environment

environment
environment
environment
Acknowledging the evidence for climate change, and along with other US businesses, local government and academic leaders, we have signed the We are Still In open letter pledging our continued support for climate action to meet the Paris Agreement.

Achievement and outcomes

In 2018 we ran scenario-planning models to help identify actions and opportunities to explore the potential of developing Science Based Targets.

Environmental footprint of our own operations.

Throughout the last year, we have worked on improving the monitoring and data quality of the environmental footprint for our own operations and, for the first time, an independent third party has verified our Scope 1 & 2 CO2e emissions. 

We have continued developing the use of our EHS reporting tool, CR360, to integrate more sites and new colleagues, as well as increasing the frequency of reporting on some sites. Our scope of reporting has remained the same compared to the previous year and includes all sites where we have full operational control (manufacturing, distribution centers and offices) but excludes studios and retail sites due to a lack of available data.

Our manufacturing operations represent our biggest direct environmental impacts, with around 80% of our water, energy consumption and waste generation, along with related greenhouse gas emissions, relating to this activity.

Energy & Carbon:

Having established our baseline in FY17, we have reduced our carbon footprint by 9% in absolute terms during FY18 and by more than 25% when compared to the intensity ratio of tonnes of CO2e per $m revenue for Scope 1 & 2 carbon emissions.

During FY18, we have decrease the energy requirement of our business by over 3% as we realised energy efficiencies. In addition, we now have a total of four offices with a green building rating from HQE, LEED or BREEAM, with our New York office rated LEED Gold, our Paris Gretry office having achieved HQE & BREEAM Excellent, our Paris Metropolitan office, HQE Excellent and our London Paddington office achieving BREEAM Excellent.

The energy we purchase for all of our manufacturing and distribution centers in Germany became CO2 neutral at the beginning of January 2018. All purchased electricity at these sites now comes from renewable sources, complete with guarantee of origin certificates and all emissions from our purchased natural gas are offset using verified carbon credits. Looking forward,  we will be piloting energy studies in our factories to further gauge opportunities for energy reduction possibilities.
 
Carbon footprint
 
Year ended 30 June   2018 2017
Scope 1 Thousand tonnes of CO2e 32.12 40.41
Scope 2 (Location-based) Thousand tonnes of CO2e 63.43 64.5
Scope 2 (Market-based*) Thousand tonnes of CO2e 56.23 59.12
Scope 1 & 2 normalized by revenue1 Tonnes of CO2e per US$m 10.16 13.712
Scope 33 Thousand tonnes of CO2e 46.62 54.07
Total emissions1 Thousand tonnes of CO2e 142.18 158.98
*Supplier specific/contract specific renewable electricity emissions
1 Using location-based emissions (country specific, national average energy emission factors)
2 FY17 revenue only includes three financial quarters of P&G Beauty Business acquisition
3 Scope 3 emissions include the indirect emissions from business travel, water use, waste and energy transmission losses
 
Waste:

We have a zero waste to landfill target for all our owned manufacturing sites by the end of December 2018. In FY18, manufacturing sites representing around 90% of our production achieved zero waste to landfill. Much of the improvement to our waste to landfill performance has been the result of better working practices and collaborations with our waste suppliers where, as an example, we have started to introduce waste to energy schemes.

Our recycling rate for FY18 is 65% compared to 67% in FY17, largely as a result of better data quality with regards to both the quantity of waste and treatment type. With improvements in our waste to landfill figures, we are confident that our recycling figures will increase over the coming year and we have also implemented initiatives to encourage employees to cut down on waste and recycle more. For example, we now provide refillable drinking vessels in our Paris office instead of disposable ones and, at one of our production sites in Brazil, we now compost waste from our water treatment plant to use as fertilizer for our on-site garden.

Water:

Water use at Coty remains relatively consistent year on year when comparing FY17 and FY18 with approximately 1 million m3 of water used each year. Having established that the main impacts of water use come from the use of our sold products, we will still focus on ways to reduce our water consumption during the manufacturing stage. With the implementation of our EHS data tool, CR360, our manufacturing sites are now able to benchmark and compare data with other factories. In FY18, as a result of these comparisons, one of our factories established that water consumption was higher than the benchmark average and investigated ways in which water efficiencies could be realised during the batch change process. As a result of implementing a new process, water consumption for this particular process was 22% lower when compared to water consumption prior to this change.

Next year we intend to develop water targets for all manufacturing sites, which will begin with pilot studies to investigate the possible reduction opportunities, and we will also undertake a water stress study to determine if and where our production processes are most likely to affect the availability of water.

Our global value chain – made to be made again

We know that the environmental impact from our own production is limited compared to the impact of our global value chain. In 2017 we conducted an environmental footprint study to cover our global value chain1, from sourcing raw materials through to the end of life impacts of our products. At the beginning of FY18, we further refined the details of this study to ensure that our initial estimates were as accurate as possible.

Our global carbon emission footprint represents 1.6m tonnes of CO2e emissions.
Consistent with other Beauty industry insights, three categories contribute the most to our environmental footprint.
  • Purchased goods (both packaging & raw materials) (50%);
  • Logistics covering both upstream & downstream transportation (21%); and
  • Consumer use of sold products (9%), mainly due to the energy used to heat hot water to use some products.
Achievements and outcomes
 
Over the past year, our Sustainability Steering Committee has allocated resources and identified single points of contacts on a wide variety of topics ranging from packaging, raw materials and fragrances in order to help identify and drive plans to improve our environmental value chain impacts. Focus groups and innovation labs have been held on topics relating to our brands, categories and materials, and have identified potential opportunities for further exploration and development, which will help inform our targets and ambitions.

For example, our packaging experts are actively working on plans to reduce unnecessary plastic use and the overall environmental footprint of our packaging, in line with our aim to explore more circular design and production in our packaging. Our participation in the Ellen Macarthur Foundation’s CE100 program, as well as in the Sustainable Packaging Initiative for Cosmetics (SPICE*) is informing our approach to the reduction of plastic use and to addressing other material packaging impacts such as metal and glass.
1 Excludes studios, own retail sites, marketing materials and also total value chain in relation to both ghd and Younique businesses.
✓ Limited assurance provided by KPMG