David Jones Annual Report

DAVID JONES LIMITED
NATIONAL PACKAGING COVENANT – ANNUAL REPORT 2009/10 CEO endorsement
David Jones is committed to managing its operations in an environmentally sustainable manner and to investing in robust management systems to ensure confidence and transparency in environmental reporting. This commitment is in recognition of David Jones’ responsibilities to its shareholders, customers and employees, and is consistent with the expectations held by government and the broader community. David Jones’ commitment to the National Packaging Covenant reflects these strategic goals and continues to enhance its ability to reduce the impact that packaging has on the environment. David Jones’ 2007-10 Action Plan and this Annual Report have been developed by implementing processes that identify, quantify and monitor initiatives to minimise the environmental and financial impacts of packaging, carry bags and office waste. David Jones has now achieved all waste minimisation targets and action plan objectives that were due for completion by the end of FY10. Key achievements over the term of the current three-year action plan include:
•

a 43% reduction in the amount of waste sent to landfill, driven by continuous improvement in recycling rates on cardboard, paper and plastic film; a sustained reduction in the amount of resin used to produce the same number of plastic carry bags; the launch of the David Jones “Community and Environment” webpage which provides information to interested stakeholders about environmental impacts and initiatives, and information about how consumers can recycle packaging at time of disposal; an increasing awareness of David Jones’ buy-recycled clause and the National Packaging Covenant’s Environmental Code of Practice for Packaging; and the initial engagement of David Jones’ top-100 suppliers to help identify opportunities to move towards more sustainable packaging over time.

• •

• •

I am pleased to submit David Jones’ National Packaging Covenant Annual Report for 2009/10, which confirms these key achievements, and outlines progress against our own action plan and industry-wide key performance indicators. David Jones looks forward to maintaining a constructive dialogue with the National Packaging Covenant and to developing its 2011-15 Action Plan, as it transitions to the Australian Packaging Covenant.

Paul Zahra Chief Executive Officer David Jones Limited

DAVID JONES LIMITED ABN 75 000 074 573 ACN 000 074 573

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DAVID JONES LIMITED
NATIONAL PACKAGING COVENANT – ANNUAL REPORT 2009/10 Executive Summary David Jones reported sales of $2.053 billion for FY10 and (as at July 2010) employed approximately 9,000 people across 41 locations in New South Wales, Australian Capital Territory, Queensland, Victoria, South Australia and Western Australia. The business submitted its National Packaging Covenant (NPC) Action Plan for the 2007-10 period in July 2007. This annual report provides a status update of initiatives that David Jones committed to in that action plan and outlines key achievements for the 12 months to July 2010. The table below demonstrates that David Jones has: achieved all key NPC targets in relation to lower general waste volumes; and satisfied all of its own objectives scheduled for completion by the end of FY10.

To meet its primary obligation to the NPC, to minimise environmental impacts arising from carry bags and packaging from own-brands and direct imports, David Jones has introduced measures to minimise resource depletion where it has been practical to do so. However, the key focus of David Jones’ action plan has been to minimise the impact that waste material has on the environment after disposal (regardless of its source) and, to that end, the business has implemented recycling systems to divert cardboard, paper and plastic film from landfill. David Jones also has an obligation to work with those branded suppliers that fall outside of the own-brand classification, to assist in making the transition to more sustainable packaging over time. To help meet this responsibility, David Jones strengthened its commitment to the Environmental Code of Practice for Packaging (ECoPP) in FY10 by actively engaging its top-100 vendors. The initial aim of this engagement was to open a dialogue with key suppliers in relation to potential design enhancements that reflect the principles of the ECoPP and the new Sustainable Packaging Guidelines (SPG). Going forward, David Jones will work with its key branded suppliers to help identify and implement design solutions that: optimise resource efficiency and reduce the amount of packaging produced for the business and its customers; and further reduce ecological degradation after disposal, by rationalising the different types of materials currently in use.

David Jones’ commitment to meet its NPC obligations has enhanced the organisations’ capabilities in relation to key waste avoidance measures and recycling programs over the past four years. David Jones will now refocus its efforts on developing its 2011-15 Action Plan, which is due for submission to the new Australian Packaging Covenant (APC) by March 2011. Table One - Progress against David Jones’ 2007-10 Action Plan
1.0 Action 1.1 1.1.1 Waste reduction and recycling Targets Increase recycling of distribution/outer packaging In NSW stores, continue measures to divert cardboard and soft plastic from general waste to recycling In Qld, Vic, SA and WA stores reduce volumes sent to general waste from stores by diverting cardboard and soft plastic Reduce volumes sent to general waste from warehouses by diverting cardboard and soft plastic to recycling Increase recycling of paper 30% reduction in general waste vs estimated FY06 baseline (Aug 05 to Jul 06) 30% reduction in general waste vs estimated FY06 baseline (Aug 05 to Jul 06) 30% reduction in total waste vs estimated FY08 baseline (Aug 07 to Jul 08) Approach revised in FY08 Individual litter bins phased out and replaced with central bins End FY08 End FY08 Achieved 49% reduction over the four years to Jul-10 Timeline Status Update (as at Jul-10)

1.1.2

End FY08

Achieved 34% reduction over the four years to Jul-10

1.1.3

End FY09

Achieved average 30% reduction in the amount of total waste sent to landfill from warehouses, in the two years to Jul-10 Expanded program in warehouses to include general waste and hard rubbish, to account for total environmental impact Implementation into corporate offices complete. Under-desk paper bins and centralised waste stations installed Implementation into stores not viable in isolation. To be incorporated into future waste minimisation projects

1.2

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DAVID JONES LIMITED
NATIONAL PACKAGING COVENANT – ANNUAL REPORT 2009/10
Action 1.3 Divert polystyrene from general waste stream Targets Most feasible option identified and business case developed Timeline End FY09 Status Update (as at Jul-10) Business case has been developed and confirmed that none of the available options is more cost-effective than current disposal methods. Collection of relatively small volumes of polystyrene, from disparate locations, remains problematic and requires market development. Next steps should focus on engaging suppliers with the aim of eliminating polystyrene from use, rather than sourcing most cost-effective disposal / recycling method. 1.4 Divert food waste and comingled recyclables from general waste stream Business case developed End FY10 Food waste - business case has been developed. Market analysis confirms that diversion of organics is not commercially viable at the current time, but should be costneutral within 3-5 years. Next steps should focus on monitoring market conditions on an annual basis to determine differential between rising landfill charges and falling costs of organic collections Co-mingled recycling - business case has been developed. Implementation into corporate offices complete but roll-out into stores to be reviewed because collection of relatively small volumes of co-mingled recycling remains problematic, given the lack of a national market and/or operators. Next steps should focus on monitoring market conditions on an annual basis to confirm any changes and/or opportunities. 1.5 Communicate targets and progress to staff Set up intranet site to provide information on Waste Management Initiative End FY08 New “Community and Environment” webpage launched in 2010 (www.davidjones.com.au) providing information to prospective, new and existing employees Environment bulletins for staff notice boards introduced to stores in Mar-09, including update on Waste Management Initiative and NPC achievements in Sep-09 and Nov-10 Up weighted the significance of the Environment Report published in David Jones Annual Report, communicating results to staff and wider stakeholders 1.6 Continue existing initiatives Program is continued Program is continued Program is continued FY08-10 FY08-10 FY08-10 Program continues Program continues Program continues 1.6.1 Recover and re-use garment hangers 1.6.2 Recover and recycle packaging from delivered furniture

1.6.3 Recover mattresses when new beds delivered to customers 2.0 Action 2.1 Minimise material used in plastic carry bags Carry bags

Targets Plastic bag range reviewed to ensure bags are correctly sized Business case and implementation plan developed and reviewed by senior management

Timeline End FY08

Status Update (as at Jul-10) Review complete and new range of bags introduced into stores in Nov-06 Achieved average 25% reduction in total weight of plastic carry bags in comparison to the pre-2006 specifications

2.2

Investigate feasibility of introducing re-usable bags

End FY08

Business case and implementation plan presented and approved. Bags launched in Nov-2007 Sold 165,000 reusable shopping bags over three years, in addition to 8,000 bags provided to staff during launch

3.0 Action 3.1

Own-brand packaging Targets Inform buyers about the Environmental Code of Practice for Packaging Reference material on ECoPP developed and distributed Timeline End FY09 Status Update (as at Jul-10) Briefings conducted, information provided and guide to help buyers influence packaging decisions published 100% of buyers have acknowledged David Jones’ aspirational aim to meet ECoPP principles (on-line signatures required to support annual corporate compliance assessment, Jan-09)

DAVID JONES LIMITED ABN 75 000 074 573 ACN 000 074 573

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DAVID JONES LIMITED
NATIONAL PACKAGING COVENANT – ANNUAL REPORT 2009/10
Action 3.2 Incorporate buy-recycled policy into supplier contracts Targets Supplier contracts adjusted to include preference for recycled and recyclable packaging Timeline End FY09 Status Update (as at Jul-10) Buy-recycled policy included in supplier agreement template 100% of buyers have acknowledged awareness of David Jones’ buy-recycled guidelines (on-line signatures required to support annual corporate compliance assessment, Jan-09)

4.0 Action 4.1

Working with packaging supply chain and consumers Targets Provide information to consumers on recycling and disposal of packaging Business case for providing information on David Jones website developed for business approval Timeline End FY09 Status Update (as at Jul-10) New “Community and Environment” webpage launched in 2010 (www.davidjones.com.au) providing information to consumers and other stakeholders about how to recycling packaging at time of disposal

5.0 Action 5.1

Monitoring and reporting Targets Waste reduction and recycling Procedure in place to collect and validate monthly data from waste contractor Targets reviewed annually Internal reports produced on progress against targets End FY08 Procedure to capture data from waste contractor currently in place. Data supplemented by internal waste audits in 30 stores conducted through 2010 Targets for FY09 and FY10 reviewed as part of existing budget process Progress against targets reported as a function of existing review process Timeline Status Update (as at Jul-10)

5.1.1 Develop procedure for estimating volumes of waste sent to recycling and landfill from on-site collection facilities 5.1.2 Review targets for reductions in general waste 5.1.3 Track progress against targets for reductions in general waste 5.2 5.2.1 Carry bags Develop methodology for estimating weight of plastic bags Own-brand packaging Develop methodology to estimate packaging volumes from own-brand sales as a percent of total sales NPC Reporting Report confidentially on tonnage of packaging sent for recycling and to general waste from onsite collection facilities Report confidentially on tonnage of plastic bags purchased Report confidentially on estimated volume of distribution/outer packaging from ‘own-brand’ sales Report changes to carry bags affecting amount and type of packaging used Report whether on-site recycling and collection facilities are provided Report on formal adoption of ECoPP Report on implementation of buy recycled purchasing policy

FY08–10 FY08–10

Procedure in place to collect data and estimate weight Methodology developed

End FY08

Methodology established and procedure in place to capture data from supplier

5.3 5.3.1

End FY08

Methodology established and live data used to test data analysis tools

5.4 5.4.1

Data entered into NPC on-line database on confidential basis Data entered into NPC on-line database on confidential basis Data entered into NPC on-line database on confidential basis once sufficiently accurate Progress update included in Annual Report Information included in Annual Report Progress update included in Annual Report Progress update included in Annual Report

31 Oct each year

Detail provided in main body of NPC Annual Report

5.4.2

31 Oct each year 31 Oct each year

Detail provided in main body of NPC Annual Report

5.4.3

Detail provided in main body of NPC Annual Report

5.4.4

31 Oct each year End FY08

Detail provided in main body of NPC Annual Report

5.4.5

Detail provided in main body of NPC Annual Report

5.4.6

End FY09

Progress update provided in David Jones 2008/09 NPC Annual Report. Key implementation requirements achievedbriefings and information provided to buyers Progress update provided in David Jones 2008/09 NPC Annual Report. Key implementation requirements achievednew clause included in supplier agreements in 2006 but execution may extend into 2010 Detail provided in main body of NPC Annual Report

5.4.7

End FY09

5.4.8

Report annually on progress against Action Plan

Annual report prepared and submitted to NPC

31 Oct each year

DAVID JONES LIMITED ABN 75 000 074 573 ACN 000 074 573

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DAVID JONES LIMITED
NATIONAL PACKAGING COVENANT – ANNUAL REPORT 2009/10 NPC Annual Report (2009/10) 1.0 Introduction This Annual Report provides an overview of David Jones’ key focus areas and key performance indicators (as they relate to the NPC) as well as a status update of initiatives proposed in David Jones’ 2007-10 NPC Action Plan. The report also provides an overview of key achievements in relation to packaging and waste management objectives for the 12 months to July 2010 and should be read in conjunction with status updates submitted in 2008 and 2009. 1.1 Background David Jones has been a signatory to the NPC since 2006 and submitted its first NPC Action Plan for the 2007-10 period in July 2007. This is the third year that David Jones has submitted an Annual Report to the NPC. 1.2 Company Profile David Jones aims to provide the best department store experience in Australia, with a premium product offering that includes:
• • • • •

apparel – womenswear, menswear and childrenswear; shoes and accessories; fragrances and beauty; homewares, bedding and furniture, appliances, home entertainment and home office; and a premium food and liquor offer in selected stores.

David Jones reported sales of $2.053 billion in FY10 and (as at July 2010) employed approximately 9,000 people in 41 locations across New South Wales, Australian Capital Territory, Queensland, Victoria, South Australia and Western Australia, including: 36 department stores, two clearance stores and three warehouse facilities. In addition, the two Sydney CBD stores also accommodate all head office functions. Since the NPC baseline was established in 2006, David Jones has made the following changes to its core business model:
• • • • • • • •

April 2007 – opened new store in Westfield Burwood, suburban Sydney (high-volume) July 2007 – closed store in Bankstown Shopping Centre, suburban Sydney (low-volume) August 2007 – opened new store in Westfield Chermside, suburban Brisbane (high-volume) October 2007 – closed store in Eastgardens Shopping Centre, suburban Sydney (low-volume) February 2008 – doubled selling floor space at refurbished QueensPlaza store, central Brisbane (high-volume) August 2008 – reduced selling floor space by ~20% across Bourke Street Mall properties, Melbourne CBD (high-volume) October 2008 – opened new store in Westfield Doncaster, suburban Melbourne (high-volume) January 2009 – reduced selling floor space by ~80% at Claremont store, suburban Perth (low-volume)

1.3 David Jones and the National Packaging Covenant In recognition of its obligations as a brand owner of carry bags and packaging from own-brands and direct imports, David Jones aims to engage its suppliers to improve resource efficiency, where there is an opportunity to influence the design of packaging. However, because packaging from imports and own-brands constitutes a relatively small proportion of all packaging managed by the business, the key focus of David Jones’ NPC Action Plan has been on developing and implementing recycling systems that minimise end-of-life environmental impacts by diverting packaging from landfill, regardless of its source. The business has adopted this approach because David Jones’ business model is different to other major retailers operating in Australia. The key differentiation is David Jones’ “Home of Brands” strategy, which has increased the number of local and international brands stocked by David Jones and resulted in a reduction in “house” or own-brand sales, over time.

DAVID JONES LIMITED ABN 75 000 074 573 ACN 000 074 573

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NATIONAL PACKAGING COVENANT – ANNUAL REPORT 2009/10 Consequently, the majority of David Jones’ product range (merchandise that falls outside of the own-brand classification) is now sourced from branded suppliers that design merchandise to meet Australian and/or global market requirements. Because influencing packaging decisions made by these suppliers is beyond the direct control of David Jones, the business sought to establish a collaborative framework in FY10 to assist these suppliers in making the transition to more sustainable packaging over time.

1.4 Scope of Report The primary review period for this report is August 2009 to July 2010 (defined as FY10) in comparison to the baseline year, which (unless otherwise specified) covers the period from August 2005 to July 2006 (FY06). It is worth noting that the baseline position does not include the two stores that have closed since July 2006, but that the FY10 data set does include three new stores and other changes to the property portfolio since 2007, as per Section 1.2. In relation to plastic carry bags, own-brand packaging and packaging from direct imports, this report presents a whole-ofbusiness view. In relation to general waste and recycling data, the report accounts for all facilities except for seven stores where David Jones does not manage waste disposal activities and recycling systems. All initiatives noted in this report have been introduced into all parts of the business, except for waste management and recycling measures, which have not been implemented into the seven stores where the Company does not manage disposal and recycling systems. 1.5 Preparation of Report David Jones’ Environment Manager is responsible for all environmental reporting and disclosure, including the preparation of this report. Assistance has been provided by other functions, including Facilities Management, Procurement, Supply Chain, Merchandise and Legal Services. Data has also been provided by external waste consultants and waste contractors; and recommendations made by KPMG in 2008 have informed David Jones in the development of the methodology for reporting under the NPC. 1.6 Contact Officer Jason Robertson Environment Manager, David Jones Limited 02 9266 5865 [e-mail] ([e-mail])

DAVID JONES LIMITED ABN 75 000 074 573 ACN 000 074 573

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NATIONAL PACKAGING COVENANT – ANNUAL REPORT 2009/10 2.0 Key Focus Areas (2007-10) As stated in its 2007-10 Action Plan, David Jones’ approach to managing packaging, carry bags and paper (as per the principles defined by the NPC) has five key areas of focus, as below. David Jones has made significant improvement against each of these goals over the three years of the current review period.
Key Focus Area Waste reduction and recycling Goal (as at Jul-07) Managing waste from stores, warehouses and corporate offices will continue to be the primary focus as it is the area in which David Jones has most control and can have greatest impact. David Jones Waste Management Initiative aims to achieve a cost-neutral position within three years by focusing on: • Increasing recycling rates of distribution packaging • Increasing recycling of paper • Diverting polystyrene from general waste stream • Diverting food waste and co-mingled recyclables from the general waste stream • Communicating targets and progress to staff Status (as at Jul-10) • All targets have been achieved on (or ahead) of schedule - Recycling rates for cardboard, plastic film and paper have improved over the three years of the current plan - Targets for lower landfill emissions from stores have been exceeded - Progress has been reported to staff through bulletins, David Jones Annual Report and the new “Community and Environment” webpage • Two business cases have been developed in FY10, as per action plan commitments • Cost-neutral target no longer viable, given growth in landfill charges • Review of carry bags completed and range introduced in 2006 continues to deliver sustained reduction in the total weight of material used to produce bags • Further to the completion of a feasibility study, re-usable tote bags were introduced into stores in Nov-07. Since launch, 165,000 units have been sold • As part of its 2011-15 Action Plan, David Jones will commit to a strategic review of carry bags, including an assessment of alternatives to plastic (including paper and bio-degradable materials) Formal progress update provided in 2008/09 NPC Annual Report. 100% acceptance of both measures amongst buyers • ECoPP briefings and information has been provided to buyers responsible for ownbrands, with some initial packaging reviews underway (in anticipation of the launch of Sustainable Packaging Guidelines) • New buy-recycled clause introduced into the revised supplier agreement template David Jones engaged its top-100 vendors in FY10 to open dialogue, with the aim of establishing greater collaboration in respect of sustainable packaging design. New “Community and Environment” webpage launched, to provide information to stakeholders and specifically to consumers about how to recycle packaging Methodologies have been established, tested and validated to enable reporting to the NPC for the FY09 and FY10 periods

Carry bags

Although much lower in volume (and impact) than distribution packaging, carry bags are also a key focus for David Jones. David Jones carry bags are made from recyclable materials and generally do not form part of the litter stream because they are typically not provided for items that are consumed in public. In Nov-06, a new range of bags (that reduced the amount of resin used to produce the four most commonly used bags by 40%) was launched into stores. David Jones aims to consider additional measures, that: • Reduce the amount of material used to produce plastic carry bags by ensuring the range is correctly sized for goods sold • Review and assess the feasibility of introducing re-usable bags

Own-brand packaging

David Jones own-brands represent only a small proportion of total sales. The amount of distribution packaging generated by these lines is relatively small, and will be captured for recycling as part of the Waste Management Initiative. Therefore, David Jones aims to influence packaging decisions associated with own-brands by: • Educating buyers about the principles of the Environmental Code of Practice for Packaging (ECoPP) • Including a new buy-recycled clause into supplier agreements

Working with stakeholders

David Jones recognises the importance of a collaborative approach to reducing the impact of packaging and will engage the supply chain, consumers and government, where it is appropriate (and effective) to do so David Jones aims to assess the effectiveness of providing information to consumers through the David Jones website

Monitoring and reporting

David Jones aims to develop methodologies and procedures to estimate the amount of packaging recycled and sent to landfill, the amount of material used in carry bags, and the amount of distribution packaging used for own-brand products. Data will be provided to the NPC to support the development of a more accurate national data set

DAVID JONES LIMITED ABN 75 000 074 573 ACN 000 074 573

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NATIONAL PACKAGING COVENANT – ANNUAL REPORT 2009/10 The product stewardship areas addressed by David Jones’ 2007-10 Action Plan include disposal, recycling and reprocessing; research, design and market development, and education. The action plan addresses covenant KPIs for brand owners and a number of other (broader) KPIs that apply to design, development and education.

Product Stewardship Areas

Reprocessing

Market development

Key Focus Areas Waste reduction and recycling Carry bags Own-brand packaging Working with packaging supply chain and consumers Monitoring and reporting

Education

Recycling

Research

Disposal

Design

Relevant Covenant KPIs KPIs 1, 6, 16, 21 KPIs 3 KPIs 22, 26 KPIs 22, 26 KPIs 1, 3, 6, 16, 22, 26, 27, 28, 29

Further to submitting its action plan in July 2007, David Jones has defined its current commitment to each of these product stewardship areas, as below. Product Stewardship Area – Disposal Key Focus Areas – waste reduction and recycling, monitoring and reporting David Jones continues to develop environmentally sound disposal strategies for all unique components of the waste stream. This work commenced prior to the development of the current three-year action plan but reflects many of the NPCs’ principles. The initial focus of this program was to reduce the amount of packaging sent to landfill for disposal, by improving recycling rates on key components of the waste stream, specifically cardboard, paper and plastic film. David Jones continues to assess the feasibility of alternative disposal plans for other (more complex) components of the waste stream, such as polystyrene, food waste, co-mingled recycling and packing void (beads). While business cases developed in FY10 confirm that alternative disposal methods for these materials are not commercially viable at the current time, David Jones will commit to completing cost/benefit analysis on an annual basis, to determine the future viability of these alternatives. David Jones is also committed to reducing landfill emissions from hard rubbish collections. To date, the business has developed alternative strategies for e-waste, mattresses and large appliances collected from customer homes, disused metal fixtures and fittings, office furniture, pallets and end-of-life visual merchandising props including mannequins. Work will continue to enhance and, where viable, expand these principles for other types hard rubbish in the most cost-effective manner, over time.

DAVID JONES LIMITED ABN 75 000 074 573 ACN 000 074 573

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NATIONAL PACKAGING COVENANT – ANNUAL REPORT 2009/10 Product Stewardship Area – Recycling Key Focus Areas – waste reduction and recycling, monitoring and reporting New recycling systems implemented prior to July 2008 initially reduced the amount of waste sent to landfill, but David Jones’ team members, contractors and service providers continue to help reduce the impact that the business has on the environment, by continually increasing the amount of waste material separated and collected for recycling. These results should continue to improve through the term of the next action plan, as the business: • • installs new waste management equipment that has the potential to recover more cardboard, paper and plastic from the general waste stream; and continues to work with service providers to increase the level of confidence in recycling data and reporting.

Product Stewardship Area – Reprocessing Key Focus Areas – waste reduction and recycling, monitoring and reporting Diverting materials from landfill, for reprocessing or reuse, has been a long-standing business practice for David Jones. Garment hangers, packaging from furniture and whitegoods, end-of-life e-waste, and mattresses are diverted from landfill to reduce both the environmental and financial impact of these materials after their useful life. In 2007, the business also started to separate packing beads for reuse in store processes, such as internal transfers and home deliveries. Over the past two years, a number of pilot locations have established systems and agreements (principally with local couriers) to enable the re-use of clean packing beads by third parties, with the potential to reduce general waste volumes by up to 10%. There are some barriers to a national roll-out of this program but a Memorandum of Understanding between the parties, which is currently in draft form, should clarify these issues. Product Stewardship Area – Research Key Focus Areas – waste reduction and recycling, carry bags David Jones has implemented a number of new waste management and recycling initiatives that have required fundamental change to the way in which the business, up until that point in time, had managed waste. Implementation of these new systems has been contingent upon comprehensive discovery and analysis and pilot studies to determine the feasibility and impact of introducing such measures into David Jones’ stores, warehouses and corporate offices. In FY10, this research included a comprehensive review of waste management equipment (predominately balers) to determine the safest and most cost effective method for processing recyclables. As a result of this research, David Jones has been able to rationalise and reduce the number of balers in use across the business, improve the risk profile of waste management activities, reduce the total cost of ownership and enhance environmental outcomes. According to David Jones’ research partner, Waste Audit and Consulting Services, “most companies are not at the stage where they are actively looking to streamline their equipment to ensure it fully meets the needs of the organisation, taking into account cost, OH&S, convenience, dock management employee practices and culture. In this respect David Jones is ahead of many other retail companies.” This approach to research has also extended to carry bags, with investigations to assess the viability of alternatives to plastic and a strategic review of carry bags, planned for early-2011, to form a key component of David Jones’ next action plan.

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NATIONAL PACKAGING COVENANT – ANNUAL REPORT 2009/10 Product Stewardship Area – Design Key Focus Areas – carry bags, own-brand packaging David Jones continues to encourage vendors and supply chain partners to design packaging that minimises environmental impacts by educating buyers about the ECoPP, cost-neutral alternatives to current packaging materials and buy-recycled opportunities. Going forward, David Jones aims establish feedback mechanisms with some of its key suppliers to identify design enhancements that reflect the common principles of the ECoPP and the new Sustainable Packaging Guidelines (SPG). David Jones has most influence over the design of own-brand packaging, including carry bags. In anticipation of the transition to the new SPG, David Jones has commenced formal packaging reviews on an initial sample of own-brand merchandise. The findings from these reviews will help to inform the business about the processes and costs associated with future packaging reviews, which will be a core requirement of David Jones during the term of its next action plan. As noted, David Jones also intends to conduct a strategic review of its carry bags offer in 2011, which will also include a formal packaging review, to line with the new SPG. Product Stewardship Area – Market Development Key Focus Areas – waste reduction and recycling, carry bags, own-brand packaging Where there is an opportunity to develop new work practices and/or recovery processes to affect a positive outcome, David Jones will work with suppliers, supply chain partners, waste contractors and manufacturers of waste equipment to develop these opportunities. Developing new equipment, new recovery processes and a market for the end product of such processes is key to the successful implementation of future initiatives, such as diverting food waste and packing void from landfill. Product Stewardship Area – Education Key Focus Areas – waste reduction and recycling, working with stakeholders David Jones recognises the importance of educating employees, suppliers and consumers about the environmental impacts of packaging and has implemented a range of measures that aim to minimise these impacts. To that end: • training and education material is provided to David Jones employees prior to the implementation of any new initiative, to new employees when they join the business and (as of February 2011) to existing employees in the Operations group as part of annual compliance training; briefings and training guides about buy-recycled options and the ECoPP have been provided to buyers in the Merchandise group; and consumers and wider stakeholders are able to access information about the disposal and recycling of packaging via the corporate website (http://www.davidjones.com.au/Community-and-Environment).

• •

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NATIONAL PACKAGING COVENANT – ANNUAL REPORT 2009/10 3.0 Key Performance Indicators (FY10) As stated, David Jones is subject to a number of Key Performance Indicators (KPIs) that are specific to brand owners, as well as some broader KPIs. This section summarises David Jones’ performance against these industry measures, as defined by the NPC. In 2008, KPMG made recommendations to David Jones in relation to data collection and analysis which have informed the business in the development of its methodology for reporting under the NPC. This methodology has been applied consistently in all three years of the current review period to enable a like-for-like comparison. 3.1 KPI 1 - Total weight of consumer packaging
Material FY08 weight estimates FY09 weight estimates FY10 weight estimates Methodology

Total packaging material, as a component of total waste material
Total – all materials Total – all packaging 6,133 tonnes 4,883 tonnes 5,364 tonnes 4,400 tonnes 4,924 tonnes 4,327 tonnes Total collections of all general waste and recyclables Total collections of all general waste and recyclables, less food waste

Locally sourced packaging products
Total – local packaging Paper Cardboard- standard Cardboard- waxed Plastics- Type 1 (PET) Plastics- Type 2 (HDPE) Glass Aluminium Other- general waste and polystyrene 4,661 tonnes 366 tonnes 1,721 tonnes