The UK retail industry and climate change
The UK retail industry contributes approximately 215 MtCO2e through the lifecycle footprint of goods sold annually in the UK, with additional emissions from vehicle fuel sales by retailers of ~50 MtCO2e. This places the sector among the most important contributors to greenhouse gas emissions, contributing approximately 80% more emissions each year than all road transport in the UK.
Emissions come from across the retail value chain: from upstream emissions on farms and in factories; through to the energy required for store operations and the diesel to power heavy goods vehicles; and downstream, the energy used by customers to power purchased devices and appliances.
Climate change is already impacting retail operations
The effects of climate change are already being felt across the retail industry. In the global supply chain, changes to climate patterns and more extreme weather events are forcing adaptations to agricultural practices and technologies, causing adjustments to sourcing arrangements, and threatening the longer-term security of supply of key commodities. With these issues accelerating, the implications for quality, price and availability of goods are growing yearly.
In the UK, climate change will increasingly pose operational challenges to retailers, with changing weather patterns requiring adjustments to retail buildings, logistics and infrastructure. Sea level rise and increased extreme weather events place retail and supply chain infrastructure in vulnerable areas at greater risk of flooding, and increase the cost of insurance. Climate-related economic disruption has the potential for knock-on impacts on consumer spending. Meanwhile, UK customers’ expectations are changing leaving companies not acting on climate change exposed to reputational risks.
Customers want to reduce emissions
Whether shopping for bread or books, t-shirts or TVs, sheds or shampoo, or simply buying a cup of coffee, UK consumers are increasingly champions of climate action. Customers want to understand the climate impacts of the products they buy and make purchases that help them live lower carbon lives. According to research undertaken by Accenture across 6,000 customers in 11 countries:
- 81% of customers plan to buy more eco-friendly products over the next five years.
- 83% think it’s important for companies to design products that can be reused, recycled and never go to landfill.
- 50% are willing to pay more for a product designed to be reused or recycled.
- 62% want companies to take a public and passionate stance on social, cultural environmental and political issues.
These findings align with global shifts in public opinion – a recent study by Globescan found that customers in markets around the world view climate change and the depletion of natural resources as top concerns. 74% of respondents wanted to reduce their environmental impact by a large degree.
These shifts in customer expectations are opening up opportunities for retailers to differentiate their offers and attract new customers, with climate concerns particularly marked amongst younger citizens.
UK retailers are already acting…
The UK’s retailers are already acting to reduce greenhouse gas emissions. Many of the largest retailers in the UK have already laid out ambitious climate targets and plans. Retailers across sectors, from the large to the very small have been innovating to reduce emissions and improve the products on offer to customers. Under the ‘Better Retail Better World’ initiative led by the BRC, major retailers have already cut emissions by 36% in absolute terms since 2005 – surpassing goals set for 2020. Beyond this, many leading retailers have now set comprehensive goals for their businesses under the Science Based Targets initiative (SBTi), which offers guidance in setting emissions reduction targets that are consistent with the Paris Agreement.
…but a great acceleration in progress is needed
While significant progress has already been made, the industry recognises that it needs to accelerate decarbonisation in order to help the UK to meet its net zero targets and mitigate against the worst impacts of climate change. Retailers recognise that they are uniquely placed to support the UK’s journey to a low carbon future. This is why the industry has come together through the BRC to support this ground-breaking roadmap to accelerate progress towards a net zero UK, ahead of the UK Government’s 2050 target.
While any one retailer can make progress in reducing operational emissions under their direct control, transformative change across the industry and supply chain will require concerted collaborative action. To deliver, retailers recognise that they need to work with other retailers, supply chain partners, governments, investors, civil society, innovators and other stakeholders. Delivery will take coordinated action, investment, systemic change and innovation. It will also require public policy that drives and enables progress, supporting the markets, innovation, technologies and behaviours needed to transform the UK to a net zero economy.
 Data download consumption emissions 1997-2017, ONS [Accessed September 2020]
 Chemical (Re)action: Growth opportunities in a circular economy (2019) - Accenture
 Study Finds People Want to Make Healthy and Sustainable Living Choices but Do Not Know Where to Start (2020). Globescan.
 Retailers are making strides in cutting carbon emissions (2019). BRC