Carbon footprint of retailers increases as businesses grow 

The report, published by market research company Mintel, looked at 12 leading retailers and found that most of them had increased their absolute carbon footprints during the last year for which data is available – despite many of them having well-publicised environmental policies in place. 

Mintel attributes this increase to businesses expanding their square footage and/or increasing their opening times – both potentially good commercial strategies, but both policies which have the effect of increasing energy consumption.

Apart from DSG International and Asda – neither of which report their carbon emissions – the only organisations bucking the trend and actually reducing their carbon footprints were Home Retail Group, J Sainbury and Next, which reaped the benefits of investment in energy efficiency measures, coupled with limited expansion.

While acknowledging that reduction of a business’s overall carbon footprint tends to be at odds with its commercial growth, Richard Caines, senior retail analyst at Mintel, suggested this should not preclude expanding companies from making serious efforts to cut their carbon emissions. 

“The report looks at the measures taken in terms of reducing the total carbon footprint [...] But you could measure it [the carbon footprint] on a per sales or per square foot basis, or use some other measure,” he said.

In fact, when the report looked at carbon emissions relative to turnover, it found most of the retailers reporting data had managed to reduce emissions through energy efficiencies.  

Marks & Spencer and John Lewis were the two that failed to make cuts – again due to expansion of operating space and longer operating hours, and in both cases at odds with their stated corporate objectives, the report observes.

The report suggests that, despite its headline findings, retailers are working harder than ever to reduce carbon emissions. They have been spurred on in part by the downturn in trading conditions which has intensified the need to improve energy efficiency for commercial as well as environmental reasons, in part to comply withe new regulatory requirements like the the Carbon Reduction Commitment.

“When we did this report last year, there were lots of high-profile stories coming out from retailers, for example Marks & Spencer had its Plan A,” observed Caines. (Plan A set out 100 commitments to be achieved in five years, aimed at combating climate change, reducing waste, using sustainable raw materials, trading ethically, and helping customers to lead healthier lifestyles.)

“This year there is a lot less media focus, but they are still doing things behind the scenes – things that consumers wouldn’t necessarily be aware of,” he suggested.

The report says retailers now want to be seen to be reducing their carbon footprint relative to sales by being more energy-efficient in the way they operate existing stores and designing and building new stores that produce up to 50 per cent lower carbon emissions.

But it suggests that if they are to square the circle of expanding their businesses while reducing their carbon footprints, it will be necessary for them to switch to renewable energy. “It is the quickest way of reducing GHG emissions that retailers are directly responsible for,” it says.

Another major concern of the retailers is waste management. Yesterday Environment Secretary Hilary Benn declared his intention to make Britain a “zero waste nation”, and Mintel’s report observes that: “Zero waste to landfill is now the mantra among leading grocery companies”. 

It says, this year, Tesco became the first to achieve this, by improving recycling rates and diverting waste away from landfill to alternative waste processing treatments.

The Mintel report – ‘ Ethical and Green Retailing - UK - September 2009’ – covered 12 leading retailers: Alliance Boots, Asda, Co-operative Group, DSG International, Home Retail Group, J Sainsbury, John Lewis, Kingfisher, Marks & Spencer, Morrisons, Next and Tesco.