Good business journey

Woolworths’ award winning sustainability strategy
Woolworths’ Good business journey programme was launched in April 2007 as a formalisation of the existing Woolworths sustainability initiatives.

The ‘Good business journey’ is a five year plan, changing the way we do business, and incorporating a series of challenging targets and commitments, centred on four key priorities: accelerating transformation, driving social development, enhancing our environmental focus and addressing climate change.

The programme is strongly influenced by our customers and` international best practice, as well as by the Global Reporting Initiative (GRI) guidelines, JSE Socially responsible investment index criteria and other legislative requirements.

The programme is managed centrally from the corporate governance business unit, but specific indicators have been included in the overall business strategy and scorecard, and the scorecards of each business unit, placing the accountability for delivery of particular projects in the business units. Progress is overseen by a Board Sustainability Committee that meets quarterly.

Woolworths’ first priority is to accelerate transformation, with the focus on enhancing local sourcing, BEE, skills development and equity ownership plans, ensuring a collaborative approach with suppliers, government and franchisees, and driving our policy of “South Africa first”.

Woolworths’ ultimate goal is to become a level 4 BEE contributor (data codes) by 2012. Woolworths improved its status to a level 6 contributor.

Woolworths’ second priority is to work harder to drive social development – poverty drives environmental destruction and that in turn creates more poverty. To help alleviate poverty, we need to expand the existing initiatives of the Woolworths Trust and link with the transformational goals to drive enterprise development. Woolworths aims to increase social contributions to more than R300m by 2012.

The third priority relates to Woolworths’ impact on the environment, in particular the issue of diminishing biodiversity. Sustainability farming, conservation and a new approach to packaging are the key areas of focus.

Targets include, aiming to increase organic food and clothing sales by a multiple of five and to sell more than R1 billion of organic-content clothing by 2012. The resultant reduction in the use of potentially harmful pesticides and chemicals, especially in South Africa, will be of significant benefit to both consumers and water quality.

Nutrition and healthy living are already a cornerstone of the way Woolworths does business, with the Good food journey having made major strides in improving awareness and offering customers the right food for a healthy lifestyle.

Water is one of South Africa’s scarcest natural resources, and Woolworths is targeting a 30% reduction in water consumption and is developing a programme to encourage our suppliers to do the same.

The company is also aiming for a one third reduction of packaging in clothing and a 20% reduction in food packaging by 2012. Customers will continue to be encouraged to use reusable shopping bags, thereby reducing the number of new shopping bags required, and there will be an increase in the percentage of recycled material in all Woolworths plastic shopping bags – 100% recycled material in Woolworths clothing shopping bags by 2012. Woolworths will also work with other corporate and government partners to make the recycling process easier for customers.

The fourth priority addresses climate change directly by focusing on reducing Woolworths’ carbon footprint. Woolworths recognises climate change as an issue requiring urgent action if the risk of serious damage to global prosperity and security is to be avoided. Woolworths will reduce its relative carbon footprint by 30% – this will be achieved through energy efficiencies (reducing relative electricity usage by 30%) and reducing product miles (reducing relative transport emissions by 20%).

Woolworths will also work closely with suppliers and customers, mobilising them to understand their own carbon footprints and making it simpler for them to reduce their footprints.

Woolworths’ current commitments will reduce our relative carbon footprint by 30% by 2012. This reduction will also lead to significant operational savings, which the business will reinvest in exploring additional sustainable business alternatives.

The ‘Good business journey’ is a business imperative for Woolworths. Many aspects of it are linked together to generate a multiplier effect: reducing product miles by encouraging greater local sourcing we will open up opportunities for enterprise development and preferential procurement; reducing packaging will result in energy and paper savings.

Justin Smith, BCom, LLB (Hons), LLM, is the manager: The Good Business Journey at Woolworths.