Arlington, Virginia – The Retail Industry Leaders Association (RILA) has released its second Retail Sustainability Report on March 7 in sponsorship with Ernst & Young, an organization that is well recognized for its sustainability leadership. The 2013 report highlights progress towards the industry’s evolving sustainability objectives and identifies a class of top-performing characteristics.
The 2013 Retail Sustainability Report provides a snapshot of activities and trends across RILA’s membership, portraying a detailed view of the industry’s adoption of sustainability programs. Those programs achieve a wide range of benefits from improved customer loyalty to decreased costs to more resilient supply chains. The report’s data was drawn from responses to a survey completed by RILA member companies. The survey’s respondents collectively represent more than 65,000 locations and $1 trillion in global revenue.
“This RILA report helps me and my industry peers keep a pulse on the evolving field of retail sustainability,” said Fred Bedore, Senior Director of Sustainability at Walmart and Chair of RILA’s Retail Sustainability Initiative (RSI).
No stranger to sustainability efforts, RILA developed the Retail Sustainability Initiative (RSI) in 2007 and has continued to demonstrate leadership and guidance for retailers integrating sustainability initiatives in their strategy, operations, workforce and community involvement.
“It’s incredibly encouraging to see the collective impact the retail industry is having on this important work,” said Kate Heiny, Senior Group Manager of Sustainability at Target. “At Target, we look forward to continuing to do our part, working with fellow retailers to create lasting, sustainable change.”
The survey uncovered six significant trends, specifically that:
- Sustainability teams are growing. Most companies surveyed have full-time sustainability teams. Teams are growing, and reporting levels are gaining seniority.
- Sustainability investment payback requirements are two- to three-years. Most companies act on sustainability investments that expect a two- to three-year payback.
- Breadth of sustainability activities are increasing. Companies project that the responsibilities of the sustainability function will significantly increase in scope over the next two years.
- Tracking of sustainability metrics will grow in prevalence. Most retailers measure energy, fuel, material usage, and waste generation. More than 25 percent more retailers will begin to measure code of conduct compliance, water usage, suppliers audited for social compliance, renewable energy generation and chemicals of concern over the next two years.
- Three key stakeholders are applying pressure. Pressure for retail sustainability efforts is strongest from employees, competitors and regulators.
- There are identifiable attributes of top performing companies. Certain concrete attributes contribute to the growth and success of a retail sustainability program.
“This report illustrates the continuing progress that retailers are making in sustainability and demonstrates that retailers recognize the strategic importance of becoming leaders in sustainability across all industry,” said Jim Thomas, Vice President of Sustainability, Safety & Environmental Health for Petco and Vice-Chair of RILA’s Retail Sustainability Initiative.
“RILA members are committed to implementing sustainability across their organizations because they recognize the inherent business value that those programs generate,” says Adam Siegel, RILA’s Vice President of Sustainability & Retail Operations. “We are pleased to share this report with our members and the wider community to highlight the progress they are making and the challenges they still face.”
The report is divided into two sections: Managing Sustainability and Implementing Sustainability.
“Sustainability is a business imperative. This report demonstrates that companies are developing the operational strategies and the systems and infrastructures – personnel, metrics, goals, tracking systems, reporting, etc. – to effectively manage and implement sustainability,” said Craig Coulter, Ernst & Young LLP’s Sustainability Practice.
The first section, Managing Sustainability, outlines the structure of sustainability teams, and companies’ investment, planning, measuring and reporting strategies. The data showed that most respondents have full-time sustainability teams, which have been growing in staff size over the last four years – to keep pace with the growing breadth of responsibilities. However, despite the growth in staff, sustainability budgets are remaining the same. This staff growth can in part be attributed to the primary benefits that respondents perceive as attributable to their sustainability programs, namely reduced costs, brand enhancement and risk management.
Section two, Implementing Sustainability, discusses operational strategies for buildings and supply chains, as well as stakeholder engagement. Waste and energy reduction are the top facility-related improvements that retailers are undertaking, though managing greenhouse gas emissions and water use and building with green techniques will grow significantly over the next two years. Supply chain improvements have focused on transportation fuel efficiency, materials, including chemicals of concern and packaging design. Managing all aspects of the product life cycle, from design through use and disposal will become increasingly prevalent practices over the next two years. Transparency remains a key trend: disclosing the social and environmental impacts of product supply chains is a growing practice.
“These management and operational strategies are strengthening retail businesses and positioning them for long-term success,” continued Siegel. “RILA will continue to track the industry’s progress over time and work with our members to uncover the greatest business value from their efforts,” Siegel concluded.
Retail Industry Leaders Association (RILA) is the trade association of the world’s largest and most innovative retail companies. RILA members include more than 200 retailers, product manufacturers, and service suppliers, which together account for more than $ 1.5 trillion in annual sales, millions of American jobs and more than 100,000 stores, manufacturing facilities and distribution centres domestically and abroad. For more information, visit www.rila.org.