Tesco CEO Dave Lewis' presentation to the CGF Sustainable Retail Summit
2 Nov 2016
Delivered on: 27 October 2016
Location: Pullman Bercy Hotel, Paris
Text: Check against delivery
Good morning everybody. Thank you Mike.
Tom, you make a joke about the fact that it’s very rare for Mike and I to stand on the same stage and that’s true for very obvious reasons. But I think the fact that we’re both here, and we’re both talking about the same subject, means it’s something that both businesses are doing a huge amount on, and I think that is significant in itself.
So I’m here to talk on behalf of Tesco, but I’m also here to talk on behalf of Champions 12.3. I accepted an invitation last year to take on the Chairmanship of that, so I’ll try to make a link between the two and I’ll try not to repeat things Mike’s already spoken about.
What I’m going to do in the context of Tesco is I’m going to talk to you about four years of work. We were also signatories to the Courtauld agreement. There are many things that have been done, the Carbon Trust and likewise, but I want to focus on four years.
It was before my time that Tesco engaged with opinion formers in the UK specifically on food waste. And what they said to us at the time, back in 2012, was actually we need to understand your food waste data. Tell us exactly what it is that’s happening in your business and the total supply chain. When we have that, we can work together on how it is we can tackle it.
So three years ago last week, Tesco became the first UK retailer to issue, in quite some detail, our food waste footprint. We even took it down to individual categories. We’ll come back and talk later about the ability once you measure something accurately, then to target your interventions to make an impact.
And all of that work has been assured externally by KPMG. The importance there is credibility. It’s about making sure we’ve got traceable, trackable, safe ways of looking at things that we can monitor over time and be assured that we are making the progress that we set out to make.
The measurement in Tesco is particular. We measure individual items, we don’t aggregate. Everything at the end of our store is measured, and we know exactly what the weight is. We also know exactly what the composition is. And what you see here is the near 60,000 tonnes that we declared last year and the breakdown of that category by category. We think it’s important. We think it’s important because it allows us to target our interventions very specifically with our suppliers in our own operation, and indeed with customers.
It can be painful too. When we put this out this year actually our waste went up by 4%. And it went up principally because our targeting and our tracking had got better, particularly in the area of bakery. One of the hardest parts of running a store is in terms of forecasting demand, in the way that Mike described. But we think it’s important. It’s a very important, very significant part of tackling waste.
So this is the level of detail that we report, it’s the level of detail we track. We also looked into some 25 different products to be able to look at the breakdown across the supply chain and what’s driving waste.
Having done that, there has been an awful lot of work over the last four years. We started discussing food waste with our partners. We talk about demand forecasting and we talk about mutual sharing of information. There’s been a huge amount of work going on in the Tesco supply chain to work with partners on the way they serve our business. We also have forged direct partnerships between suppliers and the FareShare organisation. So now food surplus, potential waste in the supply chain, is starting to get donated to FareShare from our supply base directly, sometimes delivered through our own distribution system. So that was another key element of the partnership that’s been going on in Tesco.
And the last element is actually bringing together something completely new – a start-up business from Ireland called FoodCloud together with FareShare in order to set up the ability, safely and securely to make donations to local charities and groups across the UK.
As time has progressed, we’ve made more commitments. The commitment to join Champions 12.3 is clearly one of them. I’m delighted that the Consumer Goods Forum has signed up to the commitment to halve food waste, not by 2030, as the UN sustainable goal suggests, but by 2025. There’s a clear commitment by the people who are part of the Consumer Goods Forum to deliver on this reduction in waste initiative.
At the same time, and very specifically for Tesco, based on some experiences of my own, we’ve made an audacious goal for ourselves which is this: by the end of 2017, no food which is safe for human consumption should be wasted. I’ll tell you a little bit about what we’re doing to do that, but we’re going to challenge ourselves to achieve that in 24 months from the time that we started.
What’s the progress we’re making? Well as we speak today 776 stores across the UK donate their food waste to charities and community groups. The groups have been vetted by FareShare in order to ensure that the food we donate is safely consumed. It is a concern to me that some of the other donation schemes do not have that failsafe within them.
By the end of November we’ll be at more than 800 and we have also taken it to 122 of our smaller stores. So the idea is that by the end of this year every large store in the Tesco estate will be donating to the Community Food Connection. We’ll extend that to all of our small stores through the course of next year and that will be a fundamental leap in terms of delivering on our commitment that no food that’s safe for human consumption is wasted.
We support 3000 charities and groups as we speak today. We’ve just run our first survey to make sure those partnerships are effective. 98% of those charities would strongly endorse the programme we’ve launched. We were also delighted for everybody involved that the industry recognised our approach in the IGD sustainability awards last week.
So, final chart from me with 15 seconds on the clock, is a request. At the Consumer Goods Forum Board in South Africa, we asked retailers to sign up for transparency. We believe in measurement. We’ve set a target. We need to decide what action we’re going to take. And then we can measure the progress.
I also have to say something a little candidly, which was through the years we’ve argued about methodology – it really doesn’t matter and I’m delighted to see Mike’s announcement recently. The methodologies are ever so slightly different and there might be some things that we would discuss about how it is we align them. But the most important thing is we’re measuring it, we’re trying to do something about it. And I just encourage all retailers around the world to start doing that.
From a manufacturing point of view, partnership in the supply chain is huge. We’ve not had buy one, get one free promotions in fresh produce for a long time now. We don’t have a landfill issue. Tesco’s been in that situation way before my time – 2009 was the first year we had zero waste direct to landfill.
But we also want to engage in education around household food waste. It is by far and away the biggest element in a developed market like the UK and we need to work together to do that.
And then for all of us together, when we’re not able to avoid it, let’s make sure that we distribute to people in a safe and simple manner, so that no food that’s safe for human consumption goes to waste.