ENVIRONMENT
Although the environment is not managed as a separate division, it is appropriate to include the group’s environmental approach in this section of the annual report, as it encompasses data from all of the divisions within the group, with the information being compiled by the service divisions.
Our carbon footprint is calculated after the production of the annual report and the tables of information therefore reflect the results for the March 2009 and March 2008 financial years.
The operational impacts on the environment associated with the group’s retail and financial service activities are relatively low. In terms of direct impacts, the group’s activities consume resources, energy and water, and contribute to the generation of product and packaging waste. While the environmental impacts do not have significant financial implications for the business, the group recognises that environmental responsibility is part of good business practice and to this end are committed to developing ways to reduce its impacts more systematically. The group is a relatively small purchaser and hence its ability to promote and influence greater environmental awareness and responsible environmental practices amongst its suppliers, is limited.
Environmental management
The group’s environmental performance is managed by an environmental committee comprising senior managers from all areas of the business. The committee meets monthly and reports quarterly to the chief executive officer and three members of the operating board. A member of the operating board has responsibility for setting environmental policy, objectives, targets and reporting processes. The group has an environmental policy and is in the process of determining an environmental strategy, as part of a group sustainability strategy that is currently being developed. An environmental risk assessment of the group’s operations is undertaken annually and performance objectives have been set for 2011. These include formulating an environmental strategy within each division and conducting an environmental assessment of merchandise and non-merchandise suppliers through the supplier audit process. The group has recently launched an environmental portal which provides staff with information covering environmental awareness, facts and tips, policy documents and guidelines, updates on the group’s environmental sustainability journey, an interactive facility for feedback and suggestions, links to sources of environmental and sustainability news and organisations, and retail industry sustainability news.
The group is in the process of implementing more systematic approaches for measuring key environmental performance data, with a view to setting quantitative performance targets.
Recognising the increasing interest shown by analysts and SRI investors around environmental performance issues, the group commissioned a second annual carbon inventory (or “carbon footprint”) assessing the greenhouse gas (GHG) emissions generated through its business activities. This provides a useful analysis of the group’s performance, as it seeks to reduce the GHG emissions associated with its activities. This year the group again participated in the Carbon Disclosure Project (CDP), the global initiative in partnership with Bank of America – Merrill Lynch, PricewaterhouseCoopers and Bloomberg, aimed at accelerating carbon reporting and emission reductions. The group is in the process of calculating its carbon footprint for the financial year ending March 2010. A review of the carbon footprints for the financial years ending 31 March 2008 and 2009, is provided later in this report, as well as the focus areas of activity to mitigate the environmental impact.
Environmental performance
Carbon footprint
Foschini’s carbon footprint calculations for the period 1 April 2008 to 31 March 2009 were conducted at the Foschini head offices, distribution centres, regional offices and retail stores. Operational activities covered include:
- direct emissions resulting from fuel used by equipment owned or controlled by Foschini, being gas refills from air-conditioning and refrigeration and the vehicle fleet (referred to as Scope 1 emissions);
- indirect emissions from purchased electricity (referred to as Scope 2 emissions); and
- selected indirect emissions resulting from Foschini’s business travel activities, hotel accommodation, consumption of office and external communications paper, cardboard packaging, plastic bags, employee commuting and outsourced transport/distribution of merchandise (referred to as Scope 3 emissions).
Total emissions for Foschini for 2009 was 154 051 tonnes of CO2e. Overall the group’s emissions increased between 2008 and 2009, largely due to the inclusion of additional elements that were added to the calculation, including employee commuting.
The key efforts to reduce the group’s GHG emissions focus on reducing the energy demands and reducing waste production through carton reuse.
Foschini group’s carbon emissions: 2009 and 2008*
Table 1: Comparison GHG emissions in tonnes of CO2e.
| Activity | 2009 | 2008 |
| Fuel from equipment owned | 14,72 | 25,54 |
| Air-conditioning/refrigeration gas refills | – | 16,90 |
| Fleet vehicles | 3 672,79 | 3 577,94 |
| Total Scope 1 | 3 687,51 | 3 620,38 |
| Purchased electricity | 121 169,19 | 88 774,03 |
| Total Scope 2 | 121 169,19 | 88 774,03 |
| Business travel in rental cars | 47,62 | 42,75 |
| Business travel in commercial airlines | 1 847,19 | 2 235,53 |
| Business travel in hotel accommodation | 70,98 | Data not |
| available | ||
| Consumption of office paper plus external communications paper | 867,31 | 772,69 |
| Consumption of cardboard packaging | 4 336,52 | 3 367,64 |
| Consumption of plastic bags | 2 549,65 | 2 375,33 |
| Employee commuting | 10 277,76 | Data not |
| available | ||
| Outsourced transport/distribution | 8 648,87 | Data not |
| available | ||
| Total Scope 3 | 28 645,90 | 36 194,16 |
| Non-Kyoto emissions | 548,43 | 1 047,00 |
| Total GHG emissions | 154 051,03 | 129 635,57 |
| Intensity: Emissions per FTE | 15,29 | 12,27 |
| Intensity: Emissions per m2 (excluding stores) | 1,38 | 1,23 |
| * Note: | Environmental statistics are presented for the latest available two comparative periods. As the computations in respect of 2010 are not yet available, data is presented for the 2009 and 2008 financial years |
Table 2: Comparison of units used
| Activity | Units | 2009 | 2008 | |
| Full-time permanent employees | People | 10 075 | 9 311 | |
| Area (excluding stores) | Metres squared | 111 925 | 104 970 | |
| Fuel from equipment owned | Litres | 5 513,00 | 9 712,37 | |
| Air-conditioning/refrigeration gas refills | Kilograms | – | 13 | |
| Fleet vehicles | Litres | – petrol | 1 536 553 | 1 541 045 |
| – diesel | 34 293 | Data not available | ||
| Purchased electricity | Kilowatt hours | |||
| – HOs & DCs | 13 129 673 | 14 220 092 | ||
| – stores | 104 510 316 | 74 553 938 | ||
| Business travel in rental cars | Kilometres | 219 684 | 198 132 | |
| Business travel in commercial airlines | Kilometres | 15 630 224 | 19 161 585 | |
| Business travel in hotel accommodation | Nights | 3 736 | Data not available | |
| Consumption of office paper plus external communications paper | Tonnes | 242,15 | 364,14 | |
| Consumption of cardboard packaging | Tonnes | 1 543 | 1 368 | |
| Consumption of plastic bags | Tonnes | 424 942 | 395 889 | |
| Employee commuting | Kilometres | 133 840 924 | Data not available | |
| Outsourced transport/distribution | Kilometres | 11 603 395 | Data not available | |
| Non-Kyoto emissions | Kilograms | 303 | 698 | |
in tonnes of CO2e
Our principal areas of activity
This year we have focused our efforts to mitigate our environmental impact in the areas of activity where we have the greatest opportunity to make a significant difference to our performance: energy efficiency, packaging waste and merchandise transport.
Energy efficiency
The group is committed to contribute to mitigating the current energy crisis by reducing its energy demands. Given that a large component of our electricity usage is through lighting in our stores, this year we reviewed our store lighting design, piloted energy efficiency design improvements, and rolled out lighting design improvement across all our divisions (excluding Foschini and exact!, which will be addressed in 2011). In view of an anticipated long-term increase in electricity costs, considerable cost savings (as well as emission reductions) have been achieved by lowering lighting levels as well as using more efficient fluorescent types to reduce heat generation and lamp replacement costs. By replacing all 50 watt dichroic lamps with 35 watt IRC dichroic lamps in our Jewellery, Sports and Markham divisions, we achieved a sustained annual saving of 511 233 kW; these divisions anticipate an average 14% decrease in lighting load for all new stores built for the 2011 financial year. Our Foschini division is currently rolling our lighting efficiency initiatives across its stores and anticipates saving 180 000 kW/hrs of electricity usage in 2011.
In line with our environmental committee objectives, we have appointed a utilities manager who will oversee the process of introducing systems to ensure that electricity usage, mainly in stores, is measured and recorded monthly (in kilowatt hours). This will enable us to better monitor our performance.
At our head office buildings we have energy management systems in place and seek to reduce our energy consumption through energy-efficiency measures associated with lighting, computer and other electronic equipment.
Waste reduction
The Distribution and Logistics division has significantly reduced the amount of waste generated by the group, through carton reuse. This year the division reused 68% of its supplier cartons for distribution of goods to stores, thereby only producing approximately 37 000 kilograms of waste cardboard per month. This represents a 54% reduction on last year.
Some of this waste cardboard is still shredded and utilised for protective packaging and the balance is handed to our contracted waste service providers for recycling. Going forward, we are focusing on supply chain initiative efficiencies, to further reduce our carbon footprint.
Plastic waste is kept to a minimum as a result of the elimination of shrink-wrapping of cartons. Residual plastic waste is given to our contracted waste service providers for recycling.
Plastic hangers are recycled and merchandise is flat-packed, with hangers remaining in stores, resulting in reduced packaging, transport and plastic production. All plastic bags used by the stores are durable and reusable and certain divisions use recyclable paper packets.
Vehicles
| Foschini group waste statistics* | ||
| Mixed recyclables (compactor) in tonnage (rebate: R350 per tonne) | 59,65 | |
| Mixed recyclables (30 m3) in tonnage (rebate: R350 per tonne) | 2,78 | |
| Paper (CMW) 30 m3 in tonnage (rebate: R200 per tonne) | 47,92 | |
| RELs in tonnage (rebate: R350 per tonne) | 36,32 | |
| Waste to landfill | 79,57 | |
| Total recyclable volumes per month in tonnage | 146,67 | |
| Total rebate per year | R44 145,80 | |
| * | Statistics cover activities at our Cape Town head offices and distribution centres, for the period July 2009 – April 2010; prior data not available | |
Merchandise transport is one of the group’s larger areas of environmental impact. This is managed by outsourced professionals who ensure that their vehicles perform at optimal efficiency.
