Limiting our impact on the environment is a fundamental part of our business and is something everyone in Coats takes seriously. Coats senior management has defined objectives and targets to achieve the highest practicable standard of environmental performance for the Group. But we wouldn’t be able to achieve those targets without the help of all our employees. They not only drive our processes and help to minimise our impacts, but they also come up with great ideas to improve our performance.
World Environment Day was celebrated at various locations across India in June 2016. The aim was to create awareness among employees of the importance of taking positive environmental action to protect nature and the environment. Activities included promotional posters, briefing sessions and gardening and speech competitions.
Greenhouse gas as measured in kilos per kilo of dyed product went up by 3% in the last year (4.6 kg CO₂e per kg of dyed product compared to 4.5 in 2015). As our processes are ever more energy efficient, this increase in GHGs per unit of dyed product largely results from a shifting balance of production between countries and an increase in in-house electricity generation in Bangladesh due to shortages in grid supply. However, if we go back to 2014, the figure has reduced by 7% cumulatively over the last three years.
In 2016, the total carbon footprint of our manufacturing operations (Scope 1 and Scope 2*) was 319 thousand tonnes, 4% up compared to the previous year (305 thousand tonnes). Scope 1 covers all direct greenhouse gas emissions (GHG) from sources that are under Coats control, e.g. combustion of fuel, and Scope 2 covers indirect GHG emissions from the consumption of purchased electricity. This reflects a 2% increase in orders for manufactured goods and the above mentioned increase in our own electricity generation.
Despite the latest annual fluctuation in our GHG figures, our overall impact has reduced by 17% since 2011, our new base line. This has been achieved through a combination of investment in energy efficiency – such as utilising better manufacturing schedules, regular maintenance and optimising building management – as well as in new technology. We have also seen a change in the energy mix used at our sites, e.g. an increased use of biofuels.
As we said above, we are continuing to see an increase in the amount of energy taken from renewable sources, particularly hydro power and biofuels. This has resulted in a reduction in electricity being sourced from the local / national grid. Other renewable energy sources are also important, for example, our Madura Coats plant in India is now sourcing energy from a company supplying wind power. 91% of the electricity used in Coats India now comes from clean wind power, with zero emissions from its generation. We have measured the greenhouse gas generated by our refrigerant usage and business air travel, but they each represent less than 2% of the emissions resulting from our manufacturing operations.
Over the last two years, we have also started to look at the emissions associated with the transportation of our products between our units via shipping and air, with the help of our logistics suppliers. Our calculations to date suggest that this is also small compared to the impact of our manufacturing operations. We shall be in a position to give more detail next year.
We also recognise that our activities produce waste and so we strive to reduce, recycle or re-use this where we can. For the waste that we are unable to eliminate, we make sure that this is disposed of in a safe and responsible manner.
Of the water we used in 2016, 79% was discharged as waste effluent (equal to that of 2015). Any effluent that we discharge must not only comply with local legislation and discharge limits, but also work towards meeting our own internal global effluent policy. This policy has been developed to ensure that all our operations, regardless of location, will meet a high standard in terms of the effluent they discharge. These standards require our operations to measure and monitor the quality of effluent discharges in terms of a number of criteria, including oxygen demand, pH and metals content. Our internal limits usually go well beyond legal requirements.
Coats Sri Lanka has just installed a new effluent treatment plant. This will be the first of its kind in Sri Lanka and will recycle 95% of the waste effluent back to the dyeing process. The plant was commissioned in April 2016.
In 2016, we signed up to the Zero Discharge of Hazardous Chemicals (ZDHC) Programme, originally launched in 2011 by six leading brands. Through our commitment to ZDHC, we will be working with the industry to eliminate hazardous chemicals not only from our own operations but also the rest of the supply chain.
See our case studies for more on our initiatives.
We had no environmental prosecutions during 2016. We take our relationships with all regulatory bodies very seriously and, if there is an incident – no matter how small – we are always proactive with the local authorities, undertaking robust investigations into what happened and putting in place measures to prevent any future occurrences.
*The methodology for Scope 1 direct emissions is to convert fuel consumed in kWh to GHG equivalent using the global conversion factors published by the UK's Department for Environment, Food and Rural Affairs (DEFRA). The methodology for Scope 2 indirect emissions is to convert the electricity or other purchased energy in each country from KWh to GHG equivalent using the country level conversion factors published by the International Energy Agency, IEA. The resultant figures are then consolidated globally.