REWE Group Sustainability Report 2017

Raw Materials

GRI 204-FP1: Percentage of purchased volume from suppliers compliant with company’s sourcing policy

REWE Group continuously works to make its supply chains more social and environmentally conscious. In this effort, REWE Group draws on internationally recognised certification standards and formulates its own requirements as part of its guidelines and its PRO PLANET process. The following text outlines the approaches that the company takes for individual raw materials.

Palm Oil

The increased cultivation of palm oil is destroying peat forests and rainforests. In the process, the basis of local populations’ lives is frequently being taken away, and the habitats of valuable species are being lost. The clearing of rainforests is also releasing huge amounts of CO2.

Against this backdrop, REWE Group developed its Guideline for Palm Oil and Palm Kernel Oil Products at the beginning of 2011. The goal of this guideline is to use only more sustainably produced palm oil in all store-brand products. To achieve this objective, REWE Group primarily employs the certification standard developed by the Roundtable on Sustainable Palm Oil (RSPO), an organisation it joined in 2011. Four trade models are applied in supply chains for the purchase of certified palm oil. Each employs different requirements regarding the traceability of the raw material to the farm. Taking into account all trade models, REWE Group has been able to use only certified palm oil since 2013. In Austria, REWE Group has been using only certified palm oil since 2014 and its brand Ja! Natürlich has been free of palm oil since 2018.

The objectives of the REWE Group guideline are part of a company pledge that the company signed in 2015 as a member of the Forum for Sustainable Palm Oil. The ambitious goals of this commitment are designed to facilitate the traceability of palm oil over the long term through compliance with defined supplemental criteria. This work also involves purchasing palm oil that is subject to the demanding trade model of segregation. In this process, sustainably produced oil is continuously separated from non-certified oil along the entire supply chain. In consideration of the individual goals for each palm (kernel) oil product, REWE Group attained a total achievement level of 99 per cent with all store-brand products in Germany in 2017.

REWE Group in Germany is working with its suppliers to achieve the last per cent needed to achieve the goal. The requirements pose a special challenge to small suppliers with complex supply chain structures. For instance, some suppliers could only make the switch to the segregation trade model gradually because of the very expensive work that goes into setting up separate product streams. This is particularly the case when a supplier switches only a small amount of his total production. In Austria, REWE Group has made major strides in its effort to use certified palm oil. In consideration of the individual goals for each palm (kernel) oil product, REWE Group attained a total achievement level of over 90 per cent with all store-brand products in Austria in 2017.

Cocoa

A major amount of global raw cocoa comes from Western Africa. It is work that is primarily done on small, family-run farms. Cocoa farmers have to battle difficult business conditions there and frequently live with their families below the poverty level. As a result, they lack investment funds and generally have poor working conditions, which can also include exploitative child labour. In its Guideline for Cocoa, REWE Group formulated the goal of purchasing all raw cocoa supplies for its store brands from more sustainable farming structures by the end of 2015. This is assured by applying the standards Fairtrade, Fairtrade Sourcing Programme, Rainforest Alliance and UTZ. By the end of the deadline on 1 January 2016, REWE Group in Germany was unable to achieve this goal. In 2016, the share of certified cocoa was 94 per cent. In 2017, the share of more sustainable cocoa rose to 99 per cent. REWE Group in Germany is working with its suppliers to achieve the last per cent needed to achieve the goal. One major challenge for some suppliers involves switching only small amounts of the total production to the certified product. At REWE Group in Austria, over 80 per cent of raw cocoa supplies for store brands were certified in 2017.

REWE Group is also an initiative member of the German Initiative on Sustainable Cocoa (GISCO). The objective of this multi-stakeholder initiative is to improve living conditions of cocoa farmers and their families as well as to increase the production and marketing of sustainably produced cocoa.

Bananas and Pineapples

The cultivation of the tropical fruits bananas and pineapples may result in negative environmental and social impacts in production countries. These include poor working conditions at fruit farms, the widespread use of pesticides and damage to ecosystems. In 2015 and 2016, REWE Group and its sales lines in Germany completely switched their purchasing of pineapples and bananas to Rainforest Alliance. As a result, all pineapples and bananas have come from farms certified by the Rainforest Alliance since the end of 2016. Even following the review of the Rainforest Alliance Standard, REWE Group and its sales lines are following the standard. As part of the merger of the Rainforest Alliance and UTZ, from 2018, REWE Group will become part of the committee for further developing the certification standard. The sales lines also offer organic pineapples and organic bananas.

Cotton

Cotton is the most important raw material used in the textile industry. It is primarily grown in India, China and the United States. Conventional cotton cultivation practises use extensive amounts of water, pesticides and fertilisers. To boost its percentage of textile products made with more sustainable cotton, REWE Group in Germany uses Cotton made in Africa (CmiA) and supports the Global Organic Textile Standard (GOTS). REWE Group achieved the goal of increasing its share of store-brand textile products made of more sustainable cotton from 56 per cent in 2015 to 70 per cent by the end of 2017. REWE Group is now working to increase its share of textiles made of more sustainable cotton at REWE, PENNY and toom Baumarkt DIY stores in Germany to 100 per cent by 2025. REWE Group in Germany will continue to use CmiA, GOTS and also textiles made from recycled fibre.

Coffee

The farming of coffee as a globally traded product is an important economic sector in many countries of Latin America, Asia and Africa. But the yields of the small farms that produce the beans are frequently too tiny to produce an income from which coffee farmers and their families can live. Added to this are the health and environmental risks posed by the incorrect use of pesticides. To improve the lot of coffee farmers, REWE and PENNY set themselves the goal of switching all of their store brands to certified coffee by the end of 2020. In 2017, the share of coffee certified by UTZ, Bio or Fairtrade rose to 69.4 per cent from 61.7 per cent in 2016. All store-brand coffee products at REWE Group in Austria are Fairtrade-certified.

Tea

Conventional tea farms are frequently monocultures that use large amounts of pesticides. This endangers biodiversity and the supplies of drinking water for people who live in the cultivation areas. Local workers also face a number of challenges, including low wages and inadequate occupational health and safety practises. To address such issues, REWE Group promotes sustainable agriculture in tea production and purchases certified products that bear the Rainforest Alliance seal. In 2016, the share of certified tea products at REWE and PENNY was 14 per cent. The share rose to 19 per cent in 2017. Due to the limited number of certified farms, the black and green PRO PLANET teas contained 50 per cent certified raw tea at market entry. REWE Group strove to continuously increase this percentage. In 2017, REWE and PENNY met the self-imposed goal and switched the entire segment of green tea and Earl Grey to raw products certified by the Rainforest Alliance.

Fish

Rising demand for fish and seafood has put the world’s fish stocks under severe pressure and resulted in over-fishing in some regions. In its Guideline for Fish, Crustacean and Shellfish, REWE Group has pledged to purchase increasingly more fish products from sustainable and certified fishing operations and aquaculture and to transparently inform consumers about this effort.

Share of more sustainable store-brand fish products of REWE Group in Germany (in per cent)

2016 2017
Share of MSC products 86 % 88 %
Share of PRO PLANET products 45 % 41 %
Share of store-brand fish products with tracking code 85 % 81 %

The assortment of REWE Group in Austria has about 400 MSC-certified fish products for store brands and industry brands.

Soybeans as Animal Feed

In conventional animal-husbandry practises, soybean meal imported from overseas countries is used to provide animals with sufficient amounts of protein. This meal frequently includes genetically modified types of beans. For this reason, REWE Group has drawn up a Guideline for Soy in Animal Feed that requires producers of store-brand products to abandon the use of genetically modified soybeans, among other requirements. This requirement is implemented on an individual basis for each species of farm animal. As proof that no GMO feed is being used, REWE Group in Germany works with the German Association of Non-Genetically Modified Foods (VLOG). As in the previous year, the entire range of fresh eggs at REWE Group in Germany had been certified by the group in 2017. For fresh milk, the share rose from 20 per cent in 2015 to 77 per cent in 2016, and further increased to 99 per cent in 2017. At REWE Group in Austria, the entire range of fresh eggs and fresh milk comes from non-GMO feed.

2015 2016 2017
Share of products bearing seal of the German Association of Non-Genetically Modified Foods (VLOG)
Fresh milk 20 % 77 % 99 %
Fresh eggs range 100 % 100 %

Wood and Paper

REWE Group is committed to protecting the forests of the world and the animals and plants that live there. For this reason, it supports environmentally and socially conscious forest management by increasingly procuring wood and paper for its products and packaging from sustainably operated sources. REWE Group uses the seal of the Forest Stewardship Council (FSC®) and of the Programme for the Endorsement of Forest Certification Schemes (PEFC™) as well as the German environmental seal Blauer Engel (Blue Angel). A large number of REWE Group products already bear these seals. For instance, nearly 80 per cent of hygienic paper products at REWE and PENNY have the FSC® label. All other hygienic paper bears either the PEFC™ label or the Blauer Engel seal. In addition, REWE Group is continuously trying to increase the proportion of recycled content in hygienic paper – for example, the company offers a hybrid toilet paper under the REWE store brand ja! with an intermediate layer made entirely from recycled paper. All paper shopping bags and all packaging used for the Vivess store brand are made exclusively with FSC®-certified paper. Nearly all store-brand paper stationery products at REWE Full-Range Stores have the Blauer Engel seal and almost all paper stationery products at PENNY are FSC® certified. toom Baumarkt DIY stores offer a continuously expanding range of certified items from many different product categories and are officially FSC® and PEFC™ certified. As a result, toom Baumarkt DIY stores meet the high standards that apply to transparency and the control of the product chain in both systems for sustainable forest management.

Peat-Free Soils

toom Baumarkt DIY stores plan to stop selling peat soils by 2025. This commitment applies to both store brands and branded products. As part of this transition, the percentage of peat in the entire assortment is being continuously reduced and replaced with renewable raw materials. At the same time, the range of peat-free soil products is being increased each year. In spring 2017, for instance, the assortment of peat-free toom Naturtalent potting soil was expanded to five items that also bear the PRO PLANET label. The REWE and PENNY sales lines have also added peat-free and peat-reduced alternatives to their season range of soils.

Natural Stone

toom Baumarkt DIY stores work to ensure that social standards and environmental requirements are met in the extraction and production of natural stone products. To achieve this goal, toom has been working for several years with the independent experts of XertifiX to seamlessly track the supply chain of natural stone all the way back to the quarry and to monitor compliance with social and environmental criteria. In 2016, toom Baumarkt DIY stores began to sell the first certified natural stone products that bear both the XertifiX PLUS and PRO PLANET labels. This range of certified products is being continuously expanded. For example, all natural stone products for the garden from China and India available at toom stores bear the XertifiX PLUS label.

More topics:

GRI 102-11

Risk Management

GRI 204

More Sustainable Product Range

GRI 204-1

Regional Products

GRI 204-FP2

Organic and PRO PLANET

GRI 301

Materials and Packaging

GRI 304

Biodiversity

GRI 308

Environmental Standards in the Supply Chain

GRI 412, 414

Social Standards in the Supply Chain

GRI 416

Customer Health and Safety

GRI 417

Promoting Sustainable Consumption

FP10

Animal Welfare