It's at the heart of what we do - Corporate Responsibility Review 2012 - Tesco PLC
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It’s at the heart of
what we do.
Corporate Responsibility Review 2012
Contents
What’s this
review about?
Chief Executive’s introduction 2 With operations across Asia, Europe and North America
Being a responsible business 4 there are thousands of examples of how we’re working
with customers, suppliers, charities, NGOs and local
Our seven part strategy sets out clear
Our Community Promises
Our approach
6
7
communities to fulfil our Community Promises. goals for the business to ensure we deliver
Our performance 8 This review can’t include all of them, however, we hope long-term sustainable growth. Putting our
it demonstrates that we put the communities we serve
A focus on:
• Providing good quality,
at the heart of what we do. It explains how we develop responsibilities to the communities we serve
safe and affordable food 10
our corporate responsibility strategy and manage our
performance. It also looks at some of the challenges
at the heart of what we do is an essential
• Helping our customers make
healthier and greener choices 12
we face as a global business and important areas
where we are making a difference to our customers,
part of it. By operating responsibly and
• Our journey to zero-carbon 14 the environment, our people and our suppliers. working with customers, suppliers, expert
• Working with our suppliers
• Building our team
16
20
If you have a particular area of interest that hasn’t partners and NGOs our hope is that we can
been addressed here then please visit our website
• Actively supporting to find out more. leave the world a better place; a greener,
healthier and more prosperous place than
local communities 22
Community activity around
the Group 24
when we began.
Managing our responsibilities 26
Informing our strategy 28
Scan here to visit the Corporate
Where to find out more 30 Responsibility homepage.
Our seven part strategy
Our carbon footprint 32
1 2 3 4
When this icon appears throughout the document,
Awards IBC you know that information can be found online. To grow the To be an To be as To grow retail
UK core outstanding strong in services in all
international everything our markets
Unless otherwise stated, the statements and data retailer in we sell as we
relate to our financial year 2011/12, the period
March 2011 to February 2012. This is the period of
stores and are in food
activity that we are referring to when we describe online
an activity as taking place ‘this year’. The report
covers the markets in which we have continuing
operations. This excludes Japan which has been
5 6 7
treated as discontinued following our decision to
sell the business in August 2011. In India, we have
an exclusive franchise agreement with Trent, the
retail arm of the Tata Group. We are supporting
To put our responsibilities To be a
creator of
To build our
team so that
the development of their Star Bazaar format.
We don’t include data from this franchise in
to the communities we highly valued we create
our KPI performance or carbon footprint. serve at the heart of brands more value
what we do
Tesco PLC Corporate Responsibility Review 2012 1
Chief Executive’s introduction
It’s just over a year since I set out the new strategy for
the Group, a strategy that put the communities we
serve at the heart of what we do.
www.tescoplc.com
I’m determined that every Tesco store We faced a different kind of challenge Creating jobs and developing I’m determined
We also work with hundreds of local
and every Tesco business is valued and this year when several of our UK stores producers to get their products into
trusted by local people because we do came under attack during the summer
leaders of the future that every Tesco our stores. This year across Europe we
Investing in future leaders is vital for a store and every
the right thing. I believe that our half a riots. Our people showed real bravery organised a series of events to give local
growing business. This year we opened Tesco business
million people around the world truly can and community spirit; many staff slept suppliers an opportunity to meet our
our new zero-carbon training academy in is valued and trusted by local
make a difference to the communities in stores overnight to keep them open. buyers and we’ve listed hundreds of
Asia. This offers the latest in technology-
we live and work in. people because we do the new local products. Many suppliers start
I am proud to see our staff living up to led learning, making use of smart
the Tesco values: ‘no one tries harder technology, e-learning and tablet right thing.” supplying a few local stores and over the
Facing into challenges years they grow with us, finding export
It has been a difficult year for customers for customers’ and ‘treat people how we computers – so it’s not just our customers
opportunities far and wide, ranging from
and their communities. Economic like to be treated’. Events such as those that are benefiting from our internet
South Korea to the Republic of Ireland.
uncertainty and rising living costs above are a reminder of the strength of capability! It has been a record year for
continue to weigh on consumer local communities and how people turn graduate recruitment round the world, Doing the right thing
confidence around the world. However, to them in times of need. They are also a with over 700 posts filled. In this Review you will read some
I take great pride in the way our business reminder of the importance of providing highlights of the many ways in which we
One of the great things about Tesco is
has responded in these difficult times. customers with good quality, affordable are fulfilling our Community Promises
the opportunity we have to change lives.
food, whenever they need it. around the world and how we’re making
I was humbled by our staff’s reaction to You can join us without qualifications and
get the training and skills to set you on a a difference.
the floods in Thailand: through total Helping customers lead
dedication they managed to keep most career path for life. In the UK we are the 2012 will be a year of getting back to
healthy lives largest private sector employer of young
of our stores open. Even with their own We recognise our role in helping doing what we’ve always done best –
homes under water, our people put their people. We’re creating 20,000 new jobs providing the best possible shopping trip
customers lead healthy lives. We are
community first, giving up days off and over the next two years and will expand for our customers – but it will also be
developing more healthy products,
spending hours travelling to work by boat our successful apprenticeship about making sure that we are a business
such as our US eatwell range and our
to ensure customers had access to food. programme, offering 10,000 places that gives something back to society.
Goodness range for children in the UK
We provided temporary accommodation for both new and existing staff. You will see Tesco doing the right things
and the Republic of Ireland. Millions of
and transport and helped the nation get people get active through our sporting I’m immensely proud of our record of for all its stakeholders – customers,
back on its feet. events including our record breaking helping people into work. I recently communities, suppliers, shareholders and
aerobics programme in Thailand. Nearly visited my home town of Liverpool and staff – and that means listening more,
Tragedies like this heighten concerns
a million children benefit from our FA heard first-hand about the impact we behaving responsibly across the business
about climate change. So we have set
can have locally. Last May we opened and measuring ourselves against the
ourselves very clear, ambitious targets to skills football programme and hundreds
a Regeneration Partnership store in the highest standards.
reduce emissions. Tesco is ready to adapt, of thousands of women keep fit by
with resilient operations that can deliver running Race for Life each year, raising Toxteth area, one of over 40 such stores I’m confident that we are ready to tackle
for customers when they need us most. money to fight cancer. in the UK. It is the first significant whatever challenges lie ahead and that
Our progress has been recognised by the investment in the area in 30 years and we can continue to make a lasting,
Carbon Disclosure Project which named we had over 6,000 job applications for positive contribution to the communities
us top retailer in the world. that single store. A third of our new we serve.
recruits were long-term unemployed.
It is their store and they are proud of it.
Watch our Thai floods and Toxteth Regeneration Partnership videos:
www.tescoplc.com/thaifloods Philip Clarke
www.tescoplc.com/toxteth Chief Executive
2 Tesco PLC Corporate Responsibility Review 2012 Tesco PLC Corporate Responsibility Review 2012 3
Being a responsible business What we do
We have operations across Asia, Europe
and North America. The core of our
Our community
Our business employs over half a million
people around the world and millions of
Staff throughout our business work
tirelessly to support communities as they
business is providing customers with a people in our supply chain depend on us go about their daily jobs and through
wide choice of good quality food, general for their livelihoods. Making a positive the activities discussed in this review.
merchandise, electricals and clothing, at contribution to the communities we serve
Our vision for the future is for Tesco to be the most highly valued Our Values: the right price. is the right thing to do for a responsible
Corporate responsibility is integrated
throughout our business model.
business in the world. Valued not only by our customers, but also • No one tries harder We also operate a range of retail
business seeking sustainable growth.
by the communities we serve, our loyal and committed staff and for customers services including telecommunications When we talk about community,
our shareholders. We are and we will remain a growth company. • Treat people how we and banking. we mean our customers, our people,
like to be treated our suppliers, our shareholders, our
We will be a modern and innovative company and we will win neighbours, and the charities and
locally by applying our skills globally. NGOs that represent them.
Business model
Building Core activities Enablers
the Tesco Buy Operating responsibly
brand We work with our suppliers across our markets to Having community as part of our ‘Steering Wheel’ means
develop great products that are sourced responsibly – that corporate responsibility is not a specialist function:
minimising their impact on the environment and it’s part of everyone’s job – see page 7.
ensuring everyone in our supply chain is treated with
Innovating our offer
respect – see pages 16 and 18.
Develop Innovating our customer offer is essential to meet
Sell Insight
more economies Move customers’ changing needs. That includes finding
of scale Leveraging Optimising our networks, maximising fuel economy and innovative ways to help customers make healthier and
Innovating
our offer
Group skill championing alternative forms of transport such as rail greener choices – through product development, new
and scale helps reduce emissions associated with our distribution services and incentives. We also develop solutions to
network – saving money and carbon – see page 15. minimise our environmental impact – see pages 12
and 14.
Sell
Our stores are at the heart of the communities we serve. Building the Tesco brand
We support these communities by providing them with Protecting and developing our brand reputation is the
Core purpose:
Sell To create value Buy good quality products at affordable prices, through foundation of customer loyalty. Being a responsible
for customers to education initiatives and through our charitable work – business is an essential part of our brand reputation
earn their lifetime see pages 10 and 22. which means doing the right thing for all stakeholders.
loyalty
Insight Leveraging Group skill and scale
We go to great lengths to listen to stakeholders. This We are bringing our expertise in retail and supply chain
helps us to develop our strategy, plan our community management to all of our countries of operation. We are
activities, respond to concerns as they arise and look for building direct relationships with our producers and
opportunities to do more – see page 28. suppliers so that we can share our expertise and have
greater visibility through our supply chain. Our ethical
Operating Developing programmes are helping to improve standards in
responsibly our people
Sell for Buy for countries that we source products from – see pages 10,
Move
less less 16 and 18.
The virtuous volume circle Developing our people
We are simplifying our supplier network, working directly We invest in our people so that they have the opportunity
with more producers and improving the traceability of to get on, develop new skills and build rewarding careers.
our produce and ingredients. We are working with our This is essential to our business: it means that we can
suppliers to support them to grow their businesses so provide the best service to our customers – see page 20.
Creating that they can provide us with more products at a better
valuable Creating valuable property
property
price for our customers – see page 16.
We have dedicated energy efficiency teams that make
–– Core activities
sure our new stores and existing properties are as energy
–– The virtuous volume circle efficient as possible. This means our stores are not only
For more information on our business model read our cost effective, but also save carbon – see page 14.
–– Enablers annual report: www.tescoplc.com/ar2012
4 Tesco PLC Corporate Responsibility Review 2012 Tesco PLC Corporate Responsibility Review 2012 5
Our Community Promises Our approach
Our vision and values are Caring for the environment Providing customers with We manage our business using a balanced scorecard –
reflected in the five pillars of healthy choices the Steering Wheel. It has five segments – Community,
our corporate responsibility Operations, People, Finance and Customer. Balancing
strategy. We call these our our efforts and resources across these areas makes
Community Promises. sure that we operate with due regard to the needs
www.tescoplc.com/community- of all our stakeholders.
promises
We measure our performance throughout the
business against this Steering Wheel. Non-financial
Buying and selling our The Community
As a food retailer, we have an important performance measures give us a more balanced view
products responsibly role in supporting our customers and segment of the Steering
As one of the world’s leading retailers
of our performance than using financial data alone.
staff to lead healthy lives. This means: Wheel includes our five
we have a clear responsibility – and
a significant opportunity – to protect • making healthy options accessible We have a number of Key Performance Indicators Community Promises that
our environment. This includes: to everyone through price and for each segment of the Steering Wheel to track make sure we operate as
promotions, healthy ranges, and and monitor our performance. You can find out
• tackling climate change; by reformulating our products; a responsible business.
more about how we manage this process for
• minimising our impact on the • providing clear information on the
environment; and nutritional value of our products, and
the Community segment and who is
• making the most efficient use of scarce advice on how our staff and customers involved on page 26. CO M
resources in our own operations. can lead healthy lives; and
R MU
ME
SUPPORT ACTIVELY
COMMUN CAL
ITIES
• making it more attractive to lead an
N
NS UR
ING LO
It also means working with suppliers and
Y
EARN LIFETIME
LOYALTY
IBL
O
TO
THE CLEAR
active life.
ARE
RES LING
customers to help them do the same.
EN E
PO
NM TH
AISL
T
I C AT
UC D SEL
WH
RO R
AN I W
IT
O
ES
VI F
Creating good jobs and careers
S
This means ensuring everyone in our
GE AN
TS
EN NG
Actively supporting local
PR NG AN
TH RE
S
T
RI
ER
Y
CU
A
E GO
M ES
CA
supply chain is treated honestly and fairly,
OD
PR O
O IC
communities
YI
T
ST HO
IC D
BU
U
ES
and that care is taken to minimise the ID
ON
C YC
NG TH
DI L G
impact our products have on the ’T VI HEA TIN D
QU O EA
PR ITH CR S AN S
HARD ER FOR
EU
OB EER
environment. That includes how we: THE
E
ES CU
W J
OD C AR
AR STAF I GO
TR S
EG F
REA
• treat our suppliers and how those T
TO
E
ON
working for our suppliers are treated;
M
TO
WE TRY T
ER
NO
GH
GET IT RI ME
• work with communities where we FIRST TI
S
GROW SALE
S
source our products;
IONS
WE DELIVER
CONSISTENTL
• establish and monitor animal welfare; Y
Our people are our greatest asset. Our
FINAN
EVERY DAY
TED
TRE
and
Our stores are an important part of local success depends on our half a million WE
MA
EA
AT
ISE JOB KE OU
• work to ensure products come from communities, serving customers with people worldwide doing a great job for XIM
MA FIT
S EA R
TR
SIE
PE
P RO O TO R
R AT
sustainable sources wherever possible. good quality affordable food and customers. They are ambassadors for our PL BE
DO
EH O HO
providing career opportunities for local brand. We want to attract the best people OW WE LIKE T
W W
VI E K
T N
JO AL O OW
people. We’re committed to: and for them to stay with us. We work BS U
EN R
CE
AR R
W ME
M OU
TI
E
T
E
hard to make sure that:
AL AN
ST E
PE
V E AG
W DM
AY O
IN AN
• being a good neighbour;
Y
S N
NIT
M
T R P E CT
D
SA E Y
• Tesco is a great place to work;
TE
T O TU
VE
R WHO
TING
EA
O
• working with local communities
S
GE OR
N
TO H RE
TO OPP
• everyone is welcome; and
TERES
to make them stronger;
BE
A MANAGE
HELPS ME
T
WI
AN
AN IN
• we give people an opportunity to
JOB
• offering safe and welcome places
to meet; and get on.
• supporting the causes that matter PEOPLE
to our customers and staff.
6 Tesco PLC Corporate Responsibility Review 2012 Tesco PLC Corporate Responsibility Review 2012 7
Our performance Over
This table shows our Key Performance Indicators and targets that we
£74.5m
donated to charities
First
zero-carbon store
use to assess our progress against each of our five Community Promises. and good causes in Asia
We’ve included this year’s Group performance* and our targets for the
coming year here. You can see our performance over time online.
www.tescoplc.com/performance
Community Key Performance Indicator Performance 2011/12 Comment Target 2012/13
Promise
Buying and selling Supplier Viewpoint: % of positive Supplier Viewpoint is our independent annual supplier survey. It’s anonymous and asks suppliers Supplier Viewpoint: 74% of positive
our products
responsibly
responses to the question ‘I am treated
with respect’ 74% in detail about their relationship with Tesco, including whether Tesco treats them with respect.
This year we exceeded our target of 70% positive responses.
responses to the question
‘I am treated with respect’
Supplier Viewpoint: response rate Although we improved from 2010/11, we missed our target of 60%. It’s incredibly important to 60% suppliers responding to Supplier
of suppliers
56% us that as many of our suppliers as possible respond to this survey and so this will be an area of
focus for the coming year.
Viewpoint
Caring for the Reduce CO2e emissions from our stores We met our target of 5% this year. Our performance was particularly strong in the UK, and in the Reduce CO2e emissions from our stores
environment and distribution centres built before
March 2006** 5% Republic of Ireland where maintenance work reduced refrigerant gas leakage by 28%. Page 14
shows some of the ways we are improving the energy efficiency of our stores.
built before March 2006 by 3.5%**
Reduce CO2e emissions from new stores We exceeded our target of 29% by rolling out more energy efficient equipment in our new stores Reduce CO2e emissions from new stores
built after 2006 †
31% across the Group, and working hard to reduce refrigerant gas leakage. We also opened new built after 2006 by 32%†
31,000
zero-carbon stores in Thailand and the Republic of Ireland.
Reduce the amount of CO2 emitted in We met our 10% target despite the growth of our business in developing markets such as China, Reduce the amount of CO2 emitted in our
our distribution network to deliver a case where we are building the distribution system from scratch, and the impact of the floods in distribution network to deliver a case of
more people in
our team
of goods**
10% Thailand, which meant that our trucks had to take longer trips at lower capacity. The UK,
Malaysia and South Korea performed particularly well. On page 15 we explain more about how
goods by 3%**
we are reducing our distribution emissions.
Providing customers Staff and customers active with Tesco 9.3 million staff and customers active
8.7m
We exceeded our target of getting seven million people active. In Thailand over five million
with healthy choices people took part in events like our aerobics programme. In the UK we helped to get 2.9 million with Tesco
people people active with strong participation in the Tesco Great School Run and FA Tesco Skills.
Actively supporting Staff and customer fundraising Even in these difficult economic times our staff and customers showed their strong community £13.5 million from staff and customer
local communities
£10.1m spirit raising £10.1 million, beating our target by £2.6 million. These funds provide support to
people who need it around the world.
fundraising
Donate at least 1% of pre-tax profits We exceeded our target of 1%, donating over £74.5 million to charities and good causes through Donate at least 1% of pre-tax profits
to charities and good causes
1.9% direct donations, gifts in kind, staff time and management costs. to charities and good causes
Creating good jobs Staff being trained Training and development is really important to us. Our tailor-made Options Programme 6% of staff being trained for their next job
and careers for their next job
5.9% combines leadership, general and operational skills training through ‘on and off’ the job
experiences. This year we exceeded our target of 5.6% of staff being trained for their next job.
* Our Group performance includes operations in all of our markets except India ** Annual target reported as percentage reduction against previous year.
We met our target † Annual target reported as percentage reduction against 2006/07 baseline.
where we have an exclusive franchise agreement with Trent the retail arm of
We missed our target the Tata Group and Japan which has been treated as discontinued following
our decision to sell the business in August 2011.
8 Tesco PLC Corporate Responsibility Review 2012 Tesco PLC Corporate Responsibility Review 2012 9
Providing good quality, safe Central and Adams, US
Our Central and Adams store
and affordable food in South Los Angeles was
opened in a deprived
neighbourhood that previously
lacked affordable, fresh food
Since 1919 we have been working to provide our customers with options. With over 50,000
great quality food, when they need it at the right price. We bring people living within a mile of
this expertise to all the countries in which we operate. our store, investing in this area
means that we can provide the
community with high-quality
Product safety and quality Access food that fits all budgets.
Food safety is one of our key priorities We serve customers through a range of
and is often taken for granted in store formats and channels. This means As an area in desperate need of
developed economies, but delivering that we can provide greater access to investment, local jobs that pay well
Our Central and Adams Fresh & Easy store
safe food of the right quality can be fresh food for customers that previously and with benefits such as healthcare,
challenging in countries where there is were poorly served. For example: were an important addition to the
low penetration of modern retail and neighbourhood. A job fair we held Fresh & Easy is bringing quality fruits,
• we open stores in deprived as well before opening attracted more than
supply chains are still under-developed.
as more affluent communities as our
vegetables, meat, and wholesome foods to an
1,300 applicants. area in great need of grocery outlets and food
We are bringing our expertise in retail Central and Adams, US, case study
and supply chain management to all our Our UK discount brands shows. Not only does this provide a Not only does this store provide options. I am excited to see this new urban
markets and are developing more direct boost to the local area in terms of jobs, affordable food and great jobs to the model here in South Los Angeles. I am proud that we can
relationships with suppliers. We are their salad crops reach our customers in it also provides people with access to community, it is good for our business. count them as a new investor in our neighborhood.”
working with them to help share China in the best condition. As a result fresh food in communities that may This store is outperforming Fresh &
knowledge and support their business of the improvements made, they have have been without it for many years; Easy’s company average and we are Jan Perry
development. For example in China almost doubled their business with us seeing strong growth in the number Los Angeles City Councilwoman, 9th District
• our smaller format stores are mostly of customers visiting the store.
we worked with Ideal Food, a salad crop in one year.
located in the heart of neighbourhoods,
company, to improve their business. We
Affordability providing affordable fresh food to
started with the basics by putting them in
Wherever we operate, we are committed those with limited access to transport.
contact with seed companies and helping
Our Southwold, UK, case study shows Southwold Express, UK
them to set up their greenhouses. We to offering customers great value which
means good quality food at a great price. the feedback that we received from When planning our Tesco The response was overwhelmingly I am absolutely
then linked them with European growers positive with over 90% of the people who
For those on a budget we provide plenty the community before opening this Express store in Southwold, delighted to
to learn more about the business and responded supporting our store. Our new
gain the knowledge and skills to grow of affordable nutritious options – Express store; and
Suffolk, we wrote to over receive your
customers told us that there was a limited letter, we elderly
their own seeds. To help improve their including our 98¢ fresh produce packs • our online business means that we can
in the US, our discount brands across
1,100 households – every choice of food and many residents had
locals have been saying how
business further we supported them in deliver to customers who don’t have to drive out of town to pick up their
building a brand new distribution centre Europe, our wide range of Tesco Value much time or who can’t get out and
residence in the town – to much we would appreciate
groceries. Their new Tesco Express gives
and packaging facility to make sure that products across the Group and our about. Our online grocery retail explain our plans and ask the people of Southwold fresh, good a Tesco for a long time.”
new Everyday Value range in the UK*. business is the world’s largest and most for their feedback. value food on their doorstep. Southwold resident
successful. We now offer this service
98¢ produce packs of fruit and veg in our Fresh & Easy stores
in the UK, the Republic of Ireland,
South Korea and most recently in
Prague, Czech Republic. In the next
few years, we are planning to launch
online grocery shopping in the capital
city of all our operating markets.
See our annual report to find out
more: www.tescoplc.com/ar2012
* L aunched April 2012. Our Southwold Express store
10 Tesco PLC Corporate Responsibility Review 2012 Tesco PLC Corporate Responsibility Review 2012 11
Helping our customers make
healthier and greener choices
Our customers tell us that they want us to help them make Greener living Making it easy Education and information
We’re committed to working with We know that it has to be easy and We have a range of initiatives across the
choices that are better for them and their families, and better customers to lead a revolution in green affordable to make green choices. Group providing education and advice
for the environment. consumption. We have a target to find We focus on: for our customers.
www.tescoplc.com/healthy-choices
ways to help our customers reduce their • providing affordable choices through • In South Korea, we run our Green
own carbon footprints by 50% by 2020. green promotions; Leaders programme where children
Healthy choices ‘Get Active’ In 2007 we committed £25 million to learn the importance of saving our
Leading the way on • giving customers tips for greener living
create the Sustainable Consumption environment. We have over 30,000
nutritional labelling such as recipe ideas for using leftovers;
Institute in Manchester – a global centre ‘green leaders’ and have a target of
Tesco has championed the provision of • providing recycling facilities for 100,000 by 2020.
of excellence focusing on sustainability
nutritional information for many years, household waste;
and encouraging consumers to adopt • For the second year running we were
launching our first major Healthy Eating
more sustainable lifestyles. • rewarding customers through our a headline partner of Climate Week
initiative in the UK in 1985. We now
have Guideline Daily Amounts (GDA) green Clubcard points scheme; and UK. Our activities included ‘Climate
nutritional labelling on all our eligible ‘Together For Trees’ aims to help save some Week Cuisine’ with celebrity chefs
• reducing potential waste by developing
own-label products*. We are always of the world’s most endangered rainforests such as Levi Roots cooking low carbon
innovative, low carbon packaging.
striving to provide more information recipes that were featured on our
and healthier options to customers. Real Food website.
Extended healthy ranges
In Turkey, we advised the government who We have brands across our markets that • We launched our Greener Living
have been developing a new regulation help customers manage their diets website for customers in China and
requiring all food manufacturers to adopt without compromising on taste. Turkey. They give practical tips on how
a GDA labelling system. The government This year we: We recognise that leading to keep homes green and save money.
identified Tesco’s model as an example Our China Greener Living site includes
of best practice. This approach involves
• extended our eatwell range in the US. a healthy life isn’t just a 3D interactive ‘Green Home’ for
These products contain no more about healthy eating, so
providing information on the sugar, fat, customers to look around and quizzes
than 25% of the recommended daily
saturated fat and salt content in a portion values of sodium, calories, fat and we invest in programmes to test their knowledge.
of the product and how this compares saturated fats; to encourage our customers
to a GDA of these constituents for a
typical adult. • launched the Tesco Goodness range to get active.
in the UK and the Republic of Ireland Restoring forests with our customers
Our business in Turkey, Tesco Kipa, is Across the Group this year we helped
including snacks, meals and lunch box over eight and a half million people Thousands of our customers At our launch event in December Today it is
going a step further to help its customers more important
to make healthier choices through a
fillers developed especially for children. get moving through our events and are getting involved in saving we had over 400 volunteers of all ages
and together we planted more than
In the UK we also launched a new great partnerships. In England our FA Tesco than ever for
poster and website campaign that will tasting nutritionally balanced range of forests by joining our tree 1,000 trees. organisations
include healthy living tips and recipes. Skills Partnership has now brought
chilled ready prepared meals – Eat Live football skills training to three million planting schemes in Thailand In February this year Tesco UK launched to unite and tackle climate
Enjoy; and five to eleven year olds since it and Malaysia. In 2007 Tesco its ‘Together For Trees’ partnership with change. Our new partnership
• were the first major supermarket in the launched in 2007. The programme Lotus in Thailand committed the RSPB to help save over 238,000 with Tesco, Together for Trees,
helps children learn to play football, is doing just that. We are
UK to offer a chilled dairy Free From
get active, build their confidence and
to planting nine million trees hectares of the world’s most endangered
rainforests. Customers can donate their
As an active member of The range. Not only is the range dairy-free working together to reach
Consumer Goods Forum’s Health it’s also naturally low in saturated fat for lead healthier lives. by 2013 and to date, we have green Clubcard points and Clubcard
millions of shoppers across
and Wellness pillar we have helped healthy blood cholesterol levels and is TheFA.com/tescoskills
planted seven million. vouchers, and give money directly to
the UK, raising awareness
to shape, and are committed to, suitable for vegans. the RSPB.
This year, we launched our ‘greener of the importance of our
their resolutions on:
In March 2012 we signed up to a pledge earth’ campaign in partnership with The destruction of rainforests is a rainforests and the threats
• healthier diets and lifestyles; to work with the UK government, industry the Malaysian Timber Industry Board. significant contributor to carbon they face, and providing
and health professionals to help the We have committed to planting emissions and destroys the habitats of easy ways for people to help
• product information and
nation reduce its calorie intake. As part of 500,000 trees in three years. important species. Our work in this area protect and restore them.”
responsible marketing; and
this we have committed to reducing the is part of our commitment to care for
* The only exceptions are food cooked in store and
• communication and education. calories sold in our soft drinks by over products where it would be impractical to add the environment. Dr Mike Clarke, Chief Executive, RSPB
150 million in the coming year. a label, such as herbs and spices.
12 Tesco PLC Corporate Responsibility Review 2012 Tesco PLC Corporate Responsibility Review 2012 13
Our journey to zero-carbon Distribution Our target has proved more challenging The ‘F plan’
In 2007 we also set ourselves the very in our developing markets, like China, In the UK we have halved our emissions
ambitious target of halving the emissions where we are growing our business and per case of goods delivered from 0.14 to
Zero
per case of goods delivered by 2012 developing a new distribution system 0.07 kg of CO2 by following our ‘F plan’:
across the Group. We have met this from scratch.
• Fuller cages and pallets;
target in the UK which accounts for This network development takes time.
Reducing emissions is the right thing to do for a responsible 65% of the cases we deliver. This year, As this happens, significant improvements
• Fuller trucks and containers;
We aim to be a
business seeking sustainable profits. It conserves energy, saves zero-carbon business
we have also achieved good reductions can be achieved because stores and • Fewer miles; and
in Slovakia, Malaysia and South Korea.
money, helps deliver energy security and better resource efficiency. by 2050 These reductions have been achieved
distribution centres become better
• Fuel economy.
connected. Therefore we have set a
in a number of ways: new long-term target to reduce carbon
• Reducing trips by maximising the emissions per case by 25% by 2020
amount of product we deliver in each against a baseline of 2011/12. This will
journey. In Malaysia we have been allow us to implement our ‘F plan’ for
Property We’re implementing our carbon We now have over 100 natural increasing the use of larger vehicles and carbon reduction, developed in the UK,
In 2007 we committed to halving the reduction plans through a combination refrigeration stores across the Group in South Korea we achieved reductions to our other markets as we develop our
emissions from our buildings by 2020. of more energy-efficient equipment, from the UK to China. We also have seven by filling our trucks more efficiently. distribution networks.
Because of the energy efficiency renewable energy generation and zero-carbon stores having opened new
switching from emissions intensive stores in Thailand, the Republic of Ireland • Travelling fewer miles by planning
measures we have taken across the our distribution from central locations Group distribution emissions
Group since 2006, we’re now saving over refrigeration to natural or low emission and Wales*. Our new Chinese distribution kg CO2 per case delivered
refrigeration systems. centre in Jiashan uses 45% less energy and making our networks more
£270 million a year on our energy costs. efficient. In Slovakia we made
0.177
than a traditional depot.
particular progress in this area. 0.161
* Opened March 2012. 0.156
0.150 One of our dedicated rail services in the UK
• Alternative modes of transport.
In the UK we have transferred 0.140
How we are increasing the energy efficiency of our stores significant volumes from road to rail.
Identifying energy Technology 0.122
Committed teams Lighting Our four dedicated rail services save
hotspots In the UK we have introduced • Automatic controls switch • Voltage optimisation 15,000 tonnes of CO2 per year taking 06/07 07/08 08/09 09/10 10/11 11/12
Extra energy meters in our ‘Energy Check’ a process in off lighting in areas of the devices have saved us 14 million miles off the road.
stores give information on stores which makes energy store when not needed. 180,000 tonnes of CO2
where improvements can since 2005 in the UK. • Using fuel with lower carbon
efficiency part of everyone’s emissions. Our Tesco dotcom vehicles
be made. Improved freezer • W e are trialling best
job resulting in a 1.5% • We are exploring in the UK use biogas which has lower
door design has been practice natural light
reduction in store energy opportunities for carbon emissions than standard diesel. www.tescoplc.com/climate-change
introduced into over 200 UK solutions across the Group.
consumption. We are looking renewable energy across
stores saving over 25,000 to share what we’ve learned • This year we also ran two the Group. In Hungary
tonnes of CO2 a year. from this process across our LED lighting trials in China Our carbon footprint
we have solar panels in
Refrigeration operating markets. and one in Thailand. 15 stores.
Across the Group we have This year our global direct Independent External Assurance Group CO2 emissions
kg CO2 /sq ft
• In the Republic of Ireland Summary Statement, provided by
continued to retro-fit doors carbon footprint was sustainability consultancy ERM Ltd: 65.80 64.34
Smart Control systems
on chilled cabinets in our
for heating, lighting and 5.66 million tonnes of CO2e. We reviewed Tesco’s approach to 59.16
smaller stores. In the UK
we have reduced carbon refrigeration have helped We continued to decouple measuring and reporting its direct carbon 56.11
52.17 50.64
us achieve an absolute our business growth from emissions at Group level and in a
emissions by 16% compared representative sample of markets (China,
energy consumption
to 2010/11 by focusing on
reduction of 8%.
the growth in our carbon Czech Republic, Slovakia, South Korea
minimising refrigeration emissions: while our net sales and the UK). We conclude that Tesco’s
gas leakage. global direct carbon footprint (total direct 06/07 07/08 08/09 09/10 10/11 11/12
area grew by 9%, our carbon
carbon dioxide equivalent emissions and
footprint increased by 5%. percentage breakdown per emissions
Detailed information on our carbon source) is appropriately stated.
footprint and how we calculate it For further details on the work Top retailer in the
can be found on page 32 and at undertaken and our findings please Carbon Disclosure
www.tescoplc.com/carbon-calc refer to the full assurance statement at Project’s Global
www.tescoplc.com/carbon-assurance 500 index
14 Tesco PLC Corporate Responsibility Review 2012 Tesco PLC Corporate Responsibility Review 2012 15
Working with our suppliers Working together
We have set up Supplier Academies
in all our central European operating
markets. We run local supplier roadshows,
for customers
This year we teamed up with Unilever
conferences and awards events. Our
to create a global campaign ‘Creating
roadshows give suppliers the opportunity
a Better Future Starts at Home’. The
to showcase their products.
initiative raises awareness and rewards
A resilient, efficient supply chain relies on strong, fair, mutually In Slovakia, we held four local roadshows customers for making sustainable
beneficial and long-term partnerships with suppliers. Without our this year which led to over 70 new product choices and, in doing so, helps
suppliers we wouldn’t be able to provide our customers with the products being listed. In Poland almost them make small behavioural changes
250 suppliers were involved in workshops at home to reduce their environmental
great value products they need, when they need them. to help develop their brands, learn about impact. To date the campaign has been
customers’ needs and preferences, how run in eight markets, reaching 675,000
to improve product quality, and how to customers in more than 550 stores,
adopt more environmentally friendly and has led to an uplift in sales of
Building relationships In South Africa we meet with producers Championing local suppliers practices. In the Czech Republic we have greener products.
We are building relationships with each season to review what we have Our customers tell us that they like to been working with around 60 bakeries
Together we have also been able to:
suppliers at a Group level and in our learned from the previous year and buy local products. Our commercial which supply our stores with over 700
local markets so that we can provide what we have changed following teams have an important role to play local products. • encourage over 10,000 customers to
customers with great ranges from the their feedback. We discuss and agree in identifying great local suppliers and reduce their water footprint in Turkey;
In the UK we sold over £1 billion of
best sources in the world. quality improvement plans, anticipated getting their products on our shelves. local products this year. We launched Tesco’s supply
• raise funds for community
seasonal problems and planned We can also open up new markets a new-look fleet of lorries to highlight chain ambitions
Products that are common across a programmes like planting 1,000 acres
solutions. By working together we can to these suppliers and provide them our local product lines and ran a are truly
number of countries such as bananas, of grassland in China; and
make improvements that result in better with export opportunities.
chocolate, flour and sugar are sourced products and availability for customers.
competition called ‘Best in the British
• help thousands of people in Poland
groundbreaking.
centrally. We are using our Group skill and Aisles’ where customers voted for their By working right across supply
understand their environmental
scale to make these supply chains leaner, We are also working with Sustainable favourite local foods. Several local chains, impacting thousands
impact.
simpler and better. By building closer Development Capital to help our Chinese suppliers gained national listing in of individual organisations,
relationships with all of our suppliers general merchandise manufacturers Scotland including Midlands Snacks.
they’re going to have a huge
both large and small we can put better identify energy saving opportunities.
positive impact on the world.”
products on the shelves at a better price We will support suppliers to deliver the
for our customers. identified energy savings by helping Martin Chilcott
to give them access to expert Founder and CEO
Developing direct relationships with implementation partners and finance.
Watch our video about local ice cream 2degrees
our suppliers and producers has many
benefits – it gives us greater visibility manufacturer, Frank’s:
of our supply chain, allows us to share www.tescoplc.com/franks
our expertise and provides suppliers
with opportunities to develop and grow
their businesses. The Tesco Knowledge Hub
Regional products in Poland Today’s employee
In March 2011, we launched Suppliers can pose questions to the
rest of the group, attend webinars and engagement
the Tesco Knowledge Hub. visit other suppliers’ sites. The Hub
The Hub is an online webinar was
The launch of our local lorry in Scotland gives our suppliers the opportunity really useful…
community where suppliers to share ideas and solve problems
It’s given me lots of ideas for
can access resources that together. Over 700 people from 300
different companies have joined since initiatives we could adopt
provide advice on carbon launch and we are on track to double here at Park Cakes.”
Over reduction and sustainability
best practice.
the number of supplier members in
the year ahead.
Debra Lim
£1bn
CSR manager
The Hub is one of the ways we can Park Cakes
collaborate with suppliers to help us
achieve our ambitious target to reduce
of local products the emissions of our supply chain by
sold in UK 30% by 2020.
www.tescoplc.com/supply-chain
16 Tesco PLC Corporate Responsibility Review 2012 Tesco PLC Corporate Responsibility Review 2012 17Ethical trading Together, we are working hard to support
Improving standards Sourcing responsibly Carbon reduction projects
Millions of people who work in our our suppliers to focus on improvement. We believe in making the most
supply chain rely on us for their Our process of robust independent
in the Bangladesh efficient use of scarce resources and are We are mapping the biggest We have been working with the
livelihoods, and our trade makes ethical audits continues with over 2,500 clothing industry committed to the responsible sourcing opportunities to cut carbon in University of Liverpool, where
an important contribution to the supplier sites audited in 2011/12. These of raw materials, and managing the researchers have been monitoring
communities of many more. This year Our F&F clothing brand sources impact we have on the environment our supply chain – identifying whether giving cows different food
audits provide useful intelligence on
we continued to strengthen our ethical important issues for workers in our supply many of its garments from ready- and biodiversity. carbon ‘hotspots’. will improve their digestion and reduce
trading programme ‘Trading Fairly’, chain. This year we have stepped up our made garment (RMG) factories in methane emissions.
There are significant challenges, Dairy in the UK
increasing our Group resource and support for initiatives which strengthen Bangladesh. Our ethical audits and We are also running a pilot programme
particularly for commodity products We have worked with Promar
in-country capacity to engage with local local capacity, including a national ethical stakeholder engagement work has with the RSPB and 12 of our TSDG
which are traded on global markets International and ERM to calculate
stakeholders. We have a team of 20 programme with the South African fruit shown that standards need to be members to find ways to improve
where it can be difficult to achieve full the greenhouse gas emissions from
ethical trading specialists across Europe, industry and a Skills Academy to support raised for workers in this industry and biodiversity on dairy farms.
traceability of supply. We believe the over 400 of our dairy farms who are
Asia, the Americas and Africa, and over suppliers of ready-made garments we are committed to helping support solution lies in working with others across members of the Tesco Sustainable You can see some more great work
60 Ethical Champions embedded in Bangladesh. this. We are working in partnership the industry to help change the way Dairy Group (TSDG). that we are doing with dairy farmers
within Commercial Teams globally. with DFID – the UK’s Department these products are produced. For at www.tescomilk.com
for International Development – to example, we are working with the We aim to use this information to
establish the Bangladesh Apparel Consumer Goods Forum to develop fully assess different farming practices and
Supporting a national ethical programme in South Africa Skills Foundation. traceable, sustainable sources for forest provide advice on emissions reductions
commodities. This year we responded to at a farm level.
mechanism to give workers the The centre, open to all RMG factories,
opportunity to voice their concerns whether or not they supply Tesco, the Forest Footprint Disclosure project for
and know that these concerns will be aims to develop more constructive the first time providing information to
listened to and acted upon. Over 3,000 worker relations and improve working investors on how we are managing our
workers were involved in this pilot. conditions and wages which together exposure to deforestation.
should result in higher productivity
Over the course of this year we have Raw material Manufacture Logistics/ Retail Use by Recycling and
and improve product quality. distribution consumer disposal
worked closely with the industry to
develop a national, South African- To date, we have recruited a full team sustainability.mycgforum.com
owned, ethical programme that was of professional trainers and we have Milk 73% 9% 3% 10% 3% 2%
officially launched in October 2011. developed and tested the training You can read our position statements
This programme is rooted in the South programme. We are currently online: www.tescoplc.com/sourcing
African industry’s own experience and renovating the training centre and
The South African fruit industry has
faced ethical challenges in recent years
expertise on ethical standards and are looking forward to training our Water stewardship
also meets or exceeds the ethical first group of managers.
for a variety of reasons including low
requirements of the industry’s many Water scarcity is an issue in Strengthening water stewardship
literacy rates, the vulnerability of in our supply chain
retail markets around the globe. The Bangladesh several of the countries in Lake Naivasha is the second largest
women workers and the increasing
use of migrant labour. We have been This programme is the first of its kind Apparel Skills which we operate and is a fresh water lake in Kenya. The
working to improve standards in this for ethical trade and, if successful, is Foundation problem affecting some of surrounding area is a major exporter
industry since 2008 – most notably likely to form a blueprint for future has the potential our suppliers. Although water of cut flowers to Europe.
by piloting a farm-level grievance national initiatives. to be a prominent player
in improving productivity used in our supply chain far Various pressures such as a growing
outweighs that in our direct population and an increase in
and production efficiency agriculture and horticulture are having
We are a member of the Better Cotton in the Bangladeshi RMG operations, we believe it’s significant impacts on biodiversity,
Initiative (BCI). BCI exists to make manufacturing sector. The important to manage our water availability and water quality.
global cotton production better for Over knock-on effects of improving resources carefully and this Careful water stewardship is necessary
management systems and
2,500
the people who produce it, better for to reverse the degradation of the lake
year we carried out surveys of
the environment it grows in and better management-employee and protect the communities that rely
for the sector’s future. relations on the production water use across the Group. on it.
floor are just one of many We are supporting the Lake Naivasha
ethical audits
expected benefits the water stewardship project. Our funding
programmes delivered by and expertise is helping to raise the
the Foundation will generate water levels and reduce water pollution.
with the required support Educational programmes will promote
and mindset.” more sustainable water management
practices across the community
DFID (UKaid) including residents and farmers.
www.tescoplc.com/tradingfairly
18 Tesco PLC Corporate Responsibility Review 2012 Tesco PLC Corporate Responsibility Review 2012 19Building our team
Our people are our greatest asset: they are our ambassadors.
Without great people we wouldn’t be able to provide the best
shopping trip for our customers.
Creating jobs At Tesco I believe carried out a pilot with 5,000 of our
Martin Behan Alice Kim Jo Frith, MBE
We employ more than 500,000 people the focus must people across the business and plan to
Area Director, Czech Republic Regional Director, South Korea Regeneration Partnership
around the world and are the largest remain firmly on launch local versions in the coming year.
Martin joined Tesco in the Czech Responsible for 17 of our stores Manager, UK
private-sector employer in the UK. This understanding
year we increased the number of people
Championing the issues Republic in 2002 after he left high in Seoul, Alice is the first female Jo was awarded the MBE in the New
what it takes to develop women school and has progressed rapidly, Executive at Tesco Homeplus. Over Year’s honours list in recognition of
in our team by 31,000. and to retain them in senior
that matter taking on real responsibility early in her career at Tesco she has excelled, the amazing work that she has done
Our people across the business are
We are committed to providing job positions … We are totally integral to supporting our communities
his career. He left Tesco for a short balancing the demands of a busy with Tesco to help get long-term
opportunities in areas that really committed to showing period but soon returned realising family with her work commitments. unemployed people back to work.
and making sure we meet our
need it. This year we opened our 40th increased percentages of this business gave him unique She is an inspiration for other women
Community Promises. They have the She began her career at Tesco
Regeneration Partnership store in the opportunities to grow and try new in our South Korean business – a
female leadership, explaining opportunity to become champions of over 30 years ago. It was clear from
UK. These partnerships match up the things. He has worked in a range of country where men have traditionally
our progress and sharing issues that they are passionate about.
roles across different parts of our Czech dominated management positions.
the start that she has a wonderful
needs of deprived communities with our experience.” We have Community Champions who way with people and so she moved
our development programme and create business from small format stores
coordinate activities in their local She welcomed the opening of our from checkouts to a staff training
jobs and services for the community. Philip Clarke, Chief Executive to our new department stores and is
communities, Ethical Champions who zero-carbon training academy this role and then became a Personnel
Over the past 11 years our regeneration now Area Director of Hypermarkets.
work with commercial teams to ensure year. The high-tech facilities and Manager. She had great support
stores have provided over 13,000 jobs in our suppliers are supported and Green zero-carbon credentials make it a from her immediate team and
total, with over 4,500 of them going to Training and development I think that
Champions who stimulate green having a mentor positive place for our management to was given the opportunity to gain
the long-term unemployed in the local We are committed to spotting
activities. learn, develop and share knowledge formal qualifications.
area. And at our Riverside distribution and developing talent so that our and sponsor who
and experiences.
centre in the US we provide opportunities staff, wherever they work, can fulfil Health and safety I met up with She has coordinated 15 of our
for Veterans who are able to work, but their potential. We have qualified health and safety each month helped me to Tesco is an Regeneration Partnerships, supporting
are struggling to find it. professionals in every operating market build my skills, understand incredibly over 1,500 people back into work and
In July 2011, we opened our state-of-
the business and progress. making a difference to families in areas
the-art training academy in Asia to and every business to make sure that our diverse place
Diversity stores and depots are safe places to work It’s an exciting place to where there are limited opportunities.
We are proud to have a diverse business
help deliver growth for the region. We to work. If you
invested over £30 million in this zero- and shop. Senior directors lead on our work and I am challenged have the ability, passion
and we have always valued the benefits Our Regeneration
carbon academy and have already run health and safety management and each day.”
that diversity brings. We welcomed the and commitment you can Partnership
the equivalent of over 10,000 training Lucy Neville-Rolfe, Executive Director,
aspirations of the Women on Boards Corporate and Legal Affairs, is our
progress, no matter who you programme
days. At the academy, our people are
(‘Davies’) Report on gender diversity that designated Director from the Executive are or where you come from.” provides much
trained, mentored and connected with
was launched this year. We have made Committee. Our teams are constantly needed jobs that give a real
colleagues around the world, benefiting
significant progress in recent years in working to improve safety performance. boost to local communities,
from technology-led learning. Our zero-carbon training academy
developing senior women. Since 2007 We have reduced the number of serious enabling growth and
the number of female Directors at Tesco We are also investing in the Tesco in South Korea
incidents in our business by almost 15% improving life for generations
has increased by 45, an increase of nearly Academy Online, an internet-based this year and continue to reduce the
76%, and women in senior management training platform that will give more of
to come.”
amount of work time lost through injuries
positions account for 31% across the our people access to inspiring training year-on-year.
Group as a whole. There are currently anywhere, anytime. We have already
four women on the PLC Board (29%).*
Watch our video about our Widnes
Regeneration Partnership store
You can find out more about our people promises online: www.tescoplc.com/widnes
www.tescoplc.com/people * April 2012.
20 Tesco PLC Corporate Responsibility Review 2012 Tesco PLC Corporate Responsibility Review 2012 21You can also read
