SUSTAINABILITY OVERVIEW

Sustainability remains a key focus area of our business. It is a way of thinking that should not be displaced by the pressure of a global financial crisis. We regard tougher trading conditions and tighter margins as an excellent context to ensure these considerations become more fully integrated and linked to core business practices. These include the products we stock, how they are packaged, transported and displayed, how our customers use them and dispose of any waste.

We have delivered quality products at affordable prices to our customers for decades; our challenge now is to work with suppliers and other partners to inspire products and services that create lasting value for communities and the environment. This is an immense challenge presenting several critical issues. Of particular importance for retail is food security. Food supplies globally are under threat from a changing climate, declining soil fertility and water limitations. This is intensified as farmers face tougher access to credit and a shift to biofuel production in several countries. We can never take food for granted. Challenges such as these are unequivocally our business. We have no choice but to place retailing in the larger social and environmental context which will define how well we are doing our work.

The issues are seldom simple. Organic products may lead to an increased water footprint; biodegradable plastics can hinder the plastics recycling industry; reducing packaging too much can undermine product integrity, creating more waste; biodiesel produced from our waste cooking oil still contributes greenhouse gases to the atmosphere; we delight in offering delicacies from distant places, yet recognise they carry a carbon cost not reflected in the price. Certainly, there are trade-offs to be made. But these must be made with the appropriate question in mind:
Are we doing the right things to build a more resilient company, help solve the world’s toughest challenges, and create a brighter future for all?

We are confident that we are moving in the right direction. Our sustainability strategy seeks primarily to develop our people’s capacity to make difficult decisions that reflect our commitments. This will require a combination of innovative spirit, inspired partnerships and the humility to recognise where we are on the journey.

Energy has been a principal challenge this year, focused on building the foundations to consolidate broad commitments into quantified targets. We have been inspired by our customers: over 50 000 vouchers were issued for Compact Fluorescent Lamp (CFL) light bulbs as part of our power pledge campaign. There has been concerted action across the Group to reduce waste, energy and water usage. We have introduced a large number of pilot programmes in several areas (including waste, awareness and organics); national roll-outs are underway.

We are shifting our focus towards suppliers to encourage them to see environmental and social issues as an opportunity to innovate. We have activated partnerships aimed at improving animal welfare practices and are presently reviewing our procurement policies to drive ethical and animal welfare standards throughout our supply chain. In promoting preferential procurement, our Shelf Life Project has made great strides towards attracting small business owners into our supply chain.

We are immensely proud of the efforts made by literally thousands of Pick n Pay people who, through creative partnerships, are making the transition to a sustainable society a reality. The wind turbine installed at our regional office in Port Elizabeth may only generate 3% of daily energy usage, but the learning curve is crucial.

Sustainability commitments are an investment in the future of our business, the future of our customers, and the future of families around the world. Although there is clearly a lot of work to be done, we have faith in human ingenuity and goodness. Going forward, we hope our efforts will be an inspiration to a myriad of companies who have much to contribute to this critical task.

The following summary touches on a variety of ways we have worked with partners to put innovative ideas into practice and inspire our customers. A more comprehensive sustainable development report will be published on our website.