“We aspire to be a Net Zero Group by 2040” – Chalhoub Group’s Chief Sustainability Officer

Chalhoub Group recently released its annual sustainability report that highlights how the luxury retailer is paving the way for net zero emissions across its operations by 2040 with commitments across three key pillars including People, Planet and Partners. Against this backdrop, during an exclusive interview with IMAGES RetailME, Chalhoub Group’s Chief Sustainability Officer Florence Bulte emphasised, “We aspire to be a Net Zero Group by 2040.”

Here’s what the luxury retailer is doing to achieve its goals.

A quick look at Chalhoub Group’s 3P commitments

Planet: Climate action

• Become a Net Zero Group by 2040
• Reduce Scope 1 & 2 emissions by 50.4% (owned fleet and electricity)
• Reduce Scope 3 emissions by 30% (purchased goods, leased assets, third-party upstream transportation and capital investments)
• Reduce waste to landfill and embrace circularity, with recycling rates increasing by 20% year-on-year.
• Launch of circular business models in 2022 which include Level Shoes preloved; Hikaya as a startup investment; Tanagra rental service.

People: Diversity, Equity, Inclusion

• A robust DE&I strategy focused on making infrastructure and company culture more accessible and inclusive to People of Determination (PoDs) and supporting women to take on senior leadership roles.
  • Installed over 200 hearing loops in stores across the region and 400 planned for 2023.
  • Over 60 women joined the Group’s ‘Women in Leadership’ programme created to pave way for more women in senior roles with the target being 35% by the end of 2024 from the current 31%.
• Deep commitment to peoples’ health, safety and wellbeing.

Partners: Building long-term partnerships

• Launched ‘Partner Code’ based on the United Nations Global Compact (UNGC) principles and awareness programmes, which serves as a framework outlining minimum human rights, business ethics and environmental principles that suppliers and partners are expected to follow.
• For the first time in Saudi Arabia, Chalhoub Group ran an engagement session with its Saudi suppliers based on sustainability balanced scorecards.

Why accountability and transparency are key?

Chalhoub Group has been consistently undertaking actions to further its ESG-centric efforts, especially since the last decade. However, does being a UNGC signatory make the Group even more conscious about its responsibilities?

In this context, Bulte said, “Our leadership has always been deeply committed towards operating responsibly and sustainably, because it all starts from there to ensure the mindset is well-established amongst different business verticals within the organisation. Being a signatory of the UN Global Compact gives us a voice to clearly state and communicate the ESG-centric challenges and opportunities faced not only by us but the entire region and think about specific and effective strategies to be integrated on a global scale. In addition, being part of a network like the UNGC ensures increased accountability and transparency. In our case, we’ve improved our public reporting standards year by year.”

How the Group is ramping up sustainability efforts across the flywheel

“We follow a multi-pronged approach,” Bulte shared.

Efficiency across operations: We are optimising delivery routes to reduce mileage and fuel consumption, while enhancing efficiency measures of our electricity and water consumption. In 2022, we reduced our Group level electricity consumption by 1.3 million kWh, which amounts to approximately 530 tCO2 emissions avoided, equivalent to taking approximately 115 cars off the road. We’ve also reduced water usage amounting to approximately 2.6 million litres between 2021 and 2022 in our UAE operations, thereby resulting in 7 tCO2 avoided.

A circular mindset: We strongly believe in recycling efforts. As such, since launching the visual merchandising recycling initiative in 2022 that we piloted with 11 brands – including Tumi, Level Shoes, L’Occitane, Dior & more – we recycled 33% and reused 62% of VM and furniture materials weighing 28,390 kgs. We’ve developed an IT equipment disposal policy and in 2022, a total of 3,772 kgs of e-waste was collected just in our UAE operations.

Conscious investments: We mindfully invest in wellness and sustainable fashion brands. Some examples include clean beauty brand La Bouche Rouge, sustainable fashion brand Adolfo Dominguez. In fact, our start-up studio has increased the sustainability standards for potential investments.

What kind of regulatory / policymaking are needed: COP28 & beyond

With COP28 coming up later this year in the UAE, the big question is are regulatory and policymaking changes needed to make a long-term global impact.  

“To begin with, we must leverage COP28 as a catalyst for forging local alliances to share the challenges of addressing climate change and work together to find solutions. This global platform is also expected to catalyse international collaboration and partnership between countries, organisations and stakeholders,” Bulte observed.

Countries may be expected to announce updated and more ambitious greenhouse gas emissions reduction targets. On the other hand, countries might introduce or strengthen policies and incentives to promote renewable energy generation and increase the share of renewables in their energy mix. Governments could explore or expand carbon pricing mechanisms. Policymakers may introduce initiatives to encourage green finance and investments in renewable energy, energy efficiency and sustainable infrastructure projects. Overall, the UAE being a strategic venue, acting as a connection between the east and west will make it a very inclusive COP, she concluded.