Corporate Sustainability Program

Journey Toward Sustainability
AAFA Environmental Committee Meeting
February 17, 2009
Colleen Kohlsaat
Manager, Environmental Sustainability
Levi Strauss & Co. overview
‰ Founded in 1853 by Bavarian immigrant, Levi Strauss
‰ Privately held by descendants of Levi Strauss
‰ 2008 net revenues of $4.4 billion dollars
‰ 3 brand portfolio: Levis®, Dockers®, and Signature by Levi
Strauss and CO™
‰ Over 10,500 employees
‰ Sold in over 110 countries
• 55,000+ retail locations
• 1,500 brand-dedicated stores
‰ Supply chain portfolio:
• 800 contracted factories in 45 countries
• Own and operate 4 factories
• Approximately 315,000 workers
1991: The code that launched a thousand codes
The Business Partner Terms of Engagement (TOE)
‰ A condition of doing business
‰ Applicable to every factory, subcontractor, licensee, agent
or affiliate that manufactures or finishes our products
‰ Includes environmental requirements
1992: Establish Global Effluent Guidelines (GEG)
‰ 1992
• GEG Established
• LS&CO. O&O laundries
‰ 1994
• Extended to contractors and
licensees
‰ 1996
• Shared GEG with BSR
wastewater industry group to
develop industry limits
‰ 1999
• GEG revision
‰ 2006
• GEG 3rd Party Validation
Initiative
Restricted substance list (RSL)
‰ Pre-2000: Chemical approval process
‰ 2001: European RSL
• Country regulatory restrictions
‰ 2002: Global RSL
• Country regulatory restrictions
• H&S/Toxicology data
• Peer reviewed risk assessment process
‰ Systematic updates: 2004, 2006, & 2008
‰ Restrictions
• Prohibited from use
• Limited concentration on end product
• Phase-out (2008 version)
‰ Scope: all direct suppliers, licensees, agents, branded products,
sundries, accessories, packaging
Early Cotton Initiatives
‰ 1991: naturally colored cotton
‰ 1994: organic cotton
‰ 1997-98: organic cotton blends in denim
‰ 1999: convene “From Field to Fashion” cotton conference
Launched Levi’s® eco jeans globally in 2006
‰ Made from 100% organic cotton across numerous
segments of the brand
‰ Alternative sundry items and packaging
‰ Created internal set of standards to differentiate the
different types of product that we were selling
Understanding our environmental impact
Life Cycle Assessment
Intended Internal Use Only
Two key products (by volume)
US Market (2006)
• Levi's® 501®
• STF, 100% cotton fabric
• Medium stone wash
• Dockers® Original Khaki
• 100% cotton permanent press
• Black
Considered the full product life cycle
Product
Manufacture
Raw Materials
Materials
Manufacture
End
Disposition
Recycling
Transportation
& Distribution
Use
9
Product lifecycle impact of studied Levi’s® 501® jean
32.3 kg of CO2
3480.5 liters of water
400.1 MJ of Energy
• 78 miles driven by the average auto in the
United States
• Is equivalent to the carbon sequestered by
6 trees per year (based on EPA
representative sequestration rates of tons of
carbon per acre per year)
• Running a garden hose for 106 minutes
• 53 showers (based on 7 minute showers)
• 575 flushes of a 3.78 liter/flush low flow
toilet
• Watching TV on a Plasma Screen for 318
hours.
• Powering a computer for 556 hours.
Which is equivalent to 70 work days (based
on 8 hours of computer use/day)
Data from LS&CO.’s Life Cycle Assessment on Levi’s® 501® Jean for U.S. Market, 2006 production year
Levi’s® 501® Jeans – Climate Change
LEVI’S® 501® JEANS Cradle to Grave Climate Change, % by Phase
LEVI’S® 501® JEANS Cradle to Grave Climate Change, Amount by Phase 1%
20
18.6
5%
18
16
58%
21%
kg CO2e
14
12
10
6.6
8
6
3.0
4
2
9%
2.1
1.7
0.5
Cotton
Fabric
Cut/Sew/Finish
Logistics/Retail
Use
En
d
o
f
Li
f
e
Us
e
Re
ta
il
ish
Lo
gi
st
ics
/
/F
in
Cu
t/
S
ew
6%
Fa
br
ic
Co
tto
n
0
End of Life
For the studied Levi’s® 501® Jeans (cradle to grave)
we found the climate change impact
was highest at the consumer use phase (58%)
11
Levi’s® 501® Jeans – Energy Use
LEVI’S® 501® JEANS
Cradle to Grave Energy Use, % by Phase
LEVI’S® 501® JEANS
Cradle to Grave Energy Use (MJ), Amount by Phase 0%
250
226.6
4%
200
58%
150
MJ
21%
84.9
100
40.8
50
29.8
17.7
0.4
10%
Cotton
Fabric
Cut/Sew/Finish
Logistics/Retail
Use
e
e
En
d
o
f
L i
f
Us
i st
ics
/
Re
ta
il
ish
Lo
g
/F
in
Cu
t
/S
ew
7%
Fa
br
ic
Co
tto
n
0
End of Life
For the studied Levi’s® 501® Jeans (cradle to grave)
we found the energy use impact
was highest at the consumer use phase (58%)
12
Levi’s® 501® Jeans – Water Consumption
LEVI’S® 501® JEANS
Cradle to Grave Water Consumption, % by Phase
LEVI’S® 501® JEANS
Cradle to Grave Water Consumption, Amount by Phase 0%
1800
1704.0
1575.2
1600
45%
1400
Liters
1200
1000
800
600
49%
400
200
110.8
72.1
18.1
Fabric
Cut/Sew/Finish
Logistics/Retail
Use
ife
En
d of
L
e
Us
Re
ta
il
Lo
gi
st
ics
/
/F
in
ish
2%
Cu
t/
Se
w
Cotton
0.4
0
Fa
br
ic
3%
Co
tto
n
1%
End of Life
For the studied Levi’s® 501® Jeans (cradle to grave) water consumption
was highest at the cotton production and consumer use phases
(49% and 45% respectively)
13
Understanding our environmental impact
Facility Environmental Impact Assessment
‰ Studied sample of O&O locations, worldwide
‰ Assess all inputs and outputs
Key takeaway from our impact assessments
-o
f- l
if
su
nd
an
se
Je
Ce
n
an
t io
Di
s tr
Je
ibu
Cu
e
se
ta
il
Re
nt
re
s
fic
e
Of
w/
t/s
e
Co
Fa
fin
i
br
tto
sh
ic
25
20
15
10
5
0
n
k g CO 2
Global Warming per kg garment
dof
- li
fe
en
an
s
us
e
ta
il
Je
an
s
Je
Ce
Di
st
r ib
ut
io
n
t/ s
e
Cu
Re
nt
re
s
ce
ffi
w/
O
is h
fin
br
Fa
tto
n
ic
2500
2000
1500
1000
500
0
Co
kg water
Water use per kg garment
It is not enough to focus
on what we control,
we need to address cotton and
consumers
Data from LS&CO.’s Facilities Environmental Impact
Assessment (FEIA) and 2007 Life Cycle Assessment of Levi’s®
501® Jean.
Company vision on sustainability
“We will build sustainability into everything we do
so our profitable growth helps restore the environment.”
Environmental priorities and aspirational goals
‰ Energy Efficiency and Climate Change: Achieve carbon
neutrality by implementation of energy reduction initiatives and the use of
100% renewable energy first in our operations and then throughout the
supply chain
‰ Water: Reduce water usage and improve water quality throughout the
product life cycle while growing our business
‰ Resource Efficiency: Evolve into a zero-waste company offering
consumers more sustainable products
‰ Chemicals: Minimize the environmental impact from chemicals used
in production of LS&CO. product in all stages of the product life cycle
‰ Influence: Provide leadership to encourage other companies,
consumers, governments and civil society organizations to address
environmental sustainability
Key environmental strategies
Focusing on the Full Product Life Cycle
Cotton
Business
Operations
Consumer
Cotton: big for LS&CO.
‰ 95 percent of all LS&CO. products
contain cotton.
‰ Use about 0.5 percent of global
cotton production annually.
‰ In 2007, used 298 million lbs.
(135,453 metric tons) of cotton to
make products (about the amount
produced by Mexico in 2007/2008)
‰ In 2008, source from 147 mills
globally. Based on mill locations, we
estimate that the majority of cotton
may come from China, India,
Pakistan, and the U.S. however we
do not know for sure
Developing a cotton strategy that…
‰ Includes environmental and socio-economic
considerations
‰ Supports initiatives that will spread beneficial
environmental/socio-economic cotton production
practices worldwide
‰ Supports a tracking system that reaches to the farm
level
‰ Enables collaboration with others
Water
‰ Water quality: extend GEG to mill and
sundry suppliers in 2009 with nine
other brands
‰ Consumption:
‰ Mapping water consumption by
geography
‰ Piloting new industrial garment
washing techniques to reduce
consumption
‰ Policy:
• Founding member of BSR
Sustainable Water Group
• Joined CEO Water Mandate
‰ Transparency:
• Committed to publicly sharing
benchmarks, progress, challenges
Energy and climate change
‰
Energy consumption:
• Conduct facility energy efficiency audits
• Establish energy use and GHG reduction targets
• Pilot new industry garment manufacturing techniques to reduce
consumption
Transparency:
• Global GHG Inventory (O&O)
• The Climate Registry
• Carbon Disclosure Project (2009)
2007 LS&CO. Metric Tons of CO2e
Em issions
100,000
9 1, 6 3 6
90,000
2007 LS&CO. Global Emissions of CO2e by Facility Type
80,000
70,000
100,000
91,285
90,000
60,000
80,000
70,000
57,862
50,000
60,000
50,000
40,000
42,853
40,000
30,000
30,000
20,000
8,420
2,482
O
th
er
ffi
ce
O
et
ai
l
Sa
le
s
R
O
ffi
ce
M
an
uf
ac
tu
rin
g
ist
rib
ut
io
n
C
en
te
r
0
5,078
954
9 , 3 18
10,000
To
ta
l
10,796
ra
ve
l
10,000
24,456
20,702
Ai
rT
20,000
D
‰
0
LSA
LSEMA
LSAPD
LS&CO.
Climate and energy policy
‰ World Resources Institute (WRI) Green Power Group – CA Affiliates
‰ Ceres Business for Innovative Climate & Energy Policy (BICEP)
• Founding members: Levi Strauss & Co., Nike, Starbucks, Sun
Microsystems, Timberland
• Goal: work with business community and members of Congress to
pass meaningful legislation consistent with eight core principles:
9
9
9
9
9
Set GHG reduction targets
Establish an economy-wide GHG cap-and-trade system
Establish aggressive energy efficiency policies
Encourage transportation for a clean energy economy
Increase investment in energy efficiency, renewables and carbon capture and
storage technologies
9 Stimulate job growth through investment in climate-based solutions
9 Adopt a national renewable portfolio standard
9 Limit construction of new coal-fired power plants to those that capture and store
carbon emissions
Chemicals, materials, & Information Management System
‰ Identifying alternatives for chemicals to be phased-out
‰ Mapping material procurement and flows for identification
of reduction opportunities and efficiencies
‰ Developing information management system to collect
metrics and track performance
Consumer: product design, marketing, education
‰ Product design and marketing
•
Resource efficiency: Incorporate resource efficiency factors in product design and
aftercare
•
Packaging: Reduce product packaging from 3 to 2 hangtags, print direct on
garment, and/or use dissolvable packaging
•
Alternative fibers and sundries
‰ Educate consumer
•
Wash care: Change wash care instructions on all products to “wash in cold water,
tumble dry warm”
•
Wash less: Educate consumer to wash less
•
Retail stores: Use retail stores as a way to educate consumers on reducing impact
(e.g., information on shopping bags; eco store)
Thank you
Please refer to:
www.levistrauss.com/citizenship/environment.aspx