Business review

Corporate Responsibility

Future Homes is Kingfisher’s business-wide strategy to create sustainable homes of the future. As a home improvement retailer, one of Kingfisher’s key priorities is to help customers live in homes that have a lower impact on the environment and are efficient in their use of energy and other resources. We believe that embedding sustainability in our business, including the products we sell and our own operations, will help deliver value to our customers, our shareholders and other key stakeholders.

Research has shown that there is growing consumer demand for eco-products which help customers reduce their carbon footprint and save money. Increasing sales in this area is therefore part of Kingfisher’s core business strategy to enhance shareholder returns. With the global economic downturn, a key focus is to use our buying and marketing experience to bring affordable eco-products to the mass market. A number of Kingfisher operating companies have already launched extensive eco-ranges, including B&Q UK’s One Planet Home range and Castorama France’s La Maison Éco products. Kingfisher is committed to driving innovation in order to realise its vision of a sustainable future.

Future Homes isn’t just about eco-products. It also aims to ensure that sustainability is integrated into all aspects of Kingfisher’s operations. The initiative seeks to assure stakeholders that Kingfisher is effectively managing key non-financial risks, such as supply chain standards, timber sourcing and chemicals.

How we identify the issues

Kingfisher is committed to engaging with stakeholders to identify key issues. For example, Kingfisher’s Corporate Responsibility Report is reviewed by a Stakeholder Panel, roadshows are held for socially responsible investment analysts and the Company is involved in a range of Corporate Responsibility (CR) networks and forums.

This work has enabled us to develop seven sustainability goals which set out our long-term vision for a sustainable business. These goals are:

  • Enabling sustainability – in all our product and services categories
  • Ensuring our stores and operations are efficient and sustainable
  • Making it easy for our customers to create their homes in a sustainable way
  • Engaging employees to be champions of sustainability across our business
  • Being a good neighbour in all the communities we serve
  • Working with our suppliers, governments and other stakeholders to make sustainability easy and to find solutions to common sustainability problems
  • Using our sustainability strategy to create value for the benefit of our business and shareholders.

Kingfisher also has a Corporate Responsibility Policy and a range of CR policy standards which set out our position on the key issues that relate to each of the goals.

Kingfisher is working to implement its sustainability goals and policy standards through its Steps programme. This is designed to ensure that all of Kingfisher businesses achieve consistent standards within specific timeframes.

Targets and measurement

Kingfisher sets CR targets for each of the sustainability goals, which are reviewed on an annual basis. Specific CR objectives have been set for the Group Chief Executive and the Chief Executives of the three divisions (UK, France and International). Success against the objectives is reviewed in annual performance appraisals and linked to bonuses.

In addition, Kingfisher’s Steps programme sets out specific criteria to be achieved by the Kingfisher operating companies. These criteria cover 14 key issues and are grouped into three levels – ‘minimum action’, ‘policy target’ and ‘leadership position’. Progress against the criteria is measured twice a year.

Eight of the nine Kingfisher operating companies have achieved at least the ‘minimum action’ level of progress across all issues. The next step is for Kingfisher operating companies to meet the ‘policy target’ level on all issues by the end of January 2011. Some operating companies have already achieved the higher level on some issues. The only operating company that has not yet reached the target to achieve ‘minimum action’ across all issues is Castorama Russia (one of Kingfisher’s newest businesses with seven stores). Kingfisher will be working with Castorama Russia over the coming year to ensure it achieves the required standard.

The Steps criteria were updated at the end of 2008 following the introduction of Kingfisher’s sustainability goals the previous year. Kingfisher’s operating companies are required to meet the new ‘minimum action’ criteria within six months (by July 2009).

The Company also measures progress against a range of CR Key Performance Indicators which are subject to an annual review by the audit firm Ernst & Young LLP.

Corporate Responsibility awards and recognition

In 2008/09, Kingfisher achieved the following recognition:

  • Leader of the general retail sector in the Dow Jones Sustainability Index 2008/09 and awarded SAM ‘Gold Class’ status
  • Ranked second in The Observer Good Companies Guide 2008 (highest scoring retailer)
  • Awarded a ‘Big Tick’ in the 2008 Business in the Community (BITC) Impact on Society awards category. Also achieved ‘Platinum’ status (the highest ranking) in the BITC 2008 CR Index.

B&Q UK has over 3,000 products in its “One Planet Home” range. At Castorama France, eco-ranges account for 11% of sales.

A full list of our CR KPIs and our CR strategy are available at www.Kingfisher.com/cr.

One Planet Home and eco range logos

B&Q UK has over 3,000 products in its “One Planet Home” range. At Castorama France, eco-ranges account for 11% of sales.