Consumer goods giant Procter & Gamble boasts some impressive achievements, yet its report doesn’t delve into the ultimate sustainability of its popular brands
You can’t turn around in a supermarket these days without bumping into a Procter & Gamble product. The multinational company has scores of iconic brands – 23 of which have more than $1bn in annual sales each – from Wella shampoo, to Charmin toilet paper and Fairy washing-up liquid.
Since 2010, P&G’s global sustainability efforts have centred on 14 major goals. Already in 2014, the company surpassed its 2020 target of reducing its manufacturing waste disposed to less than 0.5% of all input materials. Now just 0.4% of input materials at factories go to landfill, and 70 of P&G’s 192 facilities worldwide are zero-waste.
Last year, 54% of virgin wood fibres used in production came from Forest Stewardship Council-certified sources, far overtaking the company’s 40%-by-2015 goal. Meanwhile, two co-generation energy plants in Pennsylvania and Italy helped cut down P&G’s direct and indirect CO2 emissions – though not its GRI Scope 3 emissions – by 14% per unit of production, compared with a 2010 baseline.
On the social side, P&G’s has set itself an impressive goal to secure safe drinking water to people in need. In 2014, the company provided its 7 billionth litre of clean water through the Children’s Safe Drinking Water programme. The company is also working to encourage consumers to wash their clothes in cold water to reduce energy consumption – through communications campaigns, it aims to get its consumers to increase cold-water loads to 70% of all wash cycles, up from 53% now. This goes hand in hand with P&G’s goal to cut water in its liquid laundry detergents by 25% by 2018.
In 2014, P&G assessed progress on the 14 goals made in 2010 and added four new 2020 targets: reducing water usage at manufacturing facilities by 20% per unit of production; providing 1 billion people with access to more “water-efficient” products’; doubling the use of recycled plastic resin in packaging; and reaching 90% recyclable packaging.
Commendably, P&G has committed to show traceability of palm oil and palm kernel oil to supplier mills by the end of 2015 to ensure that they respect human rights and don’t contribute to deforestation. P&G’s 2014 report talks a lot about doing “the right thing”, and it is clear the company believes its sustainability efforts are fully integrated into its business plans.
Yet, P&G apparently hasn’t used a materiality process or matrix to identify the issues that matter most to its business and stakeholders. Materiality is not mentioned in this concise, 68-page report, nor is feedback from external stakeholders included in the document. This makes it difficult to assess where they think P&G should be putting its most concerted efforts. In addition, though the company emphasises in the report the importance that employees play in achieving all three of its pillars of sustainability – economic development, environmental protection and social responsibility – it does little in the document to tell the kind of engaged-employee stories that would make this feel more central. Meanwhile, continued job cuts, started in 2012, are on tap for 2015.
P&G’s iconic brands are its economic bread and butter – the company has said that it plans to sell off its “non-core” brands to focus its efforts on big growth ones. But are these core brands truly sustainable or can they become so?
The company’s latest sustainability report does not address this. P&G chief executive Alan G Lafley says consumers want sustainable products with no trade-offs, and that may be true. Yet, at least in this report, P&G has not conclusively demonstrated the sustainability potential of its brands, or how they can get there. The company’s “future friendly” marketing and product initiative announced in 2010 that hinted at this direction seems to have been abandoned, or at least, finds no home in this report.
- Follows GRI? Uses G3 guidelines.
- Assurance? Not mentioned.
- Materiality analysis? No.
- Goals? Many.
- Targets? Yes.
- Seeks feedback? Not overtly.
- Key strength: Clear progress toward stated goals.
- Chief weakness: Lack of materiality analysis.
- Pleasant surprise: Conciseness.
- Level of integration: (1 to 5): 2.5
brands CR report review CR Reporting P&G Procter & Gamble zero-waste
May 2015, London, United Kingdom
Europe’s leading meeting place for corporate leaders delivering sustainable business. 12+ C-Suite and over 300 attendees will address some of the key issues and opportunities, including: sustainable innovation, collaboration, and resource efficiency and brand strategies