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Tesco Plc

Sustainable development

A view from Forum for the Future

Over recent months, the role of supermarkets has come under the spotlight like never before. Government has held inquiries into how they operate; customers have made their views known on topics like plastic bags and packaging. At the same time, we have seen retailers setting ambitious targets that demonstrate visible leadership amongst businesses and put government to shame.

This Review paints a picture of Tesco responding across a breadth of issues, and acknowledging the complexity of difficult problems in an upfront way. It provides insight into Tesco’s perception of the role of a responsible retailer. Tesco clearly recognises the key concerns of civil society, such as high street diversity, and its responsibilities to the local community. We are heartened by the fact that sustainability issues are increasingly part of a strategic approach to how Tesco does business. We can now see the beginning of investment of serious resources, stronger management systems and processes, and the launching of new product lines.

The Review also contains clear targets against which Tesco can manage its business and external commentators can hold it to account. We particularly welcome the introduction of additional future commitments across its international stores, on issues such as trading fairly and reducing carbon, challenging Tesco to meet higher targets.

One of the most important contributions a retailer of this size can make is in engaging customers and making green choices widely available.

Climate change is one of the biggest challenges we face. The scale and urgency of climate change will require retailers to take difficult decisions in the short term, rather than wait for consumer education to drive the market for low-carbon products. We warmly welcome moves by Tesco to offer

Environment

We are committed to tackling a wide range of issues from reducing packaging to sourcing fish and timber responsibly.
Our position
The scale of our operations and our position between producer and customer mean that we are well placed to encourage widespread environmental improvement.

A good example is our climate change strategy, through which we are reducing our own carbon footprint and encouraging our suppliers and customers to do the same (see Climate Change).

Our scale means we must tackle a wide range of issues, from reducing packaging and increasing the amount we recycle, to addressing concerns about biofuels and sourcing fish and timber in a responsible way. We also want to encourage customers to make environmentally friendly choices by making these appealing and affordable.

Progress 2007
Managing our impacts

Waste in our operations
One of our main sources of waste is distribution packaging removed at our stores. Packaging is required to protect products – a damaged or unusable product is highly wasteful. We look for opportunities to reduce the amount of waste we produce wherever possible, for example by working with our suppliers to reduce distribution packaging and encouraging those that use one-way packaging to clearly label recycled and readily recyclable materials.

Our reusable transit trays – green trays – help us save packaging used for transporting and displaying products.

We donated surplus fresh food for disposing a food waste, from 35 stores to homeless shelters in partnership with FareShare, a charity that works with food retailers to minimise food waste and feed disadvantaged people.

Biofuels
The impacts of biofuels are complex.  Our aim is to do the right thing for the environment and communities based on sound science. We are continuing to keep the science under review and to take note of expert opinion such as the Royal Society report on the future of biofuels.

This is important because from April 2008, along with other petrol retailers, we are obliged by the government through the Road Transport Fuel Obligation to provide 2.5% biofuels in our petrol. We want to make sure that this well-meaning legislation helps customers reduce their carbon footprint by ensuring that our biofuels are sourced sustainably.

Palm oil for food products
We are active members of the Roundtable on Sustainable Palm Oil (RSPO) and nearly all palm oil in our own-brand products comes from RSPO members. We expect certified RSPO oil to become available at the end of 2008 and we are working on incorporating this into our products at that time.

Seafood
We seek to buy all our seafood from responsibly managed fisheries. We use the United Nations’ Food & Agriculture Organisation (FAO) Code of Conduct for Responsible Fisheries as our sourcing reference.

We are the first supermarket in the world to define seafood sstainability in a holistic way.  We believe the factors affecting seafood sustainability to be: stock depletion and impact on ecosystems; aquaculture; climate change; packaging and socio economic issues.

Genetically modified (GM) foods
We do not sell any own-brand GM foods in the UK, and use of GM feed is prohibited in organic products. Where we do sell non-Tesco brand products with GM ingredients, they are clearly labelled.

Timber
Tesco is committed to purchasing timber and timber products only from legal, sustainable sources. We use external certification to help verify this and to give our customers the opportunity to make informed choices. All sources of timber for our garden furniture range continue to be either Forest Stewardship Council (FSC) approved or sourced from members of the Tropical Forest Trust, who are committed to achieving the FSC standard through the certification support programmes of ethical auditors.

Community impact

We want to have a positive impact in the thousands of communities around the world in which we operate, from Birmingham to Beijing to Budapest.
Our position
We want to play a positive role, to be a good neighbour in line with our customers’ expectations. Once a store is open, our aim is to contribute to local communities by providing a great service to customers and quality local jobs that give people the opportunity to get on, by operating responsibly and by supporting community activity.

Critics claim that supermarkets have a negative impact, disrupting traditional shopping patterns and community activity. They suggest that a Tesco store takes trade away from independent retailers, from high streets and town centres, threatening the vibrancy of communities, and that our stores do not reflect the communities in which we operate.

We strive to bring quality, affordable products to our customers and to respond to changes in society (such as the expansion of car ownership and the growth in the proportion of working women) is by adjusting the type, size and location of shops. Government planning policies also influence supermarket development. Economic and social regeneration, and the task of lifting communities out of social decline or deprivation, are priorities in many of the countries in which we operate. We help address these issues by adapting our formats and our offer, meaning that we can bring jobs and investment to areas that other retailers would reject.

Community impact

Progress 2007
Listening to communities
We need to understand and respond to what people want. We consult on potential new store openings, informing local people of our plans and inviting feedback. We also talk to local traders about how our proposals can attract new customers to the area and improve business for everyone.

In the US, we have designed our trailers to reduce noise by 66% and will not make night deliveries to stores with homes nearby.

We are introducing Community Boards in stores in most countries where we operate, giving local people and organisations the opportunity to advertise local events and initiatives. We encourage our stores and car parks to be used by local groups and charities, adding to our role as a focal point in the community.

Land holdings
We buy land in order to open or extend stores, and we aim to move from acquiring the land to opening the store or extension as quickly as possible. However, owing to the complexities of property development, the planning system and our innovative mixed use schemes, which sometimes include assembling sites from several parcels of land, this can take several years.

UK Competition Commission inquiry
The UK Competition Commission’s provisional findings dismissed concerns that Tesco’s position in the market means that other retailers cannot compete or is acting as a barrier to expansion to other grocery retailers. It found that supermarket entry into the convenience sector has not distorted competition, and that convenience stores that provide consumers with a strong retail offer will continue to survive and prosper.

The Competition Commission has recognised that the market is delivering a good deal for customers.

For full details of the investigation and some of Tesco’s own submissions see www.competition-commission.gov.uk and www.tesco.com/talkingtesco

New stores
Many of our newer stores are built on previously developed ‘brownfield’ land (98% in 2007) close to town centres, and often in areas that other developers will not consider. They provide jobs for local people and help to regenerate communities, attracting other retailers as well as our shoppers.

The impact of supermarket store openings on existing shops has been controversial, but there is plenty of evidence of a positive effect. A UK study by Southampton University’s Professor Neil Wrigley (cited in his evidence to the Competition Commission) found positive outcomes from the conversion of convenience stores to Tesco Express in four Hampshire communities, specifically:

·         a major re-localisation of food shopping away from distant superstores and towards stores in the local community;

·         important travel changes involving significantly increased walking and cycling and reduced car mileage;

·         highly positive community responses to, and increases in consumer welfare from, being able to access products locally (particularly fresh foods); and

·         negligible diversion of trade from local independent stores and indications that local retailers and service providers might experience gains.

Tesco is also committed to sustainable, mixed-use development. Our scheme in Woolwich, London, promises a major transformation of the local town centre. In partnership with Greenwich Council, Tesco is providing a Tesco store and other retail space, over 900 homes, public spaces and a new Civic Centre including a library. This £400 million development will create a vibrant resource for work and leisure.

Regeneration and employment
We aim to recruit local people who have been unemployed for six months or more, in these stores. We assess aptitude rather than experience or existing qualifications. As part of our Job Guarantee Scheme, as long as applicants complete the six-week training course preparing them for working in-store, we guarantee to give them a job, unlike many such training opportunities elsewhere, which do not result in employment.

In addition to the job scheme, we have also formed the Failsworth Business Forum, bringing together local businesses to talk about ways in which Tesco and the new store can help them do business better – whether through business advice or advertising in-store. We are also participating in an allotment scheme, which will provide the local community with a facility where they can grow, use or sell their own produce.

Local Employment Partnerships
Tesco was one of the original six signatories to the UK government’s Local Employment Partnerships (LEP) scheme. We are working with Jobcentre Plus to provide job opportunities for the long-term unemployed and will be extending the scheme to existing stores throughout 2008.

Rio Tinto Sustainable Development

Rio Tinto plc and Rio Tinto Limited operate as one business organization (Rio Tinto). Rio Tinto is an international mining company. Its business is finding, mining and processing mineral resources. Its major products are aluminum, copper, diamonds, coal, uranium, gold, industrial minerals (borax, salt, talc), and iron ore. Businesses include open pit and underground mines, mills, refineries and smelters, as well as a number of research and service facilities. On October 23, 2007, Rio Tinto acquired Alcan Inc., the parent company of an international group of companies involved in bauxite mining, alumina refining, aluminum smelting, engineered products, flexible and specialty packaging. In April 2008, Hecla Mining Company completed the transaction to acquire the Rio Tinto subsidiaries that held a 70.27% interest in the Greens Creek silver mine and joint venture located near Juneau, Alaska. As a result of the transaction, Hecla subsidiaries hold 100% of the Greens Creek joint venture.

Sustainable development
We believe that our contribution to sustainable development is not just the right thing to do. We also understand that it gives us business reputational benefits that result in greater access to land, human and financial resources.

Our objective is to maximise the overall long term return to our stakeholders through a strategy of investing in large, cost competitive mines and associated activities. This is driven by the overall quality of each opportunity, and not the choice of commodity.

Our way forward

Our approach to sustainable development embedded through all levels of our organisation from our Chief executive and Chairman through to the day to day operations. We try to minimise the adverse effects of our activities and improve every aspect our performance.  In addition, wherever we operate, we hold the health and safety of our employees and the environment to be a core value.

We work as closely as possible with our host countries and communities, respecting their laws and customs and ensuring a fair share of benefits and opportunities.

In this sustainable development section

Our performance

Our results for 2007, including key performance data, how we fared against our goals & targets and some of the awards we received this year.  You can also find details of our external stakeholder reporting panel, our assurance processes, local sustainable development reports, and our GRI checklist.

Strategy

The views of both are Chief Executive and Chairman on the importance of sustainable development.  The key stages of an operations life and our management of this way of working.

Economic

Our financial results and how our operations add value to local economies. You can also learn here about our responsibility along the supply chain and the economics of our work on climate change.

Environment

Our minimisation, mitigation and remediation of the harmful effects of our operations and products on the air and water. You can also read here about how we manage our waste and our strategies on land stewardship and climate change.

Social

Our management of our employees, our proactive support of their health and safety and our engagement with the communities in which we operate.

Governance

Our position on ethics and human rights and our engagement with our stakeholders.

Environmental
We seek to be the acknowledged leader in environmental performance by demonstrating good stewardship of natural resources by reducing our environmental footprint and meeting community expectations to support sustainable development.

Our aim is to fully integrate environment into the business as a core value, as leading environmental performance also creates and sustains our business value. So we constantly look to improve our performance through consistent application of our environmental standards globally.

Respect for the environment is central to Rio Tinto’s approach to sustainable development. Unless we operate responsibly and can demonstrate leadership in all aspects of exploring, mining, processing, transporting and marketing we are unlikely to be given the ready access we need to people, land and capital. In this regard, we want Rio Tinto to be viewed as the public’s preferred developer – from exploration right through to mine closure.

What’s on these pages?

Management

An outline of environmental management process and a top level overview of our results.

Air quality

How we manage our affect on the quality of the air around our operations, particularly in relation to dust and to oxides of sulphur and fluoride.

Climate change

Our efforts to reduce our energy use and hence greenhouse gas emissions. This includes research aimed at developing more energy efficient technologies for the future.

Water

Our strategic approach to drive excellence in water management across our Group, including how much water we use, how we dispose of water, and how we conserve and recycle water.

Waste

Our waste programmes include rock dumps, tailings, acid rock drainage and non-mineral waste.

Land

How we rehabilitate land around our operations, biodiversity management and protection, providing access to newly-created recreational areas to the community, and land use in the future.

Social
We believe that our employees are our greatest asset. We also consider that the fair and decent treatment of our people, as well as those in the communities in which we operate, is a vital part of sustainable development.

That is why our aim is to build enduring relationships with our employees and neighbours that are characterised by mutual respect, active partnership and long term commitment. Safety is a core value and a major priority.  We take the view that all injuries are preventable – our goal is to have none at all – and in health, that prevention is better than cure.

What’s on these pages?

Health
Our approach to health management and occupational illness, as well as our work with HIV/Aids and health in the community, and our results.

Safety
Our policies and strategies that underpin our safety culture and safety management, and our reporting of injuries and fatalities.

Employees
Our recruitment and graduate programmes, and our approach to diversity and training of employees.

Communities
Our work in adding value by developing the quality of our relationships with those in the community, training them so that they can enhance their livelihoods and helping them to set up businesses.

 

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