retailers are nowconsidering the impact o building in an area and

modiying their site and store design accordingly.KEA, or example, is now adjusting its storeormat to suit local environmental conditions. nearlier times, KEA had a standardized model thatwas replicated in all places.

Focal Points in Green Sites

Site selection. A ew retailers do give signiicantconsideration to environmental actors beoreselecting sites. For example, is the site on environ-

mentally sensitive lands? How will employeesand/or customers travel to the location?

Natural features. Retailers can incorporate natural eatures in the property design to minimize theimpact on the surrounding natural environment and/or neighbourhoods.

Building modifications and design features. A third ocus in green sites is modiying buildingdesign and eatures to minimize environmental and community impacts.



Greening Retail 3

Top Practices


Site Selection

Select Sites near Public Transit 3

nstitute Site Selection Policies

Brownield vs. Greenield Selection

Adapt Building/Property to Surrounding Environment

Parking Lots 4

mplement Multiple Landscaping Practices 3

Stormwater Management

Protect and Restore Habitat

Adapt Building Design/Features

Accessible by Alternative Transit (bike racks, showers) 3

Contribute to Mixed-use Communities 3Reduce Heat sland Eect

Reduce Building Footprint

Site Selection

• Retailers can evaluate potential sites on the availability o transportation options. s there transitnearby? KEA ensures that sites are located near major transit access to encourage both sta and customers to travel to the stores by public transit.

• Comprehensive policies and procedures that include environmental actors in site selection arerelatively rare, even among the leading retailers investigated. More oten, the retailers locate in

markets where there is demand and then take steps to mitigate environmental impact i necessary.• For example, H-E-B wanted to serve a market in Austin Texas, near environmentally sensitive

aquiers. H-E-B executives met with area neighbourhood associations and Save Our SpringsAlliance to address their concerns about the size and quality o the store. H-E-B chose to complywith the SOS ordinance that eatures maximum limits to impervious cover in the critical watershedarea, along with stream buer zone requirements and other pollution prevention provisions.

• Brownield development reers to redeveloping land in urban areas or new uses, rather thanexpanding outward to “greenield” rural or agricultural land. Tesco set a goal o siting 90 percent o its new stores on brownields. t is not always possible to achieve such high percentagesas new stores tend to ollow new housing developments, which are usually on greenields.Several areas, including southern Ontario, now have aggressive urban development policies to

restrict greenield development and encourage inill and urban redevelopment.

Adapt Building and Property to Surrounding Environment

• Several retailers are adopting strategies to incorporate good environmental stewardship asthey develop their sites and buildings. This includes building parking lots with vegetation andpermeable suraces. t may include detention ponds on the property.



3 Greening Retail

• A inal strategy in green site development is adapting the building design and eatures to it inwith the natural environment, acilitate environmentally riendly practices at the site and relateto the community.

Adapt Building Design and Features

• MEC locates its stores and oices in areas where employees can easily ride bikes, walk or use

transit to commute. This requires ensuring that access to the property has sae sidewalks andbicycle paths, not only rom the road to the building but along the surrounding streets andaccess points. t also means avoiding excessive setbacks o the building rom the roadwaythat discourage walking or biking because it is dangerous (due to car traic, poor lighting orisolation at night) or unpleasant during bad weather.

• Retailers can also reduce the building ootprint and choose building materials that minimize aheat island eect.

3.2.4 Energy Efficiency and Conservation

Energy eiciency is one area where retailers o any size can begin to make changes and realizeimmediate return. Actions as simple as turningout lights when no one is in a room, turning o computers at the end o the day or adjusting thethermostat by a couple o degrees improve energyeiciency and are immediately evident on utilitybills. Beginning with the most modest changesand reinvesting the savings into and more andlarger energy saving programs have led majorretailers to considerable savings.

Focal PointsLighting. Lighting is oten the irst ocus o retailers as they begin looking or environmentalimprovements. Changing habits, using lesslighting, installing motion sensors and replacinglight ixtures and bulbs with new high-eiciencylighting are relatively easy to do and deliver almostimmediate savings and return on investment (RO).

Building. Building includes all improvementsthat can be made to a building to reduce energy

consumption. This includes improved insulation,environmentally riendly building materials,energy eicient heating and air conditioning, aswell as lighting and water-saving ixtures.

Refrigeration. Replacing reezers and improving rerigeration units in grocery stores are oten keychanges as the running costs are high and potential savings are readily realized in the short term.



Greening Retail 33

Tracking usage and reduction. Usage and savings are easily calculated or energy consumption.Various internet tools are also available to assist in converting savings into CO

reduction igures.

Tracking usage raises awareness, identiies opportunities or greater action and motivates action.

Top Practices


Less Lighting

Changing Habits (lights out in empty rooms) 5

Reduced Lighting 0

Use Automatic Controls 8

Daylighting 7

Energy Eicient Fixtures and Bulbs

LED, Fluorescent, T5, T8 (other eicient bulbs) 3

Reduced Wattage 7

BuildingHeating/AC Replacement 7

Test/Showcase Store 4

LEED Certiication 4

Government Programme – Support/Awards 3

Building Materials

Rerigeration Changes

New, More Eicient Rerigerators 6

Secondary Loop Rerigeration Technology 3

Doors on Cases 3

Re-commissioning or Replacing Components 3

Track RO/ncrease in Proit/Payback Period

CO

Calculations 8

Gross Savings 7

Energy Savings 5

Payback Period 3

Annual Rate o Return 3

ncrease in Net Proit 3

Changing Habits.

• All top retailers have invested in some type o ormal training or inormal communicationto encourage sta at all locations (stores, head oice and warehouse locations) to develophabits such as turning o lights, computers and equipment when they are not in use orextended periods.





Greening Retail 35

Refrigeration Changes

• Rerigeration costs are an enormous energy burden in grocery stores. The leading retailerswith grocery stores have all replaced or modiied their rerigeration units. Usually they replacedopen reezer units with upright units containing doors. They have also installed night curtainsto reduce the loss o rerigeration, and several are using secondary loop rerigeration technology.

3.2.5 Green EnergyAlmost all o the top retailers interviewed expressed an interest in green energy and stated that theyare investigating the alternatives. Most indicated that they plan or at least hope to implement theirown green energy sources in all o their locations in the uture.

For the time being, retailers are encounteringseveral barriers. The technologies are oten costprohibitive and still in the development stages. Asa result, the technologies have not yet achievedtheir ull energy-producing potential, reliabilityor eiciency. Also, there is uncertainty over whicho the green technologies will prove to be mostsustainable, cost eective and productive.

Multinational retailers are inding that the types o green technologies evolving vary signiicantly bygeographical area. This makes it diicult to selecta single approach across all o their operationsand stores.

Some o the largest retailers are testing one or twotechnologies at selected locations, but are vaguein the roll-out plans.

For the time being, retailers report buying greenenergy o-site where it is available.

Top Practices


Purchase Energy Produced O-Site 9

Wind 4

Solar Hot Water 4

Produce Energy On-Site

Photovoltaic

Biomass

Geothermal

Biogas



36 Greening Retail

• Wherever it is available, the retailers are purchasing green energy rom the grid and intend toincrease the ratio o green versus traditional sources in the uture.

• Some retailers, such as KEA, recognize that green technology availability and evolution varyby geographical area. Options to purchase green energy are oten limited. As a result, KEAexpects all o their stores to have a strategy or developing green energy in their annual plans.The stores develop their strategies according to the green energy technology with the mostpotential in their regions.

• The ollowing are the green energy trials currently underway by the leading retailers:

H-E-B is testing the use o uel cells to replace batteries in their orklit trucks. The uel cells savesigniicant idle time o the orklits. While it takes eight hours to recharge a battery, it only takes ourminutes to reill the uel cells. The drawback is that the liquid gas is expensive.

Wal-Mart opened a prototype store in Burlington, Ontario in January 009. The store is heated usinggeothermal technology, which will be tested or use in uture stores.

A pilot project is underway in the U.S. to determine solar power viability or Wal-Mart in McKinney,

Texas. The site also has wind-generated energy.

Mountain Equipment Co-Op installed rootop solar photovoltaic and a thermal generating systemin 007, as a test in their Toronto, Ontario store.

3.2.6 Transportation

Transportation costs are high and volatile, asshown by the soaring uel costs in 008. naddition to environmental beneits, retailers arehighly motivated to improve eiciencies in uel

consumption, ind alternative uels, and analyzetheir logistics or improved shipping modeand loads.

Focal Points

• Logistics. Retailers are reviewing their logisticsto optimize transportation o goods romthe point o manuacture to inal delivery tocustomers. This includes improving routesand scheduling, modal shit, partnerships

and backhauling opportunities.

• Fuel eiciency. This includes vehicle main-tenance and repair to ensure the vehicles areachieving their best perormance. Retailersare also looking to purchase alternative uelsand more uel-eicient vehicles. Drivingtechnique can also aect vehicle perormance,thereore, retailers provide training totheir drivers.



Greening Retail 37

• Product weight, packaging and warehousing. Making the most eicient use o space onvehicles is important. Retailers and suppliers together are analyzing their product and itspackaging to reduce volume. They are also looking at vehicles to ensure the correctly sizedvehicle is being used or the load being transported.

• Customer and sta transportation. This includes sta commuting, business travel, customeraccess to stores and home delivery strategies.

Best Practices


Logistics 4

Modal Shits 0

Routing and Scheduling 7

Backhauling 5

Transportation Partnerships 4

Fuel EiciencyMaintenance and Vehicle Modiication(e.g., tire pressure)

8

Alternative Fuels 5

Driving Techniques 4

Fuel-eicient Vehicles

Product Weight/Packaging/Warehousing

Load Size 5

Distribution 3

Packaging

Transportation o Customers/Sta

Commuting 4

Customer Transportation 3

Business Travel 3

Bicycle

Logistics

• Analyzing logistics to ind the best mode, improve eiciency and get the most out o each tripare key strategies that virtually all retailers are monitoring. Many retailers have itemized andprioritized the key strategies and communicate these throughout the organization.

• n Europe, retailers are more likely to measure COemissions relative to the impact o various

changes in practice.• Modal shit opportunities vary by geographical area. For instance, there are more opportunities

and hence greater emphasis in shiting rom rail or truck to water shipment in the U.K. (Tesco)than in North America.



38 Greening Retail

• n the latter case, retailers such as Wal-Mart are more ocused on shiting rom truck to rail,optimizing the location o their warehouses, and opportunities or partnership and backhauling.

Fuel Efficiency

• n the U.S., the Department o Transportation works with retailers and suppliers to improveuel eiciency. Retailers such as H-E-B and KEA U.S. use the tools and measures provided by

Smartway to model their strategies.

Product Weight, Packaging and Warehousing

• Product weight and size have a tremendous impact on shipping costs. Whenever possible,retailers, suppliers and transportation companies attempt to minimize the unnecessaryshipping o empty space. Hence, they look or opportunities to replace round or odd-shapedpackaging with square or rectangular packaging. Another strategy is to lat pack product andhave it assembled at the destination or by the consumer. n addition, suppliers can eliminateexcessive packaging, which adds bulk to the product.

• Wal-Mart and some manuacturers are changing to more product in concentrated orm toreduce the volume o unnecessary water being shipped.

Transportation by Customers and Staff

• nterestingly, European-based retailers are much more likely than North American retailers toinclude customer or sta transportation in their strategies and CO

calculations.

• ncluded in commuting costs are the carbon ootprint o the number o vehicles, and the modeand distances travelled by sta in stores and head oice locations.

• Some also consider customer transportation, ensuring good public transportation and non-vehicular access to their stores. Where product cannot be transported without a vehicle,delivery service is oered. KEA, or example, attempts to locate stores near transit centres andoers shuttle services to customers.

• Marks & Spencer oers home delivery to encourage customers to leave their cars at home orshop online. However, they also measure the CO

emissions rom the home delivery service and

oset the emissions using a reoresting program.• Finally, some retailers have consciously reduced their business travel, especially by air, and

several are purchasing osets or air travel. Some have opted or teleconerencing and onlinemeetings wherever possible.

• North American retailers have been slower to look or ways to reduce automobile travel bycustomers and sta. This is an area o opportunity in Canada and the U.S.

• O note, Mountain Equipment Co-Op in Canada does measure the carbon ootprint o sta commuting. Over 80 per cent o their sta commute to work by walking, bicycling or transit.



Greening Retail 39

3.2.7 Solid Waste – Three Rs: Reduce, Reuse, Recycle

There are many beneits to retailers in implementing strategies to deal with solid waste in theiroperations. The three R strategies have been in the public eye or several decades now. t is relativelyeasy to understand the beneits o reducing waste. Excessive packaging and shipping materials addto the cost o shipping and result in retailers handling the waste at store level. n an eort to reducevolume in landills, many municipalities have imposed or increased tipping ees to discourage disposal.

Hence, it is in the interests o retailers to minimize the waste rom packaging and shipping materials.

Focal Points

• Reduce. Reducing is the irst priority, simply because it is better not to produce somethingthan to reuse or recycle it. Source reduction strategies decrease the amount o materialthat is thrown away or recycled. Source reduction also cuts back the costs o transporting,throwing away or recycling waste. t can also reduce labour costs without the need orup-ront investment.

• Reuse. Reusing items saves energy and resources compared to disposing o or recycling them.

• Recycle. Retail stores can reduce disposal costs and sometimes gain revenue rom sellingseparated recyclables. n addition to the inancial gains, major environmental gains are realizedrom recycling materials rather than sending them to landill.

Top Practices


Reduce

Reduction o Packaging Weight 5

Lie Cycle Assessment o Packaging 4

Eliminate ndividual tem Packaging 4

Reduction o Packaging by Suppliers 3

Reuse

Bags 9

Other Product Return 4

Customer Education 3

Biomass Packaging

Reused Materials in Store Construction

Reusable Packaging DuringTransportation to the Store

Reusable Packaging and Materialsat Store

Packaging that Customers Take Home

Plan or Damaged Goods

Donate Unwanted Goods to Charity



40 Greening Retail


Recycle

Recycling at Store 8

Recycling Materials DuringManuacturing

5

Closing the Loop 4

Recyclable Packaging 3

Recycling Ater Customer Use 3

Composting at Store

Compostable Packaging

Products Made rom RecycledMaterials

Recycled Content in Products

Reduce• The leading retailers look at the whole liecycle o a product rom manuacturing to disposal by

the consumer to identiy opportunities to reduce or eliminate waste.• Retailers who manuacture their own store brands or products have ocused on managing

waste in their own products beore approaching suppliers o other brands.• H-E-B, or example, has extensive programs to reduce, reuse and recycle materials in their store

brands. They have not worked signiicantly with outside manuacturers to date.• Wal-Mart works intensively with manuacturers and suppliers to reduce waste in production,

packaging and shipping, recognizing that this helps to keep costs down. Wal-Mart Canadahas recently launched a packaging scorecard and has requested that their suppliers providedetailed inormation on their environmental practices, packaging to product ratios and avariety o other inormation. Compliance in providing this inormation is required or allcompanies within nine months.

Reuse

• By ar the most popular consumer program among the top retailers in all geographical areas isencouraging the use o reusable bags. Many oer abric bags or sale and have bins to collectused plastic bags.

• Strategies to encourage customer participation in bag programs include asking customers i they need a bag, supplying bags only on request and charging customers or plastic bags.

• LUSH goes a step urther and encourages customers to return some product packages or reuse

and or ree merchandise.• Customer education on beneits is key to the success o reusing bags. They must remember

to bring back the plastic bags or recycling and believe in the beneits to the environment o reducing plastic bag usage.



Greening Retail 4

Recycle

• Over hal o retailers recycle at the store level. Cardboard is the most common recycled material.• n oice operations, retailers encourage employees to reduce their paper use. This includes

using electronic materials instead o printouts and photocopying on both sides o paper, ratherthan single-sided copying.

• Some retailers, such as Alliance Boots, remind sta o the carbon ootprint o paper-related

activities. The carbon ootprint o photocopying is 88 per cent paper and per cent copier.Hence, double-sided printing is a signiicant savings. The company also removed all waste binsat their head oice in an eort to change employee habits and teach them about recycling.

• As waste is easily measured, retailers can set speciic diversion goals, or goals based onreducing levels o waste rom year to year.

3.2.8 Water Quality and Conservation

Using water eiciently can lower operating costs and enhance the eiciency o a retailer’s operation.Almost all commercial water use also uses energy and other raw materials.

Water management is not always top o mind orretailers, especially those who do not use waterdirectly in their retail operations. However, manyday-to-day human and business activities impactwater quality and usage. Even i retailers do notuse water in their stores, they can consider actionsin head oices, restrooms and cleaning acilities,plant watering and parking lot coniguration.These are described urther in the sections below.

Retailers may also consider including awareness o habits and improvements that sta can implementat home as part o their training. Raising customerawareness is an additional opportunity orretailers to contribute to improved water qualityand conservation.

Water usage is typically easy to measure andmonitor by metering and tracking o bills. Leadingretailers have realized considerable savings byimplementing small changes and monitoringthe results.

Focal Points in Water Management

• Water quality. There are two primary areaso ocus in water management. The irst ismaintaining water quality by minimizingpollutants entering the waterways.

• Water conservation is the other and morecommon ocus o water managementamong retailers.



4 Greening Retail

Top Practices


Water Quality

Parking Lots and Vegetation 6

Grease Traps and Puriication Tanks

Permeable Suraces

Bio-swales and Stormwater Ponds

Customers: Educate on Reducing Pollution

Water Conservation

Fixtures: low-low toilets, spray nozzles, ix leaks 9

Audits and Water Metering 3

Train Sta and Customers on Conserving Water

Reuse Methods: Steam, ce rom Freezers

Capturing Rainwater or toilets/cleaning/irrigation Less Water in Manuacturing/Work with Suppliers

Water quality

• The most common practice in maintaining good water quality by retailers is the designo parking lots to reduce runo. Planting vegetation along the perimeter and throughoutthe parking lot are common practices. These have a surprising array o beneits. First, andmost obviously, they add to the aesthetics o the store ront. More importantly rom anenvironmental perspective, they retain and detain water during heavy rainall. n a heavy rain,rapid runo and large volumes result in pollutants such as grease, soot or salt rom cars being

swept into nearby waterways. Plants, especially tall grasses and reeds, help to retain the waterand actually prevent the pollutants rom entering the water table.• Bio-swales and stormwater ponds are strategies used to accomplish the same eect. These

practices are being employed in all parts o the world, including Wal-Mart’s McKinney storenear Dallas, Texas and at their new demonstration store in Burlington, Ontario.

• Retailers such as Home Depot are strongly ocused on Sustainable Market Transormation andcreating customer awareness o the habits they can employ at home to minimize water pollution.

Water conservation

• The most common practice is reducing consumption on premises. Frequently, top retailersreplace existing ixtures with those using less water. These include low-low toilets and aucets,and installation o sprayers.

• Other practices include reusing water in manuacturing processes or capturing and using waterrom natural sources, such as rainwater or condensation. H-E-B, or example, captures steamrom their manuacturing process and reuses the water. Alliance Boots consumes 35 per centless water by investing in ice removal ramps in the resh ish department, water-saving systemsand advanced electronic controls.



Greening Retail 43

• Retailers commonly monitor water usage at their locations with audits and metering. Auditingmeter readings allows retailers to monitor adherence to guidelines in their locations, set goalsor improvement, look or leakage and any wasting o water, and track progress.

• Retailers are also working with suppliers to reduce water in products and in the manuacturingprocess. This ensures not only less water consumption, but lowered transportation costswhen product concentrates can reduce the volume and weight o shipping. For example,Wal-Mart began selling only concentrated liquid laundry detergent at U.S. Wal-Mart discount

stores, SuperCenters, Sam's Clubs, and neighbourhood markets as part o its commitmentto sustainability. Detergent in concentrated orm has less impact on the environment, usingless water and plastic, and reducing transportation costs. The company expected to sell morethan 800 million units o concentrated detergent in the three years to 00 and estimates theinitiative preserved more than 400,000,000 gallons o water.

• Some retailers use rainwater capture or a variety o purposes on premises. Examples includeusing rainwater or toilets, plant watering, loor washing and other cleaning.

• n a similar vein, retailers can discover alternative water sources or reuse. For example, H-E-Bsaves 6. million gallons o water each year by reusing condensation rom manuacturing steamequipment—that is enough to supply the water needs o more than 50 homes every year.

• Finally, leading retailers sometimes use slogans and campaigns to inorm and engage sta and

customers in water conservation measures. Examples o these include Woolworths’ “Every DropCounts” program. Two o Home Depot’s 0 market transormation programs ocus on waterconsumption and environmental impact.

3.2.9 Environmental Charity Giving

The top retailers all report supporting charitable causes, encouraging and rewarding employees whovolunteer their time and providing materials or sta to educational and community activities.

Focal Points in Environmental Charity Giving

• Human rights and developing regions. Retailers make inancial contributions to primarycauses including air trade, human rights, working conditions in developing countries, childlabour, children’s health and education. Oten they support speciic international NGOs such asUNCEF or Save the Children.

• Local community environmental campaigns and education. Retailers strive to be part o the local culture and viewed as a good neighbour. They encourage employees to participate inlocal events such as clean up days, school recycling campaigns or clean air days. Some o theleading retailers also contribute educational materials and workshops to the public.

• Environmental NGOs and projects. This strategy supports broader or international

environmental programs and organizations. Retailers support organizations such as WorldWildlie Fund (WWF), and orest stewardship and reorestation programs. They also includecampaigns to stop rainorest depletion and similar environmental degradation.



44 Greening Retail



Greening Retail 45

4.0 Conclusions

The adoption o greener and more sustainable retailing practices among the leading internationalretailers in this research was based on voluntary participation rather than on regulatory control,though the spectre o impending regulation has generally spurred the European and Asiancompanies to earlier endorsement.

The case studies presented in this document demonstrate the diversity in origin, approaches, corporatestructure, product line, geographical area and method in taking action. There is no wrong door andno single approach. For some retailers, social and environmental responsibility grew out o an idea orproviding a product that is more natural or is not tested on animals. For others, it grew out o an ideathat their inluence is so large in the communities they serve that they have a responsibility, or better

yet an opportunity, to make a large impact. For others still, it grew out o the belies o their ounders.For many in the uture, it may be viewed as a business opportunity and good risk management.

The many reasons or adopting environmentally sustainable practices are compelling:• These actions generate lower costs and higher proits.• Competitive pressures will dictate environmental action.• Customers expect it and will increasingly demand it.• Energy supplies are dwindling and costs are uncontrollable.• Landills are overlowing.• Water shortages, in terms o quality and quantity, are real.• Access to new markets—according to the Stern Review, markets or low carbon products and

services are likely to exceed $500 billion per year by 050. (www.bitc.org)• mproved reputation—“responsibility to the environment” is an important criterion or

customers in brand trust.• mproved recruitment and retention—recent research has shown that nearly hal o all sta

want to work or organizations with strong environmental policies. (www.bitc.org)• t is good risk management and a key part o corporate social responsibility.



46 Greening Retail

Barriers

t is important to recognize and address the barriers that may prevent retailers rom adoptingsustainable practices.

External Barriers

• Location in a shopping centre that does not have acilities to allow action, e.g., no recycling, no

water-saving ixtures, no control over heat and air conditioning.• Poor urban design and lack o community resources, e.g., poor public transit, no sidewalks, no

green energy source, greenield development, no opportunity or aquiers or bio-swales.• Lack o a level playing ield or shopping centre developers in terms o environmental zoning

and/or building requirements.

Internal Barriers

• Lack o awareness o the issues, solutions and opportunities• Lack o a champion• Not knowing how or where to start, overwhelmed by the range o potential activities or the task

o implementation across the organization• Lack o knowledge or inormation about products (e.g., which are the best light bulbs, urnaces

or building materials)• Complicated technical language• Fear o expense and ability to compete• Time and expense required or certiication• Fear o alse claims or liability, accusations o “greenwashing”• Lack o knowledge about educating employees• Diiculties in auditing and monitoring.

Realities

• Underdevelopment o new technologies, especially green energy. These are not perected yet,and there is uncertainty as to which will prove most reliable, eicient and prevalent.

• Geographic distances, especially in North America.

Recommendations and Next Steps

Many o the recommendations relate to providing education, inormation and raising awareness, aswell as to urther research on shopping centres and the easibility or developing guidelines.

1. Research

• Shopping centre research. dentiy the best environmental practices o leading shopping

centres around the world to assist retailers and developers to jointly adopt environmentalbest practices. This would incorporate a wide range o actors, including operations, buildings,identiication o standard requirements, and green leases, to name a ew.

• Feasibility study. Assess the easibility o developing the environmental sustainability guidelinesor retailers and shopping centres. The guidelines would be based largely on the results o thecurrent and planned research.



Greening Retail 47

2. Demonstration

• Undertake projects with key retailers and shopping centres to demonstrate best practices thatsigniicantly impact the sector.

3. Performance Indicators

• Develop perormance indicators and benchmarks.

4. Marketing and Communications

Communicate the research indings to the sector using:• Reports and the internet• Expansion o the interactive online database• Conerences, workshops and webinars• Our partners, the Ted Rogers School o Management at Ryerson University and the Retail

Council o Canada• Links with other organizations such as the National Retail Federation and the nternational

Council o Shopping Centres• Programs launches such as “Ask the Expert”• Content provision or Greening Retail university and continuing education courses.



48 Greening Retail

Appendix 1

Identifying the “Greening Retail” Opportunity for Canadian Retailers

BACKGROUND, METHODOLOGY AND DATABASE ELEMENTS

Background and Methodology

For the initial phase o the Greening Retail research, a report was produced titled, Greening Retail:Engaging the Retail Sector in Sustainability. n this study, secondary research was conducted andmeetings were held with Canadian industry leaders to identiy tangible examples o environmentalbest practices and achievements in the global retail sector. Clearly, investment in sustainability yieldsa signiicant payback.

Methodology included research on industry programs and measurements, a review o public domainbenchmarks and best practices in the retail and other relevant sectors and identiication o the majorenvironmental standards rom around the world and their relevance to retail. Results include a list o the most environmentally advanced retailers rom around the globe. This report is available onlineat www.greeningretail.ca or through the Center or the Study o Commercial Activity at Ryerson

University.

More than 00 retailers were reviewed online, over 90 were reviewed in detail and 66 were ranked asbest practice retailers according to a 4-point ramework o practices.



Greening Retail 49

14-Point Best Practice Framework

This ramework was created rom 3 major international standards that were identiied and reviewed.The checklist used, together with a description o each item, is presented in the table below.

Corporate Environmental

Policies

explicit written environmental policies

Energy Efficiency energy used in heating and lighting in buildings owned/occupied by company

Green Energy renewable, low-impact energy sources used in buildingsowned/occupied by company

Transportation methods and management o transportation o productsrom suppliers to warehouse, work-related transportationo employees, transportation o customers to stores

Supply Chain/Purchasing policies and programs with speciic purchasing guidelinesor products used in operations

Green Products raw material use, production methods, reduction o

pollution and eects on biodiversity o products sold

Environmental Charity Giving donations given to environmental organizations

Solid Waste reduction o waste in packaging, recycling, reuse andreduction o hazardous waste

Water reduction o use o water and reduction o pollution inwater

Staff Training systematic training o sta on environmental policies andprograms

Customer Education/

Marketing

through sta, advertising, merchandising, in-storeproducts, presentation and community-wide programs

Benchmarks & Indicators measuring environmental impacts and monitoringperormance against accepted standards

Financial Impacts measurable eects o environmental practices on thecompany bottom line through sales increases or costreductions

CSR Reporting publicly accessible and transparent reports on corporatesocial responsibility

n order to identiy environmentally-leading retailers, more than 30 associations, social indices,environmental organizations, registries, NGOs, leading business rankings and conerence award

listings were investigated through the nternet. More than 00 retail companies were identiiedthrough this method and due to the short time rame and vast amount o inormation to evaluate,the number o retailers that were reviewed in detail against the 4-point ramework was limited to 93.From this group, 66 were identiied as leading best practice retailers and 5 to 0 were highlightedas potential targets or the more detailed research in Phase . (Please reer to the online report orurther details on the methodology).



50 Greening Retail

This research was intended to identiy exemplary leadership in the retail sector, not to relectnegatively on retailers that do not practise or report this inormation. Retailers were highlighted inthe report as possible candidates or the in-depth best practice review.

a company practiced leadership in environmental methods without including that inormationin literature or on their website, cases were not included in this research. t should be noted that incompiling this list, English was the main language used although some Dutch, French, German and

Japanese sites were also reviewed. n addition, there were more examples o department and grocerystore chains that could have been included. Companies in other categories however, were soughtin order to represent the diversity o the Canadian retail sector. The objective was also to provide abase list rom which retailers could be selected or the Best Practices study in subsequent researchprojects.

The retailer list by merchandise category and country o origin was presented in the report. Themerchandise categories are those used by the Centre or the Study o Commercial Activity, RyersonUniversity. Some retailers may all into several merchandise categories. Where this was the case, theyhave generally been included in their most dominant category.



Greening Retail 5

Appendix 2

Description of Participating Retailers

Companies or the current study were selected to represent a cross-section o leading retailers. Thecharacteristics included are as ollows:

• Type of merchandise includes grocery, home urnishings, apparel, cosmetics, health and beautyaids, drugs, department stores, sports equipment, home improvement and general merchandise.

• Size includes large- and medium-sized companies as well as large and small space users. Thereare no independent retailers included in the detailed case studies and this is a shortcoming,

however, many o the tactics o the large- and medium-sized retailers can be applied to smallretailers. Time and budgetary constraints imposed some limitations on the extent o this research.

• Format includes both large- and medium-sized big box retailers, ree standing/ high streetretailers, and small space users in a shopping centre environment. Formats also includeHypermarche, department store, grocery store, Membership Warehouse Club and specialtystore retailers.

• Brand includes own brand and national brand retailers.

• Ownership structure includes corporate, ranchise/dealer, cooperative, conglomerate/holding

company and single banner chains, both private and public companies, and a wholesaledistributor serving several chains.

• Geography includes companies rom Canada, the United States, U.K., reland, France, Japan, andAustralia. While it is important to include companies rom Canada and the U.S., the Europeanand Asian companies are more advanced with respect to environmental best practices. Theresearch included single country retailers as well as those with global operations in order todemonstrate ways o inluencing and implementing best practices across dierent cultures.



5 Greening Retail

P a r t i c i p a t i n g R e t a i l e r s b

y C o m p a n y ,

S i z e ,

C a t e g o r y , C

o u n t r y o f O r i g i n a n d K e y D a t a

C o m p a n y

C o u n t r y

o f O r i g i n

C a t e g o r y

S a l e s

N u m b e r

o f S t o r e s

I n t e r n a t i o n a l

M a r k e t s

R e t a i l F o r m a t

S t r u c t u r e

O t h e r

A e o n

J a p a n

G e n e r a l m e r c h a n d i s e

s t o r e s , g r o c e r y ,

c l o t h i n g ,

h o m e

c e n t r e s , c o n v e n i e n c e

s t o r e s , d r u g s t o r e s ,

U S D $ 5 5

b i l l i o n

i n 0 0 9

e s t .

3 , 0

0 0 s t o r e s

w o r l d w i d e

A s i a - P a c i f i c

p r i m a r i l y J a p a n

a n d N o r t h

A m e r i c a

D e p a r t m e n t s t o r e s ,

s u p e r m a r k e t s a n d

s p e c i a l t y s t o r e s

H o l d i n g c o m p a n y

w i t h 6 9 s u b s i d i a r i e s

a n d p a r t i c i p a

t i n g

f i r m s

S e c o n d -

l a r g e s t r e t a i l e r

i n J a p a n a n d

A s i a P a c i f i c

A l l i a n c e

B o o t s

U . K .

D r u g s t o r e s

n / a

6 , 6

5 0 s t o r e s

w o r l d w i d e

U . K . a n d 4

c o u n t r i e s i n

E u r o p e ,

A s i a ,

R u s s i a

P h a r m a c i e s a n d

h e a l t h a n d b e a u t y

s t o r e s , f r e e s t a n d i n g

s t r i p a n d s h o p p i n g

c e n t r e s

P r i v a t e c o m p

a n y

o w n e d b y A B

a c q u i s i t i o n s

( c o n t r o l l e d b y f u n d s

a d v i s e d b y K K R &

S t e f a n o P e s s i n a )

0 0 , 0

0 0

e m p l o y e e s

C a r r e f o u r

F r a n c e

D i s c o u n t , g e n e r a l

m e r c h a n d i s e ,

f o o d

a n d c o n v e n i e n c e

€ 9 7 . 6

b i l l i o n

i n 0 0 8

, 5

4 7 s t o r e s

F r a n c e a n d 8

o t h e r c o u n t r i e s

H y p e r m a r k e t ,

s u p e r m a r k e t ,

h a r d d i s c o u n t a n d

c o n v e n i e n c e s t o r e s


a n y ,

f r a n c h i s e r

4 5 6 ,

9 5

e m p l o y e e s

H o m e D e p o t

U . S .

H o m e i m p r o v e m e n t

U S D

$ 7 . 3

b i l l i o n

f o r f i s c a l

0 0 8

,

0 0 s t o r e s

U . S . ,

P u e r t o

R i c o ,

U . S .

V i r g i n

s l a n d s , G u a m ,

C a n a d a ,

M e x i c o ,

C h i n a

B i g b o x s t o r e s

a v e r a g i n g 0 5 , 0

0 0

f t . ²

P u b l i c c o m p a

n y ,

c o r p o r a t e s t o

r e s

S e c o n d -


i n t h e U n i t e d

S t a t e s

H - E - B

U . S .

F o o d ,

d r u g ,

f u e l

s t a t i o n s

U S D

$ 3 . 5

b i l l i o n

i n s a l e s

i n 0 0 8

O v e r 3 0 0

s t o r e s

U n i t e d S t a t e s

( p r i m a r i l y T e x a s )

a n d M e x i c o

S u p e r m a r k e t s

9 0 , 0

0 0 t o 7 0 , 0

0 0 f t . ²


a n y ,


r e s

T h e l a r g e s t

U . S . p r i v a t e

c o m p a n i e s

K E A

S w e d e n

F u r n i t u r e a n d h o m e

f a s h i o n a c c e s s o r i e s

€ .

b i l l i o n

i n 0 0 8

3 s t o r e s

4 c o u n t r i e s

p r i m a r i l y i n

E u r o p e

B i g b o x s t o r e s

P r i v a t e l y o w n

e d b y a

f o u n d a t i o n

9 5 0 0 p r o d u c t s

p r i v a t e b r a n d

L U S H

U . K .

C o s m e t i c s

U S D $ 5 0

m i l l i o n

i n 0 0 7

5 0 0 s t o r e s

S t o r e s i n

c o u n t r i e s a n d

t r a d i n g i n 4 3

c o u n t r i e s

S p e c i a l t y s t o r e s ,

f r e e s t a n d i n g a n d i n

s h o p p i n g c e n t r e s

P r i v a t e l y o w n

e d ,


r e s

P r i v a t e b r a n d

p r o d u c t s

M a r k s a n d

S p e n c e r

U . K .

C l o t h i n g a n d g e n e r a l

m e r c h a n d i s e

£ 9 . 0

6

b i l l i o n

i n 0 0 8

8 5 0 s t o r e s

6 0 0 s t o r e s i n

t h e U . K . ,

5 0

i n t e r n a t i o n a l l y

D e p a r t m e n t s t o r e


n y ,


r e s

L a r g e s t

c l o t h i n g

r e t a i l e r i n U . K .



Greening Retail 53

C o m p a n y

C o u n t r y

o f O r i g i n

C a t e g o r y

S a l e s

N u m b e r

o f S t o r e s

I n t e r n a t i o n a l

M a r k e t s

R e t a i l F o r m a t

S t r u c t u r e

O t h e r

M o n o p r i x

F r a n c e

C l o t h i n g ,

f o o d ,

h o u s e h o l d p r o d u c t s ,

U S D $ 5

b i l l i o n

3 0 0 s t o r e s

S t o r e s i n F r a n c e

D e p a r t m e n t s t o r e

O w n e d 5 0 / 5 0

b y

G a l l e r i e s L a f a

y e t t e

a n d C a s i n o s

9 , 0

0 0

e m p l o y e e s

M o n s o o n

a n d

A c c e s s o r i z e

U . K .

C l o t h i n g ( M o n s o o n )

a c c e s s o r i e s ( A c c e s s o r i z e )

h o m e a c c e s s o r i e s

( M o n s o o n H o m e )

n / a

4 0 0 s t o r e s i n

t h e U . K . a n d

E i r e

5 0 0 s t o r e s i n

o t h e r c o u n t r i e s

S p e c i a l t y s t o r e s -

6 0 0 t o 8 0 0 f t . ²

P r i v a t e l y - o w n

e d

c o m p a n y

/ 3 a r e

f r e e s t a n d i n g ,

/ 3 i n s h o p p i n g

c e n t r e s

M o u n t a i n

E q u i p m e n t

C o - o p

C a n a d a

O u t d o o r c l o t h i n g a n d

s p o r t s e q u i p m e n t

C A D

$ 4 7 . 7

m i l l i o n

i n 0 0 8

S t o r e s i n

C a n a d a

N o n e

S p e c i a l t y

f r e e s t a n d i n g s t o r e s

M e m b e r s h i p

c o o p e r a t i v e

s t r u c t u r e ,

, 3

8 7

e m p l o y e e s ,

. 8 m i l l i o n

m e m b e r s ,

5 0 % p r i v a t e

b r a n d p r o d u c t s

M u s g r a v e s

r e l a n d

W h o l e s a l e g r o c e r y

d i s t r i b u t o r

€ 4 . 8

b i l l i o n

i n 0 0 8

S u p p o r t i n g

3 , 4

0 0

r e t a i l e r s

P r i m a r i l y r e l a n d ,

U . K . a n d S p a i n ,

S u p e r m a r k e t s ,

c o n v e n i e n c e s t o r e s

a n d c a s h a n d c a r r y

P r i v a t e f a m i l y

- r u n

b u s i n e s s ,

f r a n

c h i s e e s

S e r v e o v e r

7 c h a i n s

a n d m a n y

i n d e p e n d e n t s

T e s c o

U . K .

F o o d a n d g e n e r a l


£ 5 9 . 4

b i l l i o n

i n 0 0 8

3 ,

6 0 s t o r e s

3 c o u n t r i e s ( 7 i n

E u r o p e ,

5 i n A s i a ,

U . S . ) , p r i m a r i l y

U . K .

S u p e r m a r k e t s

6 8 m i l f t . ²


n y ,

4 0 , 0

0 0

e m p l o y e e s

B r i t a i n ’ s


W a l - M a r t

U . S .

F o o d a n d g e n e r a l


U S D

$ 3 7 5

b i l l i o n

i n 0 0 8

7 , 4

0 0 s t o r e s

4 c o u n t r i e s

L a r g e l y f r e e s t a n d i n g

s t o r e s , s o m e i n s t r i p

c e n t r e s , r a n g e f r o m

0 0 , 0

0 0 - 0 0 , 0

0 0 f t . ²


n y ,


r e s

m i l l i o n

a s s o c i a t e s

W o o l w o r t h s ,

A u s t r a l i a

( n o t e – n o

c o n n e c t i o n

t o W o o l w o r t h

U . S . )

A u s t r a l i a

F o o d , g e n e r a l

m e r c h a n d i s e ,

l i q u o r ,

p e t r o l , e l e c t r o n i c s ,

p u b s

A U D $ 4 7

b i l l i o n

i n 0 0 8

3 , 0

0 0 s t o r e s

A u s t r a l i a a n d

N e w Z e a l a n d

D e p a r t m e n t s t o r e s ,

s u p e r m a r k e t s ,

l i q u o r

s t o r e s , e l e c t r o n i c s

s t o r e s , p e t r o l

s t a t i o n s , p u b s


n y

8 0 , 0

0 0

e m p l o y e e s

o n e o f t h e

l a r g e s t

c o m p a n i e s i n

A u s t r a l i a a n d

N e w Z e a l a n d



54 Greening Retail

Appendix 3

Notes on Regulation and Measurement

The U.K., European and Asian markets are more regulated than those o North America with respectto environmental requirements. n many cases, however, the standards that have been developed arevoluntary, but that may change.

The U.K. Climate Change Bill was passed in July 008 and the regulations that will emerge arestill being ormulated. Targets will be set ollowing a period o energy emissions monitoring andconsideration o which enterprises and sectors to which it will apply.

n February o 008 the ramework or the Code o Best Practice or Carbon Osetting wasannounced. The code is voluntary and initially covers only certiied emissions reductions that arecompliant with the Kyoto protocol to which the U.K., EU and a number o Asian countries haveagreed. n the EU, the law requires all member states to implement action plans to reduce energyconsumption by per cent per year or the next nine years. n addition, the Commission wishes toregulate the energy eiciency standards on supermarket equipment.

While North America is not a signatory to Kyoto and is less regulated to date, the new U.S.government may become signiicantly more stringent in terms o its environmental controls, in turnaecting Canada.



Greening Retail 55



Documents

Greening Retail 2009