PUMA has disclosed that raw material production accounts for the highest relative impacts of Greenhouse Gas Emissions (GHG) and Water Consumption within PUMA’s operations and supply chain.
As the first company to provide such details, PUMA has published an economic valuation of the environmental impacts caused by GHG emissions and water consumption along its value chain. Ultimately, PUMA’s undertaking will see the inclusion of further environmental key performance indicators in Stage 1, followed by social and economic impacts in later stages of development. As part of PUMA’s long-term sustainability plan, the analysis was commissioned in recognition that producing and selling PUMA products has a wide impact along the entire supply chain. By identifying the most significant environmental impacts, PUMA will develop solutions to address these issues, consequently minimizing both business risks and environmental effects. PUMA’s E P&L statement provides an unprecedented and detailed level of understanding, sets a new benchmark in corporate environmental reporting and will hopefully serve as a catalyst for others to join an industry-wide engagement. The first results of PUMA’s E P&L have revealed that the direct ecological impact of PUMA’s operations translates to the equivalent of €7.2 million of the overall impact valuation. An additional €87.2 million falls upon four tiers along the supply chain. In total, this leads to an overall environmental impact of GHG and Water Consumption of PUMA’s operations and the supply chain of €94.4 million. By putting a monetary value on the environmental impacts, PUMA is preparing for potential future legislation such as disclosure requirements. These costs will serve as a metric for the company when aiming to mitigate the footprint of PUMA’s operations and all supply chain levels and will not affect PUMA’s net earnings. “The E P&L statement is a milestone in PUMA’s mission to become the most desirable and sustainable Sportlifestyle company in the world. It is an essential tool and a shift in how companies can and should account for and, ultimately, integrate into business models the true costs of their reliance on ecosystem services and PPR HOME will encourage and collaborate with the industry to adopt this tool,” said Jochen Zeitz, Chairman and CEO of PUMA and Chief Sustainability Officer PPR. “Gaining a better understanding of the source of the natural goods and services PUMA relies on and the declining availability of the basic resources required for our business growth, will help PUMA build a more resilient and sustainable business model and ultimately better manage its impacts on the environment.” PUMA chose GHG emissions and water for the first analysis in their E P&L development as they were considered to be the most significant environmental impacts. The economic valuation of these impacts (please refer to www.about.puma.com for details of methodology) by PwC (GHG emissions) and Trucost (water use), estimated a value per tonne of CO2e at €66 and an average water value of €0.81/ m3. The analysis found that: • Including the full supply chain, the overall impact was valued at €94.4 million in total for 2010 with greenhouse gases equating to €47.0 million and water to €47.4 million.
• Of the total, PUMA’s operations accounted for 15% of the overall GHG emissions analysed, and 0.001% of water consumption. This is the equivalent to €7.2 million of the overall valuation.
• The remaining GHG and water consumption – the equivalent of €87.2 million – fell upon its entire supply chain. “Fundamentally, this analysis is about risk management for the environment, and for business, because you cannot separate the two,” said Alan McGill, partner, PwC Sustainability and Climate Change. “This is a first for a company to measure and value the impact of its business in this way and gives PUMA a unique and challenging insight into their supply chain. It’s a game–changing development for businesses to integrate environmental issues into their current business model like this, because it provides a basis for embedding their reliance on ecosystem services into business strategy. Tackling the impacts will need concerted efforts by the businesses in their supply chain as PUMA shares a common but differentiated responsibility with other brands at the production facilities,” he continued. Analyses of the water and GHG impacts were performed across PUMA’s value chain, including the operations of raw material and product suppliers as well as logistic services, which PUMA has limited control over. • Tier 4: Raw material production, such as cotton farming, oil drilling, etc.
• Tier 3: The processing of raw materials, such as leather tanneries, chemical industry, oil refining
• Tier 2: Outsourced processes such as embroiders, printers, outsole production
• Tier 1: The manufacturing of its products
• PUMA core operations: Design, logistics services, warehousing, head office functions and retail
MOST POPULAR IN LAST 24 HRS
MOST POPULAR IN LAST 7 DAYS
|
