Salterbaxter Directions 2008

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2008 The year sustainability got tough.
2008 saw some really hard to handle issues ruse to the surface. they are complex, full of paradoxes and beset with conflicting agendas. we put these tough issues in the spotlight and identify the difference between CR housekeeping and CR leadership.

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Salterbaxter Directions 2008

  1. 1. directions the full report 2008 trends in corporate responsibility 2007/08
  2. 2. CoNTENTS 01 BIoFUELS Thirst for fuel vs 04/ Dr Peter Cotgreave Director of Public Affairs, hunger for food The Royal Society Page 02 05/ Chris Carter Director of Corporate Affairs, British Sugar plc 06/ Sagarika Chatterjee Associate Director, F&C Asset Management plc 09/ Dick Searle PACKAGING Are we suffocating Chief Executive, under the weight of the packaging The Packaging Federation problem? Page 08 11/ Alasdair James Director of Waste, Recycling & Packaging, Tesco plc 13/ Leo Horn-Phathanothai National Coordinator, CHINA It’s not as black UK-China Sustainable and white as a panda Page 12 Development Dialogue, DEFRA 17/ David Grayson Director, Doughty Centre CREDIT CRUNCH for Corporate Responsibility, Will corporate responsibility crack Cranfield University 18/ Barry Clavin We have a strongly held belief that most things could be made better under the strain of the credit – they just need better insight, brighter ideas, more creative thought. Ethical Policies Manager, crunch? Page 16 The Co-operative Group And so our offer to clients is all about creative re-thinking. Re-thinking 202 Kensington Church Street their entire business proposition; re-thinking their branding, vision and London W8 4DP 20/ David Godden Chief Operating Officer, values; re-thinking how they should approach corporate responsibility; Tel +44 (0)20 7229 5720 Land Securities Trillium re-thinking how they engage with their employees; re-thinking what the www.salterbaxter.com web can do for them; re-thinking how to communicate with shareholders. 26/ Top 50 European companies For many years now we have helps new ideas flourish and breaks boundaries. It sheds these issues cannot be debated outside of the This approach seen businesses starting to do their CR But ANALYSIS housekeeping.new light on old some small, there have been leaders and Some big and problems and turns some new problems inside out. context of the economic climate we are operating in – And if you are looking for the analysis Are businesses making the tables you usually find at the end of criticism of those that are lagging behind. But now things are getting a tough issue itself. So we have also invited discussion shift from CR 1.0 to 2.0? Directions, these are now online at: tough. 2008 saw some really hard to handle issues risebetter. surface Most importantly it helps clients do things to the on the topic “Is corporate responsibility going to be Page 22 www.salterbaxter-rethinktank.com – and it’s not as if tackling sustainability isn’t a challenge in the first smashed by the credit crunch?” /directions/analysis place. This year we sense a clear focus our attentionare are: that aren’t The main areas we difference: these on issues To find ways forward businesses need to be – Brand and reputation just hard to handle, they are complex, full of paradoxes and beset with communicating about these big issues and inviting – CR/Sustainability conflicting agendas making it really tough for businesses to develop clear stakeholders in to help create solutions – it’s going – Corporate reporting strategies or tactics to deal with them. It’s almost as if the work to date to be incredibly difficult for them to work this out on has just been – Employee engagementreal challenge ahead – and not all the groundwork for the their own. But are they ready, willing or able? It’s going – Digital communications businesses will be ready to face up to the scale of this challenge. to take a shift in their approach from focusing on CR housekeeping to broadening their outlook to true To mirror the online world, it’s as if CRvaried and include FTSEbravecompanies; Our clients are extremely 1.0 is over. This is the 100 sustainability and how they function amongst shifting new world of CR 2.0. major multinationals; some of the world’s most exclusive brands; We are launching the economic, environmental and social agendas all law firms; private equity firms; world-leading educational around them. This is theCover photography by to 2.0 andat shift from CR 1.0 Lee Funnell Re-think tank, an online forum establishments and this year’s Directions we have invited comment NIGEL SALTER So for independent, entrepreneurial businesses. we’ve researched what the biggest 50 companies www.graphicphoto.com for everyone to share their from specialists and businesses who are battling with across Europe are doingPage 08–11there are any Liam Bailey to see if photography by views. Join the debate at: DIRECToR, these conflicts, trying to find a way through the maze indications of change. We hope you on Heaven 42, Cover printed find it illuminating. SALTERBAXTER of economic, social and environmental pressures We’ve thrown downFSC (Forest Stewardship Council) the gauntlet on how salterbaxter-rethinktank.com LUCIE HARRILD involved. There are uncomfortable trade-offs at every businesses need to engage in the toughest of Horne certified. Supplied by Robert www.roberthorne.co.uk hEAD of CR PRACTICE, turn and even some generally held beliefs exposed sustainability issues. And as part of the debate we SALTERBAXTER as myths. The issues we If you would like to find put in the spotlight are: have launched the Re-think printed This is a place certified Text tank. on Think Bright, FSC with 50% recycled content. Supplied by Biofuels – saint or get in Packaging – scourge of out more, please sinner? where everyone can air their views, discuss possible Howard Smith www.hspg.com touch: the developed world or energy and waste saviour? ways forward, find information and network to find For more information on FSC go to And China – derailing global sustainability or partners who are tackling the same things. Discussion www.fscpaper.co.uk Nigel Salter alleviating poverty and implementing world class and debate is essential for progress, so ISO 14001 certified log on to Printed by CTD, an nsalter@ salterbaxter.com technologies? Plenty of debate there. environmental www.salterbaxter-rethinktank.com to have your say. and FSC accredited company. Louise Dudley-Williams TT-COC-2142 ©1996 Forest Stewardship Council A.C. www.ctdprinters.com ldudley-williams@salterbaxter.com Copyright © 2008 salterbaxter Copyright © 2008 salterbaxter SALTERBAXTER DIRECTIoNS 2008
  3. 3. 02/03 531 million 6.7 billion vehicles on the road people in the world hunger For Fuel Five hundred million cars, one planet. our thirst For carbon intensive Fuels means something has to change. is it possible For Food every second Five people are born and two people die. with an extra three mouths a second to Feed, can we that bioFuels still hold the answer? aFFord to lose crop growing land to bioFuel production? During 2008 we’ve seen biofuels go from the answer to our prayers on transport and climate change, to the pariah of the world’s food supply and agents of rainforest destruction. So which one are they? Well it’s just not that simple. Crops that take over food-growing land, or cause the clearing of our precious rainforest carbon sinks can’t be a direct substitute to fossil-based fuels. But is that the end of the road for biofuels? What are the alternatives? And after the early rush of enthusiasm, what should a business do with commitments already made? Should others continue to introduce biofuels into carbon management programmes and green transport policies? With a changing agenda, knee-jerk reactions to this issue won’t do the business or the agenda itself any good. But it’s not clear which way to turn – our three contributors shed some light on how they see this issue developing. SALTERBAXTER DIRECTIONS 2008 SALTERBAXTER DIRECTIONS 2008
  4. 4. BIOFuElS 04/05 can bioFuels maKe a positive diFFerence? is their impact really understood? dr peter cotgreave preordained dogma. What is required is rational the considered approach to biofuels DireCtor of PuBliC AffAirS, debate based on all the available evidence. the technology taken by the uK and eu so far offers Can biofuels help? The answer the royAl SoCiety royal Society recently published a report based on hope for the future. Policy must provide industry is yes provided they are produced a year-long study that concluded that biofuels have with a clear way forward so that long-term energy is one of the biggest issues in the uK. real potential but that we must have the systems in investment can be directed with confidence to efficiently and sustainably. how do we meet our growing energy needs while place to ensure that investment is put into the most ‘good’ biofuels. industry must in turn ensure that also tackling climate change and doing all of this efficient and sustainable types and practices. it is responsible in its investment, ensuring that in a secure environment? it is an incredibly complex We are at a critical point in relation to biofuels supplies are properly assessed for their overall agreement in March 2007 to introduce a renewable problem, yet if you are to believe the hype of various policy. the uK and eu have suggested adjusting impact. those who chase the quick and easy energy Directive with binding targets for renewables lobby groups you could be forgiven for thinking it is the targets, to allow time to gain a greater profit could destroy the biofuels industry and and biofuels. not. Soundbite campaigning has become the order understanding of the impacts of these biofuels. deprive us of a useful tool in tackling climate transport accounts for one quarter of all of the day, with each technology in turn pitched as they have recognised the problems but have not change and energy issues. greenhouse gas emissions. however, transport a silver bullet or a catastrophe with ‘evidence’ to forgotten the fact that there are examples of ‘good’ is the only significant sector which has not shown back up the case. in this environment it is difficult biofuels which can play an immediate and important a reduction in emissions against the 1990 Kyoto for policy-makers to make rational decisions based part in helping to tackle climate change without baseline year. on the contrary, transport emissions on an assessment of all the evidence. triggering other crises. have increased sharply – by 12% in the uK – and the current debate on biofuels is a classic Biofuels must be part of a sensible debate are continuing to rise. the conclusion is clear: unless example of this. We have seen biofuels presented about energy that looks at all the technologies. transport emissions are brought under control, as a totally green alternative to fossil fuels and that debate must include energy efficiency and longer term climate change goals will be jeopardised. massive subsidies thrown at specific crops in some seek to address the need to meet energy demand But can biofuels help? the answer is yes provided countries. We were then told that biofuels were the and effectively tackle climate change while not chris carter they are produced efficiently and sustainably. main reason for global food shortages and rising creating other serious problems. DireCtor of CorPorAte AffAirS, on 22 November 2007 lord rooker, on behalf prices. the fact is, like most things, it is never that Science and technology underpin most of BritiSh SugAr PlC of DefrA, opened the uK’s first bioethanol plant simple. Assessing these fuels is a complex task our lives. electricity, transport, computers, phones, at British Sugar’s Wissington facility in Norfolk with made even more complicated by the diversity of products that fall under the biofuels banner. it is this diversity that makes it foolish to iPods, medicines – without science we would have none of these things that we take for granted. it also offers us the potential to solve many of the problems 55,000 tonnes per year is the Biofuels are being introduced throughout the world to address two main issues: climate change and fuel security. Because they are produced from renewable a capacity of 55,000 tonnes/year. this delivers a greenhouse gas emissions saving of 71% reported under the uK’s renewable transport fuel obligation decry the technology and call for blanket moratoria. that we face. Whether it is meeting energy needs, capacity of the UK’s sources like plants or waste materials, biofuels (rtfo), compared to petrol. it is also highly We should be looking to see what practices in the tackling climate change or feeding the world – we first bioethanol plant. can make a contribution by avoiding burning fossil sustainable. Detailed standards governing soil, air, industry are causing problems and seek to replace need to make our judgements and our policy based energy reserves and lessening dependence on water, biodiversity and social operating practices them with good practice that is also common. on real evidence about the risks and benefits. oil imports. the relative importance of these two are set out in a sustainability manual, available for these good and bad practices do not only objectives depends where you are. in Brazil and the public scrutiny. relate to what crops are being used. We also need uSA, biofuels programmes have been introduced At a time when biofuels are under the spotlight, to look at where the crops are being grown. Are they displacing food crops, are rainforests being cleared to grow them, can they be used to restore degraded We are at a critical point in relation 12% increase in UK mainly for fuel security reasons. in Britain the main driver is climate change, although continued high oil prices may increase future emphasis on this British success story demonstrates that biofuels can make a positive and immediate contribution to tackling the urgent issues of transport emissions and land, are people being exploited in the farming of to biofuels policy. The uK and Eu transport emissions, fuel security. fuel security. them and many other factors? have suggested adjusting the targets, and continuing to rise. Both the eu and uK regard climate change government support is needed to introduce, in relation to the increase in global food prices as a key policy issue, and have set ambitious goals and enforce, performance standards in the rtfo to allow time to gain a greater caused by biofuels we have seen estimates that to address it. the uK has taken a lead in europe and renewable energy Directive to ensure that range from 3% through to 75% and the lobbyists understanding of the impacts of by agreeing a long-term target to cut emissions by biofuels – from all sources – deliver what they on all sides will choose the numbers that best fit their these biofuels. 60% by 2050, and supported the eu heads of State claim to. To you have r sa sal y go reth terbax to inkt ter- a dire nk.com cti / biof ons/ uels SALTERBAXTER DIRECTIONS 2008 SALTERBAXTER DIRECTIONS 2008
  5. 5. BIOFuElS 06/07 3 reasons to thinK hard about bioFuels – unless the industry taKes action this year sagariKa chatterjee rainforests and peat bogs – these are critical carbon to find industry solutions to sustainability challenges. ASSoCiAte DireCtor, sinks and in need of protection to mitigate the Biofuels could be a real climate Biofuels could be a real climate change solution, f&C ASSet MANAgeMeNt PlC impacts of climate change. change solution, but investment must but investment must be put into the most energy- efficient and sustainable types. in 2006, the capital markets witnessed a series of 2 Is the company exposed significantly be put into the most energy-efficient governments should not throw out biofuels initial public offerings (iPos) of biofuel companies. to political risks? and sustainable types. targets, but instead review how incentives and Promising high returns, energy independence and Biofuels crops have been criticised for public policies can encourage a sustainable biofuels a way to reduce greenhouse gas emissions from competing with food crops and contributing to food industry. in addition to Brazilian ethanol, there are transport, the fledgling biofuels industry shot to price inflation, severely impacting the food intake savings than many first generation biofuels. other biofuels that offer carbon savings, including prominence in the City as the latest hot investment. and nutrition of low-income people in emerging however, second generation biofuels are far from biodiesel based on used cooking oil and ethanol two years on, chastened by a series of profit markets. Biofuels were discussed at the uN’s recent commercialisation and still in the research and from municipal waste. greenergy international is warnings that have disappointed investors, World food Summit, but countries were unable to development stage, with virtually no opportunities among a handful of biofuels producers managing the biofuels industry has been stunned by an reach any agreement on the extent to which biofuels for an investor such as f&C to invest in publicly carbon savings and sourcing impacts proactively; aggressive political backlash, led by environmental contribute to food security concerns and failed to listed second generation biofuels companies. it buys ethanol from Brazil, palm oil from members campaigners, that has steadily snowballed into a agree on public policies for tackling this. it remains f&C’s analysis is that the biofuels industry of the roundtable on Sustainable Palm oil and soy chorus of concerns voiced by united Nations’ food unclear to f&C to what extent biofuels have partly has itself to blame for the political backlash. from members of the roundtable on responsible Soy. and agriculture officials and the organisation for contributed to food price inflation, with potential Companies underestimated the supply chain in spite of the obstacles, it may yet be possible economic Cooperation and Development (oeCD). contributory factors including land availability, environmental risks involved in feedstocks for to create a sustainable biofuels industry. to rebuild for investors like f&C, who seek to invest in population growth and speculation. one thing is biofuels; they miscalculated political concerns public confidence and to deliver sustainable climate change solutions, first generation biofuels clear – the lack of agreement among global public about food security and food price inflation; they investment returns, the biofuels industry must take producers have become unattractive as investment policy-makers increases political uncertainty for mistakenly believed that governments would turn action in 2008. f&C encourages companies and opportunities. Biofuels present political risks, with investors. Meanwhile, campaign groups have a ‘blind eye’ to negative impacts when devising government to take the following four key actions speculation that governments may reverse current questioned how smallholder farmers will benefit biofuels targets; and they failed to work together before the year end: biofuels-related targets and incentives, and exposure from biofuels, and allegations of human rights to commodities markets means profit margins are abuses have surfaced; including forcible removal squeezed. in looking at any company involved in of farmers to make way for biofuels crops in biofuels, our three main concerns are: Columbia, and of slave labour on Brazilian FOuR KEy aCTIONS TO CREaTE a SuSTaINaBlE BIOFuElS INDuSTRy sugarcane plantations. 1 3 1 are the carbon savings genuine? Governments need to set a clearer Global industry-wide standards must Brazilian ethanol, derived from sugarcane, 3 are second generation biofuels on the horizon? political and regulatory framework for be implemented to ensure biofuels have produces less greenhouse gas emissions than oil and gas majors, including BP, Chevron and a sustainable and competitive biofuels a net positive impact on ecosystems. conventional transport fuels, but uS corn-based total, have made investments in second generation industry, and remove European and US This needs to happen fast, as biofuels ethanol has emerged as energy intensive; and biofuels (e.g. lignocelluloses), which may have lower trade barriers such as tariffs on Brazilian ethanol producers face a profit margin squeeze due to in some cases produces more greenhouse gas sustainability impacts and offer higher carbon imports. Governments need to promote investment rising commodity prices, and many are sourcing emissions than are saved. A further concern is the in new technology, as this will be key to the low-cost feedstocks regardless of the long-term extent to which uS corn-based ethanol contributes industry’s success. Biofuels policies must enhance environmental damage they cause. The new to food price inflation; faced with government Biofuels producers face a profit margin climate change prevention strategies and subsidies Roundtable on Sustainable Biofuels presents subsidies for ethanol and protection from cheaper squeeze due to rising commodity prices, should be linked to achieving real carbon savings. an opportunity for this. Brazilian imports, uS farmers have switched from and many are sourcing low-cost 2 4 producing food crops to producing crops for ethanol. The biofuels industry needs to work The industry must engage more actively environmentalists have also linked biodiesel based feedstocks regardless of the long-term more closely with governments to promote in the public debate about biofuels and on palm oil with the destruction of tropical environmental damage they cause. political objectives on carbon savings, demonstrate transparency on carbon technology, food prices, food security savings and sourcing impacts. The and international development. biofuels industry stands at a crossroads and must To s The industry also needs to collectively address public concerns. If companies h thou are yo encourage governments to do not convince the public that they will move g ur salt hts go support easier distribution towards sustainable business models, they may find ret erba to of biofuels. that governments change course on the targets and hink x ter- ta subsidies that are driving their industry’s growth. dire nk.com ctio / biof ns/ uels SALTERBAXTER DIRECTIONS 2008 SALTERBAXTER DIRECTIONS 2008
  6. 6. 08/09 ARE WE ENVIRONMENTAL SAINT OR SINNER? THE PARADOX OF PACKAGING DICK SEARLE SUFFOCATING chIEf ExEcUTIvE, ThE PAcKAGInG fEDErATIOn Where did all this packaging come from? 50 years ago very little of the packaging that exists today had even been invented. As the affluence of the consumer society increased dramatically, there was a seismic change in the variety of packaging UNDER THE available in all types of materials but particularly in plastics. This was driven by customer demand for a wider range of products and convenience and led to the explosive growth in supermarkets WEIGHT OF THE (which wouldn’t exist without modern packaging) – accompanied by moves to weekly shopping as storage facilities in the home developed and packaging enabled product protection including vastly extended product lifetimes. Many brands PACKAGING and sectors were also ‘created’ and defined by their packaging. So is packaging as big an issue as consumers, the media and politicians seem to think? Particularly at a time when PROBLEM? food prices and security of supply are a major issue? Overall, our packaging ‘consumption’ in the UK puts us at number seven in the EU league table and our growth per head is one of the lowest – indeed in the last seven years, packaging growth at 3% is less than one fifth of GDP and consumer spending growth over the same period. So what are its real environmental impacts? Packaging is highly visible, particularly once it is used. It receives an enormous amount of media and It has to be said, packaging gets a lot of bad press. Whether it’s plastic bags at political focus – at a level wholly disproportionate to supermarkets or over-packaged items using an array of plastic and cardboard, most its true impact. Less than 20% of household people have a pet hate linked to packaging. Landfill is full of it, recycling rates aren’t waste is packaging and the amount of packaging climbing quickly enough – and nobody wants rubbish in hedgerows or on beaches. going to landfill is less than 3% of total landfill. It feels like we are suffocating under a mountain of packaging waste. Its carbon footprint is less than 2% of the UK’s footprint and the carbon impact of the wastage But is it really that simple – is packaging really the scourge of our society? Would we that it prevents would be much higher than be better off without it? Should other consumer issues be getting more attention? The this figure. The growing use of plastics for load paradoxes within the packaging debate make it difficult for businesses to explain where wrapping has also enabled transportation efforts should be focused. We’ve asked Dick Searle, Chief Executive of The Packaging economies as lighter loads are moved. Federation and Alasdair James, Director of Waste, Recycling & Packaging at Tesco plc The whole issue of the material used is highly to drill a bit deeper into the packaging paradox – waste creator or waste saver? complex with the first consideration always that the packaging works. Environmental impact covers a range of issues including carbon footprint, SALTErBAxTEr DIRECTIONS 2008 SALTErBAxTEr DIRECTIONS 2008
  7. 7. Is fresh thin PACKAGING to prolong king needed 5 10/11 our shelf li recyclability, ‘sustainability’, replenishability and security of supply are a major issue? A recent Without pa ckaging, w fe? have to reve e would eit rt her weight. not one of these should be the sole survey by one retailer discovered that twice seen in the to shopping pattern determinant of the material used. It is the overall as many of its customers were worried 50s or watc s last accelerate h net environmental impact that has to be assessed about ‘excessive packaging’ as were worried as the incre climate change sends meth ase in food – providing the pack functionality is correct. about global warming! As a result of modern ane levels waste soaring. packaging and distribution methods, food The problem is that most consumers look waste in the UK is 3%, where in less developed countries like russia and India, at used packaging with little thought for food waste is +40%. With food supply, the role that it’s played in getting goods safely from producer to point of usage. security and cost at the forefront of most DITCH PACKAGING? Best before : Better than packaging? before Waste: consumers’ minds, packaging is playing NOT AN OPTION Would incr Energy: Lots wasted ea without pa se dramatically a vital role in minimising waste and wrong issu on the ckaging? contrary to popular belief, the whole maximising availability, choice and value. es? Price to pa y: Potentially high? packaging supply chain has been working for The Government’s obsession with ALASDAIR jAMES decades to minimise the impact of packaging. ‘one-trip bags’ as an environmental menace director of waste, Most recently, the focus has been on primary and a totem of the throwaway society is recycling & Packaging, packaging but a substantial amount of packaging another example of getting it wrong. True, tesco Plc is used for actually getting the goods into retailer they are very unsightly as litter but they outlets and is never seen by consumers. And most don’t throw themselves away – people do it! it sometimes feels as if packaging carries the weight 4 Can we reuse it? of what is seen as excessive is more to do with gift Prompting behavioural change is good but of the nation’s environmental ambitions on its Packaging and recycling should always Household experience or retail methodology including theft leading the public to believe that bags are shoulders: if we can banish it, we will be cured from be considered together. as the Uk government waste minimisation. The problem is that most consumers a major threat to the environment is not every eco-ailment around. of course, this simply continues to build a coherent recycling look at used packaging with little thought for the – it trivialises a very important debate. isn’t true. without packaging, we would either have infrastructure, we can support them by choosing Less than role that it’s played in getting goods safely from producer to point of usage and the role it continues A recent Government advertising campaign pointed out that 40% of carbon emissions to revert to shopping patterns last seen in the 50s or watch climate change accelerate as the increase to use packaging that most councils accept for recycling – such as Pet – over materials like PVc 20% to play in preserving products until they are used. were linked to household activities such in food waste sends methane levels soaring. which few can handle yet. of household waste Arguably, the biggest area of criticism is fruit, as car use and home heating – massive However, this highly tangible example of waste is packaging vegetable and meat packaging in supermarkets contributors to the UK’s footprint – and is important to our customers and, as a responsible 5 What’s its carbon footprint? (mostly in plastics) and yet this represents just massively more than that of packaging. If the – and responsive – retailer, we are doing what we when thinking about how you pack a product, 1% of all packaging used. What consumers don’t Government wants to see a serious reduction can to reduce it. it pays to look at the big picture, not just the product see is all the packaging used to get goods into in consumers’ carbon footprints, it needs to we have approached the problem by introducing in isolation. we’ve done a great deal of work recently Packaging store which are then sold loose. A recent survey stop trivialising the message by focusing on a simple check-list which allows us to make the best to understand carbon footprints and know that, by one retailer showed that more energy was used issues like packaging. decisions for the environment. while packaging typically makes up a small part of in ‘loose’ apples than those pre-packed in fours. the overall footprint, there are opportunities here to Less than And another retailer saw wastage levels double when all their fruit was sold loose – and the Whether packaging is a ‘Saint’ 1 Does it do its job? it hardly needs saying but the whole point of make a real difference. we now receive new world wine in barrels and bottle it ourselves in this country 2% environmental impact of that waste was far or ‘Sinner’ will be, like beauty, packaging is to keep a product in peak condition to save thousands of tonnes of glass from being of the Uk’s carbon greater than that of the packaging ‘saved’. in the eye of the beholder. until it has reached the customer’s home or been shipped half way round the planet. this new footprint And what about all the focus on recycling consumed. this is why, despite some vocal approach is cheaper, more efficient and much – and should we countenance the remainder being As long as consumers want to buy the opposition, we still sell soft fruit in sturdy plastic better for the environment. put into landfill? The packaging industry welcomes widest range of goods all day and every day, trays. without them, millions of strawberries, the use of recycled materials but the availability there will be a need for modern packaging. peaches and avocados would wind up in the bin. By 2010, we aim to have reduced the packing Food waste of these is constrained by the quality of recyclate Without it, there would have to be a return to on all the products we sell by 25%. it is a stretching currently delivered from the household waste living styles of 50 years ago. There would be 2 Can we use less of it? target but, by stating our ambitions clearly, we stream. consumer concern is primarily prompted no supermarkets, much less choice, vastly we spend £600m every year on packaging know that everyone in our business – and in all Only by the apparent lack of facilities in many areas for the collection of waste packaging. The extent to increased product wastage and a general return to austerity experienced only by those of us of so it is in our interest to keep on finding ways to reduce what we use. this can be a simple case of those businesses that supply us – can appreciate what we are trying to achieve. 3% which plastics should be recycled in the UK is a more advanced years! The packaging supply light-weight wine bottles and tin cans, or rethinking the real challenge now is to communicate matter of considerable debate – particularly in the chain will continue, as it has for many years, how we package a whole range. last year, we to our customers the reductions we are making in the Uk’s supply chain context of what makes most environmental sense. to strive to minimise the impact of packaging dropped bulky blister packs from our electrical and why the packaging that remains is essential, Our performance in using unrecyclable packaging whilst continuing to provide the wherewithal products and used shrink wrap instead. we saved and not the whim of unthinking manufacturers or waste (mostly plastics) for energy production is for consumers to live as they do. Life is about 72 tonnes of mixed packaging as a result. retailers. we must get better at explaining why one of the poorest in Europe so we shouldn’t be choices and as long as consumers choose to strawberries sold in a plastic tray are likely to be sending to landfill those materials that could be live as they do now, modern packaging will 3 Is there a better material? greener than those without, and we must help To r e used to generate energy. There is an urgent need continue to be an integral and necessary part them to embrace innovations that may not feel M&S ad ab once we’ve thought about the perfect design, ’ vie out salt w for more joined-up thinking between local of their lives. Whether packaging is a ‘Saint’ we can think about the best material to make it from. quite right first time, like wine sold in cartons or reth erba go to authority, industry targets and improvements or ‘Sinner’ will be, like beauty, in the eye of we are trying to increase the amount of recycled shower gel in pouches. inkt xter a - in packaging recycling. the beholder. But, as a major contributor to content in the materials we buy. for instance, we there is still a lot of work to be done but dire nk.com ctio / So is packaging as big an issue as the way in which society functions, it’s difficult now sell our freshly baked buns and cakes in clear it is work worth doing – and our customers will pac n kag s/ consumers, the media and politicians seem to to see many products which have made a plastic boxes made from 50% recycled Pet. thank us for it. ing think? Particularly at a time when food prices and more significant change to consumer lifestyles. SALTErBAxTEr DIRECTIONS 2008 SALTErBAxTEr DIRECTIONS 2008
  8. 8. 12/13 ENVIRONMENTAL DEGRADATION vs ECONOMIC GROWTH IN CHINA: IT’S NOT AS BLACK AND 80% of the world’s zips and toys WHITE AS A PANDA are produced in China YET 58% of Chinese exports come from foreign-invested enterprises A growing economy 106 billionaires in Chin ent BUT a damaged environm YET there are 300 milli a on people living below the povert China is now buildin y line g 2 power stations ever y week BUT it is set to become the w largest producer of orld’s wind power by 2020 The US produces 19 tonnes of CO2 per capita BUT China produces 10 million people with no access to only 4.7 tonnes electricity BUT by 2020 there may be 140 millio n cars on China’s roads When you look at the facts and figures, China’s development rate can be mind LEO HORN-PHATHANOTHAI but public debate has often been one-sided and boggling. On the one hand, millions are benefiting from an improving economy vindictive: politicians and the media alike have NatioNal CoordiNator, and opportunities. On the other hand, millions are locked in poverty and oppression UK-ChiNa SUStaiNable over-indulged in vilifying China as the number one and the environmental cost of that developing economy is almost catastrophic. developmeNt dialogUe, global eco-delinquent. this narrow typecasting of deFra China as villain is fundamentally misleading and So how do foreign, responsible business investors reconcile their role working with blinds us to the opportunities that China’s arguably the most important economy in the modern world, which is also a country China’s environmental crisis has caused much transformation presents us with. of contradictions? there are no easy answers, but leo horn-phathanothai, National public concern in the West. this is understandable: China’s environmental ills have been widely Coordinator for the UK-China Sustainable development dialogue, deFra, discusses as the world’s top emitter of greenhouse gases, documented and reported on. many of the dizzying the changes in China. China’s domestic environmental problems have statistics about China’s air and water pollution, global impacts, and therefore should concern us all. its acquisition of natural resources abroad, and its SALTERBAXTER DIRECTIONS 2008 SALTERBAXTER DIRECTIONS 2008
  9. 9. ChINa 14/15 all this is significant because it means that Underlying all this is the reality of global China has the potential to be a major positive interdependency. this interdependency is ecological influence on the international scene. by dint as well as economic. China is the global manufacturing of its sheer market size, whatever technology hub of the world. export trade rather than domestic China adopts is likely to become an industry norm. consumption is driving China’s growing pollution China will be an increasingly important contributor and resource demands. the average Chinese to the setting and protection of global standards. person in fact consumes very little: 48% of Chinese live in China 1.3 billion people as a heavyweight in global trade and environmental gdp goes to savings. on the other hand, China is ther than r t trade ra ption is driving negotiations, China will have a strong vested interest the world’s third largest exporter, after the United Expo in creating predictable international environmental States and germany. onsum domestic c ing pollution rules under which its businesses operate, and w AND the average China’s gro under which its own goods and services are traded. there is of course an important moral On a more upbeat note, China’s life expectancy is 72 dimension to the debate that needs to be taken into account. alongside pollution and environmental environmental crisis is also presenting depletion, poverty reduction has been the most huge commercial opportunities that the notable output of China’s rapid growth. indeed international business and investment China has rendered a great service to humanity: communities are just waking up to. without her we would be nowhere near achieving the millennium development goal of halving impacts on global commodity markets are well poverty in the world: China has been responsible Significantly, most of China’s exports are coverage rate, and treatment of 70% wastewater known, and will not be repeated here. Suffice to for 80-85% of global poverty reduction in the primary goods or manufactured products that create and 60% residential garbage in urban areas by say that China’s environmental crisis is real and last 20 years. heavy pollution and require intensive resource uses. 2010. these objectives are backed by a raft of it is planetary in scale. China’s per capita ecological footprint is still a whopping 40% of China’s energy use goes into measures designed to mobilise massive investment as a resident of beijing, i am reminded of low, at 1.5 global hectares per person, compared its exports. With tighter environmental regulation and knowledge transfers from the private sector. this almost every day as i breathe in the thick soup to a world average of 2.2, a whopping 9.7 for the in the West, the manufacturing of many energy- these cover legislative change, fiscal and financial of cough-inducing urban smog. it is worth recalling United States and 5.6 for the UK (according to intensive goods has shifted to China. this means incentives, regulatory reform, public private however that air pollution is not a modern Chinese the WWF). We should be fair. economic growth that the West has effectively outsourced much of its partnerships, training and education, and subsidies invention: not very long ago (in the winter of 1952) is fundamental to China’s future and China has a energy consumption and pollution often to facilities to research and development. the ‘london fog’ claimed the lives of thousands right to develop. with lower efficiency and environmental standards perceptive investment analysts such as of people. if one could peer back in time from the in China. morgan Stanley’s Stephen roach see in these london eye, the view in the 1950s would not have in short, we are getting all the ‘goods’ at changes signs of a new ‘commodity-lite’ model of been worth the ride! a cheap price, while China absorbs most of the development in China, “in effect retrofitting China’s the broader point here is that China is in the In short, we are getting all the ‘goods’ ‘bads’ such as pollution and a depleted environment. commodity-guzzling production platform with more midst of its industrialisation drive, and nowhere responsibility, clearly, is shared. commodity-efficient technologies”. the government has this kind of transformation been a clean one. at a cheap price, while China absorbs the Chinese government has set specific is indeed stepping up its investment to support this by 2015 China will have completed its first round most of the ‘bads’. targets for environment conservation in its current economy-wide environmental upgrading. of industrial modernisation, by which time it will five-year plan, including reduction in energy intensity the environmental protection industry in have reached a level of economic development by 20%, reduction in the emission of major particular will benefit from targeted programmes comparable to most western countries in 1960. pollutants by 10%, attainment of 20% forest of support aimed at building up specific market in the sixties the environmental movement had segments. Key industries benefiting from policy only just started to emerge in the US. support include water treatment, air purification, in comparative terms the Chinese government natural gas, hydropower and solar power. these is responding much sooner and resolutely to the market segments have huge growth potential. environmental problems caused by industrialisation. deutsche bank predicts the growth of demand for the government’s macroeconomic plan for 2006-10 water treatment, waste gas treatment and natural is the nation’s first to focus on a comprehensive gas will reach 20% per year and that for solar power range of sustainable development priorities. will be as high as 35% per year. China is also serious about meeting the international thus China has become a global laboratory commitments it has made. the recent White paper of change and an incubator of technological, design on environmental protection in China reaffirms and policy innovations. To you have China’s commitment to sign and ratify international We can point fingers and cry foul play, but r sa sal y go obligations. Under the montreal protocol, China ible for we’ll have much more to gain from constructive reth terbax to has already adopted more than 100 policies and China w as respons over t y engagement with China. China is hungry for the inkt a dire nk.com ter- global p 0-85% of the last 20 years measures to reduce ozone-depleting substances technology, investment and know-how needed to ctio / (odS), accounting for half all odS eliminated by 8 remedy the damaging consequences of economic chin ns/ in reduction developing nations. growth. responsible governments and smart a businesses should see vast opportunities in this. SALTERBAXTER DIRECTIONS 2008 SALTERBAXTER DIRECTIONS 2008

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