Plan A

Recent reports show that the green agenda continues to grow in importance despite the economic downturn and pressures on household budgets (Source: Ipsos MORI). At M&S we have identified an increase in the number of our customers who say they will take environmental action ‘if it’s easy’, while at the same time seeing a decrease in those who say ‘what’s the point?’ or ‘I can’t make a difference’.

It is not only the normal buying metrics such as price, quality, style, durability and fashionability, which resonate with our customers, but also ensuring all these things are underpinned by sustainability. This sets us apart from our competitors and reassures our customers that they can trust us to do the right thing.

We are continuing to push hard to reduce, reuse, recycle and reinvent to become more efficient across our operations. The following review highlights some of our Plan A successes over the past year, as well as new initiatives for the year ahead.

To reach our goal of making our UK and Republic of Ireland operations carbon neutral by 2012 we are improving our energy efficiency and increasing our use of renewable electricity. In the last year we’ve reduced our net CO₂ emissions by 18%, and our energy efficiency in stores has now improved by 10%.

In February 2009 we signed the UK retail sector’s biggest renewable energy contract. The six-year deal with npower will provide M&S with enough renewable energy to ultimately power all our stores and offices in England and Wales. In March 2009 we then signed with EDF to supply renewable energy to our Scottish operations.

The npower deal also underlines our commitment to work with local communities to encourage small third-party suppliers to develop renewable electricity. M&S buys, through npower, any renewable electricity generated by farmers.

The ‘Plan A way to save’ campaign is a collection of simple green changes designed to save family households up to £1,000 a year. Measures include encouraging washing at 30°C and ‘Love Food, Hate Waste’, which can save customers up to £600 a year by cutting down on food waste.

Our two pioneering eco factories in Sri Lanka were developed in partnership with suppliers MAS Holdings, a new lingerie factory operating exclusively for M&S, and Brandix, an existing casualwear factory that has been upgraded to eco status. They are now hitting their targets, achieving 50% less water use than factories of a similar scale. While MAS Holdings was designed to be carbon neutral from day one, Brandix has also seen a 78% reduction in its carbon footprint.

These are in addition to the 150,000 sq ft Westbridge eco factory in Wales – responsible for producing all of our UK furniture ranges – and our new supplier eco factory in China that opened in May 2009. It is the country’s first eco clothing factory, with a green roof, low energy lighting and a ‘water curtain’ for cooling the factory. All of which will help reduce electricity use by about 50% compared to similar sized factories.

These factories establish a benchmark we can share with other manufacturers across the world.

This year we retendered our waste contracts for stores and GM distribution centres. This contract includes a plan to achieve our ambition of zero waste to landfill by 2012. We produced around 116,000 tonnes of waste of which 41% was recycled.

One of our most high profile initiatives is our 5p carrier bag charge. Profits fund local environmental projects run by our partner Groundwork UK. Carrier bag usage in our food halls is down 83%, saving over 387 million carrier bags from landfill. In the process we have helped raise £1.2m for Groundwork to create Greener Living Spaces in 46 local neighbourhoods.

The M&S and Oxfam Clothes Exchange is a unique partnership that has been a remarkable success. Over 875,000 customers have now donated 3.2m garments to their local Oxfam stores, in return for a £5 M&S discount voucher to spend on purchases of £35 or more. Their efforts have saved 1,500 tonnes of clothing from landfill, helped Oxfam to raise £1.9m, and given our customers the opportunity to save over £4.4m.

Innovation is key to ensuring that our key raw materials come from the most sustainable sources available to us.

As the winner of the ‘RSPCA Good Business Award’ in 2008, for both our Food and fashion business, we continue to push ahead on animal welfare. We are trialling free range pork in 100 stores, and we guarantee that for all of our pork, no farrowing crates are used at birth, and that no pigs have been castrated, had their tails docked or their teeth clipped.

There is also a clear plan to better understand our impact on the global freshwater supply. Together with WWF and our suppliers, we are undertaking a water footprint assessment of our supply chain so that we can reduce our water impact during the product sourcing and production stages. So far this has involved five crops – strawberries, tomatoes, lettuce, potatoes and roses – and raw materials including cotton and leather.

During the year we launched the Fern Collection which is produced using timber sourced from sustainably managed forest and Fairtrade certified covers. The Fern furniture is also filled with a combination of Ecoflex foam – a castor oil based foam containing 20% renewable resources – and fibre made from 80% post-consumer waste. This includes plastic drink bottles, 122 of which are used to make every two-seater sofa.

Plan A is not only becoming ingrained in the way we do business and in the way we interact with our customers; it is also integrated into the way we conduct our day-to-day business with suppliers. As a fair partner we’re committed to improving the lives of the hundreds of thousands of people in our supply chain and local communities.

Work on three garment factories in Bangladesh – part of our Ethical Model Factories – helps us to do this, by creating sustainable ways of improving the livelihood of those who work in the factories. By providing workers rights, supervisor and production training we are ensuring long-term improvements in labour standards and establishment of a living wage.

But setting new standards as a fair partner is not just about helping overseas. M&S prides itself on our work at home in the UK.

Marks & Start is our flagship community programme and is the country’s largest company-led work experience programme. Some 705 work placements were given out last year. We have also completed a successful year with Breakthrough, the breast cancer charity. Since 2001 we have raised a staggering £11m – making us their largest corporate partner.

M&S has long led the way in food innovation, which is now more important than ever in helping our customers and employees lead healthier lifestyles.

Our current focus is on natural enrichment for instance the inclusion of probiotics in food such as yogurts and by feeding omega to salmon. We have identified what people are missing in their diets and are finding a way to put these essential vitamins back in.

This builds on our commitment that all of our food is now entirely free of artificial flavours and colourings. We have also continued to expand our ‘Eat Well’ healthier options, reduce salt, and eliminate hydrogenated fats. We have reduced the level of saturated fats by 70% across our range of crisps, and by 30% across our range of sandwiches. We now meet over 67% of the FSA’s salt targets for 2010.

We made considerable progress with Plan A during the year. The high street has provided some challenging conditions, but has also given us an opportunity to approach things in a new way.

Plan A differentiates M&S in the market. With our commitment to producing quality goods, we are helping to dispel the myth that being environmentally and ethically sound is a more expensive way to live and shop.

Plan A is a journey. We know we still have some way to go before we achieve our five-year targets. But already it is embedded in our culture and evident in how we do business. We will continue to innovate; develop and maintain partnerships; play a key role in local communities; and, perhaps most importantly, listen to what our customers want and communicate with them every step of the way. Doing the right thing.