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EcoAct UK Managing Director, Stuart Lemmon speaks to Compass Group Global Head of Sustainability, Laura McMullen to find out about Compass Group’s net zero journey, what’s behind their ambitious sustainability drive and what are the main challenges of transitioning to net zero.
Can you give us a summary of where Compass Group is on its net zero journey, including the targets you’ve set, the milestones your meeting and achievements you’ve made?
We have a three pillared approach to sustainability, which is around health and wellbeing, environment and better for the world. Climate is certainly is in the environmental pillar, but also in the better for the world pillar, as well. I’d say that climate straddles all of those and for us, it’s one of those strategic priorities within ESG. So in terms of where we are on the journey, we’ve committed to set a science-based reduction target, and that will be communicated later on this year. We are working hard across our countries to finalise what that is, and roadmap how we’re going to get there. Out of that will flow our subsequent journey and ambitions beyond science-based targets for our net zero journey. So at the moment, we’re still in the relatively early stage of that journey. For Compass Group UK & Ireland though, we’ve actually just announced a net zero targets by 2030. And that’s across Scopes 1, 2, and 3 by 2030 and it’s supported by science-based targets across the UK part of our business. Our different countries are at different stages of their journey in terms of climate, ambition, and climate commitments. And that is probably mirrored by some governments’ differing commitments. Because we operate in so many countries around the world, there’s quite a degree of variation of what we’re seeing internationally in different markets from a government perspective. And so at Compass Group, our strategies need to mirror those different commitments or different maturity profiles when it comes to climate, as we take the business as a whole forwards.
Does that sort of variation across countries and across the business make it more difficult for Compass Group to set an ambitious target? Or is or is it an opportunity and that you can start in small locations?
I think it’s probably both an advantage and a disadvantage in different ways. Compass Group can be very localised in our offer, not just around climate across the business in general. If we try to do a one size fits all across our business, then it’s just less relevant, because what might be suitable in the US might just not be suitable in France, or in Australia, or New Zealand.
What is driving sustainability at Compass Group?
So I think when it comes to climate, we’re seeing a lot of activity and commitments and engagement from a lot of our stakeholders, including our clients as many of them have made net zero commitments. Also some of our investors are signatories to coalition’s on net zero or carbon reduction commitment, like Climate Action 100+. We’re absolutely seeing more and more movement in that area from a number of different stakeholders, but also we’re seeing it amongst the consumers that are the end users of our products on sites, and we can see as more of the younger generation are galvanised into action and have higher expectations for both corporates and their employees. Of course, we’re at the coalface of that because not only are we a large employer ourselves, but we provide the support and food services for our clients who are at the forefront of helping their employees on a sustainability journey. There are also quite a few of our suppliers themselves that have made either net zero or carbon reduction commitments as well.
Compass Group is now a member of World Business Council For Sustainable Development (WBCSD) and in fact, our CEO sits on the executive committee. The conversation we are now having is not just about switching to renewable energy but actually, how do we have more sustainable proteins in the food supply chain? And how can we support sustainable agriculture? And where does regenerative agriculture come into that? Overall, we’re seeing across all of our large stakeholder groups, a number of different aspects of sustainability come into play, and about net zero in particular.
How much do you see Compass Group’s role as being responsive and reactive to customer demands? And how much do you see it as being sort of leading them and encouraging them in a more carbon friendly, climate friendly direction?
I actually see both of those happening. Some clients are much further ahead, and others are a bit further behind, so we need to bring them with us. We have some clients that are wanting to have everything low carbon and everything labelled the provenance of all the products and zero waste, and then you’ve got other clients who are very much at the other end of the spectrum. So, it’s a challenge to move it forwards with some of those clients and consumers. But I think that it’s an opportunity to help shape the direction, particularly where some clients haven’t thought about it in a lot of detail. But to have almost a sort of an off the shelf solution to say, right, you might not have discussed this with us yet but this is what we can do, because it’s coming. For companies that might not have made any commitment on carbon, they will get left behind if they don’t acknowledge and act on the stakeholder requirement across the board.
Has it been a challenge up until now to get board level engagement? What are the challenges in adopting an ambitious and comprehensive programme like this?
COVID has been a huge challenge for the business, with quite a few sites are closed, and we’re dealing with our employees on the front line, ensuring the PPE and protection, enhance health and safety measures. Despite these challenges, we have been pushing for a renewed approach to sustainability and that drive is coming from the board. There’s a level of understanding around sustainability across the business now and how we move the business forward. And part of that is listening to what our stakeholders are saying, and what the expectations are, but also what the opportunity is. For example, we collect information on our clients, how many of our clients have made commitments and our suppliers? What are investors saying, and what do they think about it? And that goes into our materiality analysis that can help shape where we go forward and can help communicate to the board and the senior management on these important topics. It’s definitely a challenge to change how we look at our operations, and our wider influence in our Scope 3, it takes quite a bit of education and change to make it move forward.
Despite the wide-ranging challenges of COVID, Compass Group seems to have really having protected and prioritised sustainability. How much do you think the business recognises the opportunity that comes with this sort of transformative change and how much do you think it’s reactive in perhaps a risk way?
From a corporate perspective we’re seeing it in decarbonizing and companies moving to renewable energy, there’s this real transition now. Our clients look to us as the experts in food service, that’s our core, and therefore, we are in a position to help educate and make them aware of this area and how we can bring the sustainable options to them, to help them be more engaged with their employees and to fulfil their own sustainability goals.
And does that mean, therefore you need to engage with your account teams, business development teams? Are they asking you to, you know, support them in the work they do?
Yes, absolutely. 100%. Again, different levels, depending on the client and their location but there are a lot of investor calls or client calls and bids that we’re involved in asking about sustainability. This is our sustainability strategy, says the client, how can you support us on this journey?
As are part of a value chain of, taking a raw ingredient through various stages of preparation and delivering food outside the home to your to your customers, do you need to work and collaborate to make that happen?
Yes, like most companies, the majority of our footprint is in our supply chain and our Scope 3. Everyday, we buy kilos of tomatoes or bread, meat, seafood and that’s where a lot of our footprint is because of course, we don’t grow any of those products ourselves. It requires us to collaborate more closely, particularly with suppliers, on environmental areas. And I think we’ll see more and more of this collaboration going forward.
You talk a lot about the different countries and the different levels of maturity, how do you engage right across such a diverse business operating in?
We have a very decentralised model, which means our countries can engage with us in a way that works for them. We find that there are countries for whom sustainability is more of a topic and an opportunity, with more substantial teams in the area are might look to us more for support and resources. So it’s about providing a platform that answers the questions and helps them do their job and work with clients more readily. We do this through webinars, resources, having systems and tools that can calculate and analyse data. We want to show best practice and provide answers when we’re speaking to clients on this area because it’s a new topic overall. We want to help educate those individuals to understand what the answers are and work with clients to help them achieve their goals.
Increasingly, I think it’s that data provision that can help inform further decisions to be able to track something that’s quite important.
In terms of your net zero journey, what’s your current view on offsetting for Compass Group in the longer term for net zero?
Given our huge reach in our supply chain, there are areas that we are not able to decarbonized right now, so I think offsets play a role in helping abate those. Also, if we look at long-haul transport or aviation, there’s an aspect that can’t be decarbonized or can’t be decarbonized quickly enough. So, whilst I don’t think offsets are the panacea or the ultimate answer, I think they serve a necessary purpose at this point.
There has been a real change of pace in the last 18 months, is that a good thing, or does that start to take some of the control away from you and your team and make things harder?
I think the level of movement is ultimately a good thing. If you look at the climate crisis, we need to be moving quicker as a planet, so I think any movement in that direction is a positive. We have to get behind the changes that can be made in a certain timeframe to make that impact. But when it comes to control or ownership and responsibility, my job title might have sustainability in it but sustainability should be everyone’s responsibility in an organisation. And it should be woven throughout. I’m not putting myself out of a job but I will be satisfied when there isn’t a need for my role. For now though, I think there’s an important role to play oversee things and check the strategy is aligned. When it comes to my team, operating in a vertical fashion in in an area just doesn’t work really. And therefore, for sustainability to be effective, it needs to be more integrated into the businesses in general. But we are seeing that transition now, with a lot of the investor community driving this change.
Are there any other areas of Compass Group’s operations that are changing significantly to meet these new demands around sustainability?
A huge priority for us is food waste, which when you look at our whole supply chain, has a big impact. Also we are focusing on responsible sourcing. There’s a lot of good work that we’re doing locally and globally, we’re a member of the Global Sustainable Seafood Initiative (GSSI) and Roundtable on Sustainable Palm Oil (RSPO) and Round Table on Responsible Soy Association (RTRS). We are working with suppliers in general, and understanding how we can all move forward on our Scope 3, because the more the more companies that reduce that and commit to reduce their, whether that’s net zero or science-based, then the easier it is for everyone. If one of our suppliers makes a net zero commitment, then it’s much easier for us to reduce our Scope 3 emissions related to them in the same way that our clients ask us to be there with them on their net zero reduction journey. So I think ultimately raising the bar across the industry, I think we’ll see more acceleration. And I think that can only be a good thing. If we help our suppliers make the commitment, we make it easy for our clients to reach theirs. So it becomes just part of the way doing business
Looking forward, I think we might see some businesses really differentiate themselves on it, and the ones that don’t will absolutely get left behind in that sense. So, that would be interesting to see.