With sustainability becoming more important to consumers, retailers across the board have started making bold statements and setting out ambitious goals – but are they real or just for show? Retail Week investigates.
- Retail Week compares the progress of 14 retailers against their own sustainability targets
- Greenwashing is rife within retail, says Accenture’s Lynda Petherick, with too many businesses taking only partial steps towards sustainability
- Greater benchmarking and better guidance on labelling is needed across the industry, say campaigners
From net-zero carbon to ethically sourced cotton, sustainability targets have become ubiquitous across retail and the global pandemic has only accelerated consumer expectations.
Shoppers are becoming more aware of their purchasing habits and where the products they buy come from. Some 49% of UK consumers said they were planning to make more environmentally friendly, sustainable or ethical purchases over Christmas, according to the latest research from Accenture.
But while there is now more scrutiny on retailers’ environmental practices, it can be difficult to differentiate between genuine corporate responsibility and those jumping on the bandwagon.
‘Greenwashing’ – a marketing ploy whereby businesses present themselves as more climate-friendly than they really are – is rife in retail, says Accenture head of retail Lynda Petherick.
A raft of sustainable targets have been set by retailers over the past few years on materials such as cotton, wood and paper, as well as the energy resources used in offices, stores and distribution centres.
Greenwashing arises when retailers set unrealistic targets, publicise misleading claims or limit the scope of their goals to certain elements of the business – ultimately allowing the rest of the company to continue to operate in a way that is detrimental to the environment and plastering over concerns.
“What’s important is that retailers don’t look for quick fixes and instead ensure their business models are reflective of the initiative they’re promoting”
Lynda Petherick, Accenture
“What’s important is that retailers don’t look for quick fixes and instead ensure their business models are reflective of the initiative they’re promoting,” explains Petherick.
“Let’s take the fashion industry, for example. Organic cotton seems to be the latest retail marketing buzzword since its environmental benefits have become more well-known among consumers.
“However, there are some products being advertised as made from organic cotton – and indeed they may well be – but a retailer’s overall business model still might not align with sustainable consumption.”
In 2019, for example, Boohoo’s #ForTheFuture recycled-clothing capsule collection of just 34 items received backlash, given that the retailer ordinarily adds around 100 new items to its site every single day.
The collection itself, which claimed to help shoppers “dress well and do your bit for the planet”, was made largely of polyester and, with prices starting at £4, still contributed to the single-use nature of Boohoo’s ranges.
However, former Marks & Spencer sustainability director Mike Barry, now a sustainability consultant, does believe the retail industry is taking this seriously.
“It’s complicated, mistakes get made and businesses overclaim – but the problem is some businesses do not realise how much they have to change”
Mike Barry, sustainability consultant
“As businesses do more in this space there is the risk – I don’t think maliciously– that they do it wrong and it comes across as greenwash,” he says.
“Not to be naive – there is a little bit of bullshit out there – but generally this is lots of businesses waking up to the fact that they need to do more.
“It’s complicated, mistakes get made and I think businesses sometimes overclaim – but the problem is some businesses do not realise how much they have to change.”
Is retail doing as it says?
Retail Week has researched the sustainability pledges that retailers have made and their progress against these targets. Pleasingly, most retailers are making notable headway in achieving their aims.
In fact, in some areas retailers are actually exceeding their targets. Tesco, for example, has achieved 68% renewable energy, above its 65% by 2020 target and on track to reach 100% by 2030.
However, there are some areas where retailers are struggling. In grocery, plastic packaging and recycling are prominent environmental targets.
Marks & Spencer is seeking to have 100% recyclable packaging by 2022, with figures currently reported at 77%, while Tesco has achieved 83%.
Sainsbury’s, the Co-op and Aldi, meanwhile, are far more vague about their achievements so far, with Sainsbury’s even blaming the pandemic for a lack of progress.
Cotton has been high on fashion retailers’ agendas, although there is some discrepancy about what ‘organic’ and ‘sustainable’ cotton actually means.
H&M had almost reached its target of 100% sustainable or recycled cotton by 2020 when reporting in 2019, but it has not updated since.
Meanwhile, John Lewis Partnership has some way to go to hit its target. It aimed to achieve 50% sustainable cotton for the John Lewis fascia by January 2021 and 100% for Waitrose in the same timeframe.
As things stand, John Lewis has 36% sustainable cotton, while Waitrose has just 23%.
Retailer | Environmental targets/goals | Achievements to date |
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Marks & Spencer |
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Ted Baker |
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Iceland |
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John Lewis |
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Tesco |
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Sainsbury’s |
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Aldi |
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Co-op |
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Boohoo |
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H&M |
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A popular pledge across the retail industry is to reduce carbon emissions, with many businesses seeking to reach net-zero by 2050.
With that goal still a way off, however, reduction figures seem to be moving slowly or are not being reported on at all. Retailers therefore need to make sure they are not just jumping on the bandwagon and are actually putting measures in place.
Holding businesses to account
Of course, sustainability targets are not new. In 1990, Coca-Cola set itself a target of making its bottles from 25% recycled plastic. Thirty years later, its bottles still only contain 10% recycled plastic. And the company is the world’s largest plastic polluter, according to sustainability campaigner Changing Markets Foundation.
So, how can retailers be held to account on the bold targets they set?
One way is for official bodies to formulate labelling or certification schemes. However, at this stage none seem forthcoming.
“Universal targets are yet to be defined for measuring the sustainability of retail; therefore the feasibility of individual targets can differ. It all depends on their ambitions and how willing they are to hold themselves to account,” says Petherick.
“The appetite for sustainable fashion and ethical products is growing. Retailers have cottoned on to this as we have witnessed a pervasive rise in greenwashing”
Abigail Morris, Compare Ethics
However, with consumers eager to do the right thing and buy from sustainable companies, it can be confusing knowing where to spend one’s cash.
“The appetite for sustainable fashion and ethical products is growing. Retailers have cottoned on to this as we have witnessed a pervasive rise in greenwashing,” Compare Ethics co-founder and chief executive Abigail Morris told the Environmental Audit Committee when giving evidence for its Fixing Fashion report.
“Consumers currently struggle to separate the legitimate sustainable options from the dishonest, ambiguous claims of ‘all-natural’, ‘recycled’ and ‘conscious’, which are frequently taken out of context.”
Independent benchmarkers, such as the Dow Jones Sustainability Index, FTSE4Good, Greenpeace, Peta, The Food Commission or World Benchmarking Alliance, can all help towards understanding where a retailer stands, but it is both time-consuming and difficult for customers to do all the research necessary.
Morris believes there needs to be specific guidelines for retailers to follow.
“The misleading environmental and social claims made by retailers re-emphasises the need for clear guidance on labelling. This includes details on environmental impacts, provenance of garments and fair labour practices,” she says.
“New guidance on labelling would also positively influence consumer behaviour as what gets measured gets managed,” she concluded.
In the case of food retailers, Barry says universal labelling could help separate the fact from the PR fluff.
“Walking into a supermarket and going through all the thousands of product lines to work out which is green and which isn’t would be extremely difficult, so independent benchmarking at a brand level and product level is needed to help people separate the good from the bad,” he says.
“We’re seeing brands like Allbirds and Quorn putting carbon labels on their products. For supermarkets like Tesco, where there’s 100,000 SKUs, it’s hard to imagine putting a label on everything, but it’s something retailers are likely to look at over the next few years.
“I think consumers will look to those that do everything for them – they don’t instinctively want to look over all the products themselves.”
Barry also predicts that consumers will start to look to apps to help identify products’ or retailers’ sustainable credentials.
Amazon, for example, has started putting independent certification on some of its products, which he says is a step in the right direction for the global ecommerce giant.
Meanwhile, apps such as Good on You, which ranks fashion retailers and details their corporate responsibility, have become popular recently.
H&M makes its sustainable progress transparent
H&M has been placing sustainability at its core for more than a decade, integrating practices into its ways of working, with more than 250 of its colleagues now working on sustainability alone.
The fashion retailer has collaborated with a number of innovators to create tech such as a garment recycling machine for both its H&M and Monki brands.
“Investing in sustainability and having a strategic sustainability programme is today of vital business importance for all companies that wish to be competitive,” says H&M transparency strategy and engagement lead Giorgina Waltier.
“We see technical innovation as a key solution to environmental challenges – for many types of textiles, viable recycling solutions either do not exist or are not commercially available on a large scale.
“That is why we are collaborating with innovators to tackle this challenge, which is another important factor in achieving our goals.”
“Customers are demanding stronger sustainability credentials; as a brand, it is our responsibility to educate our customers”
Giorgina Waltier, H&M
H&M has a proven track record of holding itself to account, reporting on progress towards targets in a detailed standalone report each year, as well as seeking external accreditation, such as from the Peta Vegan Fashion Award, Dow Jones Sustainability Index, Fashion Transparency Index, Sustainable Cotton Ranking and Global 100 Index.
“Customers are increasingly demanding stronger sustainability credentials; as a brand, it is our responsibility to educate our customers and provide clear information on our collections,” says Waltier.
“They are more interested than ever in taking care of their garments and understanding where they were made and what they are made from.”
Stronger together
Last month, 63 retailers, including Ikea, Kingfisher, Boots and Primark, signed up to the BRC’s Climate Action Roadmap with the goal of becoming net-zero by 2040.
The roadmap aims to put decarbonisation at the centre of all business decisions, reduce emissions across shops and logistics, and explore new technologies to help consumers live more sustainably.
While there are still some things that retailers wish to compete on – Barry gives the example of food retailers creating the best plant-based meals – working together will ultimately bring the end goal within reach and ensure that retailers keep each other accountable.
Petherick also suggests retailers who may not know where to start could join forces with one of the many tech start-ups that have broken into the market recently.
“For the retailers who are struggling to ramp up their sustainability initiatives, they should consider wider technology partnerships that may help them to achieve their goals and gain the trust of consumers.”
Greenwashing may be a problem at the moment, but with sustainability predicted to be more important than ever post-pandemic, and collective strategies like the BRC roadmap coming to the fore, retailers not taking the situation seriously may soon have the impetus to change.
Petherick says: ”All stakeholders are demanding it, not just investors, employees and consumers, but the planet, too.”
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