The biggest single impact a retailer has on planet and people is its products - raw material sourcing, manufacture, logistics, customer use and disposal.
M&S is certainly not the biggest, turning over about £10 billion per year (about $16bn, compared to Walmart's $420bn). But even as a mid-sized retailer we still sell 2.9 billion products per year. That's an awful lot of stuff that needs to become much more sustainable.
In this blog I talk about how we're approaching the challenge of making every single product we sell more sustainable.
And I mean EVERY product. Traditionally a retailer or FMCG might have felt they'd discharged their social and environmental obligations by having a small Fairtrade or organic range, often tucked away in the corner.
It's not good enough. But nor is just tackling the big product issues in isolation anymore.
When we launched our eco and ethical programme, Plan A, in 2007 we made some big bold product related commitments. For example, to get all our wood and fish from the most sustainable source possible. It wasn't the wrong thing to do but we were looking through the lens of 'issue' rather than 'product'.
We didn't say, right we need to improve the sustainability of our fish based ready meals, from trawler, through food factory, storage, logistics to the customer's home. We reached straight for the sustainable fish issue. I'm sure we were right to. Stakeholders had told us sustainable sourcing mattered. Instinctively it feels the most material issue associated with any fish based product. But alone it doesn't make the finished product sustainable.
And then what about all the products that didn't contain wood, fish or another 'poster child' of the NGO movement? Were they already sustainable just because they lacked a campaign that would cause us a PR risk?
Of course not. It took us three years to realise that Plan A had triggered important work to improve our social and environmental footprint but it wasn't sufficient to allow us to systemically make all our products more sustainable.
When we updated Plan A in March 2010 we introduced a new commitment, that by 2020, 100% of M&S products would have at least one Plan A attribute (50% by 2015). A Plan A attribute being a materially significant social or environmental improvement to a product that went beyond the marketplace norm.
So a big goal, one that commits us to improve the sustainability of every product we sell, how are we going about it?
1.Definition - First you need to define what an attribute is. For some things it's quite obvious. For example Fairtrade coffee and tea. Other things require more discussion, usually because there is no external definition of what 'good' is. For example, for food factories we've developed our own framework that defines 'good' environmental performance. Crucially we've put in place a robust governance structure that signs off any attribute as material and credible.
2.Benchmark - once you've defined what an eco or ethical attribute is you've got to work out how many of your products actually have one. This is where the IT folk earn their corn. This year we reported a baseline of 31% of our products having a Plan A attribute, just shy of one billion items.
3.Bonusable targets - baseline set, you've got to start growing towards those macro targets - 100% by 2020 and 50% by 2015. Crucially the Directors in charge of our Foods and Clothing businesses have personal, bonusable targets each year to grow the number of products in their areas with a Plan A attribute. This drives an ownership and commitment through the product categories as we report internally and externally on progress.
4.Towards sustainability - even if we achieve our 2020 target, our products still won't be truly sustainable. To catalyse that change we will have to introduce a new set of targets, for all products to have two, then three, then four attributes. One for raw materials, one for manufacturing, one for packaging, one for consumer use and disposal. Our milk, for example, already has multiple attributes.
5.Getting other companies on board - at the moment we've created our own M&S framework for attributes, which uses some external attributes (MSC, FSC etc) and some internal ones. Ultimately though for us to operate in a sustainable economy all retailers and FMCGs are going to have to use a common definition of an 'attribute'. We are supporting the work of the Sustainability Consortium and, in the UK, WRAP to create a common definition of product sustainability. Their ideas are informing how we use attributes so they evolve in line with the bigger picture. Sometime in the next decade we will switch across to a common global system.
So that's the plan to build sustainability into every M&S product, a pragmatic mix of science, stakeholder engagement, culture change, targets, incentives and IT. It's not perfect, it will evolve but it's got us moving on the biggest challenge of all, building a complete sustainable product portfolio.