M&S' Plan A savings not clear

Retailer reports CSR progress, but misses opportunity to raise reporting transparency as initiatives are put on hold.

06 Jul 2009

By Rachael Singh

Marks & Spencer has hailed its Plan A project as having turned “cost-positive” ahead of its 2012 deadline, but has declined to reveal how much of its £200m allocated budget it has spent on the CSR exercise, or explain how much money has been saved.

In its latest CSR report, How We Do Business, M&S says the project has reduced some of its energy usage and landfill waste and that Plan A became cost-positive at the end of its 2008-09 business year. But it is not clear how, given the lack of financials to back up its claim.

In 2007, the group said it would spend £200m by 2012 on the initiative, but a spokesperson for M&S could not say how much of this had been spent so far, saying only that “for every £1 M&S invests in the plan, we effectively save £1” ­ making it cost-neutral at best.

So far, Plan A has achieved just 39 of its 100 initiatives across the business. Meanwhile, 11 initiatives in areas including making business travel carbon-neutral and achieving the globally used Building Research Establishments Environmental Assessment Methodology (Breeam) ‘excellent’ rating on all new stores and Breeam assessments on all existing stores, are behind schedule or on hold.

The company says it has spent 2.1% of annually adjusted pre-tax profits on “community programmes” ­ part of Plan A’s remit ­ which, by 2009’s figures, would represent a spend of £12.6m. It reduced the number of plastic carrier bags given to customers by 83%, but started charging five pence per bag on the 77 million still sold, which contributed to the £1.2m it reinvested in “groundwork projects”.

M&S chairman Sir Stuart Rose maintains the group is committed to its existing plan and budget, despite recession and group pre-tax profits falling 40% in 2008-09. While not as transparent as some might hope, Rose said in the company’s May annual report that he had put Plan A “at the heart of our business” and CSR is one of five key board initiatives, alongside international expansion and growing core business.

Some of the initiatives where it has made headway include:
• More than eight million fair-trade clothing and housing products sold;
• More than three million garments sent to Oxfam instead of going to landfill sites;
• Group carbon emissions reduced by 18%; and
• Group energy usage reduced by 10% on its 2006-07 levels.

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