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Water and the environment

We’re proud of our brands, and alongside that pride comes a recognition that making them has an environmental impact – on the rivers which give us water, the ecosystems in which our ingredients are grown, and the people with whom we share these natural resources. We owe it to them, and to the future of our business, to ensure that we safeguard the environment in everything we do.

Our approach and performance

From the fields from which we source our ingredients to the consumers who enjoy our brands, our value chain encompasses farmers, vineyards, suppliers, distilleries and breweries, transport networks, retailers, shoppers – and more. We recognise that there are impacts on the environment at every link in that chain, and that protecting resources and minimising the impacts is both a requirement as a responsible company, and imperative for the success of our business. Ultimately our aspiration is to be a business which does not materially deplete natural resources, does not contribute to climate change, causes no lasting damage to species, habitats, or biodiversity – and wherever possible, improves the environment we operate in.

We are analysing and addressing the impacts of our operations throughout the value chain, adding new areas of activity as our understanding of them grows and our capability develops. Our strategy is underpinned by a commitment to address those areas of our operations where we see the greatest impacts and where we are most able to act. In 2008, we set ourselves a series of challenging targets to achieve by 2015 in the areas of water, carbon emissions, and waste – mostly absolute targets which acknowledged that our existing impacts should be reduced in real terms, regardless of the future size of the business. In 2009, we added commitments covering our packaging.

We are making good progress towards halving carbon emissions and eliminating waste to landfill from our operations by 2015, and the packaging of our brands is becoming more sustainable.

Water is one of our most critical environmental impacts, with its implications for local economies, communities, and ecosystems – and we have made continued progress against targets to improve water efficiency and reduce pollution. Since 2008 we have focused particularly on reducing our impact in areas defined as ‘water-stressed’1 – and our water strategy has continued to evolve to reflect our growing understanding of water management within watersheds. This year, our operations in Africa exceeded our 30% improvement target for water efficiency two years ahead of our 2015 target.

Alongside these long-standing commitments, we are increasingly looking at impacts from our supply chain. For example, we are assessing the way our ingredients are grown in terms of the implications for water use, and we are aiming to make our packaging more sustainable through partnerships with suppliers. We are also exploring ways to reduce our ‘scope 3’ emissions – the carbon footprint of our value chain beyond the emissions resulting directly from our operations (‘scope 1’), or indirectly from the energy that we buy (‘scope 2’).

Where we can, we aim to extend our work across the full length of the value chain through initiatives with customers and consumers such as our glass recycling campaign, which encourages consumers in Brazil and Colombia to recycle bottles at sites run by our partner customers.

As our business expands, both organically and through acquisitions, we have both an opportunity to learn from the experience of new colleagues, and a requirement to address the additional challenges presented by increased production and a wider operational footprint in new geographies.

This year has also seen a number of investments and initiatives which we expect to yield significant results in 2014 and beyond. We have invested in applied research at universities in Ireland and the United Kingdom which is exploring novel approaches to achieving carbon-neutral operations and new uses for manufacturing by‑products, and we have committed to further water conservation projects at our operations in Kenya. We anticipate that the bio‑energy projects commissioned in 2013 in Scotland, and our investment in bio‑energy at our Tusker brewery in Kenya, will reduce emissions from next year.

Our strategic approach has been further strengthened by the appointment as external advisor to our environmental executive working group of Professor Gordon L Clark DSc (Oxon) FBA, Director of the Smith School of Enterprise and the Environment, Oxford University.

In 2013, for the first time all our operational environmental metrics – carbon emissions, water, wastewater discharge and waste to landfill – were independently assured. In the previous two years, only carbon emissions and water metrics were assured.

  1. Diageo defines water-stressed sites as those locations that pose a higher risk for water insecurity now and/or into the future; the definition is based on an evaluation of physical or economic water scarcity as well as regulatory and social risk.

2013 performance

We have made significant progress towards our targets this year while the business has both increased production organically, and grown through acquisitions. New businesses in Turkey, Ethiopia, and other markets have added 8% to our greenhouse gas (GHG) emissions and 6% to water use, but we have nonetheless achieved overall reductions, in line with our ambition to grow our business while reducing our environmental impact.

Delivering against absolute targets is not necessarily a linear process, however: our progress with some impacts has been more rapid than with others. As our business continues to expand, achieving our targets will become increasingly challenging, and we will continue to evaluate our progress in the coming year.

Our efforts will be greatly enhanced by the commissioning of our bio‑energy plant at Cameronbridge in Scotland. The plant, which came into full service in the last quarter of 2013, is expected to reduce total company CO2 emissions by over 5% by the end of 2014.

Find out more about our work in water and the environment in our video: Sharing our environment journey

Progress against operational targets
Target by 2015 2013
performance
(%)
Cumulative
performance
(2007–2013)(%)
Achievement
Reduce carbon emissions
by 50%
4.1 26.3 On track
Improve water efficiency
by 30%
1.5 19.5 On track
Reduce water wasted at water-stressed sites1 by 50% 7.0 21.0 On track
Reduce polluting power of wastewater by 60% -9.8 -18.1 Off track
Eliminate waste to landfill 53.4 77.9 On track
  1. Diageo defines water-stressed sites as those locations that pose a higher risk for water insecurity now and/or into the future; the definition is based on an evaluation of physical or economic water scarcity as well as regulatory and social risk.
Progress in efficiency format (by litre of packaged product)1
Target by 2015 2013
performance
(%)
Cumulative
performance
(2007–2013)(%)
Reduce carbon emissions by 50% 1.2 27.3
Improve water efficiency by 30% 1.5 19.5
Reduce water wasted at water-stressed sites2 by 50% 6.7 33.3
Reduce polluting power of wastewater by 60% -13.0 -16.5
Eliminate waste to landfill 52 78
  1. Carbon emissions (grams CO2/litre of packaged product); water efficiency and water wasted (litre/litre of packaged product); wastewater polluting power (grams/litre of packaged product); waste to landfill (grams/litre of packaged product).
  2. Diageo defines water-stressed sites as those locations that pose a higher risk for water insecurity now and/or into the future; the definition is based on an evaluation of physical or economic water scarcity as well as regulatory and social risk.
Progress against packaging targets
Target by 2015 2013
performance
(%)
Cumulative
performance
(2009–2013)(%)
Achievement
Reduce average packaging weight by 10% 1.2 5.3 On track
Increase average recycled content across all packaging to 42% 2.0 37.0 On track
Make all packaging 100% recyclable/reusable 0.2 98.5 On track

Progress against water and the environment targets

How we're performing against our targets