Checkout revolution

Household names vie for low carbon leadership

Radical new initiatives, rather than just run-of-the-mill New Year’s resolutions, were flavour of the month in the retail trade this January, as the bosses of both Marks & Spencer and Tesco propelled their companies to the forefront in the sustainability stakes.

Stuart Rose, CEO of M&S, was first to show his form, with plans for a far-reaching £200 million green makeover, turning M&S into a carbon-neutral, zero-waste, ethical trading, sustainable sourcing, health promoting company by 2012.

‘Carbon-neutral’, stresses Rose, doesn’t involve just offsetting emissions, but tackling them at source. That means making the company 25% more energy efficient, for a start, and powering stores with renewable energy, some of it generated by waste from food halls, farms and factories. As for transport, M&S will use 50% bio-diesel in all lorries, at the same time doubling regional food sourcing within the next year, and minimising airfreight. It’s in areas such as flying that the offsetting ‘last resort’ will kick in. But the clever bit is “to allocate the cost of doing so to individual business units, as a commercial incentive to minimise CO2 emissions”.

As Rose points out, M&S leverage extends to its own 2,000 factories and 10,000 farms. As well as reducing packaging by 25%, the company is to recycle plastic bottles into polyester for clothing. Over the next year it will also convert key ranges to 100% fair trade cotton - for which it will need around one third of the world’s certified supply.

This so-called ‘Plan A’ from M&S (for whom “there is no Plan B”) is so far-reaching, according to Jonathon Porritt, that “it raises the bar for everyone else - not just retailers, but businesses in every sector”.

Porritt is a founder director of Forum for the Future, which advised M&S on its initiative - and also worked with Tesco, whose own transformation plans show that CEO Terry Leahy has been thinking along similar lines.

Leahy told the audience at a joint Forum/Tesco event that the reduction of carbon dioxide emissions is to become “a central business driver” in the company’s business model. Tesco’s new aim is to reduce the footprint of its 900 stores (by half by 2020) and its distribution network. All its lorries are to switch to biodiesel this year, and there is a firm target that less than 1% of products will be flown in.

Leahy stressed that he wants to bring green consumerism to the masses, “to empower everyone - not just the enlightened or the affluent”. So Tesco will be wielding its all-powerful Clubcard to encourage sales of organic and fair trade goods. Stores will also offer more energy-efficient products through the no-frills ‘Value’ range, and may well be the first to introduce ‘carbon labelling’ on products [see ‘Calories, cholesterol and carbon’].

Another household name, BT, is cranking up its carbon-cutting commitment too. Its new nine-year programme aims to get emissions down by 80%. Energy efficiency measures are already saving the company an estimated £100 million a year. Its green energy power deal with npower and British Gas (the world’s largest deal of its kind, dating back to 2004) is being renewed, backed up by more combined heat and power schemes. The company is looking at biofuels for its vehicle fleet (which totals 32,500 vehicles, plus the 10,000-plus company cars it gives to its managers), and at ways of helping staff cut their personal carbon footprint, as well as working to squeeze out carbon in its supply chain. “We need companies like BT to demonstrate commitment and leadership,” said environment secretary David Miliband approvingly. - Hannah Bullock and Roger East

11 March 2007

Hannah Bullock and Roger East