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Sustainability
     in Retail
             Jason Clay
    SVP Markets, WWF-US
population x consumption   ≠
Global trends by 2050
                    200
                                                    Income
                    180
                    160
 percent increase




                    140
                    120
                    100                             Consumption
                     80
                     60
                     40
                                                    Population
                     20
                      0
                       2010                       2050
Source: United Nations
x 1 =6

x 2 = 18
The China phenomenon

                                         Population at start               Years to double                         China doubling of GDP
                                          of growth period                 GDP per capita1                         was 12x the speed of
Britain (1700-1855)                                9M                              155                               Britain during the
                                                                                                                  Industrial Revolution at
US (1820-1873)                                    10M                               53
                                                                                                                      100x the scale
China (1983-1995)                              1,023M                               12
                                                                                                                             400 million
India (1989-2006)                                822M                               17
                                                                                                                      lifted out of poverty




1 Time to increase GDP per capita (in PPP terms) from 1,300 to 2,600 USD   Source: Angus Maddison, University of Groningen
Countries with   >5% GDP growth (2010- 2011)
                                                        (2010-
                        Countries where China is a top trading partner
Source: UN Comm Trade
2 1 1 2                              4            3 1 1 5
   palm oil        cotton          biofuels           sugarcane        pulp & paper



1 10 3 1 3 5 1 5                                                           1
 sawn wood          dairy            beef                soy          fishmeal and oil



    1           1 3                 6                   6                  1
farmed salmon   farmed shrimp   tropical shrimp         tuna             whitefish


   Priority commodities                           1    China      1   India
global food
 40 years =
8,000 years
on a finite planet, should consumers have a
  choice about sustainable products?

 or should all choices be sustainable?
Unilever’s commitment:
      100%
sustainable ingredients
performance & results
      not practices
IKEA and BCI Cotton—2005-10
IKEA Cotton Use
• 100,000 MT/yr (24% verified)
• 400,000 producers (10% verified)

Producer Impacts of BCI & BMPs
• 60% less pesticide
• 40% less water
• 30% less synthetic fertilizer
• 15-20% more income
Mars won’t buy
certified poverty
Tetra Pak and embedded CO₂e emissions

                2020 Goal = 10.8 MT CO₂
      raw materials,                          brands, retailers,   end of
  production, processing                       consumer use         life
         45%                                      38%              10%

                              6%
                               Tetra Pak
                           direct emissions
CGF – Precompetitive
approaches
• 57 companies
• Deforestation out of supply chains
• 4 commodities, 4 countries
• By 2020
• Impact on BEI
illegal                                                                 illegal
         SPECIES          MINERALS            FISH                FOREST         PLANTATION




tigers             gold              bluefin tuna        pulp               palm oil




elephants          coltan            demersal fishes     timber            soy




rhinos             diamonds          shrimp and prawns   mangroves         beef
Performance curve
                          government                  voluntary
                            regulation                standards
number of producers




                      performance shift




                        worse               average          better
move certified commodities
 from niche to norm
Necessary but insufficient
• Credible certification standards
   ‒ Science based
   ‒ Performance based
   ‒ Focused: 6-8 impacts reduced

• Certification increases producer profits
• Change the market, don’t create a
  parallel one
Reduce transactions and costs
purchases




              Year 1   Year 2   Year 3   Year 4   Year 5
Pool sustainability commitments
purchases




            Year 1   Year 2   Year 3   Year 4   Year 5
,,
 Age of Damage
               ,,                                   David Jones, Havas International




                             93%
          of people are
    prepared to boycott
         a company for
 irresponsible behavior
  “2011 Cone/Echo Global Corporate Responsibility
                             Opportunity Study,”
         Cone Communications and Echo Research
“Millennials: The Challenger Generation”
 Euro RSCG Worldwide, Prosumer Report, Vol 11, 2011



       48% of Millennials
  agree with this statement:

 “The things I consume
   have more power to
change things than the
     people I vote for.”
the issue in retail is about
 change not change
it’s about how you make money,
    not how you spend profits
It’s about exceeding consumer
expectations


             Supply
        Walmart & Mars:
  100% of seafood from
certified sources (MSC &
            ASC) by 2020
It’s about exceeding consumer
expectations in the South, too


Product origin
   Carrefour in China:
     product origin on
                  tags
Providing the unexpected to consumers


         Recycling
              M&S Shwop:
change the behavior of 21
         million customers
                      Goal:
Recycle as many clothes as
     M&S sells every year
Create a conversation with consumers


Issue awareness
    “Arctic Home”
the issue isn’t what
to think about sustainability,
 it’s how to think about it
think about it

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Jason clay

  • 1. Sustainability in Retail Jason Clay SVP Markets, WWF-US
  • 2.
  • 4. Global trends by 2050 200 Income 180 160 percent increase 140 120 100 Consumption 80 60 40 Population 20 0 2010 2050 Source: United Nations
  • 5. x 1 =6 x 2 = 18
  • 6. The China phenomenon Population at start Years to double China doubling of GDP of growth period GDP per capita1 was 12x the speed of Britain (1700-1855) 9M 155 Britain during the Industrial Revolution at US (1820-1873) 10M 53 100x the scale China (1983-1995) 1,023M 12 400 million India (1989-2006) 822M 17 lifted out of poverty 1 Time to increase GDP per capita (in PPP terms) from 1,300 to 2,600 USD Source: Angus Maddison, University of Groningen
  • 7. Countries with >5% GDP growth (2010- 2011) (2010- Countries where China is a top trading partner Source: UN Comm Trade
  • 8. 2 1 1 2 4 3 1 1 5 palm oil cotton biofuels sugarcane pulp & paper 1 10 3 1 3 5 1 5 1 sawn wood dairy beef soy fishmeal and oil 1 1 3 6 6 1 farmed salmon farmed shrimp tropical shrimp tuna whitefish Priority commodities 1 China 1 India
  • 9. global food 40 years = 8,000 years
  • 10. on a finite planet, should consumers have a choice about sustainable products? or should all choices be sustainable?
  • 11.
  • 12. Unilever’s commitment: 100% sustainable ingredients
  • 13. performance & results not practices
  • 14.
  • 15. IKEA and BCI Cotton—2005-10 IKEA Cotton Use • 100,000 MT/yr (24% verified) • 400,000 producers (10% verified) Producer Impacts of BCI & BMPs • 60% less pesticide • 40% less water • 30% less synthetic fertilizer • 15-20% more income
  • 16.
  • 18. Tetra Pak and embedded CO₂e emissions 2020 Goal = 10.8 MT CO₂ raw materials, brands, retailers, end of production, processing consumer use life 45% 38% 10% 6% Tetra Pak direct emissions
  • 19.
  • 20. CGF – Precompetitive approaches • 57 companies • Deforestation out of supply chains • 4 commodities, 4 countries • By 2020 • Impact on BEI
  • 21. illegal illegal SPECIES MINERALS FISH FOREST PLANTATION tigers gold bluefin tuna pulp palm oil elephants coltan demersal fishes timber soy rhinos diamonds shrimp and prawns mangroves beef
  • 22. Performance curve government voluntary regulation standards number of producers performance shift worse average better
  • 23. move certified commodities from niche to norm
  • 24. Necessary but insufficient • Credible certification standards ‒ Science based ‒ Performance based ‒ Focused: 6-8 impacts reduced • Certification increases producer profits • Change the market, don’t create a parallel one
  • 25. Reduce transactions and costs purchases Year 1 Year 2 Year 3 Year 4 Year 5
  • 26. Pool sustainability commitments purchases Year 1 Year 2 Year 3 Year 4 Year 5
  • 27. ,, Age of Damage ,, David Jones, Havas International 93% of people are prepared to boycott a company for irresponsible behavior “2011 Cone/Echo Global Corporate Responsibility Opportunity Study,” Cone Communications and Echo Research
  • 28. “Millennials: The Challenger Generation” Euro RSCG Worldwide, Prosumer Report, Vol 11, 2011 48% of Millennials agree with this statement: “The things I consume have more power to change things than the people I vote for.”
  • 29. the issue in retail is about change not change
  • 30. it’s about how you make money, not how you spend profits
  • 31. It’s about exceeding consumer expectations Supply Walmart & Mars: 100% of seafood from certified sources (MSC & ASC) by 2020
  • 32. It’s about exceeding consumer expectations in the South, too Product origin Carrefour in China: product origin on tags
  • 33. Providing the unexpected to consumers Recycling M&S Shwop: change the behavior of 21 million customers Goal: Recycle as many clothes as M&S sells every year
  • 34. Create a conversation with consumers Issue awareness “Arctic Home”
  • 35. the issue isn’t what to think about sustainability, it’s how to think about it