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Environment and logistics committeeEnvironment and logistics committee

SURVEY ON EMAS CERTIFIEDSURVEY ON EMAS CERTIFIEDCOMMERCIAL SITES AND SUSTAINABILITYCOMMERCIAL SITES AND SUSTAINABILITY

TRENDS IN THE RETAIL SECTORTRENDS IN THE RETAIL SECTOR




Commerce in the EUCommerce in the EU

�Interface between industry and the EU 370million consumers / citizens

�13% of EU GDP; 4.7 million entreprises

�22.5 million workers from all parts of

society




EuroCommerceEuroCommerce

� R epresentation of the R etail, Wholesale andInternational Trade sectors to the EU

institutions� Members in 24 Countries from:

± National federations (7 from the Accessioncountries)

± Individual companies± European sectorial trade associations

� A recognised social partner in EuropeanSocial Dialogue for Commerce




EuroCommerce (cont)EuroCommerce (cont)

� Our mission:

� Promote and defend the interests of

Commerce towards the EuropeanInstitutions

� - Explain as much as Lobby

� R aise the visibility of Commerce to reflect

the importance of the sector in theEuropean economy

� Inform members of EU developments




Scope of the surveYScope of the surveY

� The questionnaire has been sent to 60registered EMAS wholesalers/retailers

companies� We received 23 answers back.

� Main countries represented: Germany butalso Sweden, Denmark, Austria and Spain

� 14 Large retailers: none are EMAS certified,5 are ISO 14001 certified (Auchan, Marks & Spencer, SOK corporation, Sainsbury PLC,C&A and Kesko)




What fields of activity are represented?What fields of activity are represented?sector of activity

number of companies

W holesale 23W holesale trade and com mission trade, except of motor vehicles and m otorcycles

1

W holesale of wood, construction materials and sanitaryequipment

1

W holesale of non-agricultural interm ediate products, waste an dscrap

3

W holesale of agricultural raw m aterials and live anim als 3W holesale of food, beverages and tobacco 2W holesale of other m achinery for use in industry, trade andnavigation

1

W holesale of other interm ediate products 1

Other w holesale 4W holesale of other household goods 1W holesale of household goods 3W holesale on a fee or contract basis 2Age nts involved in the sale of fuels, ores, metals and indu strialchemicals

1

Retail 4Other retail sale of new goods in specialized stores 2

Retail sale of books, new spapers and stationery 1Other retail sale in specialized stores 1




Reasons for implementing EMAS

custom

er orien

business orien

managem

ent sys

environm

ent orie

subsidie

don't kno




Why did you not choose ISO 14001?Why did you not choose ISO 14001?

77%

14%

9% they have both

It was too

expensive to have

both

Emas was

considered better




What is the cost to receive EMAS certification?What is the cost to receive EMAS certification?

Size f t e enterprise average price (in ¼)Small enterprises ( t ) 82

Medium nterprises (50 t 2 ) 833Large nterprises (250 and

more)

3000




Main benef it of t e EMAS cer tif ication

cost/benefit

competitivity

benefits

financial benefits

number of customer s

cor por ate image

yes

no




1 to 9

10 to 49

50 to 249

250 and more

Does EMAS require full-time staff

yes

no




CONCLUSIONCONCLUSION

�Environmental issues are a widespread concern among

customers and entrepreneurs

�Many SMEs implemented the EMAS management system,and not only large companies

�EMAS registration is mostly considered as a beneficialpolicy to implement

�Large distributors are really expecting their suppliers toimplement the EMAS management system, despite theydon¶t necessarily implement it themselves




Sustainability and the retail sectorSustainability and the retail sector

� Since the early nineties, large retailers have beenreporting on their environmental issues. Then, theyincluded the social dimension to the environmental

report.� Now, the trend is that large retailers publish

sustainability reports with indicators generallyelaborated by themselves. (comparability betweentwo retailers reports)

� In 2002 two retailers issued a sustainability reportbased on some of the GR I Guidelines (Carrefour,Kesko) . We will study those two as beingrepresentative of the sector. This does not discardthe other reports which are also relevant.




Carrefour Reporting SystemCarrefour Reporting System

� Improving the reporting system by identifyingrelevant performance indicators:

� The group reviewed:

Ethical rating agency questionnaireThe new French Economic R egulation makingenvironmental and societal reporting compulsory forlisted companiesThe GR I guidelines

The goals set out in the first SustainabilityR

eportThe indicators used by other companies in the retailsector to facilitate comparison of the Carrefourperformance with that of their competitors




Carrefour Reporting System (cont.)Carrefour Reporting System (cont.)

� in 2002, 21 countries participated in the Groupreporting

� Identification of Key performance indicators (KPIs)

1. Consolidated sales excluding VAT and net incomefrom recurring operations after goodwill2. Number of countries completing the Groupsustainable development reporting3. Number of purchase offices that use the Group¶s

Quality Scoreboard4. Number of stores audited on the Group¶s hygieneand quality standards.5. Energy consumption/sales area6. Water consumption/sale area7. Water treatment (% recycled)




Carrefour Reporting System (cont Carrefour Reporting System (cont ))

� 8. Share of women in management positions

9. Number of supplier facilities audited on socialissues10. Number of days of training per employee, peryear11. Number of Carrefour Quality Line products12. Number of organic or ecological products

� The Carrefour report is based on some of theperformance indicators of the GR I (see copy)




Carrefour awards for its 2002 SustainableCarrefour awards for its 2002 SustainableReport Report

� Carrefour was listed on the Dow Jones Sustainability

Index for the first time� Carrefour has qualified for the first time to

³Storebrand Principle Funds´ portfolio of ethicalcompanies by Storebrand, Scandinavia¶s leadingethical funds manager




Carrefour policy with suppliersCarrefour policy with suppliers� 15 countries includes a code of ethics in the

employment contract of purchasers

� Carrefour promote partnership with SMEs entering,

among other things, into long terms commitments:In France ³the commitment contract´ strengthensthe business co-operation with 255 SMEs throughmutual commitments

� Carrefour works in close partnership with their

supplier for their own brand products. They set up aproduct safety programme for its controlled products

� Carrefour encourages their suppliers to put in placean Environmental Management System (EMS) evenproviding some financial aid for that.




Carrefour packaging design policyCarrefour packaging design policy� The Group compiled a guide to packaging conception,

to disseminate best practices throughout the Group.It defines the essential features of packaging

including environmental criteria.� In 2002, Carrefour France saved 484 tonnes of raw

material (a total of 4 500 tonnes since 1996)

� It launched two projects to existing materialreduction initiatives: a GMO free vegetal ink for use

in paper and cardboard packaging and a newecological limestone-based material to wrap ownbrand butter




Carrefour labellingCarrefour labelling

� Carrefour buys FSC certified roble

� Silver Sea private label for the purchase of fish

� Filière qualité de carrefour




Carrefour Social CommitmentsCarrefour Social Commitments� Carrefour developed a Social Commitment Charter

whereby it enforces basic workers¶ right as laid downby the ILO, I.e., eradication of slave labour, a ban on

employing children under the age of 14, etc� Carrefour created the INFANS association in

partnership with the International Federation of Human R ights whose role is to monitor social risks,carry out spot checks and identify local NGOs able to

oversee the roll-out of Carrefour¶s initiative out inthe field




ConclusionsConclusions� Economic pillar goals:

1. Make quality products available to the greatestnumber of people

2. Guarantee balanced trade3. Pay grower a fair price4. Develop long-term relations with local partners5. Promote international trade

� Societal pillar goals:

1. Uphold human rights, especially those of children2. Help maintain local jobs3. Ensure consumer health and safety4. Promote the sharing of know-how




Conclusions (cont)Conclusions (cont)� Environmental pillar:

� 1.Preserve the environment by limiting the

negative impact of Carrefour¶s Quality Lines� 2. Preserve bio-diversity

� 3. Conserve natural resources

� 4. Manage waste




KeskoKesko

� Kesko is Finland¶s leading trading sectormarketing and logistics company

� Kesko fully owns its subsidiaries: KeskoAgro, Kesko Food (55% of Kesko net sales),R autakesko and Keswell are responsible forstore sites, purchasing, logistics, marketingand chain co-operation with the respective

K-retailers.




Kesko Reporting SystemKesko Reporting System

� The Kesko report follows closely the GR I guidelinesbut not 100%

� GR I Environmental indicators not used in the Kesko

report:1.Specifications of supplier practices2. Information on land-ownership and its impacts3. Fuel consumption statistics4. Indicator typical of industrial activities

5. Detailed environmental analysis of water use� GR I economic indicators not used in the Keskoreport:1. The value of research and development2. Wages and benefits have not been given bycountry

3. An economic supplier analysis is missing




Kesko Reporting System( cont)Kesko Reporting System( cont)� GR I social indicator not used by the Kesko report

The social kesko reporting differs most from theguidelines

1. No information on special programmes forminorities, nor on the ratio of lowest wage tonational legal minimum or cost of living2. The questions relating to child and forced labour,freedom of association are discussed under thestandard SA 8000 with the suppliers and not inrelation with Kesko personnel




Kesko awards in 2001Kesko awards in 2001� In 2001, Kesko was awarded as being the best

overall reporter of responsibility by the FinnishForum of environmental experts who compared

environmental and corporate responsibility reports.� The Helsinki Metropolitan Area Council Waste

Management awarded the ³2001 Natural R esourceSaver prize to Kesko Food´.

� Kesko Eco-efficient construction model was given an

honorary mention in the ³Environmental Deed of theyear´ category, because they combine ecologicallyand financially business operations.




Kesko labelling and EMSKesko labelling and EMS� The logistics of Kesko Food LTD and Kesped Ltd,

became the first companies in the Finnish tradingsector to obtain ISO 14001 certification in January

2001� In 2002, Kesko food had 445 organic products and

215 products with environmental labelling (NordicSwan and EU flower for example)

� FSC label for garden furniture




Kesko Environmental Store DiplomaKesko Environmental Store Diploma

� In spring 2003, the diploma was granted to 33K-foodstores.

� Conditions to get the diploma:

the hypermarket director, the employees responsiblefor environmental affairs and the whole personnelare trained, and that a comprehensive environmentalaudit is passed.In the audit, made by a third party, assessment is

made as to whether the store fulfils the detailedrequirements set for awarding the diploma.

� The K-environmental store diploma gainedinternational recognition as the UNEP and ICCselected it among the 10 best sustainabledevelopments partnership out of over 120

candidates.




Kesko Social Commitment Kesko Social Commitment � training and questionnaire on staff satisfaction

� Social quality control of suppliers:Application of the social accountability SA 8000

(about 100 kesko suppliers participated on the SA8000 training in 1999-2001)

� Internal handbook on social quality control of suppliers.

� To promote certification, Kesko has made an

international co-operation agreement with bureauVeritas Quality International.

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