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Introduction
Morrisons About us
Contents
1 2 4 Chief Executives statement Responsible retailing 3 Stakeholder engagement Business 5 Championing British farming 6 Meet our farmers 7 Sourcing with integrity 8 Fair working conditions 9 Focused on the things that matter 10 Creating opportunities 11 Achieved today 12 Society 13 Making it easier to eat healthily 14 Working together 15 Promoting fresh food in the community 16 Good neighbours 17 Achieved today 18 Environment 19 Making the most of our food 20 Reducing and recycling trade waste 21 Helping customers to reduce and recycle 22 Reducing carbon emissions 23 Refrigeration 24 Effective logistics 25 Achieved today
Food is at the heart of what we do and we are passionate about it. Perhaps not surprising for a food retailer, but what is unusual is the way our business is structured. Uniquely, we source and process most of the fresh food we sell through our own manufacturing and packing facilities. This gives us close control over provenance and quality and means that we are able to provide fantastic food at affordable prices. With 439 stores, we are the UKs fourth largest supermarket as well as the second largest food manufacturer. We serve 11 million customers each week, preparing more fresh food in-store than any other major UK food retailer.
Large End User of the Year, Refrigeration Innovation and Collaboration Awards
Visit www.morrisons.co.uk/today
Wm Morrison Supermarkets PLC
Store Manager of the Year, Fresh Produce Retailer of the Year and Meat Retailer of the Year.
439
stores.
11 million
customers per week.
132,000
employees.
Responsible retailing
At Morrisons, we care about where our food comes from, how it is produced, the people who make it and how it is moved and sold. We want our customers to be confident that food bought at Morrisons is food they can trust.
Food for thought
In some ways we are a relatively straightforward business. We buy, make, move and sell food. Much of the complexity comes from the scale of our operation because we sell to 11 million people every week. Our continual challenge is to provide quality food at a fair price through supply chains which are sustainable over the long term. Quality and affordability are part and parcel of what we offer every day. The difficulty is that sometimes, in relation to sustainability, there are tensions between competing issues and conflicting views of different stakeholders as to what is the right thing to do. Our approach to responsible business means that we can tackle these issues more effectively. Our Business programme is concerned with how we buy, make and sell food. In championing British farming, for example, we shorten our supply chains, support our national and local economy and are buying into standards that people trust. Our programme also ensures that we apply similar standards and ensure responsible sourcing whoever we buy from and whatever we buy on a global basis. Making and selling food, with great service, requires extensive investment in people. Our strategy to continually develop our people through industry-leading training is helping us to differentiate ourselves in the sector. Society is where we share our passion for fresh healthy food with our shoppers and the wider community. Weve focused a great deal of time and attention on providing advice and support for customers on fresh food preparation, nutrition and healthy eating options through our website, social media, customer magazines and in store. Our point of difference is that our colleagues have a wealth of experience and knowledge about food, particularly our experts on our Market Street counters. Weve taken this a stage further through campaigns like Lets Grow, which enables us to encourage the next generation to think about where food comes from, understand its value more clearly and share this knowledge with others. Environment is centred on how we manage food, operate efficiently and reduce waste. Where we make, package, move and store food we have to ensure the effective use of resources. These issues arent just important in our business, they are universal in their application. As well as our own extensive carbon and waste reduction programmes, we are also helping customers to play their part, whether that be through the latest packaging innovation or by reducing food waste with our Great Taste, Less Waste Campaign.
In some ways we are a relatively straightforward business. We buy, make, move and sell food. Much of the complexity comes from the scale of our operation because we sell to 11 million people every week.
Stakeholder engagement
Our Values
Our Values are at the heart of everything we do, defining what we expect of each other and what our customers can expect of us. Our Values help us to shape our corporate responsibility commitments.
Stakeholder engagement is vital to ensuring our approach to sustainable business is both relevant and effective. It enables us to identify issues and opportunities, respond to changing needs and adhere to best practice by incorporating different views and feedback into our business operation.
Can do
Can do is about making things happen. Its about getting the job done and delivering results. Its about being positive and rising to a challenge.
Suppliers
Customers
One team
One team is about working together to reach a common goal. Its about keeping our promises, building trust and respect, and valuing each others contribution. Investors Government
NGOs Employees
Great shopkeeping
Great shopkeeping is about setting high standards and taking care of every detail. Its about having pride in our work and making quality our top priority.
All of our stakeholders recognise the importance of sustainable business. Each group has their own particular focus. Customers want quality products at a fair price with good service. Communities are where our operations have the most immediate impact. They require us to be a good neighbour and bring employment and investment. Investors expect a good return on their money and that we grow, find opportunities and mitigate risks.
Employees want good working conditions, job security and satisfaction and opportunities to develop a career. NGOs (Non-Governmental Organisations) ask us to follow their advice, change or adapt the way we operate. Government sets the rules and regulations but also asks for support to deliver government policy. Suppliers want our custom, a reliable trading relationship and the best price.
Fresh thinking
Fresh thinking is about finding new and better ways of working. Its about greater awareness, asking questions and coming up with bright ideas that give us the edge.
See some of the things that stakeholders say about us throughout our Review.
Morrisons CR Review 2010/11
Business
Our approach
Most British supermarkets rely heavily on third party companies throughout their supply chain. This reduces control over the way their food is sourced and produced. At Morrisons, we do things differently. We run our own production facilities and buy fresh food directly from British farmers we know and trust. We are also farmers in our own right. Through our vertically integrated business model, we have direct control over the production and supply of food than other supermarkets do. Whats more, our care for food doesnt end once it arrives in our supermarkets. We have more trained butchers, bakers, fishmongers and other food professionals on hand than in any other supermarket. So we dont just sell food; we offer traditional craft skills and expert advice so that customers can really make the most of it. By cutting out the middleman and staying in direct control of our supply chain, we keep unnecessary costs down and get quality fresh food onto our shelves faster. So we can give our customers the freshest, best quality food possible, at a great price, and prepared in a way that they will enjoy. We think this is a responsible way of doing business. This section of the Review highlights some of the work were doing to build on this approach and explains why.
We want to help our customers enjoy great quality, fresh food. So at Morrisons, our business isnt just about getting food in and out of stores as fast as possible. Its about taking responsibility for every stage of the production and supply chain, from the farmers field all the way to the customers plate.
The starting point for the food that we buy or make has to be quality. Then we must be able to buy it in sufficient quantity at a price that our customers can afford. But this is far from the whole story. Where we can we will source British food first. This is why the vast majority of our produce and all of our fresh beef, lamb, pork, poultry and milk is British. Being closer to source means we are well placed to ensure these products are responsibly produced. This means that their environmental impact is properly managed, workers rights are upheld, animal welfare standards are maintained and suppliers are treated as partners. Customers also want choice and availability all year round. In practice, this means that we also sell food that comes from around the world. Our challenge is to make sure the high standards we set are applied globally, not just at home.
Weve long recognised the issue of climate change and have a leading emissions reduction programme. However, this is only part of the solution because, for example, at the start of the supply chain we also need to ensure that we arent adding to deforestation through the sourcing of key commodities such as palm oil or soy. This is why we are changing products so that they only contain palm oil from certified sustainable sources. We know there is always more to do. It is not the case that you could ever say weve done this. Corporate responsibility is about continuous improvement. We keep ever vigilant and strive for best practice at home and overseas. By upholding these standards we will ensure our customers can trust that the food we sell is food with thought.
Business continued
Farm research
Morrisons is working with universities and other research institutions in the UK to investigate new and more effective methods of production. All our research is led by experts, but ideas come from many sources: from the farmers themselves, from people in our own business and from our own farm. We launched 12 new research projects over the last year. For example, we commissioned the UKs first independent report into renewable energy options for dairy farms. The report suggested that renewable energy has the potential to cut dairy farm electricity costs by a third and offers farmers the chance to generate and capture energy that can be sold back to the grid, creating a new source of income.
of making the Morrisons Farm both commercially and environmentally sustainable. By sharing whatever we learn with our fellow farmers theres real potential to benefit farm businesses. Dalton Philips Chief Executive
Business continued
David Westwood
Westwood Rhubarb Growers, West Yorkshire David Westwood has been supplying Morrisons with rhubarb for over 20 years from his family run farms in West Yorkshire. David is part of a long legacy of rhubarb growers. His great-great-grandfather and great-great-uncle were some of the first rhubarb growers in the mid 1800s.
Mark Strawson
Strawsons Leeks, Newark, Nottinghamshire Mark Strawson is the third generation of the family to work on the farm. Since he started, the Strawson farm has diversified from potatoes and cereals into other crops including leeks and carrots. The family is also committed to promoting biodiversity and encouraging wildlife to prosper on their land. Its a way of working that has helped them become LEAF Marque accredited.
relationship with Morrisons and weve been working with them for more than 15 years. They appreciate the fact that farmers have to deal with something as unpredictable as the weather.
Mark Strawson
David Brass
Meg Bank Farm, Cumbria On Meg Bank farm, hens have acres of woodland and grassy glades, enabling them to forage on land that is rich in clover, wild flowers and herbs. Davids dedication to producing free range eggs has seen his farm named Poultry Farmer of the Year at the Farmers Weekly Awards.
David Westwood
Morrisons over 20 years ago. Weve maintained this close relationship over the years and speak to Morrisons nearly every day about how the crop is progressing.
Business continued
Where we are able to influence the supply chain we do so by balancing economic, environmental and social considerations as well as the interests of our customers, shareholders and suppliers.
Our ongoing response and last years activity All of our fresh meat and poultry is British supporting British farmers and working to further enhance welfare standards.
Dairy
All of our fresh milk is British. We do not operate a dedicated supply pool which we believe is fairer because all of the farmers our processors buy from get a premium rather than a select few. We gave our processors longer term contracts to guarantee income over a settled period. We undertook a major research project into renewable energy options for dairy farmers through our Research Farming Programme.
One example of our responsible approach to farming is the way we source eggs. From 2010, we became the first top-four retailer in the UK to switch to 100% British free range for own brand eggs. Morrisons sells more than 10 million eggs every week, so this switch will make a substantial difference to the welfare of laying hens throughout the UK. We also introduced an Online Egg Tracker to our own brand Nature's Nest range. Each egg comes stamped with a special code, allowing customers to trace the eggs provenance and find out about the farm where it was laid. Over the year, weve made great strides by introducing free range eggs into other own brand products, including all of our ready meals, pasta, quiche, mini eggs and scotch eggs and in 2011 our mayonnaise. All of the eggs used in our in-store cafes are now also free range.
Fish Fish sourcing Concerns over sustainability but increased interested from customers as a healthy option
Enhanced sourcing policy. Fish counters certified under the Marine Stewardship Council chain of custody programme with species such as Cape Hake, Mackerel, Dover Sole and Wild Alaskan Salmon certified under the scheme. We encourage customers to buy different types of fish and joined the Sustainable Seafood Coalition to promote this and clearer labelling. We moved our tinned tuna policy in line with our fresh sourcing so that all own brand fish will either be pole and line caught or from Fish Aggregating Device (FAD) free fisheries.
Palm oil
Commodity sourcing
We progressed our policy to move to 100% certified (RSPO) palm oil. By 2015 we will use fully segregated palm oil in own brand products. All new products now have to support an RSPO certified palm oil supply chain system. We are undertaking more detailed analysis where soy is used in our products. We are supporting WWFs call to work with a certification system under the Round Table for Responsible Soy. We have not yet committed to sourcing under the system until we can assess the impact particularly on UK farmers (the majority around 80% is used for animal feed). We have committed to research under our Farming Programme to look at alternatives to soy used in feed in relevant livestock farming.
Soy
Commodity sourcing
Timber
Commodity sourcing
We have a longstanding commitment to manufacture all own brand timber-based products (such as paper and garden furniture) from FSC or equivalent sources.
Business continued
We audit suppliers of Morrisons own brand products through our Fair Working Conditions (FWC) programme. We make sure that our suppliers comply with our Ethical Trading Code and monitor their employees general health, well-being and satisfaction. All our audits are carried out independently. We choose candidates for audit based on a risk-assessment process. This means that we focus on areas where there may be concern such as emerging markets, or labour intensive sectors such as agriculture. In the past year, for example, we looked carefully at Indian and Kenyan tea gardens, our UK meat and poultry supplier base and packers of prepared food products. Instead of simply relying on factory
documentation or information from employers, our audit approach is based on the views of employees themselves. Although we normally audit external suppliers, one of our main focuses this year was on our own manufacturing sites. Our independent FWC assessments have now been successfully completed at most of our own facilities ensuring we apply the same high standards across the board. See www.fairworkingconditions.ie
The traditional checklist/box-ticking approach alone does not provide a reliable insight into the real working conditions; a vital source of information is overlooked employee experience. Fair Working Conditions is fundamentally changing ethical auditing by promoting employee engagement.
Dermot Kenny Fair Working Conditions
Wm Morrison Supermarkets PLC
Business continued
In Market Street we have more highly trained and experienced colleagues with craft skills on hand than any other supermarket. Whether our customers are looking for recipe ideas, advice about whats in season, or a certain cut of meat for their family Sunday roast, our expert staff will be happy to help. Were able to respond quickly to changes in demand, which means we can cut down on unnecessary waste while giving more of our customers what they want.
48,000
colleagues trained in Retail Skills QCF Level 2.
18,000
apprentices will be trained in 2011 (largest apprenticeship provider in the UK).
Management training
At management level, our Coaching for Performance Programme draws on learning from the world of sport to help our business leaders maximise the potential and performance of their teams. More than 1,000 of our senior leaders will take part in the programme in the next 12 months. At the top floor, our Advanced Leadership Programme prepares our senior management team to be the executive directors of the future. In 2010, 20 senior managers joined this programme and three of them have recently progressed to the Management Board. 95% of our Store General Managers are promoted from within and 30% of our Senior Management Team started on the shop floor. Our approach to recognising talent, rewarding hard work and creating opportunities for progression saw productivity increase by 7%, labour turnover decrease by 6% and a 0.3% fall in absence. All of this contributes to a higher level of service and expertise in our stores.
The best thing about being a butcher for Morrisons is that we offer the full traditional butchers shop service. We dont just sell meat, we offer advice and help on how to cook it.
Brian Hill Morrisons butcher
1 million
training days delivered to our people in 2010/11.
10
Business continued
Creating opportunities
We are proud to have a diverse workforce
Diversity means that our employees reflect the communities in which we operate. This means that we are better able to serve our local customers and are more likely to meet their expectations. We are turning our attention ever more keenly to ensuring that our workplace provides equal opportunity for all. One example is our new programme to unlock the talent of women working at Morrisons. Weve set ourselves the target to ensure that we have at least 30% female representation in our Senior Management Group within three years (13% by February 2011). Why? Because its the right thing to do and it will help us to accelerate growth in our business. Women have an increasingly important position as consumers and companies with a higher proportion of women on their Boards outperform competitors.
An employer of choice offers better customer service In 2010, we opened 14 new stores, creating 3,500 jobs. As well as investing in the skills of our people, we believe that it is important that our employees are representative of the communities in which we operate.
big solutions. Partnerships between large corporates and social enterprise are the way to help society work and do business for good.
Gary Stott CREATE Foundation
As part of our commitment to being a good employer and an active member of the community, we want to create job opportunities for people who might otherwise find it a challenge to find employment. Our aim in 2011/12 is to give up to 10% of new jobs at our new stores to vulnerable people. Last year we set up a working partnership with CREATE, an award-winning Leeds-based charity supporting disadvantaged people.
Through our association with CREATE, weve already started to recruit and train people from homeless backgrounds. The jobs were providing will get their lives back on track and create loyal and committed team members. Its our aim to provide 1,000 jobs through our partnership with CREATE over the next three years. New starters taking part in the scheme receive three months of training, both in the classroom and on-the-job, leading to a QCF Level 1. Successful applicants will then become fully employed by Morrisons, and given the opportunity either to gain an QCF Level 2 in Retail Skills, or take up an apprenticeship to learn a craft skill for example, as a baker, butcher or fishmonger.
disadvantaged people to get their lives back on track. We look forward to taking this approach nationally and we would encourage other British businesses to join us in this initiative.
Norman Pickavance Group HR Director
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Achieved
Target Responsible sourcing Be a leading supporter of British farming Commitment Update
Implement Farm Programme initiatives. Share research projects and experience from Morrisons Farm at Dumfries House with the farming industry. Introduce more 100% British fresh own brand lines. Set a Gold standard to identify leadership in quality of supply. Apply auditing on a risk rated basis and using priority indicators.
Reports published on renewable energy in the dairy sector, cross-breeding and free range hen activity. New workstreams established. Four reports to be published in 2011/12. Further commitments to British food, with new lines including all British sausages. Currently rolling out with suppliers. Developed the standard in line with Morrisons Values. Focus on manufacturing in 2010. Review completed for all major livestock groups in 2010. First retailer to introduce CCTV into abattoirs. Suppliers notified, new products now must comply with an RSPO endorsed system. Own manufactured products compliant by end of 2011. Focus on soy in 2011/12 with supply chain analysis and farming research (in relation to soy alternatives for livestock). Joined Round Table for Responsible Soy. Application of policy to tinned tuna and freshly prepared food (e.g. sandwiches and salads) in line with fresh so that it is pole and line caught or from FAD free fisheries by the end of 2013.
500 own brand suppliers to achieve Morrisons Gold Standard for quality of supply by 2013. 600 site audits for Ethical Trading Code compliance to be completed by 2013. Enhance animal welfare policies and auditing processes by 2013.
We will work with our suppliers to ensure that 100% of the palm oil used in our own brand products is sourced through a Roundtable for Sustainable Palm Oil (RSPO) recognised supply chain system by 2015. No product/ingredient from areas subject to unregulated deforestation.
Through product specification and supplier auditing ensure procurement from sources able to be maintained in the long term, or able to regenerate with intervention, support and careful management. No sourcing of raw materials or ingredients from areas of recognised ecological or environmental value and proven to be at risk of long term harm. Work with recognised, independent third parties and suppliers to gain independent certification and accreditation.
Sustainable seafood policies to apply universally across all own brand ranges by 2013.
Excellence in selling: Our people Delivering sector-leading training and skills development
Further develop Fresh Food Academy to provide nationally recognised qualifications, apprenticeships and skills training programmes. Build colleague stability and retention through engagement with Vision and Values. Application of our Values across the business.
Over 48,000 colleagues trained. Over 1 million training days provided. Morrisons is now the largest provider of apprenticeships in the UK. Labour turnover reduced by 6%.
Commentary on targets
Our responsible Business targets are a non-exhaustive set of commitments that we believe capture material issues that relate to how we operate in terms of buying products (sourcing) and then how we best prepare and support our people to sell them. This is in addition to the regulatory framework, best industry standards and responsible commercial trading which would be expected of us as a major UK retailer. We do this because, as well as being environmentally and socially responsible, there are clear benefits for customers and our business today and in the future.
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Society
Our approach
We depend on the communities which are home to our stores, so it is in our interest to ensure that we maximise the value we provide for them. That means being a good employer, a good neighbour and an active part of the community. Equally, we can have an impact on our customers behaviour, so it can sometimes be important for us to take a lead in helping those who shop with us to make positive, healthy choices. Morrisons has a range of initiatives to help fulfil these responsibilities. This section of the Review includes details of some of them.
Food is part and parcel of our society. What we eat and drink has a direct affect on our health and well-being and our stores are part of the neighbourhood. We see this as an opportunity to make a difference.
How do we do it? It comes back to food; after all we are a food business. This includes promoting healthier eating as an essential part of daily life. We dont dictate to our customers what they should and shouldnt do. Ultimately, customers will exercise their choice, but we can make it more attractive to eat fresh and healthy food by making it affordable and accessible. Whilst supermarkets are sometimes criticised for promoting unhealthy food, at Morrisons, over the last year, we have always had a minimum of 50 promotions on fresh produce every week. These include promotions on items such as stew packs, which make eating healthily not only more affordable but also more convenient. We can do this because we buy most of our produce direct from growers and pack it in our own facilities. Weve taken our passion for produce into the community with our hugely successful Lets Grow campaign which has reached over half the schoolchildren in Britain.
For all our success, we know there is much more we can do. We are reviewing our work this year as we look to play an even more active and positive role in our communities.
We touch the lives of 11 million shoppers a week. That is 11 million people and, in most cases, also their families. Add to that the communities in which our shops are based and our employees and you start to capture the effect our business can have at a social level.
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Society continued
As well as consistently driving up the quality of our food, we also want to make it easy for our customers to make healthy choices. Last year, we set out a number of commitments on health and well-being and weve been making steady progress towards achieving our goals. Here are a few examples.
The effect of the guidance and further work with our suppliers has been to reduce the salt and saturated fat content of products without compromising on taste. For example, last year we reduced the saturated fat in all of our own brand crisps by 75%. Our baked crisps have only 5% of GDA. Over the last year, we have also extended and reformulated our Eat Smart (low and lower fat) range and developed new products such as our crustless quiche, which has 60% less fat than our standard range.
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Morrisons CR Review 2010/11
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Working together
Some issues are best addressed when business and government work in partnership. Whilst competition drives progress, collaboration can deliver a wider social impact.
It was on this basis that we signed up to the Department of Healths Responsibility Deal, which was launched in early 2011, with pledges on food, alcohol, health at work and physical activity. Our commitments build on the longstanding approach we have taken to promoting healthy lifestyles. We believe we can offer expertise and leadership to help bring about positive change. We have signed up to all the relevant pledges and will report on our progress. These pledges are based on the following core commitments. We: recognise that we have a vital role to play in improving peoples health; will encourage and enable people to adopt a healthier diet; will foster a culture of responsible drinking, which will help people to drink within guidelines; will encourage and assist people to become more physically active; and will actively support our workforce to lead healthier lives.
Task 25
We take our legal responsibilities with regard to selling alcohol very seriously. Task 25 is our scheme to help us make sure we never sell alcohol to people under the legal drinking age. Under Task 25, any member of staff who believes that a customer wishing to purchase alcohol may be under the age of 25 will ask that customer to provide recognised proof of age documentation.
because we are committed to making healthy choices easier and more affordable.
Martyn Jones Group Corporate Services Director
Sensible pricing
Morrisons set a policy of not selling alcohol below the rate of duty plus VAT over two years ago. We proposed this as a wider policy to the Government in June 2010. Since then the Government has implemented this policy and made it a legal requirement for all UK retailers. For the first time this gives the Government a lever to get a guaranteed floor price for alcohol sales.
The Responsibility Deal is a significant development bringing together industry, the Government and campaign groups to help promote healthy eating and drinking habits.
Andrew Opie Food Director at the British Retail Consortium
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Society continued
5 million
school children have access to gardening equipment.
14 million carrots
grown by schools taking part in Let's Grow.
450,000
people can be fed with the amount of potatoes grown by Lets Grow schools. There is growing concern that many children have little understanding or interest in the story of fresh food and the importance of eating well. Thats why we created Lets Grow a community benefit programme designed to help reconnect people with food, inspire children to follow a healthier lifestyle and get them excited about fresh produce. Having completed its third year, Lets Grow currently has 18,417 schools registered, with 67% of all primary schools and 47% of all secondary schools in the UK actively taking part. Lets Grow has continued to develop. The programme now has: a n enhanced catalogue introducing living plants and cookery equipment; e ven more technical resources available to teachers; o pportunities for schools to visit Morrisons stores and farms to further their education; and i ncreased communications to strengthen relationships with teachers. As well as schools, nurseries and registered childminders can now also join the campaign. See w ww.morrisons.co.uk/letsgrow
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Good neighbours
Supporting people with terminal illnesses
Under our Raise a Smile campaign, we support one national charity every year. In 2010, our colleagues nominated Help the Hospices as our charity of the year. Help the Hospices works with children and adults living with a life-limiting or terminal illness. The charity twinned each of our stores with a local hospice, which meant the money raised in each of our stores directly helps our local communities. Thanks to the fantastic generosity of our customers and colleagues, we raised over 1.3 million for the charity.
Being good neighbours. At Morrisons we have a range of valuable skills and expertise, not to mention heaps of enthusiasm, to offer the communities in which we operate. Here are just a few of the ways weve been making a difference during the past year.
Improving local communities
The CSV Action Earth campaign challenges local communities to find ways in which they can protect and enhance their environment, improve their quality of life and safeguard the environment for future generations. We have supported the campaign for the last four years. Our support has helped the charity provide many small grants to local voluntary and community groups. These grants go towards purchasing tools, equipment and materials needed for projects that make a positive difference to their community and environment.
3,470
13,000
new trees planted
18,000
bags of litter collected
+63,000
Supporting ethical products
At Morrisons, we support the work of the One Foundation by stocking its products within our stores. 100% of their profits go towards funding vital projects by providing sustainable clean water supplies, HIV/AIDS counselling and testing, nutrition, hygiene and sanitation facilities. By buying One products, Morrisons customers have so far funded 12 vegetable gardens, a sanitation block, eight HIV testing days and 34 water PlayPumps, providing over 68,000 people with access to a sustainable supply of free, clean drinking water and crop irrigation in Africa.
The partnership with Morrisons has been a huge success and we are absolutely delighted to have raised over 1.3 million for hospice care. This is a fantastic achievement and is testament to the dedication of Morrisons colleagues, who have really taken the hospice cause to their hearts.
David Praill Chief Executive, Help the Hospices
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Achieved
Target Health and well-being Contributing to food education to support healthy, balanced lifestyles
Develop nutritional policies and adopt best practice to provide useful and relevant advice for customers. Develop and provide information to help with education on what we eat and drink. Give support and guidance for achieving healthy, balanced lifestyles to customers and colleagues. Manage policy development and implementation for own brand products on health and nutrition issues related to matters such as salt and saturated fat reduction. Continued development over 95% of product categories meet FSA 2010 salt reduction targets. Launched a minimum 50 fruit and vegetable promotion guarantee. Signed up to the Governments Public Health Responsibility Deal, including all the core commitments. We: recognise that we have a vital role to play in improving peoples health; will encourage and enable people to adopt a healthier diet; will foster a culture of responsible drinking, which will help people to drink within guidelines; will encourage and assist people to become more physically active; and will actively support our workforce to lead healthier lives.
Commitment
Update
Community Investment Supporting the development of fresh food know-how and cooking confidence
Develop the Lets Grow scheme to increase participants skills and knowledge. Build food skills knowledge by enabling practical expertise and advice. 18,417 schools registered. Lets Grow and Cook trialled in 40 schools. Won Best Green Education Award in 2010. Support national and local good causes for community benefit. Establish Raise a Smile brand to encourage support for charity fundraising. Raised 1.3 million for Help the Hospices and numerous local causes through our stores; for example, 0.4 million for the Pakistan Flood Appeal.
Commentary on targets
Our responsible Society targets are a broad set of objectives that we believe demonstrate our real commitment to addressing health and well-being and extending our positive influence in the communities in which we operate. These targets are non-exhaustive and indicative of our intention constantly to improve our social responsibility performance. They are in addition to the regulatory framework, best industry standards and responsible commercial trading which would be expected of us as a major UK retailer. In other words, it is all the work we do on top of what might be expected. We do so because as well as being socially responsible, there are clear benefits for customers, communities and our business today and in the future.
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Environment
Our approach
We recognise that it is important to our business, as well as society at large, to play our part in protecting the environment. Climate change, resource depletion, waste and pollution affect us all. As well as protecting the natural environment, reducing the impact of our operations can produce cost benefits by improving efficiency, allowing us to be more competitive in the marketplace. We have made good progress in many key areas. This section of the Review outlines some of the measures we have taken over the last year to improve our environmental performance further, focusing in particular on our stores where the majority of our impact is created.
As one of the UKs biggest supermarkets and a major food producer, we have a significant environmental footprint. We work constantly to reduce our impact and help our customers to play their part.
Our environmental considerations fall mainly into two parts. First, is all that we do to ensure food is produced, moved and sold with minimal waste and help customers reduce, reuse and recycle. This is about making the most of food. Second, is the major issue of carbon emissions reduction, which is a key overarching benchmark for environmental performance. When people think of emissions, they tend to think of energy, but in fact refrigeration, transport and waste are also significant factors. Increasingly, attention is turning to carbon in the wider supply chain, which commentators highlight as being the greatest challenge. We agree, but from a practical point of view we believe strongly that our focus should remain on our direct emissions where we can exert the most control. Our business model means that we own a greater part of the supply chain than other supermarkets. Our emissions programme (and the efficiencies we gain from the extent of our network) means that there are inherent carbon benefits from the way we are set up to operate. Wider supply chain issues, emissions associated with agriculture, global food supply and water use all present challenges that we will have to tackle as an industry, working with government at all levels. Clearer scientific research, like that undertaken in our Farm Research Programme, will be an important part of this collaboration.
1st
placed supermarket in the 2010 ENDS Carbon FTSE CDP Carbon Strategy Index.
1st
supermarket to be awarded the Carbon Trust Standard. All new stores are benchmarked under the BRE Environmental Assessment Method (BREEAM).
Wm Morrison Supermarkets PLC
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Meat
Instead of buying cuts of meat, we buy the whole animal; we buy the pig not the pork chop. As a result of the great relationships that we have built with farmers, our buyers can buy British cattle, lambs and pigs and then transport the livestock to one of our own abattoirs. We are then able to use every single cut of meat. Large cuts of meat, called primals, are transported to our stores where our trained butchers can expertly prepare smaller cuts exactly how customers want them. We also supply our own food preparation sites to make our own pies, sausages, cooked meats and other products. It all adds up to a better deal for farmers, great quality food, less waste and efficient use of valuable resources. Our customers gain the benefits of quality at a keen price.
their manufacturers to redirect their own brand surplus food to FareShare so that we can use it to feed disadvantaged people. We hope that many of them will take this opportunity to make sure that good food isnt wasted and we look forward to continuing to work together to fight food poverty and support local communities throughout the UK. Lindsay Boswell Chief Executive FareShare
Produce going through our own pack houses is washed, sorted and graded so that it arrives in store quickly and as fresh as possible. We buy whole crops from farmers and can utilise all of the food we buy. Take, for example, the great British potato. Other supermarkets ask a third party to pack certain sizes for them, to a certain specification based largely on how it looks rather than how it tastes. We take smaller potatoes out of the load and sell them as baby roasters or, if really small, as animal feed. Out-grades with skin blemishes or odd shapes can be sold in value packs. Nothing is thrown away. For a given tonnage of potatoes we can make use of 20% more of the crop than other supermarkets. Farmers sell their whole crop, customers save money and we reduce food waste.
Produce
As with fresh meat, we buy most of our fruit and vegetables direct from the farmer. The vast majority of the vegetables we sell throughout the year are British. When in season we are 100% British for strawberries, carrots, broccoli, swede, cauliflower, peas, cabbage, onions, potatoes, parsnips and sprouts.
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At Morrisons we work hard to reduce the amount of packaging we use and recycle as much of our own waste as we can.
Is packaging bad?
Packaging is not in itself bad. Packaging actually has a positive impact, reducing food waste by extending shelf life and protecting food in transit. When you consider the energy and resources used to make food and the greenhouse gases produced when it spoils, its clear that protecting food has to be a priority. As part of our Great Taste, Less Waste campaign, we introduced the Morrisons Keep it Fresh test, which scrutinises the use of packaging against set criteria. Its not always obvious what makes good packaging. Take, for example, the humble cucumber. Adding 1.5 grammes of film may seem unnecessary but can extend its life from three to 14 days (before it goes dull, limp and most people wont eat it). In 2010, we signed up to the second phase of the Courtauld Commitment, alongside other retailers, collectively to reduce the carbon impact of packaging in the food retail sector, by 10% by the end of 2012. This means we have committed to reducing our packaging by weight, increasing the amount of packaging that can be recycled and increasing the recycled content. O ver the last year alone weve cut nearly 4,000 tonnes of packaging from our products. For example, by replacing the punnet lids with a sealed film across a variety of our strawberry lines we have saved 138 tonnes. W e have saved a further 100 tonnes by reducing the thickness of the film on our loose fruit and vegetable easypick bags. W e have increased the levels of recycled plastic in our packaging. For example, the higher recycled content of our mince and sausage trays has saved the carbon reduction equivalent of over 290 tonnes of packaging. T he redesign of our caf sandwich trays from foamed plastic to card has improved recyclability and saved over 42 tonnes.
Reducing impact
Where the use of packaging is necessary, our in-house technologists work closely with our trading colleagues to offer advice on how to reduce the environmental impact of the packaging for new (and existing) product lines. Key performance indicators Store waste analysis Total waste generated
Year 2010/11 2009/10 2008/09 188,376 tonnes (including new stores) 2007/08 2006/07 192,846 tonnes 188,643 tonnes (including new (including new stores) stores) 187,773 tonnes 198,500 tonnes (including new (including new stores) stores)
0%
store waste direct to landfill by 2013.
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225 tonnes
300 tonnes
5,179 tonnes
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Our ambitious carbon reduction plan will see us reduce our total operational footprint by 30% by 2020 (from a 2005 baseline). We aim to achieve this despite the new stores, manufacturing and distribution centres that we continue to build. This means that, as we grow with each successive year, we have to work even harder to keep on track.
Store carbon reduction projects
Our stores are one important area where we are targeting savings. Our work on refrigeration is central to this (see page 23) but we also have other exciting plans for our stores this year. V oltage optimisation reducing incoming voltage to a lower value can save up to 7% of total store energy demand. Were trialling this in 50 sites in 2011, aiming to save around 6,300t CO2e, with a view to rolling this out across our entire estate. V entilation control by balancing the amount of air being brought into stores and the amount of CO2e produced by its occupants, it is estimated we will save 12,200t CO2e on electricity alone, with additional savings made on the gas used to heat the incoming air. P eterborough Stanground concept store (due for completion this year) will be our latest eco-store and will trial technologies including an air-source pump for heating, a fully natural-refrigerant refrigeration system, solar panels and full-LED lighting. L ED lighting on chilled display cabinets Installing low-power display lighting into cabinets will give us savings of 11,400t CO2e.
1,603,273
30%
target to reduce operational carbon emissions by 2020.
Wm Morrison Supermarkets PLC
2005
2006
2007
2008
2009
2010
Emissions figures have been updated to be aligned with the Greenhouse Gas Protocol, developed by the World Resources Institute and World Business Council for Sustainable Development. They have been updated with the latest electricity and waste conversion factors issued by DEFRA. SKM Enviros (Environmental Consulting)
1,417,376
1,498,255
1,549,089
1,418,697
1,457,098
Other projects
From stores to manufacturing, logistics and our people, were always looking at ways to reduce emissions. N ew lighting at manufacturing and logistics sites (with a survey to look at more) will save around 11,200t CO2e by introducing energy-efficient lighting. M ajor employee awareness campaign Were delivering our third major carbon awareness programme in 2011 to get colleagues on board to contribute to our reduction target. The graph below shows the steady progress that we are making, even as we grow our business.
1. Electricity 2. Gas 3. Haulage 4. Waste 5. Employees work travel 6. Business miles 7. Refrigeration
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Refrigeration
Cooling Industry Awards Large End User of the Year Small End User of the Year (Rathbones) Environmental Collaboration of the Year (Morrisons & WR Refrigeration for setting up the National CO2 Refrigeration Academy) Refrigeration Innovation of the Year (Morrisons & Arctic Circle Portable CO2 Plant).
Refrigeration is a big environmental issue for supermarkets. It is a really important component in keeping our food fresh and preventing waste, but the gases used in the refrigeration equipment have very high greenhouse gas emission factors. That means that a small amount of leakage is equivalent to a large amount of carbon dioxide being released into the atmosphere. Weve made reducing the impact of our refrigeration central to our carbon reduction strategy.
progress in the past year on its refrigeration programme, introducing new carbon dioxide plant, cracking down on leakage, delivering a hydrocarbon integral specification and setting out to reduce energy consumption.
Judges comment, Cooling Industry Awards 2010
In the last three years weve invested over 100 million in new and replacement systems. The net effect is that, since our 2005 baseline, weve reduced direct refrigeration emissions by over 40%. Were not finished yet. Refrigerant types vary and have different effects. Weve focused on replacing the more harmful gases with more environmentally friendly ones. More modern systems use carbon dioxide as the refrigerant because its global warming potential is far less than that of other gases. Over 70 stores were fitted with CO2 based central plant units in 2010, giving greater coverage than any other supermarket. More are planned in 2011. We set up a joint venture, the Natural Refrigerant Technology Centre, based in Hereford. The aim of the facility is to put the best available natural refrigerant equipment through detailed analysis to ensure its up to the task.
This approach has led to some real innovations. Weve developed equipment that is, in effect, a portable CO2 plant. It can service a whole store by being plugged in whilst we refurbish or refit existing equipment. This won Refrigeration Innovation of the Year in 2010. Weve also had to look beyond just the equipment. A lack of suitably trained engineers to service the machinery has been an issue. Weve helped to address this by developing industry-leading training for all our engineers to help them to maintain the efficiency of our equipment and further reduce emissions. Our work featured prominently in a best practice case study conducted and published by the Carbon Trust in 2010. We also picked up the Refrigeration & Air Conditioning Cooling Industry Large End User of the Year Award.
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Effective logistics
The Morrisons distribution fleet is vital to our supply chain and gives us flexibility in how we move products from suppliers to Regional Distribution Centres and from our food manufacturing sites to our stores.
illustration to be placed here Over the last 12 months, weve gone even further in supporting our target to reduce company emissions by 30% by 2020. Despite continued growth, weve reduced our haulage emissions once again, through better fuel efficiency in our modern fleet, driver training and the effective management of our road miles. In 2010/2011, the increased use of double deck trailers saved us 4.1 million kms. These streamlined, supersize trailers enable us to transport up to 80% more volume per trip. The goal for this year, with an additional 44 double decks in the fleet, is to save a further 83,000 kms per week. This would equate to an annual saving of 4.3 million kms. 90% of our current fleet utilises the latest Euro 5 engine emissions technology. This is an increase of 13.8% compared with January 2010 and we anticipate that 100% of the fleet will be Euro 5 compliant by the end of 2011. Euro 5 engines help to limit nitrogen oxides (NOx) emissions. We have a new initiative on trial to further reduce our fuel consumption. We are rolling out across our network the use of mains power for our refrigerated trailers, rather than using diesel. Over the next year, we expect this programme to save up to 400,000 litres of diesel. In logistics, we measure route planning efficiency in terms of how many cases per kilometre we are able to move. Over the last two years we have increased the number of cases per km by 12.7%. Following our successful completion of Sittingbourne in the South East were now fully underway with the construction of our new distribution centre in Bridgwater in the South West. As well as delivering greater transport efficiency to our network we are also working to make Bridgwater one of the greenest sites we have ever built. Some of the environmentally friendly features include extensive coverage of solar panels, rain water recycling, LED lights that dim when no movement is detected and recycling across all areas of the site. When operational from Autumn 2011, we anticipate that Bridgwater will be one of the most energy efficient distribution centres in Europe.
500,000km
saved through efficient transport planning.
Wm Morrison Supermarkets PLC
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Achieved
Target Waste prevention Enabling customers to reduce food waste Reduce the carbon impact of our packaging
Further development of Great Taste Less Waste campaign. Reduction in the carbon impact of our packaging by 10% by the end of 2012. Zero waste direct to landfill from stores by 2013. Research, development, packaging, storage and cooking advice. Extended communication via in-store magazine, website and social media. Saved over 4,000 tonnes in 2010.
Commitment
Update
Packaging to be best fit for purpose, considering: weight saving type of material recycled content recyclability. Collection and processing back of store waste through a national waste management framework. Diversion of supply chain waste for processing through Anaerobic Digestion. Minimising waste from our own supply chain.
Achieved original target of 50% reduction (by volume). On target to achieve zero waste direct to landfill target.
Resource efficiency: conversion of waste to energy through Anaerobic Digestion continue carbon awareness programme
Commentary on targets
Our responsible Environmental targets are formed from a nonexhaustive set of commitments that we believe capture material issues that relate to waste prevention and reduction and climate change. This is in addition to the regulatory framework, best industry standards and responsible commercial trading which would be expected of us as a major UK retailer. In other words, as with our Business and Society targets it is all the work we do on top of what might be expected. The efficiencies we gain provide clear benefits for customers and our business today and in the future. Critically, our wider carbon emissions programme is part of a recognised collective response to the global issue of climate change.
Contact us: Corporate Responsibility Corporate Services Wm Morrison Supermarkets PLC Hilmore House Gain Lane Bradford BD3 7DL Telephone: 0845 611 5000 Find out more about our approach to CR, our policies, targets and to view previous reports:
Visit www.morrisons.co.uk/today