Environment

Operational waste

91%

diverted from landfill

Electricity usage

30%

reduction

Fuel emissions / m2

16%

reduction

We recognise our responsibility and obligation to reduce the direct impact of our business operations on the natural environment, both now and in the future. Reducing emissions is the right thing for a responsible business to do, and we aim to create more sustainable ways of doing business to conserve energy, save money help to deliver better resource efficiency. Our priority is to reduce both the carbon intensity of our activities and the natural resources we use, through the development and operation of good business practices.

Approach

Our priorities are to:

  • Improve energy efficiency and reduce energy use
  • Minimise waste produced and increase the quantity recycled
  • Increase the efficiency of our delivery fleet

We recognise that these key operational activities are environmentally significant for NEXT, and we continue to explore every opportunity to manage the environmental impacts from our direct operations, including greenhouse gas emissions and natural resource usage. In addition, as a business with a global supply chain, we recognise the opportunity of working with our suppliers to help contribute to emissions reductions. We are a signatory to the British Retail Consortium’s Climate Change Initiative, “A Better Retailing Climate”. The voluntary initiative includes commitments to reduce energy and resource use, transport emissions, waste, and packaging. We work to improve our own environmental performance as well as helping customers and suppliers to do the same.

We measure and report our impacts where we either have direct control or significant influence across Scopes 1, 2 and 3:

  • Scope 1 – Direct emissions (gas, owned distribution vehicles, company cars, refrigerant losses, diesel oil)
  • Scope 2 – Indirect emissions from energy consumption (electricity)
  • Scope 3 – Other indirect emissions (waste, third party distribution vehicles, business travel)
Performance

Our global direct carbon footprint, where we have operational control, is 196,928 tonnes of CO2e. Our total floor space has increased by 3% and we have consumed 3% less energy overall, however our emissions per m2 have increased due to the overall growth of the business including the emissions associated with our increased warehouse operations. We continue to investigate and implement further opportunities to reduce our emissions.

95% of our reported carbon emissions are independently assured by PwC.

Next group operational global direct CO<sub>2</sub>e footprint 2014 breakdown in percentage: 3% next sourcing, 1% internation stores, 50% all stores, 22% retail and mail order distribution, 15% warehouse and distribution, and 9% head office

Progress

We report against reduction targets for NEXT Retail Ltd in the UK and Ireland from a baseline year of 2007 and in place until the end of our 2015 financial year.

Energy

  • Target: Electricity consumption – 35% reduction in kg CO2e/m2
  • Progress: 3% reduction compared to last year, and 30% reduction achieved to date

We manage emissions through our energy efficiency programmes and install building management systems as we open new stores and now have 512 stores with this system in operation. As well as providing increased visibility of our consumption, the system also automatically manages some key store functions around lighting and air conditioning in addition to identifying any faults or malfunctions in store.

During the year we have continued to install energy efficient LED lighting in our stores which consumes less energy and creates less heat in store and so our air conditioning requirements are reduced too.

Waste

  • Target: To send less than 5% of operational waste to landfill
  • Progress: 91% of operational waste diverted from landfill (excluding head office waste)

Our in-house recycling centre receives materials for recycling from around 400 of our stores such as cardboard, plastic, returned carrier bags, Directory packaging and broken clothes hangers. Once received they are segregated and baled before being sent for recycling.

Distribution

  • Target: Retail Distribution – 10% reduction in litres of fuel used/m2
  • Progress: Target achieved in 2012 with 16% reduction

Our priority is to use our vehicles as efficiently as possible to deliver products and help to reduce transport related emissions. We use double deck trailers where possible as this helps to reduce the number of vehicle deliveries required. We use computerised planning for vehicle journeys as well as utilising empty space on returning vehicles by consolidating loads, returning Directory customer returns and back hauling materials to our recycling centre. In addition we have continued to develop our driver training programme to help improve driver style and fuel efficiency.

Challenges and Targets

Develop and implement new reduction targets for energy, waste and distribution to 2020, through our priorities of

  • Improving energy efficiency and reducing energy use
  • Minimising waste produced and increasing the quantity recycled
  • Increasing the efficiency of our delivery fleet