Keynote: Sustainable practices in retail

Day 1 concluded with a keynote address by Amazon’s Mathsy Kutty, Anne-Laure Descours, Chief Sourcing Officer for PUMA, and Angela Langmann, Start-Up Advisor & Mentor.

Mathsy is a sustainability and climate change expert with about 20 years of experience. She leads The Climate Pledge charter for the APAC region at Amazon.

Anne-Laure Descours was appointed PUMA’s Chief Sourcing Officer in February 2019, and a member of the Board Management. She joined PUMA in 2012 and oversaw the product development, sourcing activities and sustainability of the global PUMA Group.

Angela is a former Amazon GM and was on the Executive team that launched Amazon in Australia in 2017. She spent over 16 years with Amazon across the US, UK and Australia working in their consumer business across multiple categories and had roles in Marketing & Creative, Product/Program Management, Buying/Vendor Management and Supply Chain.

Angela began the discussion by enquiring about what PUMA and Amazon were focusing on from a sustainability context

Anne-Laure advised that she and PUMA were currently exploring way in which to make global sourcing more sustainable.

“My biggest focus is on how PUMA can meet EU regulations.” The European Climate Law sets out the European Green Deal for Europe’s economy and society to become climate-neutral by 2050. The law also sets the intermediate target of reducing net greenhouse gas emissions by at least 55% by 2030, compared to 1990 levels.

“As you can imagine, running a global brand, working across nations, with manufacturers and logistics providers, makes this a difficult task.

Mathsy from Amazon spoke about their ‘Climate Pledge’.

“I’m looking at our vendors when they sign up for the Paris Agreement, I look to see how I can help them achieve those goals.”

The Paris Agreement has a long-term temperature goal which is to keep the rise in global surface temperature to well below 2 °C (3.6 °F) above pre-industrial levels. The treaty also states that preferably the limit of the increase should only be 1.5 °C (2.7 °F).

Angela sought some practical solutions.

Anne-Laure suggested that ‘sustainability’ is not a specialist conversation today, it’s a business conversation. Responsibility and accountability have become everyone’s mandate. It’s now a broader conversation.”

“At PUMA, we are really looking at AI, robots and automation, and electric vehicles. Anything that will mitigate the use of natural resources.”

However, scalability can only be attained through collaboration – we collaborate with governments, our suppliers and universities. This needs to be adopted from the top down.”

“Think about electric trucks. If we had done it alone, or we asked out logistics providers to do it, it wouldn’t have happened. Far too much capital is involved. So, we need multiple parties to participate in this shift.”

Angela asked, “What had changed over time?”

Anne-Laure said that sustainability had always been a part of PUMA’s DNA.

“While we have set ten clear goals, I am focussed on a couple currently. We want to take a leading role in Climate Action within our industry and implement our existing science-based greenhouse gas emission reduction target. For this, we are on target.”

“We want to move to a more circular business model. We have implemented a ‘Take-back’ scheme in at least one country in each of the Americas, Europe, Asia and Australia. We have attained a 64.7% reduction of waste to landfill per footwear pair, and an 87.4% reduction of waste to landfill per apparel piece and are now using ‘recycled cotton’ at scale. We are also moving to recycled rubber and reconstituted leather in selected collections.”

Angela asked, “What is APAC doing well?”

Anne-Laure, “APAC is the factory of the world. APAC has the power to save the world. There has been a significant shift in manufacturing in Asia across the past thirty years.”

Angela asked what sustainability collaborations were Amazon working on in relation to their ‘Climate Pledge’.

Mathsy said she was really pleased to announce they had over 500 supplier signatories to their Climate Pledge.

“We believe we have an obligation to stop climate change, and reducing carbon emission to zero will have a big impact. Amazon wants to reach net-zero carbon emissions by 2040, a decade ahead of the Paris Climate Agreement, and we are on a path to powering our operations with 100% renewable energy by 2025 as part of our goal to reach net-zero carbon.”

“Naturally, at Amazon, we are concerned about freight and logistics’ role in carbon emissions. Accordingly, Amazon has committed a further US $10 million to develop electric trucks. We are collaborating and starting small to demonstrate a proof of concept.”

Angela asked, “What is Amazon doing in customer-facing roles?

“We are working with suppliers and manufacturers to ‘optimise packaging’ so that we don’t have to put a box in a box.”

“One of the learnings we discovered is that customers want to buy sustainable but can’t identify those items.”

We are adopting a badge program, so we can allocate a badge to a product based on the extent of recyclability and sustainability.

“We collaborate with trusted third-party providers, and we’ve created our own certifications to highlight products that meet sustainability standards and support our commitment to help preserve the natural world.”

While searching for products on Amazon, customers are encouraged to look for the ‘leaf icon’ and the sustainability features label to identify more sustainable products.

“You can also find this label on product pages, where you can learn more about the sustainability features, which are backed by certifications.’

“Our research shows a Climate Badge leads to 10x the views. Over 16 million customers have purchased based on badge.”

Anne-Laure advised a key focus for PUMA was the recyclability of athletic footwear, which was challenging.

“We are partnering with designers, chemical manufacturers, logistics providers and retailers. Our football jerseys are now made from recycled materials. We’ve had to invest a great deal in the technology.”

Angela asked, can you be profitable and sustainable?

Anne-Laune said that today, the PUMA recycled football jersey sells for the same price as the non-recycled version and the costs are the same.

“However, to attain those same margins requires collaboration and partnerships and a willingness to innovate. It can’t be left to just the retailers or the brands. Everyone needs to lean in.”

In conclusion, Mathsy said “We need to leverage our learnings and share them widely, everyone has a role to play. From the designer to the marketing comms teams, to the frontline team member.”

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