PPR Leads the Industry into Sustainable Consumerism

PPR is the French company responsible for megabrands in fashion such as Gucci, Alexander McQueen, and Yves Saint Laurent. The brands listed make up just one branch of PPR (formerly Pinault-Printemps-Redoute)—its luxury group—while Puma, Fnac, and Redcats represent its diverse global portfolio markets of operation. As stated on its website, the company’s strategy is to maintain its values and concerns for quality and responsibility by fostering actions that invest in “overall growth and constant reinvention by building new brands, extending the geographic footprint of its companies, inventing new products and original concepts, and implementing modern ways to communicate with consumers” (PPR.com). By creating a culture of thoughtful decision-making, it was an organic move for PPR to incorporate more socially and environmentally related policies.

On March 22, 2011, chief executive officer François-Henri Pinault announced that the group would be undertaking a new sustainability initiative that would “revolutionize the way it does business by requiring the company’s brands to not only do less harm, but to generate social and environmental benefits in the long run” (WWD.com). The initiative is part of PPR Home, the program that Pinault defines as the “group’s contribution to a better world, by developing innovative and sustainable initiatives” (WWD.com).

While the PPR Home program is a relatively new only in its second year, the group has been developing its Ethics Charter since 1996. In the past fifteen years, it has expanded in terms of employee diversity and manager training through the release of its Code of Business Practices, creating the Ethics and Corporate Social Responsibility Committee, and finally by defining seven key strategic CSR priorities.  These seven primary issues have defined the way the business has grown since their release in 2007. Employability, diversity, suppliers, transport, stores and infrastructure, product and clients, and community are the “common frame of reference for each brand and company to make their own” in how they approach stakeholders when creating business plans (PPR.com).

While the seven commitments are significant to the core of PPR culture, the group has pushed the efforts further by developing the Home project: “an ambitious multi-tiered” sustainability initiative. It originally derived from the company’s funding of filmmaker Yann Arthus-Bertrand’s climate change documentary Home in 2009. The firm’s initial involvement was purely for public relations purposes, however, after receiving over 400 million views, the company has taken the message to heart. In 2010, PPR Home was launched as the Innovation and Sustainable Development Awards for creative sustainability proposals conceived within the PPR group. The awards included “56 projects [that] were entered by 160 employees from 15 countries, and three award-winners received grants at the Group’s General shareholders’ Meeting” (PPR 4).  The first winners were

–       Puma Switzerland to design and equip an eco-friendly concept store in India

–       La Redoute France to create an online information source of the social and environmental performance of different products

–       Fnac Portugal to create children’s play areas in hospitals close the brand stores

The project was renewed for the 2011 cycle, yet instead of presenting awards, it

has become another division of the company with a staff of 15 and an annual budget of 10 million euros. The three projects that are starting the division’s inaugural year off are

–       The launch of the Creative Sustainability Lab, a partnership with the biomimicry design group Cradle to Cradle. The lab “will focus on developing products and retail pilots that integrate and apply objectives such as environmental and social concerns.”

–       A complete offset of emissions by purchasing carbon credits from San Francisco-based Wildlife Works’ Reduced Emissions from Deforestation and Degradation (REDD).

–       Puma’s revolutionary new reporting system, Environmental Profit and Loss Account Statements. The EPLs will be published in tandem with financial reports as a “step toward measuring the full environmental impact of the activities of Puma and its suppliers” (WWD.com).

So far the division has seen its best results in Puma, a brand that is determined to

lead the industry toward sustainable consumerism. In Paris, the Puma Boulevard de Sébastopol flagship store was remodeled as an eco-concept store, “combining high-tech interactive features with eco-friendly materials for merchandising and decor. Materials included energy-efficient lighting and FSC-certified sustainable wood, while clothes hangers are made from cornstarch” (WWD.com). This eco-concept design is a test that will determine if it will be rolled out into other markets as well.

At a recent CEO summit, Puma North America president and general manager Jay Piccola spoke to the driving motivation behind the new strategy. “We, as an industry, can make a difference. The sheer volume of people we speak to and work with is massive. And our consumers are asking us to drive change” (WWD.com). Other measures that the brand has been taking lie within its five-year sustainability plan that calls for a 25 percent reduction in emissions, energy and water use in its offices, stores, warehouses, and suppliers. As for the collection itself, the firm is working to produce 50 percent with sustainable materials. Industrial designer Yves Behar is working with the company in completing design on the “Clever Little Bag”. The bag is a reusable mesh bag that will replace all shoeboxes by 2013. As a brand that is looking to guide the industry in changing business practices, this is an unconventional move that could prove to have an enormous impact if other footwear firms decide to follow Puma’s lead.

Another recent development under Puma’s roof is the release of its first Environmental Profit and Loss statement. The purpose of the statement is to give a calculation of the business’ impact in monetary values. On May 16, at a press conference in London, Jochen Zeitz, Puma chief executive and PPR chief sustainability officer, said that in 2010 Puma had an impact of 133 million USD. The supply chain accounted for 123 million USD worth in raw material production alone due to a strong dependence on cotton. This value is in terms of “green house gases emitted and water consumed through Puma’s operations and supply chain” (WWD.com).  Zietz believes that this EP&L statement is an essential tool that companies should “integrate into business models [to account for] the true costs of their reliance on ecosystem services” (WWD.com).

While this initial report measures gas emissions and water consumption, it is only the first stage of a three-stage report. The second stage, that is due in the fall, would also determine the operations effect on “acid rain and smog precursors, volatile organic compounds, waste and impact on land use.” The third stage will look to report the social and economic benefits of the business, such as job creation, wages, working conditions and health.

PPR has set itself some ambitious goals with the creation of PPR Home. However, it does not set them just for itself. The purpose of the newly minted division is to be a research and development facility that will set the pace for the industry at large. Chief sustainability officer Jochen Zeitz plans to share findings with industry peers who use the same supply chains,”I am hoping that this will serve as a catalyst for us to work together to reduce our shared impacts across the supply chain” (WWD.com).

– Jamie Ortega

Sources.

http://www.ppr.com/en/

http://www.wwd.com/wwd-publications/wwd/2011-03-22/#/article/markets-news/ppr-unveils-environmental-initiative -3561573?navSection=issues&navId=3561478

http://www.wwd.com/business-news/puma-maps-its-environmental-footprint-3614220

http://www.wwd.com/retail-news/puma-opens-eco-friendly-concept-in-paris-3589062?browsets=1305989139960

http://www.wwd.com/footwear-news/ceo-summit-whats-fueling-pumas-green-machine-3604892?browsets=1306009160346

Corporate Social Responsibility at PPR: 2010 Elements. Paris, France. PPR.

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