Rei Sustainability Case

To Council of Executive Vice Presidents check 1th of November, 2012 From Anders F? dder Subject Evaluation of REIs sustainability name and addresss I am writing in response to your inquiry regarding the plausibility of maintaining the day-and-night growth of the corporation as comfortably as satisfying its sustainability goals. The following sections go a stylus address the trio egresss, mentioned by chair management, by offshoot describing them, then reading them and lastly they bequeath be evaluated.Conclusion and recommendations get out be based on this. REI revolve about greatly on the w eachop that their line of business has on the environment. They continuously work on molding forward- look and innovative firmness of purpose that will help reduce these ostracize onuss. Their corporate mission emphasises this commitment At REI, we inspire, educate and outfit for a spirit of outdoor adventure and stewardship REIs stewardship priorities * back up the active saving of nature animize the responsible exercise and enjoyment of the outside * Enhance the natural world and our communities done responsible business practices * Foster opportunities to impr over berthicipation in human- authorityed outdoor frolic * Maintain REI as an employer of choice, where employees ar extremely engaged in the vision of the familiarity and atomic number 18 representative of our communities The CEO, Kevin Hagen, alike tell that these financial and environmental goals and ambitiousness must(prenominal)iness be met without sacrificing either. Hagen advocated shifting to a mannikin of no tradeoffs thus making a paradigm shift Innovation over compromise.Issue 1 First issue is whether the unions stated sustainability goals and aspirations are pursuant(predicate) with its corporate mission and its stated stewardship objectives that are tended above. REI sustainability goals focus on third areas goose egg consumption, greenhouse gas liberatio n ( atomic number 6 footprint) and reducing of waster to killfills. The follow plans to add water, toxics, land use and social push to this list in near future. Each of these areas has an aspiration for 2020, a goal for 2015 and a reckon for the current year. Energy consumptionREI has letn distinct initiatives to increase their null capacity by switching to parvenue re newbornable power stems wherever possible. They mission is to keep their energy consumption at a frozen(p) level despite opening new stores. One the ship canal they do this is by investing in self-generation options such as solar technology. Their ways of managing their energy use and increasing efficiency complicate * solar technology in many of our stores * lighting * Elimination of all in cornerstonedescent bulbs from our retail stores * Installation of highly energy-efficient bulbs and fixtures * Greater trustingness on skylights and natural lighting diverseness & cooling (HVAC) * Aggressive re trofitting and rehabilitation of outdated HVAC equipment with sophisticated new models * alter monitoring * Energy-saving techniques such as on-demand ventilation and airflow * Measurement of our stores energy efficiency against similar buildings nationwide with the ENERGY unity benchmarking tool Greenhouse gas emission (GHG) The aspiration for 2020 concerning GHG was to be climate neutral. Their goal for 2015 was to cut GHG by 50 percentage compared to 2010 emissions. The budget for each year was a specific target in scores of CO2 that was defined by the 2015 goal.REI looked at many aspects of their business in assign to reach this goal. These were not limited by their own specific action in spite of appearance REI. They look beyond themselves and try to change the way their employees and suppliers act to. The list include employee commuting and travel, travel by customers participate in REI Adventures programs from their homes to the site of program, transportation of pro ducts from vendors to the order and shipments to customers. However, they fill not included customer transportation to and from the stores.REI provides meaningful incentives for their employees to reduce the environmental impacts of commuting and corporate travel. These include * A 50 percent transit bonus * Showers and secure bike storage at every REI facility * Telecommuting options at our headquarters location * Web conferencing and otherwise technology tools In 2011, REI partnered with The record Conservancy to follow up an afforestation project on the Bayou Bartholomew property in Louisiana, which will bear upon forest pertinacity with the adjacent Chemin-a-Haut State Park.Funding provided voluntarily by REI Adventures will finance the future privacy of carbon off good deals from this project. Through this effort, REI supported The Nature Conservancys restoration of this forest eco scheme, as sound as the design of a carbon project. This carbon project has been valid ated and registered done a credible trio-party certification system (the Verified Carbon Standard). The effort will contri barelye to long-term systemic change, benefitting the halo and the forest ecosystem, and has been designed to produce falsifiable carbon offsets in the future.Though REI would playk new and innovative solutions to all aspects within the keep company, at that place is at least one were they could tho(prenominal) offset rather than reduce. REIs largest source of GHG emissions was REI Adventures which generated 31 percent of its total, namely passing members to adventure destinations. This exception was dealt with by acquire carbon offsets as a part of the travel package, paid by REI. littleening of waste to landfills REI aspiration for 2020 was to have no waste to landfills and cut waste to landfills by half between 2010 and 2015.In order to pass on this, they strive to brace their packaging tape transport operations as efficient as possible. They work with vendors, shipping companies and industry colleagues to originate new move upes to this complex situation. One physical exercise of this is how they reinvented the way bicycles were packaged and shipped. The bikes, shipped in composition board boxes from china, was packaged in split and fixd at one location in the US from where they were sent to the stores. The extensive packing, taped and stapled together, held the parts and assembled bikes securely even was difficult to assemble and disassemble.REI revised this process in way that includeed them to reuse the carton over and over again. Essentially, the same cartons that was used from the manufacturer in China, was used throughout the proviso drawstring and returned to China, to once again be use. thereby recycling all the materials rather than direct it to landfills. This decreased the cardboard consumption by more(prenominal) than 60 percent. Additionally they deliver more than $1 million in annual labour h ours due to lessen prison term required to pack and pull up bikes. reprize REI saw a opening in its net carbon impact during 2010.But the increase was smaller than overall company growth during the year, as measured by sales. Overall, the company used 2. 4% less energy in its facilities, despite adding iv new stores and relocating two retail locations to big spaces. Other sustainability efforts include purchasing 58. 4% Forest Stewardship Council (FSC)-certified paper fiber, and recycling 74% of total operational waste, including more than 95% at REIs two scattering centers. Community efforts included 109,785 volunteer hours committed through 541 REI-hosted conservation projects to plant trees, restore trails, and clean parks and streams.The company likewise funded $3. 7 million in grants provided to 330 noncommercial partners with a focus on conservation and outdoor recreation. However, REI is transferring renewable energy certificates generated by their solar panels. Si nce they do not deal credit for reducing carbon when doing so, this is creating a problem in terms of make carbon zero. A challenge they must overcome if they intend to reach their aspirations. REI could provided reduce their GHG by reevaluating the use of rising Zealand as a destination. Many locations on North American (e. g.Alaska, Canada, and the Rocky Mountains) celibate have similar location to offer, and perceive that New Zealand is half away almost the world, this could be an effective substitution. Exhibit three displays the give of reaching the 2015 goals. Is shows the actual lieu of all three areas in e. g. the first quarter of 2011, the plan for 2011, the trajectory for 2015 and the goal for 2015. Though the trajectories for 2015 for all three are above the goal, one can see from the actual status for 2011, that they are all fairly close if not beneath the plan for the same year.So despite the lugubriousness trajectory for 2015 REI is indeed on the function pa th. Issue 2 The second issue was identifying the potential risks with REI adopting the No Trade-offs progression joint by the corporate social debt instrument group, seen from a managerial performance criterion perspective. The No trade-offs approach presents both(prenominal)(prenominal) risks. It can prove be expensive, not only in the solutions required to fulfil but also the hours it take to reach them. As the CEO aspires innovation over comprise, the employees will always have to look for new ways of performing tasks.This takes condemnation and time is money. This is also a very ghastly and white approach leaving no(prenominal) or very little joggle room. The employees need to stay within the parameters and in some cases they might be looking at for solutions that are simply not there. Again, this is time consuming and will undoubtedly make REI miss out on surplus earnings lost by looking in other fixed directions. REI has set the bar high and this might also have a negative effect on the people working to find the solutions. If the goals seem too impossible, it might demotivate rather than inspire thus lowering the team spirit among the workforce.However, by setting a more reasonable goal for 2015 this is somewhat counteracted. palingenesis So there are several risks by the No trade-off approach, but REI seems to get around them. The company is solace growing and still finding ways to lower their influence on the environment. The employment section also notes that REI has been included on Fortune magazines snow Best Companies to Work for list for 14 consecutive years. The company has a 79% employee retention rate. Issue 3 The third issue was to evaluate the validity of the companys approach to measuring its carbon emission.The goals for environmental sustainability were set by the self-confidence of CEO. They were included in the companys non-financial KPIs (Key Performance Indicators). The CSR group is tasked to carry them out, however t hey also make the recommendation to the ability of the CEO on which the goals are based. This could pee internal problematic situation as it is the same people who make the recommendations for the goals as well as carrying them, though some tasks are overseen by other departments than CSR.However, REI take a comprehensive view of their environmental impact using a mannequin that reflects the work of the Outdoor Industry linkups Eco Working Group. They have effected winder performance metrics for e. g. the three before mentioned areas, and in 2011, they implemented measuring and reporting tools that enables them to forecast, budget and review their progress in these areas. These metrics tie flat into strategic and financial planning for key REI divisions, and results are assessed quarterly by company leadership.REI also became a member of bluesign technologies in 2008. The program requires tight manufacturing controls in move and factories in order to be certified. This appr oach will provide greater supply chain transparency in support of REIs goal of reducing the environmental impact of its products. The transparency will also allow them to make a more little assessment of their impact, as they will have greater access to their suppliers information regarding manufacturing. Recap Based on this I obtain the validity of the companys approach to measuring its carbon emission as high.