Unilever sustainable living plan: Implementing sustainability management across the value chain

Henry King, Llorenc Mila i Canals

Unilever, United Kingdom

Two billion times a day somebody, somewhere in the world, uses a Unilever brand covering a range of Home Care, Personal Care and Foods products. We have ambitious plans to grow our company but growth at any cost is not viable. In November 2010 we launched the Unilever Sustainable Living Plan that addresses the social, economic and environmental impacts of our business and products. The plan takes a life cycle perspective and it is based on a rigorous assessment of our product portfolio and it takes into account our business ambitions and the views of key stakeholders. For example, the environmental footprint analysis covered 14 countries, 1600 representative products and 70% of sales and the sustainable sourcing target covers 100% of agricultural-based raw materials. The key social impacts addressed include the health and well-being benefits of our products. Overall the plan has three main targets to be achieved by 2020 as well as over 50 time-bound publically stated goals.

The paper will review the practical challenges and choices of moving from sustainability assessment to implementation in the business context. It will address decision making during the formulation of the plan and the business need to focus on actions rather than continual assessment. Key assumptions and choices will be highlighted based on the extent of current knowledge and robustness of measurement techniques. The emphasis on action is supported by a strong business case which can be summarised as: meeting the growing number of consumers that want reassurance that the products they buy are ethically sourced and protect the earth’s natural resources, winning with customers (retailers) many of whom have sustainability goals of their own, fueling innovation, growing sales in developing markets where the challenges of sustainability is often the greatest and generating cost benefits. Traditionally sustainability management and reporting ambitions of manufacturing companies have often remained inside the factory gate. By adopting a life cycle based perspective new challenges are presented to business and in the implementation of the plan we have identified three main areas of change or ways of doing business. Firstly, technological change led by companies encompassing not only eco-efficiency improvements but transformation system change. Secondly, behaviour change by consumers both in terms of the types of products they use and in the way that they use them. Thirdly, legislative change led by governments in areas that will help businesses and consumers to reduce life cycle environmental impacts and promote socio-economic development.

Measuring the sustainability of products: The Eco-Efficiency and SEEBALANCE® analysis

Peter Rudolf Saling, Marianna Pierobon

BASF, Germany

BASF has pioneered the assessment of the sustainability of chemical products and production processes through the development and use of its Eco-Efficiency Analysis as well as SEEBALANCE® analysis. The tools are used by BASF and its customers to assist strategic decision-making, facilitate the identification of product and process improvements, enhance product differentiation as well as to support the dialogue with opinion makers, NGOs and politicians.

Both Eco-Efficiency Analysis and SEEBALANCE® analysis are comparative methods; the advantages and disadvantages of several alternatives are assessed according to a predefined customer benefit. The analysis uses a Life Cycle Assessment approach with the whole life cycle of a product – from cradle to grave – being considered. Next to the environmental impact, which is assessed based on ISO14040 and ISO14044 norms, all economic factors are taken into account. The SEEBALANCE® also considers social impacts of products and processes.

The experience of over 450 analyses and is increasingly applying Eco-Efficiency analysis to measure sustainability in different sectors. Different examples will show, how the methodology can be applied. It helps with its holistic approach to answer questions of sustainability in the fields of R&D, strategy development and marketing. It enables industries along the whole supply chain to improve products and processes for more sustainable solutions.

The multicriterial life cycle based approach in combination with a defined aggregation and summary of single results ends in an easy understandable graph. Different scenarios can be worked out additionally to support decision-making processes. New developments of the methodology will show additional aspects in the sustainability evaluation.

Literature

[1] Saling, P. et al, Eco-efficiency analysis by BASF – The method, Int J. LCA 7 (4), 2002, 203-218.

[2] Shonnard, D.R., Kicherer, A., Saling, P., Industrial Applications Using BASF Eco-Efficiency Analysis: Perspectives on Green Engineering Principles, Environmental Science and Technology, 2003, 37(23), 5340-5348

[3] Kölsch, D., Saling P., Kicherer, A., Grosse-Sommer, A., How to Measure social Impacts? What is the SEEbalance® about? – Socio-Eco-Efficiency Analysis: The Method. In: International Journal of Sustainable Development. Int. J. Sustainable Development, Vol. 11, No. 1, 2008, 1-23.

Sustainable lifecycle engineering at Siemens AG

Jens-Christian Holst, Katrin Mueller, Karin Uebelhoer

Siemens, Germany

As Siemens history shows, our understanding of sustainability is closely linked to our company values – responsible, excellent and innovative. From the very first, Werner von Siemens insisted that his company fulfill its responsibilities to its employees, to society and to nature. To achieve excellence, to capture leading positions in the markets of tomorrow, to develop innovative technologies that help ensure the future viability of modern civilization – this has always been our vision and our challenge.

We are focused on the future trends:

• Demographic change and healthcare

• Urbanization and sustainable development

• Climate change and Energy supply

• Globalization and competiveness

The paper presents a number Siemens initiatives, programs and activities driving sustainability at Siemens AG worldwide and to reach our key sustainability goals.

• Environmental Portfolio - helping our customers to reduce their CO2 emissions

• Company Environmental program – implementing, monitoring and reporting of KPIs

• Energy Efficiency Program - reducing our energy demand and carbon footprint systematically at all our locations and in our supply chain

• S.M.A.R.T. products – provide customized solution for emerging markets

Looking more detailed in the sustainable supply chain management particularly in energy-intensive production processes such as steel processing, but also in logistics, there are usually always possibilities to be found for reducing energy consumption and therefore costs. Originally we had developed the Energy Efficiency Program for our own production processes however with the help of our experts, a number of suppliers have already taken part in the Energy Efficiency Program for suppliers. The appropriate procedure is being developed in dialog with representative suppliers and ranges from the implementation of their own energy efficiency programs, to the use of Siemens advisers, through to supplier self-assessment.

Achieving environmental improvements across the product life cycle requires cross-organizational collaboration. Siemens AG engagement in the European project OEPI “Exploring and Monitoring

Any Organization’s Environmental Performance Indicators (EPI)” supports the development of integrated information source bridging the gap between various sources and types of environmental information and users of different backgrounds and of a standardized description language for environmental information to enable the integration and delivery of environmental data in a unified pattern. Case studies will be discussed considering various aspects of design for environment and sustainable procurement.

Natura Brazil, a life cycle management experience in the cosmetic industry

Fabien Brones

Natura Cosmeticos, Brazil

Since its creation in 1969, Natura Cosméticos –a leading cosmetic company in Latin America – has adopted strong compromises in Sustainability, to create value in all its supply chain, with a balance between economic, social and environmental impacts. Consistently with this principle, the company has launched initiatives to minimize its environmental impacts, such as the iconic example of refill packs since the early 1980´s. In parallel, since 2001 several environmental indicators and associated management systems have been implemented in three waves:

The first model was a simplified Life Cycle Assessment for packaging which was established in 2001; the calculated aggregated value, in “millipoints” per kilo of content, characterized the relative environmental impact of packaging of each product, and helped initiate Ecodesign practices in the Development process. Also, this indicator permitted the calculation of an average value for all packaging of Natura’s products, considering the mass of sold products each month and year.

In 2007, a second model was launched – the Environmental Table: this self-declaration stands in the label of all products or website. It is composed of 6 indicators of the product content (characterizing the origin of raw materials) and the packaging part (% of recycled material, % of recyclable material and number of recommended refills). This model not only aimed at raising consumer consciousness about environmental issues related to products, but also increased the number of Environmental Indicators available for Sustainability Management purpose, as the average value of these 6 parameters for all sold products are also calculated on a monthly and yearly basis.

The third model, the Greenhouse Gas (GHG) Emissions Corporate Inventory, was also created in 2007 (being the basis for the Carbon Neutral Program). Natura’s externally verified Scope 3 Inventory accounts the GHG Emissions starting from the extraction of raw materials up to the disposal of products and packaging. This model was recently updated including two additional levels of accounting: inventory split by internal macro-process and carbon footprint of all sold products, to give an even more effective support to the Carbon Reduction Program. This reduction effort refers to a publicly reported reduction target of 33% in carbon intensity adopted in 2007 for a 5 years period, whose result is been followed up every quarter.

We are still continuing to bring LCA knowledge for business application, looking for new relevant social and environmental indicators to turn Natura’s products and activities even more sustainable.

Life cycle management capability: An alternative approach to sustainability assessment

Thomas E. Swarr¹, James Fava¹, Allan Astrup Jensen², Sonia Valdivia³, Bruce Vigon⁴

¹Five Winds International, United States of America; ²Nordic Institute for Product Sustainability, Environmental Chemistry and Toxicology (NIPSECT), Denmark; ³UNEP, France; ⁴SETAC, United States of America

There has been steady progress advancing life cycle assessment methods. UNEP published guidelines for social life cycle assessments, and the CALCAS project developed a blue paper on life cycle sustainability analysis. However, the use of life cycle methods in routine business decision- making has lagged. This paper builds on a life cycle management capability maturity model Presented at LCM 2007, which was developed to facilitate the integration of life cycle thinking into business decisions [1]. Capability models are well- established as effective tools for guiding process improvement efforts and have been applied to numerous domains, such as software, systems engineering, product development, and personnel management. The models establish a common vision, help set priorities for action, guide efforts to tailor improvements to the specific needs of an organization, and facilitate learning from the experiences of other organizations [2].

UNEP and SETAC launched a project to develop the capability approach for use by small- to- medium sized enterprises (SME) with limited knowledge of and experience with life cycle management. A practical self- assessment protocol and supporting workbook were developed and tested with participating companies [3]. The workbook was revised based on stakeholder feedback to more clearly align with the familiar quality Plan- Do- Check- Act continual improvement cycle. Users are guided through a process of evaluating key business processes to assess organizational readiness for various life cycle methodologies. Improvement projects are designed to serve a dual purpose; meeting the near term performance targets set by customers, investors, and other stakeholders and incrementally building the components of a comprehensive management system.

The capability framework also enriches sustainability assessments based on quantified performance measures. There is no consensus that the current sustainability indicators are the most appropriate, and there are no universal solutions for the complex mix of environmental and social problems facing diverse communities [4]. The capability framework is structured around decisions; information systems and metrics used to monitor and manage implementation; and integration of affected stakeholders into the decision process. The framework provides a structured approach to gradually build the capability of organizations to manage more complex problems using more inclusive processes. Rather than specifying specific sustainability measures, the framework builds the capacity of actors to make effective decisions based on their understanding of the local situation and according to their values and priorities. Participants are currently being solicited for a Phase 2 pilot test of the framework.

S-LCA: Preliminary results of Natura's cocoa soap bar

Cassia Maria Lie Ugaya¹, Silvia da Costa Corrêa¹, Fabien Brones²

¹UTFPR, Brazil; ²Natura Cosmeticos, Brazil

Social Life Cycle Assessment (S-LCA) is a technique that allows the evaluation of positive and negative social impacts throughout the life cycle of a product. Due to the interest in sustainability issues, Natura, a cosmetic company in Brazil, is performing an S-LCA pilot project aiming understanding the contribution of its social actions. The methodology used followed the Guidelines of S-LCA published by UNEP (2009). The functional unit chosen was to make one person clean in a year (one shower a day) which resulted in an amount of around 10 soaps of 150 g. A cocoa soap was chosen, as part of the production involves the extraction of cocoa oil by a local community, which is one of the social actions of the company. The initial product system included the soap and the packaging. Then a working hour cut-off rule was applied which reduced the flow of six materials in the product system. Among the remaining processes, this study presents a cradle to gate results which involves the processes from the extraction till the production of soaps. All the processes took place in Brazil, nevertheless, in different regions of the country, including the Amazon area and the state of São Paulo. Several questionnaires for each impact subcategory were developed and they were compared with data that is already collected by several departments of the company. Furthermore, generic data and information about the law was collected, for instance, the difference between the Brazilian legislation related to cooperatives and workers. The study showed that there are already some data available from the management of Natura. On the other hand, it was verified that a lot of information that is obtained is not necessary in an S-LCA, according to the Guidelines, although it could be used by developing proper methodologies, following the method used to develop the S-LCA methodological sheets. Some other results showed the difference between the contribution of the company in the local community in the Amazon area and in São Paulo state. Next steps will consist of collecting further data to evaluate the whole life cycle of the product.

A social hotspot database for acquiring greater visibility in product supply chains: Overview and application

Catherine Benoit^1,2, Deana Aulisio¹, Gregory Norris², Caroline Hallisey-Kepka², Susan Overakker², Gina Vickery Niederman³

¹University of New Hampshire, United States of America; ²New Earth, United States of America; ³University of Arkansas, United States of America

In a world of globalized production and consumption, both positive and negative environmental and social impacts are abundant in product supply chains. With the complexity of sourcing and distributing around the globe, a great deal of transparency is lost. Transparency, in economic theory, implies providing key information to help stakeholders make decisions, which in turn creates incentives for businesses to align their practices with the public’s priorities.1 Consumers are more frequently questioning where, by whom, and under what conditions their products are being sourced and produced. Most companies are not currently able to provide their customers with this information.

New Earth, a non-profit organization fostering innovative strategies and tools to help achieve sustainable development on a global level is providing a solution to acquire greater supply chain visibility. The Social Hotspots Database (SHDB) offers an overarching, global database that eases the data collection burden in S-LCA studies. The UNEP SETAC Guidelines for S-LCA of products recommended the development of such a resource.2 It enables mainstream application of S-LCA by allowing stakeholders to prioritize unit processes for which site-specific data collection will be desirable. Data for two criteria are provided to inform prioritization: (1) labour intensity in worker hours per unit process and (2) risk for, or opportunity to affect, relevant social themes related to Human Rights, Labour Rights and Decent Work, Governance and Access to Community Services. The SHBD system utilizes an Input-Output global trade model, derived by New Earth from GTAP, a general economic equilibrium model facilitated by Purdue University, supplemented with data on wage rates from the ILO. The model calculates worker hours estimates by country and sector involved in the supply chain of products. The Social Hotspots Database incorporates more than 100 references to develop data tables for nearly twenty social themes, and continues to grow.

The paper will present an overview of the SHDB development and features, as well as results from two chosen pilot studies conducted with the SHDB. These studies, mandated by The Sustainability Consortium, focus on the potential social impacts existing in the supply chains of various product categories, including laptops, laundry detergent, wheat cereal, and orange juice. The two pilot studies description and results will show how the SHDB can be applied and what outcomes can be generated.

1. Goleman, Daniel. 2009. Ecological Intelligence. New York: Doubleday.

2. Benoît C, Mazijn B (eds). 2009. Guidelines for S-LCA of Products.

Social life cycle assessment of biodiesel in South Africa: An initial assessment

Charles Mbohwa, Nonhlanhla Myaka

University of Johannesburg, South Africa

Social impacts of anthropogenic activities are important factor in determining sustainability of production and consumption systems. This paper examines the production and consumption of biodiesel in South Africa, with a view to do an initial assessment of its life cycle social impacts. The methods developed by UNEP and its partners are incorporated. Competition between bio-fuels and food issues are found not to be straightforward especially when by-products of biodiesel production are used as animal feed. Particular social issues in South Africa include, low wage for farm workers, the use of illegal workers from neighboring countries, crime against commercial farmers and child labour. Some additional value addition in the sector can improve wages and living standards while indiscriminate land use can result in increased food prices. It is argued that more work needs to be done to examine these specific impacts and contribute to a better understanding of social LCA.