This year has seen a quantum shift in the way Woolworths approaches sustainability, or the Good business journey, as we have now called our efforts towards a more sustainable future for people and planet.
In January 2007, Simon Susman, Chief executive of Woolworths, drove a process with the leadership team of the business, focusing on what accelerated role Woolworths could and should play in addressing the mounting global issues around sustainability. The outcome of this discussion was a decision that Woolworths would put some clear targets in place around key issues and that these needed to be driven from a South African viewpoint.
The Woolworths Good business journey encompasses the agreed targets and was announced to key stakeholders including the media in April 2007. A detailed communication document (available on www.woolworthsholdings.co.za) was put together that clearly outlined what Woolworths believes its role to be in driving the South African sustainability agenda and articulated some very challenging targets for the business with a 5 year timeframe to 2012.
The essence of the rationale for Woolworths Good business journey approach was summed up by Simon in the following statement:
“It is becoming increasingly obvious that sustainable growth can only be achieved through paying greater attention to the world around us than has been the case in the past. The links between economic growth, transformation, social development, the environment and climate change can either form a vicious or a virtuous circle. For the past 75 years, these issues have been deep at the heart of Woolworths values but the launch of the Woolworths Good business journey marks a step change in the way we will operate going forward, ensuring that we drive that virtuous circle that will benefit all of our stakeholders.”
The feedback from stakeholders was mixed. In the main, the stakeholders who are deeply involved with sustainability issues were supportive of the role that Woolworths had adopted, with some sounding a caution that the targets were far-reaching and that they would challenge Woolworths. We acknowledge the challenge these stretch targets present, and accept that they may need some modification in time, but we are committed to working towards making a real difference.
Right from the start, the executive team at Woolworths has been clear that delivery of the far-reaching targets was not something that would be achieved by the business in isolation. Woolworths influence is broad as a business with more than 17 000 employees, 300 plus stores, 6 million customers and a network of over 1 000 suppliers. We need to use every opportunity to engage with our customers, our suppliers and our people if we are to meet our targets and deliver the difference to which the Good business journey is committed.
Woolworths customers will play an important role in the Good business journey. Firstly, as customers in supporting our Good business journey innovations such as organic cotton and food, less packaging, fewer additives and in supporting our social initiatives such as MySchool and a soon-to-be-launched programme to encourage kids to help kids.
Secondly, as consumers, we believe our customers can really make a difference to the world we live in, in many different ways. More than 80% of the household waste in South Africa is generated by less than 20% of the population, and most of that group of consumers are Woolies customers. We will be putting in place waste reduction and recycling programmes to help our customers with their recycling initiatives, starting with a pilot in the Western Cape.
Woolworths wcode campaign, communicating our Good business journey to our customers, will be launched throughout the stores’ network in early 2008.
We reported last year that we had done extensive work in putting together the Woolworths Sustainability index. This has stood us in good stead as we move forward on our Good business journey. We were able to identify key priorities for the business, which were highlighted in the goals and targets that we set in our announcement in April, but we are also able to identify the gaps in our journey that we need to address as part of our responsibilities as a good corporate citizen.
Woolworths now has a truly integrated framework for sustainability, our Good business journey. The pillars that we identified and reported against in our last sustainability report, then in line with the Global Reporting Index (gri) version 3, remain as relevant today and we have again structured this report around these five pillars. We are reporting, for the first time, on our plans to reach some challenging 5 year targets. In each section we have given the reader a summary of the highlights of the year and the focus for the year ahead and we have included quick reference tables to the sustainability initiatives we already have in place, providing iterative evidence of our ambitions to drive Good business journey practice and thinking sustainably across the business.
I have been supportive of a process to identify a single measure for sustainability in the business, much like the work that the Department of Trade and Industry (dti) has done around defining a single measure at each level of Black economic empowerment. I am delighted to be able to announce that Woolworths will introduce a Good business journey barometer scorecard. This scorecard will, by the end of the 2007-2008 reporting period (i.e. June 2008), provide us with single scores reflecting our progress at three levels:
The barometer readings are reached by taking a ‘roll-up’ approach, using our Woolworths Sustainability index as the base and scoring against 1 and 5 year targets for the components of each indicator. The barometer score is also embedded in Woolworths business scorecard and will be incorporated in individual business unit’s scorecards, ensuring that Woolworths Good business journey is embedded in business unit plans.
Finally, I noted in my last report, that Woolworths had identified three key projects for 2007: waste, energy and water. I am delighted to report that substantial progress has been made in the waste initiative, and that Woolworths continues to focus on reducing energy usage and finding energy-efficient ways of doing business – both of these are reported on in more depth in this report. We have not met our commitment to a clearly defined project around water – whilst it is part of our Good business journey commitments, we have not put a specific project in place to address water usage in the business.
The Good business journey identified and committed the business to challenging 5 year targets in key areas of sustainability.
Plans are in place to map out 1 year goals in preparation for meeting 5 year targets.
Two out of three key projects gained significant momentum, whilst one fell away with the re-focus on the broader scope of the Good business journey.
Delivery against 1 year goals, progressing towards meeting the 5 year targets.
Embed the Good business journey as a way of working into the business.
I am confident that, with the commitment and passion of Simon and his team, in 2008 we will be able to report achievement of 1 year targets in most instances and good progress against our 5 year targets.
Brian Frost
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