Tesco Group Environment Policy

Last updated 13/7/2021

Background

Our ability to produce food depends on a healthy, natural world. It is in our interest to do what we can to tackle climate change and protect and restore precious ecosystems. We are committed to minimising our environmental impact – including working with suppliers and partners to protect nature and helping our customers live more sustainably by reducing the environmental impact of the average UK shopping basket.

With the global population set to reach 10 billion by 2050, pressure on the natural world is intensifying fast. Food production will need to radically change to feed everyone and with that comes increased pressure on ecosystems, soils and biodiversity. We are committed to promoting a more sustainable food system, one which protects and restores nature.

Such changes sit against a backdrop of an ever-changing climate. We believe that climate change is one of the biggest challenges facing the world. The risks associated with a changing climate pose a serious threat, not only to our direct operations but also to our supply chain. That’s why we are taking action and are committed to becoming a net zero carbon business as soon as possible and taking others with us. We cannot realise the changes we need to see alone, we need to work together.

Protecting and enhancing the environment is essential to how Tesco conducts business. This policy explains how Tesco manages its responsibilities to the environment. This policy applies to all of Tesco PLC’s business activities, including all subsidiaries and international markets. It is complemented by detailed policy requirements for our suppliers, including our overarching Tesco Supplier Environment Policy.

Our approach

We are committed to ensuring all our activities are genuinely sustainable and strive to care for the environment through any business activity we undertake. We expect our suppliers and partners to do the same, and to follow the principles laid out in this Policy. This includes, but it very much not limited to, respecting and upholding the environmental laws and regulations of any country in which we operate. Any form of breach to environmental law or regulation will be treated seriously with immediate action taken to address and remediate the issue.

The size and nature of our business means that there are many potential ways in which we could impact the environment, specifically:

Sourcing ingredients and materials: In partnership with suppliers, we work to source ingredients and materials in a way that minimises our impact on the environment, and we will also strive to enhance those environments and leave them in a condition that enables them to thrive.
Operating stores, distribution centres and offices: Our aim is to construct and operate all sites that we own and those that we manage with respect for the local environment and community in which we serve, for example by preventing pollution, eliminating food waste, minimising non-food waste, energy and water use, and encouraging greater biodiversity.
Delivering products: We will always strive to maximise efficiency in the delivery of all products through our distribution network or directly to our customers in order to minimise pollution to the environment and waste.

Addressing our material impacts

As a food business, our long-term success depends on the health of the natural environment and we recognise the impact our industry can have on our surroundings. We review our business activities and assess how they impact the environment, developing strategies and mitigation plans to continually improve our performance. To further support this work, we have prioritised the five natural environments in which our operations and supply chains can have the greatest impact. These are: Climate, Forests, Marine, Freshwater and Farmlands (Agriculture).

We have committed to taking action to protect and sustain these environments over the long term. Further information on our work, and our expectations of our suppliers in supporting this can be found on our website and in the Tesco Supplier Environment Policy.

We have also identified the following environmental issues as priority areas where we can play a leading role:

Greenhouse Gas Emissions (GHG): We commit to reducing GHG emissions generated in our own operations and in our supply chain in line with the science-based trajectories of 1.5 degrees in our operations and 2 degrees in supply chain
Deforestation and land use: Deforestation has no place in our supply chains, which is why we are committed to only sourcing deforestation-free commodities (soy, palm oil, timber, pulp and paper, and beef). Tesco recognises that preventing further deforestation and land conversion is critical to a sustainable future. We endorse the New York Declaration on Forests (NYDF) and support its goals.
Biodiversity: We will strive to encourage greater biodiversity across our operational footprint including from places where products are sourced, and to protect natural habitats and ecosystems (such as forests and soils) that are already rich in biodiversity. We also promote better management practices, including from our suppliers, to protect and restore biodiversity and prevent loss.
Waste: we have no time for waste and strive to eliminate food waste and minimize non-food waste in our own operations and supply chain as much as possible and help our customers reduce waste in the home.
Packaging: we will only use packaging where it serves a clear purpose, such as to ensure product safety, and we will strive to ensure that packaging materials are chosen in a way that considers their holistic environmental impact, from production of raw materials, transportation and disposal.
Water: To reduce our impacts on water resources, we aim to minimise the quantity of water used in the production of food, clothing and our operations. We also aim to ensure that any wastewater or pollutants that have the potential to reach water bodies, such as rivers or lakes, will not have any adverse impact.

Managing suppliers

We recognise that many of our most significant environmental impacts occur in our supply chain, which is why we have a specific environmental policy for suppliers of Tesco Food and Non-Food Formulated Sourcing, supplying into the UK and ROI respectively, our largest markets. This policy addresses our core sourcing requirements for Own-Brand products:

Not to trade in recognised endangered or critically endangered species according to IUCN red list of threatened species.
Not to knowingly cause, or risk causing, irreparable ecosystem damage.
Take steps to improve adverse environmental impacts identified by the Tesco team or other credible experts recognised by Tesco.

The policy also sets out detailed requirements in support of our commitments relevant to each of the five priority natural environments in which we operate: climate, forests, marine, freshwater and farmlands (agriculture). Where a supplier’s operation impacts upon the natural environment, we expect that supplier to adopt the policies and ways of working as specified in our Tesco Supplier Environment Policy.

To understand the cumulative impact of the Tesco supply chain, to track progress and to assess supplier performance, suppliers are expected to provide data applicable to their business about their operation to the Tesco team when requested.

Governance and implementation

We believe that safeguarding the environment is everybody's responsibility and everyone that works for and on behalf of Tesco is expected to follow the principles of this policy. This policy is endorsed by our senior management team and responsibility for overseeing the policy lies with our governance groups:

Corporate Responsibility Committee: Comprised of members including non-executive directors and the Tesco Group CEO, this Committee is responsible for overseeing the Group’s environmental obligations and holding senior management to account in terms of delivery and progress.
Corporate Responsibility Steering Group: Chaired by the Tesco Group Communications Director, a member of the Executive Board. This group of senior managers are responsible for monitoring changes to the external environment and consider how they impact our sustainability strategy and reputation
Senior management: Functional senior managers have accountability for ensuring compliance with this policy and driving sustainable best practice.
Environmental specialists: Our in-house environmental experts, together with our suppliers and partners, are responsible for ensuring our policies and business activities promote environmental best practice, including in product sourcing, operating stores, distributions centres and offices, and delivering products.
Compliance team: Our in-house compliance team are responsible for investigating breaches of environmental law/enforcement and determining corrective action.

We will ensure that this Tesco Group Environment Policy and our wider environmental objectives and expectations are communicated to colleagues through relevant channels, such as induction and refresher training.

Building partnerships

We look to proactively engage and build partnerships with external organisations in order to improve how we manage the effects our business has on the environment. We will seek to do this with organisations that can offer additional expertise, new perspectives and enhanced capabilities to address the challenges. Such organisations include NGOs / charities, industry associations, academics, consultancies and government agencies.

Reporting progress

We will regularly review our environmental commitments and performance and will publicly report progress on our Tesco website and through our online Reporting hub.