Reckitt Benckiser PLC: The Programme For Sustainability

RECKITT BENCKISER plc
The Programme for Sustainability
York, July 2nd 2008
COPYRIGHT RECKITT BENCKISER 2008

• Global Consumer Goods Company

• Operating in a number of segments
– Health & Personal Care
– Fabric Care
– Surface Care & Germ Protection
– Automatic Dishwashing
– Home Care
– Food

• Market Valuation £17 Billion
• Operations in 60 countries
• Sales in 180
• 2007 Net Revenues: £5.3 Billion
• ~ 22,000 employees
RECKITT BENCKISER Net Revenue 2007
£5.3 Billion
4
£B 3
0
2003 2004 2005 2006 2007

~ Two thirds of the revenue
comes from just 18 Brands

RECKITT BENCKISER Net Income 2007
£905 Million
1000
900
800
700
600
£M 500
400
300
200
100
0
2003 2004 2005 2006 2007

Health &
Personal Care
Fabric Care
Surface Care
Automatic Dish
Home Care

Europe
North America
and Australia
Developing
Markets

“We are PASSIONATE
about delivering better solutions….
….products that work BETTER for

the CONSUMER, FOR SOCIETY and for
THE PLANET”
SUSTAINABILITY
THE DRIVERS
The Consumer
The Trade
Regulation
It’s the right thing to do
WHAT DOES SUSTAINABILITY MEAN FOR
RECKITT BENCKISER?
WORKPLACE
MARKETPLACE
COMMUNITY
ENVIRONMENT
Incorporates Corporate (Social) Responsibility (CSR),

Environmental, Social & Governance (ESG) matters
…IT IS MANAGING OUR BUSINESS IN A
RESPONSIBLE & ETHICAL MANNER
- People will want to, and will passionately, work for us
- Retail customers will want to sell our products
- Suppliers will want to work with us
- Consumers will buy our products
- Society at large will support our business
- Government / regulators will endorse our business
- We will continually improve our positive, and reduce our
negative, impact on society, communities and the
environment
- We will achieve additional Squeeze and X-Trim cost
reductions

WORKPLACE
Lost Working Day Accident Rate

86% reduction since 2001
Lost working days per 100,000 employees

• Health & Safety
How we ensure a safe working environment
• Labour / employment standards

How we ensure good and ethical employment
practices
• Management training & development

How we develop talent in the Company and
ensure people maximise their potential
• Remuneration
How we incentivise and reward our employees

MARKETPLACE
Products that are safe and effective from a supply chain that is
responsible and ethical. Business practices that are legal,
ethical and socially responsible.
Code of Business Conduct Since 2001

How we ensure that our business operates in a
responsible and ethical way.
Global Manufacturing Standard

How we ensure an ethical supply chain and
how we meet international labour, health &
safety and environmental standards across it. Since 2004
Product Safety and Quality

How we ensure our products are safe for their
intended use.

COMMUNITY
Returning some of the wealth we create to those who are most in
need of help … supporting health, hygiene and social development,
particularly for families with children.
Environment

ENVIRONMENT
Energy Use 20% reduction since 2000
Waste Water 5% reduction in wastewater discharges since 2000
Waste 17% reduction in total manufacturing waste between

2000 and 2005
Hazardous
Waste 40% reduction in our hazardous waste since 2000

Programmes
for Continuous Improvement

Environmental Performance
Sustainable
Development
Risk
Management
Compliance
Economic Performance

ENVIRONMENTAL SUSTAINABILITY
CARBON NEUTRAL PRODUCTION
• A program which is making all (~ 8 billion products)

made at our manufacturing facilities in 2006 and 2007
carbon-neutral
• Planting more than 2 million trees in over 15 square

kilometers of new forests, absorbing in excess of 1
million tonnes of CO2 over the next 80 – 100 years
PEER RECOGNISED
Ranked as a Sustainability Leader in independent, external benchmarking

indices
BitC BitC Corporate Dow Jones FTSE4Good

Environment Responsibility Sustainability Q3 2007
Index 2006 / 07 Index 2006 / 07 Index 2007 / 08
Platinum
Reckitt Platinum
(> 95% score) Yes Yes
Benckiser (> 95% score)
+ Global Top 10
Gold Gold Yes
Unilever Yes
(90-95% score) (90-95% score)
P&G No No Yes Yes
Henkel No No Yes Yes

SC Johnson No No No No
Colgate No No No No
Clorox No No No No

Programmes
for the Future

Programmes
for the Future
CLIMATE CHANGE

Programmes
for the Future
CLIMATE CHANGE
THE CONSUMER

Programmes
for the Future
CLIMATE CHANGE
THE CONSUMER
THE CUSTOMER
THE CONSUMER?

THE CONSUMER….
Me
My Family
My Friends
My Community
The World
THE CONSUMER….
Personal protection…..What's going in
me/on me/around me (and my family)
Cost…..I save $$ by reusing/reducing

consumption
Status…..I let others know that I care about

the environment
Altruism…..I do it because it's the right thing

to do.
Source: Clorox Company, North America
Environmental considerations are starting to
impact consumer thinking …
Climate Change
has jumped from
8th to 4th biggest
concern in a
year, more than
doubling its %
score
Source: c. 47 countries; AC Nielsen / University of Oxford, 2007

44% of consumers
are more concerned about impact of household products on the
environment compared to a year ago
Source : Nunwood Market Research, 2007

3 Big Problems
Individually their actions won’t make a difference
Lack practical information on what to do e.g. easy green choices
Environmentally better products are believed to cost more or not
work as well
Source: Ipsos MORI All UK adults April 2007; retailer / consumer interviews

Consumers expect business to help them tackle these
problems
They believe producers / manufacturers can make the biggest impact on

change along with Governments and much more than individuals, NGOs or
retailers
Source: circa. 47 countries; AC Nielsen / University of Oxford, 2007

What Consumers will pay more for
Organic Milk
Produce
Apparrel
Household and Cosmetic Goods
Source: Wal*Mart North America

THE CUSTOMER?

THEY WANT CHANGE….
TESCO
"I am determined that Tesco should be a
leader in helping create a low-carbon
economy….. For Tesco this demands
that we transform our business model so
that the reduction of our carbon
footprint becomes a central business
driver.“
Sir Terry Leahy, 18 January 2007,
speech to Forum for the Future conference
WAL-MART
“We believe working families should not
have to choose between a product they
can afford and a sustainable product. We
want our merchandise to be both
affordable and sustainable. Because when
it is, we empower our customers to make
the right decisions.”
H. Lee Scott, Jr., February 1, 2007
Cambridge Programme for Industry Lecture

SO WHAT IS RB PLANNING TO DO?

OUR CARBON FOOTPRINT
THE CARBON 20 PROGRAMME

OBJECTIVE
20% reduction
in our product’s Total Carbon
Footprint by 2020
The first major FMCG company to set a Total Carbon Footprint

target

WHY?
Because it is the right thing to do …

Climate Change
- is arguably the largest environmental issue of the 21st century
- is increasingly a business issue
• Consumers increasingly want to buy products that help them to
reduce their environmental impact in their day-to-day activities
• More and more of our trade customers want to work with suppliers
who help them to deliver carbon reduction to consumers
• Suppliers recognise the benefits of working with companies that help
them to proactively seek sustainable growth
• Employees / New Recruits want to be part of a company that is
making a real contribution to tackling climate change

MEASURED BY
The complete product lifecycle
raw and packaging materials

product manufacturing and distribution
retail sale
consumer use
disposal

MEASURED BY
Retail Product &
Raw & Packaging Product Product Consumers
Operations Packaging
Materials Manufacturing Distribution
Disposal
Raw materials RB Factories Logistics Retailers: Shopping Product &

and Centres - Logistics journeys Packaging
components 3rd-party Centres Disposal /
Factories Product Recycling
- Product use:
Packaging Distribution
Distribution e.g.
materials RB Offices &
R&D Centres - Stores - ADW
- Laundry
Business - Air Care
Travel - Surface Care
- Hand washing

THE RB CARBON FOOTPRINT
~ 15m tonnes of CO2 equivalents / year
20% reduction equates to
emissions from > 0.5 million average UK

households / year or
~ 1 million UK medium sized family cars / year

Raw & Product Product Retail Consumers Product &
Packaging Manufacturing Distribution Operations Packaging
Materials Disposal /
Recycling
30-40% 2-6% 1-5% 2-6% 50-70% 3-7%
• Largest portion in Consumer use (e.g. in dishwashers / washing machines)

• Second largest portion in Raw and Packaging Materials
• Direct impact of our operations is relatively small
Trial
• builds on 6 years experience of measuring our direct carbon
footprint
• developed and trialled with external consultant URS during 2007
• uses a combination of RB specific data and generic industry data
Going forward
• Carbon 20 base year = 2007
• using more specific and less generic industry data
How will we report progress?
• measurement process carried out independently by URS
• public reporting in our annual Sustainability Report
• third-party, external assurance of methodology and reported data

20% REDUCTION……by
REDUCE energy consumption / improve energy efficiency

REPLACE ingredients, processes, packaging and energy

sources - to continually move towards lower carbon alternatives


Carbon offsetting will NOT be counted towards

the Carbon 20 target


Carbon offsetting will NOT be counted towards the Carbon 20 target
TRANSPORT optimisation


Carbon offsetting will NOT be counted towards the Carbon 20 target
TRANSPORT optimisation
Helping CONSUMERS CHANGE their habits

CONSUMERS Energy Reduction / Efficiency
Consumers
RB led the European industry initiative to Save Energy & Water in ADW
switch to low temperature / ‘eco’ cycle reduces energy & water use by > 20%
Step 1
50-70% 65 50 – 55
degrees degrees
Changing
consumer
behaviour to
achieve energy 50% of those in Europe
reduction/ using 60 / 65° moving
efficiency in
to 50 / 55 ° = up to
using RB
products - 338,000 tonnes
CO2e avoided, p.a.
- 60,410 households /
97,150 cars, p.a.

CONSUMERS Energy Reduction / Efficiency
Consumers
Switching from washing by hand to automatic dishwashing
saves heating the equivalent of a small swimming pool of water /
year per household
50-70%
• Saves energy – Saves up to 40% of energy use
Changing • Saves water – Saves 30-40 litres per machine load
consumer
behaviour to
achieve
energy Step 2
reduction/
efficiency in
using RB
products
per 1 m households shifting to ADW, in terms of household energy use alone =

53,400 tonnes CO2e avoided p.a. = 9,540 households / 15,350 cars, year
SUMMARY
It’s the right thing to do WORKPLACE
MARKETPLACE
COMMUNITY
ENVIRONMENT
Consumer & Customer focus
We will deliver a 20% Carbon footprint

improvement by 2020

Reckitt Benckiser PLC: The Programme For Sustainability

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RECKITT BENCKISER plc

The Programme for Sustainability

York, July 2nd 2008

COPYRIGHT RECKITT BENCKISER 2008

• Global Consumer Goods Company

COPYRIGHT RECKITT BENCKISER 2008

• Market Valuation £17 Billion

• 2007 Net Revenues: £5.3 Billion

COPYRIGHT RECKITT BENCKISER 2008

COPYRIGHT RECKITT BENCKISER 2008

COPYRIGHT RECKITT BENCKISER 2008

COPYRIGHT RECKITT BENCKISER 2008

COPYRIGHT RECKITT BENCKISER 2008

….products that work BETTER for

Incorporates Corporate (Social) Responsibility (CSR),

COPYRIGHT RECKITT BENCKISER 2008

Lost Working Day Accident Rate

Lost working days per 100,000 employees

• Labour / employment standards

• Management training & development

COPYRIGHT RECKITT BENCKISER 2008

Code of Business Conduct Since 2001

Global Manufacturing Standard

Product Safety and Quality

COPYRIGHT RECKITT BENCKISER 2008

COPYRIGHT RECKITT BENCKISER 2008

Energy Use 20% reduction since 2000

Waste Water 5% reduction in wastewater discharges since 2000

Waste 17% reduction in total manufacturing waste between

COPYRIGHT RECKITT BENCKISER 2008

for Continuous Improvement

COPYRIGHT RECKITT BENCKISER 2008

COPYRIGHT RECKITT BENCKISER 2008

• A program which is making all (~ 8 billion products)

• Planting more than 2 million trees in over 15 square

Ranked as a Sustainability Leader in independent, external benchmarking

BitC BitC Corporate Dow Jones FTSE4Good

P&G No No Yes Yes

Henkel No No Yes Yes

COPYRIGHT RECKITT BENCKISER 2008

for the Future

COPYRIGHT RECKITT BENCKISER 2008

for the Future

COPYRIGHT RECKITT BENCKISER 2008

for the Future

COPYRIGHT RECKITT BENCKISER 2008

for the Future

COPYRIGHT RECKITT BENCKISER 2008

Cost…..I save $$ by reusing/reducing

Status…..I let others know that I care about

Altruism…..I do it because it's the right thing

Source: c. 47 countries; AC Nielsen / University of Oxford, 2007

COPYRIGHT RECKITT BENCKISER 2008

Source : Nunwood Market Research, 2007

COPYRIGHT RECKITT BENCKISER 2008

COPYRIGHT RECKITT BENCKISER 2008

They believe producers / manufacturers can make the biggest impact on

Source: circa. 47 countries; AC Nielsen / University of Oxford, 2007

COPYRIGHT RECKITT BENCKISER 2008

Household and Cosmetic Goods

Source: Wal*Mart North America

COPYRIGHT RECKITT BENCKISER 2008