Corporate social responsibility:a case study of the UK’s leading

food retailersPeter Jones and Daphne Comfort

University of Gloucestershire, Cheltenham, UK

David HillierUniversity of Glamorgan, Pontypridd, UK, and

Ian EastwoodThe Manchester Metropolitan University, Crewe, UK

Abstract

Purpose – The purpose of this paper is to offer a preliminary case study exploration of the corporatesocial responsibility (CSR) issues being addressed and reported by the UK’s leading food retailers.

Design/methodology/approach – The paper begins with a short discussion of the characteristicsand origins of CSR and this is followed by an outline of the structure of food retailing in the UK and ofthe ways in which the leading food retailers are driving innovation and development. The paper drawsits empirical material from the CSR reports and information posted on the world wide web by the UK’sten leading food retailers.

Findings – The findings reveal that each of the leading food retailers has its own approach to CSRand that there are substantial variations in the nature and extent of the reporting process. That said,there is some common ground in reporting on a range of environmental issues, on sourcing, onemployees, on customers and on the communities in which the retailers operate. The underlyingmessage is that all food retailers believe that CSR is an integral element of their core business.

Originality/value – The paper provides an accessible review of CSR issues and agendas, asperceived by the UK’s leading food retailers, and as such will interest academics and practitionersworking in and on this sector of the retail marketplace.

Keywords Business ethics, Food industry, Retailing, United Kingdom

Paper type Case study

IntroductionWithin the last decade “corporate social responsibility” (CSR) has been gainingmomentum across the business community and it is seen to be increasingly high onboardroom agendas. Within the retail sector of the economy the UK’s major foodretailers are major employers and they continue to be very much at the cutting edge ofinnovation and development and they increasingly recognise the impacts they have onthe environment, on society and on the economy. They are increasingly keen tocommunicate their commitment to CSR to their shareholders, their customers, and theiremployees and to the public at large and to government. This case study offers asimple preliminary exploration of the CSR issues being addressed by the UK’s leadingfood retailers.

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British Food JournalVol. 107 No. 6, 2005

pp. 423-435q Emerald Group Publishing Limited

0007-070XDOI 10.1108/00070700510602192

Corporate social responsibilityCSR is rooted in the recognition that businesses are an integral part of society and thatas such they have the potential to make a positive contribution to social goals andaspirations. That said there seems to be no universally agreed definition and Frankenal(2001) has argued that “CSR is a vague and intangible term which can mean anythingto anybody, and therefore is effectively without meaning” and the UK’s Confederationof British Industry (2001) has argued that “CSR is highly subjective and therefore doesnot allow for a universally applicable definition”.

However, different organisations have framed a variety of definitions. TheCommission for the European Communities (2001) defines CSR as “a concept wherebycompanies integrate social and environmental concerns in the business operations andin their interactions with their stakeholders on a voluntary basis”. For the Commissionof the European Communities this means not just fulfilling legal responsibilities butalso going beyond compliance to embrace wider social, environmental and economicgoals. The World Bank (2004) defines CSR as:

. . .the commitment of businesses to contribute to sustainable economic development-workingwith employees, their families, the local community, and society at large to improve thequality of life, in ways that are good for business and good for development.

According to Wood (1991) “the basic idea of CSR is that business and society areinterwoven rather than distinct entities”. More generally, a distinction has been drawnbetween CSR seen as philanthropy as opposed to CSR as core business. In the formercompanies conduct their business unfettered by wider social concerns and then makecharitable donations to selected worthy causes while in the latter the accent is onoperating the core business in a socially responsible way which seeks to enhance thecompetitiveness of the business and maximise the value of wealth creation to society.

CSR is characterised in a number of ways. The Commission for the EuropeanCommunities (2001), for example, identifies an internal and an external dimension toany company’s approach to CSR. The former concerns socially responsible practiceswithin the company while the latter extends beyond the company into the localcommunity and beyond and involves a wide range of external stakeholders. Theinternal dimension is seen to embrace the management of human resources; health andsafety at work; adaptation to change; and the management of environmental impactsand natural resources. The management of human resources, for example, wouldinclude encouraging diversity within the workforce, responsible recruitment practices,equal pay and career prospects for women, profit sharing schemes and providing anenvironment that encourages lifelong learning. In a similar vein the management ofenvironmental impacts and natural resources has focused on reducing theconsumption of resources, polluting emissions and waste. The external dimension iswide ranging and includes investors, local communities; business partners, suppliersand consumers; human rights; and global environmental concerns. CSR, for example,puts the onus on companies to provide products which customers want in an efficient,ethical and environmentally responsible manner. CSR is also seen to have a stronghuman rights dimension, which extends throughout the supply chain and thusincreasingly has not just a national but also a global reach.

Whooley (2004) suggests that the key CSR issues are often clustered under fourheadings, namely “Marketplace, Workplace, Environment and Community”. She

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argues, that the marketplace presents nebulous and risky terrain for all companies butthat it presents the major challenge to CSR management because it is a key source ofreputational damage. For her “the marketplace is essentially concerned with the costsor benefits of the company’s products and services, and their social and economicimpact”, and with “how a company advertises goods and services” as well as howcompanies “take into account both the indirect as well as the direct impact of theirproduct or service”.

In some ways the underlying concept of CSR has a long history. In outlining thegrowth of CSR, Hopkins and Cowe (2003) for example, suggest that there has alwaysbeen a tension between business and social goals and they cite the power of the craftguilds in the Middle ages, the slave trade and the struggles to improve living andworking conditions in Britain’s rapidly growing towns cities during the nineteenthcentury, as graphic evidence of these tensions. Turning to more recent times Marlinand Marlin (2003) have identified three phases in the development of what they call“CSR reporting”. The first phase dating from the early 1970 s was seen to be composedof advertisements and annual reports which focused on environmental issues butwhich were not linked to corporate performance. The second phase in the late 1980 swas characterised by the introduction of social audits, which examined theperformance of companies in the areas of social responsibility with respect tocommunities, employees, customers, suppliers and investors. Ben and Jerry’s are citedas pioneering this approach with the Body Shop and Shell Canada being other earlyexamples of companies adopting a similar approach. The third phase dating from thelate 1990 s saw the strengthening of social auditing through the introduction ofexternally set and certified standards.

A variety of factors are cited as being important in building the current momentumbehind CSR. Ernst & Young (2002) suggest that five key drivers have influenced theincreasing business focus on CSR, namely greater stakeholder awareness of corporateethical, social and environmental behaviour; direct stakeholder pressures; investorpressure; peer pressure and an increased sense of social responsibility. The EuropeanCommission (2002) argues that CSR has gained increasing recognition amongcompanies as an important element in new and emerging forms of governance becauseit helps them to respond to fundamental changes in the overall business environment.These changes include globalisation and the responsibilities companies feel the need toaddress as they increasingly source products and services in developing countries; theissues of image and reputation, which have become increasingly important elements incorporate success; and the need for companies to recruit and retain highly skilledpersonnel. Girod and Bryane (2003) adopt a strategic marketing perspective arguingthat CSR is “a key tool to create, develop and sustain differentiated brand names”.National and supranational governments have also been active in promoting CSR. TheEuropean Union, for example, promoted CSR in all member states and the UKGovernment has emphasised its ambitious vision for CSR.

The leading food retailersRetailing is a large, diverse and dynamic sector of the UK economy and Mintel (2004)estimate that food retailers account for half of all retail sales though they note that theterm “food retailer” is becoming increasingly inappropriate as the operators of majorstores increase their non-food offer. Mintel (2004) estimate that UK consumer spending

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on food and drink was running at £90.4 billion in 2003 with 61.1 per cent being spenton foodstuffs 8.7 per cent on non-alcoholic beverages, 13.3 percent on alcoholic drinksand 16.9 per cent on tobacco. At the same time many, but not all, the large food retailershave been extending their product range to include a seemingly ever wider variety ofgoods and services which includes clothes, household goods, books and magazines,pharmaceutical products, music and videos, telecommunication products and servicesand clothes. During recent decades food retailing within the UK has becomeincreasingly concentrated. The sale of food by, and the numbers of, small independentretailers have declined and a very small number of major players have taken anincreasing market share. So much so that by 2003 the top ten food retailers accountedfor just over 82 per cent of food sales and just four retailers, namely Tesco, J. Sainsbury,ASDA and Wm. Morrison Group, had a massive 65.3 per cent market share (see Table I:Mintel, 2004).

The leading food retailers have been very active in driving innovation anddevelopment in a wide variety of ways and their activities have attracted somecontroversy. In many ways they have become the dominant players within the wholeof the food supply chain. At one end of the spectrum the leading food retailers sourcemany items within their massive product ranges from developing countries andWrigley and Lowe (2002), for example, argue that “the geographies of production arebeing actively shaped by multi-national retail capital”. At the same time domesticsuppliers and distributors have had to meet increasingly demanding supply schedulesand prices and the retailers’ aggressive marketing strategies are seen to be powerful ininfluencing consumer buying behaviour. Large food retailers have been very active innew product development, which has seen the growth in the number and range ofpart-prepared, pre-prepared and portioned ready-made meals and convenience foodsand in added value products. The past decade has seen what might best be describedas “outbreaks” of consumer concern about food safety, typified by the BSE and GMcontroversies, and a more general debate about “healthy eating” and here the largefood retailers have been very much in the frontline. The large food retailers are majoremployers, Tesco employs 326,000 people, with the corresponding figures forJ. Sainsbury, ASDA and Somerfield being, 147,500, 128,000 and 54,000 respectively andas they have extended their opening hours, in some cases to include 24-hour trading sixdays of the week and for up to six hours on Sundays, so they have looked to recruit anincreasingly flexible workforce.

Several of the leading food retailers have played an important role driving out oftown retail development and in successfully confronting town planning legislationwhich sought to concentrate new retail development within traditional city, town,district and local centres. During the past three decades the growth of large out-of-townfood superstores has been accompanied by the closure of many thousands of small,traditional specialist food retailers and by a radical reshaping of the geography of retailfood provision within towns and cities. Large food retailers have also been very muchto the fore in the introduction of new information and communication technologies.The introduction, initially by the large food retailers of article numbering and thescanning of items at the checkout, from the early 1980 s onwards, led to revolutionarychanges in supply chain management and when linked with loyalty cards thistechnology provided the retailers with large volumes of data on the buying behaviourof large numbers of customers. More recently, some of the leading food retailers have

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been testing radio frequency identification (RFID) technologies and while its adoptionbrings a wide range of stock control and supply chain management benefits civilliberties groups and the National Consumer Council have expressed concerns thatRFID could also be used to monitor individuals and track all their shoppingbehaviours.

The UK’s leading food retailers are major players within the UK economy and inone way or another they touch the everyday lives of the vast majority of the populationand with very much an eye to customers the major food retailers have consistentlyemphasised their commitment to choice, quality and value. However, such claims havebeen vigorously and critically contested in some quarters. Blythman (2004), forexample, has argued that the large food retailers wield too much power in the buyingand supplying of many products thus damaging suppliers businesses andmanipulating customers through promotions and that they are effectivelydestroying the independent retail sector. In a similar vein Boydon (2001) has argued,inter alia, that shopping at supermarkets pollutes the environment and damageshuman health, is destroying British agriculture and ruining the countryside,dismantles communities and undermines local economies and that it reduces bothbiodiversity in the countryside and choice for the consumer. Partly in response to someof these criticisms the UK’s Competition Commission conducted an investigation intothe UK grocery retail market in 2000 but rejected claims of excessive profiteering.However, towards the end of 2004 Friends of the Earth, the Association of ConvenienceStores, the National Federation of Women’s Institutes and FARM (a farming pressuregroup campaigning for family and independent farmers) petitioned The Office of FairTrading to open a new investigation into supermarket domination of the grocerymarket and to investigate what they claim are the damaging impacts of marketconcentration on small stores, on farmers and on consumer choice.

CSR overviewThe authors have reviewed the CSR reports and information on the UK’s top ten foodretailers (see Table I), as identified by Mintel (2004), which was available via theGoogle Search Engine, on the world wide web (WWW) in early December 2004. Thereare considerable variations in the volume and detail of CSR information that theleading food retailers post on the WWW. While the majority of the chosen retailers

Company Market share (%)

Tesco 24.7J. Sainsbury 14.2ASDA 13.3Wm Morrison Group 13.1Somerfield 4.5Marks & Spencer 3.3Co-operative Group 3.2Waitrose 2.5Spar UK 1.9Iceland 1.5

Source: Mintel (2004)

Table I.Top-ten UK food retailers

(2003)

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produce substantial and detailed dedicated CSR reports, some include CSR informationin their annual reports while others provide some limited information on CSR issues ontheir general company web site. Tesco, for example, produced a 38-page CorporateResponsibility Review while similarly titled reports produced by Marks and Spencer,Waitrose and the Co-operative Group, for example, ran to 42, 33 and 48 pagesrespectively and J. Sainsbury provide an interactive web based report. Somerfield onthe other hand devote four of its 17 page Annual Report and Accounts to CSR whileASDA, Iceland, Spar and the Wm Morrison Group provide limited CSR information ontheir company web site.

Those leading food retailers who do provide substantial CSR reports do seem tointegrate CSR very much into their business. Marks & Spencer, for example, claim astrong tradition of CSR and see it as integral to how they conduct their business. In asimilar vein Tesco argue that CSR is an integral part of the company’s overallcorporate governance framework and it is fully integrated into existing managementstructures and systems. Within Tesco a cross-functional team of senior executivesprovides leadership on CSR and the company’s annual Corporate Responsibility Reviewis its main vehicle for communicating its policies and performance in this area.J. Sainsbury argue that CSR is an integral part of their brand. Here, the company havesix board level directors responsible for individual CSR issues and the company’s Headof Public Affairs and CSR leads a small team which has responsibility for co-ordinatingand reporting on CSR policy but the overall responsibility for CSR lies with the ChiefExecutive.

The leading food retailers report on CSR issues under differing headings.J. Sainsbury, for example, use the following headings “colleagues”, “community”,“customers”, “environment” and “suppliers”, Waitrose use “sourcing”, “customers andcompany”, environment”, and “partners” while Marks & Spencer list “sustainable rawmaterials”, “responsible use of technology”, “animal welfare”, “ethical trading” and“community programmes” as primary issues but also focus briefly on “products”,“people” and “places”. In this paper four principal headings, namely Environment;Sourcing; Employees; and Customers and Communities are used in an attempt tocapture CSR agendas as reported by the UK’s leading food retailers but it is importantto note that there is some inevitable overlap between these headings.

EnvironmentEnvironmental issues were the earliest and are now the most commonly reported set ofCSR agendas among the leading food retailers. These environmental issues includeenergy consumption and emissions, raw material usage, water consumption, waste, thevolume of packaging, recycling, genetically modified foods and the use of chemicals.Tesco, for example, is committed to reducing energy consumption and emissions ofgreenhouse gases. The company has invested heavily in energy saving schemes and islooking to reduce energy consumption per square foot by 35 per cent by 2006 but itreported that higher than expected growth in sales during 2003-2004 had led to themmissing this target by over 50 per cent. The company also participate in the UK’sEmissions Trading Scheme and are committed to making an absolute reduction of74,000 tonnes of green house gases over five years at a control group of 188 stores. Thebulk of the company’s emissions into the atmosphere come from the transportdistribution fleet and here the efficiency accent has been on increasing the number of

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cases of products delivered per litre of fuel consumed. In addition, Tesco has beenexperimenting with transporting clothing goods by rail in an attempt to make acontribution to reduced emissions and congestion on the roads but the trial showed raildeliveries to be unreliable. In a similar vein ASDA’s environmental policy recognisesthat the activities and services the company operates can potentially have a negativeeffect on the natural environment and its aim is to identify, monitor and reduce anydirect effects. The policy embraces a number of commitments including compliancewith national and international legislation, the reduction of greenhouse gases andozone depleting gas emissions, minimising packaging on own brand products,encouraging customer recycling activity and the dissemination of environmental bestpractice guidance to all employees.

Marks & Spencer recognise that chemicals are used in the production of everyproduct sold within their stores but they have particularly focused their attention onpesticides, polyvinyl chloride and dyeing. The company have sought to balance theneed for sufficient quantities of high quality food against environmental concerns andthey have set themselves two sets of goals on fresh fruit, vegetables, potatoes andsalads. First to use the minimum amounts of pesticides that customers and societytrust and to work to eliminate the residues and second the company have acted to banor replace some 79 pesticides. By 2003 some 72 per cent of the foods mentioned aboveon sale in the company’s stores were recorded as being residue free. Some 99 per cent ofPVC packaging, the disposal of which releases chemicals which cause environmentalconcerns had been replaced by 2002.

Waitrose stress that it takes all reasonable steps to manage its operations so as tominimise its environmental impact and to promote good environmental practice. Thecompany seeks to promote responsible and sustainable methods of agriculture, animalhusbandry and biodiversity. Along with the majority of the other leading food retailersWaitrose are also looking to redesign and simplify their packaging to reduce costs andto reduce packaging waste for customers. The company reported a reduction inproduct packaging of 11 per cent, a reduction in the weight of waste disposed of 37 percent and a reduction in water consumption of 10 per cent between 2002/2003 and2003/2004.

SourcingThe sourcing of food has become an increasingly topical and often controversial issuefor large retailers. Four sets of issues receive widespread, but not universal, attentionnamely ethical trading, sourcing local and regional foodstuffs, food safety and animalwelfare. Sourcing foodstuffs within the global marketplace often offers considerablevariety and attractive supply prices but it also led to growing pressure group andpublic concerns about working conditions, rates of remuneration, child labour andhealth and safety. At the same time the majority of the leading food retailers recognisethat the issue of ethical trading is made complex by both the distances involved and bythe existence of different political and regulatory regimes. J. Sainsbury, for example,was a founder member of the Ethical Trading Initiative (ETI) launched in 1998 and thecompany claim that as it broadens its “supplier base, especially in developingcountries’ it is “conscious of the need to take some share of the responsibility for socialdevelopment and for the welfare of employees who produce the goods” it “sells”. Thecompany’s approach is centred on a number of principles namely fair terms of trading;

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protection of children; health and safety; equal opportunities; freedom of association;freedom of employment; and hours of work and wages. Under fair terms of trading, forexample the company stress that while “suppliers will have to respond to the highlycompetitive environments in which Sainsbury’s trades” it “will not make undue use ofits size to bring unfair pressure on suppliers”. The code of conduct relating to theprotection of children includes the International Labour Organisation (ILO)conventions on child employment as the minimum standard and an expectation thatemployers will encourage eligible young workers to attend classes or participate inwork-study or government sponsored educational programmes. More generally, anumber of the leading food retailers have launched “Fair Trade” ranges but theCo-operative Group is widely acknowledged to be the market leader here, it stocks arange of coffees, teas, cakes, chocolate, fruit juices, fruit and wine and overall itaccounts for 20 per cent of the Fair Trade market.

While global sourcing continues to grow some of the leading food retailers have alsobeen keen to affirm their commitment to working with local and regional suppliers.Somerfield, for example, claim a long established policy of seeking out local andregional foods to enable its customers to support producers in their own localities.Throughout the UK the company now sell over 2,000 of what it describes as “locallines” and labels on a range of lamb, pork and beef all now identify the specific farm oforigin. Waitrose launched its “Locally Produced”, which encompasses 160 producers,offering 360 product lines in some 100 shops, initiative in 2002 and the companydefines “local” as being food and drink that is made by small-scale producers andsupplied to shops within a 30-mile radius of the production site. Producers includedwithin this initiative are selected on the basis of product integrity and quality,regardless of turnover or volume of production and these producers do not need tosupply all Waitrose outlets.

Food safety has become a high profile issue and a number of food retailers commenton it in their CSR reports and information. J. Sainsbury, for example, acknowledgesthat their customers have the right to be completely confident in the food they buywithin the company’s stores. The company stress that food safety is considered atevery stage from product design and production to transportation and sale in theirstores, they look to provide customers with food safety information through productlabels and in store leaflets and they undertake regular inspections to ensure highstandards of hygiene and safety from suppliers to shoppers. More generally, the largefood retailers have reported on how they have responded to concerns about geneticallymodified (GM) foods, food scares such as BSE and listeria, the use of pesticides andheavy metals and the perceived growing demand for organic products. In 1998 Iceland,for example, became the first UK food retailer to ban GM foods from its own labelproducts, in the same year the company removed all artificial flavours and thecompany banned the use of mechanically recovered meat in all its products long beforethe BSE scare in the mid-1990 s.

A minority of the large food retailers report their commitment to animal welfare.Marks & Spencer’s, for example, emphasise that their customers believe thatupholding good standards of animal welfare is particularly important. The companyhas been selling only free range eggs since 1997, in 2002 it became the first major UKfood retailer to use only free range eggs in all its food products and while conscious ofthe need to balance animal welfare with efficient food production it has introduced a

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lower protein diet and slower maturation regime for all its chicken production. In asimilar vein J. Sainsbury stress that their customers have the right to be completelyconfident that animals reared for meat sold in its stores have been well treated. Morespecifically, the company look to ensure that the “Five Freedoms”, namely, fromhunger and thirst; from discomfort; from disease and injury; from fear and distress;and the freedom to express normal behaviour, are achieved by supplying farmers bothwithin and outside the UK.

EmployeesThe majority of the leading food retailers report on their commitment to theiremployees and they present evidence of this commitment in a variety of ways. Suchevidence covers a range of topics including remuneration and benefits; training anddevelopment; equality and diversity; health and safety; recruitment; retirement; andwork-life balance. All the leading food retailers are committed to recruiting andretaining a culturally and socially diverse workforce and here the emphasis is onattracting the best people and meeting the needs of the communities in which theytrade. These commitments are usually strengthened by the provision of a mix offlexible working arrangements and by acknowledging the need to address the balancebetween life and work. Tesco, for example, stress that looking after its employees sothat they, in turn, can look after the customers is central to the company’s core valuesand emphasise the importance of recruitment and retention. The company reportoffering its staff an attractive benefits package including wages, flexible hours andleave, profit sharing, free uniform, subsidised meals, staff discount, childcare vouchersand a pension.

Staff training and development is also a major theme. J.Sainsbury, for example,provide a range of different types of training including courses, job shadowing,mentoring, qualifications and self-development books and videos. All employees haveaccess to “Learning@Sainsbury’s” via the company intranet and this offersinformation on “Sainsbury’s Behaviours, Operational Training” and the company’sprogramme of qualifications and learning library. ASDA report having invested £8million in 15 “Stores of Learning” (SOL), which provide training for new and existingmanagers. The SOL’s have provided training for almost 4,000 managers and thecompany report that post training evaluations suggest that SOL trained managers areoutperforming trading targets by significant margins.

Waitrose offers its employees (“partners”) a dedicated occupational health service.The company report that a team of 13 advisers tours its shops giving advice on healthand safety issues, diet, exercise and healthy living, conducts regular health checks,performs workplace risk assessments, and provides support to employees sufferingfrom both short-term and long-term illnesses. Waitrose also reports its commitment topreventing crime against its employees and to ensuring that they are able to work in asecure environment. During the period 2001-2004 the number of security personnel inits shops was increased and intelligence collating systems have been installed toevaluate crime within and against the business.

Customers and communitiesA strong commitment to customers is widely reported by the leading food retailers andthis commitment generally includes listening to customers; services for disabled

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customers; healthy living; and data protection. Thus, food retailers emphasise theimportance they place on to listening to their customers. Waitrose, for example,encourages its customers to make comments to the customer service departmentswithin stores and theses comments are recorded and monitored centrally, enablingtrends to be identified and appropriate actions to be taken. Tesco ran “CustomerQuestion Time” events in over 170 locations during 2002/2003 and these eventsprovided an opportunity for the company’s store and Head Office representatives tolisten to customers’ views on a wide range of issues. The issues raised inform anannual customer plan which targets improving performance in areas identified bycustomers and enhancing customer loyalty. At the same time Tesco also report regularmeetings with analysts from the financial institutions. In 2003/2004, for example, thecompany met with 97 of its leading shareholders, representing over 54 per cent of itsissued shares. The company report that these investors stress the need for moreeffective demonstration that Tesco are managing emerging issues, that CSR is fullyintegrated across the business, that the environmental and ethical aspects of the supplychain are being managed and that future CSR performance targets should bepublished.

Access and services for disabled customers is also widely reported. ASDA, forexample, have a range of facilities to aid disabled shoppers. These facilities includedisabled toilets and dedicated car parking spaces, electric shopping scooters, Brailleguns, hearing loops, and sign language interpreters within stores. In a similar veinJ. Sainsbury report a similar range of services as well as wide aisle checkouts forwheelchair users and its home shopping service, which is said to be available to 72 percent of the population in 82 stores. A minority of the leading food retailers report ontheir “Healthy Living” initiatives. In 2004 Tesco, for example, re-launched its “HealthyLiving Club”, which provides information to customers on general health, weight lossand green and organic products. Data protection is also a minority reporting issue.J. Sainsbury report that they do not provide personal information about customers tothird parties without the customer’s prior permission and Marks and Spencer reportthat they have held discussions with the National Consumer Council about public andpressure group concerns about the use of RFID technologies to track people and theirbehaviour.

The leading food retailers all have a range of impacts on the communities withinwhich they operate and, in at least some measure, they all report on these issues withintheir CSR reports and information. The most commonly reported issue is that ofcharitable work with, and for, local and national organisations. Somerfield, forexample, have recently worked with the Muscular Dystrophy Campaign and theMeningitis Trust and ASDA has been supporting Breast Cancer Care for some sevenyears. In 2004 SPAR helped to support local cancer care through a partnership withMacmillan Cancer Relief and the company has been a principal sponsor of theEuropean Athletics Association since 1996.

A focus on being “good neighbours” within the local community is another generalCSR theme. Spar, for example, has been running a “Keep It Local Campaign” since 1999and the company claim that it has ensured that essential local services, such as PostOffices, banking services and bill paying facilities, which have been lost to somecommunities have been integrated into SPAR stores. ASDA report on their “Stores ofthe Community Programme” and on its educational initiatives in local schools. The

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former provides an opportunity for the company and its employees to participate inand often facilitate a range of local activities while the latter has provided store trailsfor some 130,000 school children since 1999. Waitrose reports on the development of itsCommunity Needs Assessment Toolkit designed to help build relationships with thelocal community and business forums and to target community initiatives to thoseareas where need is the greatest.

A minority of large food retailers report on their role in urban regeneration. Tesco,for example, claim a particular focus on the regeneration of deprived communities andon the reclamation of derelict land. In 2003-2004 the company reported the creation of950 new regeneration jobs in Shettleston, Warrington and Batley bringing the totalnumber of such jobs to 3,200 since 1999. These regeneration schemes are based aroundthe development of new stores designed to serve local communities and the focus is onworking with public services, local employers and community groups to yield social,economic and environmental change in deprived urban areas. In a similar vein Asdaargue that regeneration is at the heart of their new store development programme andthat it has an excellent record of developing stores in those urban areas which havetraditionally suffered from a lack of investment. In 2002, for example the companyopened a 100,000 square foot store at Eastlands, which has anchored a majorregeneration project in East Manchester.

Key performance indicatorsFive of the leading food retailers, namely J. Sainsbury, Tesco, Waitrose, Marks &Spencer and the Co-operative Group, report on the development and/or use of CSR KeyPerformance Indicators (KPI’s). Tesco, for example, employ some 18 CSR KPI’scovering economic, environmental and economic issues and containing 24 specifictargets. In choosing these KPI’s the company use one or more of four criteria namelycustomer priorities; staff priorities; business priorities; and compliance with legislationor public policy. The company’s CSR report provides a brief description of the annualtarget for each KPI, outlines the actual performance against each target and sets atarget for the following year. During 2003/2004 the company exceeded expectations on18 of its targets, met 13 and was below target on three. Where possible, verification ofthe data used for the KPI’s is carried out using independent sources including marketshare data, independent surveys, services bills and audits for the Emissions TradingScheme and Climate Change Levy Agreement. In a similar way the Co-operative Groupintroduced a set of KPI’s to enable it to measure its performance against itscommitment to CSR. These currently fall into two categories namely “processindicators” and “impact indicators”. The former measure the quality of themanagement of the company’s identified material social, ethical and environmentalimpacts while the latter look to measure the direct impacts of the company’smanagement processes.

In 2003 J. Sainsbury, Tesco, Marks & Spencer and Waitrose, who entered as part ofthe John Lewis Partnership, participated in the Business in the Community CorporateResponsibility Index. The Index was developed to help improve performance byproviding a systematic process to compare companies’ management processes andperformance with those of others in the sector and it is based on four components. The“Corporate Strategy” component looks at how the nature of a business’s activitiesinfluence company values; the “Integration” section looks at how companies organise,

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manage and integrate CSR throughout their operations; the “Management” sectionreviews the processes for managing different stakeholder relationships relating tocommunity, environment, marketplace and workplace; and the “Performance andImpact” section examines the company’s performance across a range of social andenvironmental impact areas. The results were published and Business in theCommunity also provided the participating companies with confidential feedback ontheir performance. J. Sainsbury was placed 8th in the overall rankings and thecorresponding places for Marks & Spencer, Tesco and Waitrose were 18th, 19th and45th, respectively.

More generally in their report for the International Institute for Environment andDevelopment (IIED) Fox and Vorley (2004) argue that while the Business in theCommunity’s Corporate Responsibility Index clearly suggests that a number of theUK’s major food retailers are leaders of the CSR movement many civil organisationshave been very critical of their dominance over the food system and the damagingimpact of this dominance across many of the areas where the food retailers claim CSRsuccesses. The authors go on to suggest:

. . .what often gets overlooked in the war of words between supermarkets and theirdetractors is the lack of comparable and credible benchmarks for measuring progresstowards greater sustainability across the sector Fox and Vorley (2004).

The “Race to the Top” project, co-ordinated by the IIED was designed to develop suchbenchmarks in partnership with a broad coalition of civil society organisations and towork with the major food retailers to apply them. The overall aims being to “promoteaccountability and transparency within the UK supermarket sector” and to build“incentives for the major UK supermarket companies to improve and communicatetheir social, environmental and ethical policies and performance over a five-yearperiod”. The project ended prematurely in 2003 following a confidential pilot year andthe withdrawal of some of the major food retailers. Fox and Vorley (2004) recognisethat there was disagreement “on what went wrong” but they note that resistance to thebasic idea of KPI’s as proposed by the DEFRA, the lack of government drive to pushthe major food retailers into engagement, over reliance on industry data, the lack ofcompany resources devoted to the project and continuing upheaval within foodretailing were contributory factors. Ultimately, the failure of the project would seem tocast a shadow over the CSR agendas being pursued by the UK’s leading food retailers.

ConclusionEach of the UK’s ten leading food retailers has its own approach to CSR and there aresubstantial variations in the nature and extent of the reporting process. While some,and not always the smallest, of these leading retailers provide relatively limited CSRinformation and others offer detailed and comprehensive reports they all make the casefor locating CSR as an integral element of the core business. The underlying argumenthere is that these food retailers ultimately believe that long term economic viability isin the interests of all stakeholders and that by integrating CSR into their businessesthey will be better placed to provide long term growth and financial security for thosestakeholders and to maintain or enhance their market position. Similarly, at theoperational level business imperatives seem to be the drivers of CSR. Thus, while manyof the environmental initiatives addressed in the CSR reports are designed to reduce

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energy use and waste generation, for example, they also reduce costs. In a similar veinsocial issues focusing on good working environments and conditions, health and safetyat work and training and management development all help to promote stability,security and efficiency within the workforce. Finally, it should be stressed that the CSRreports emphasise the leading food retailers’ aspirations which may not always be fullyreflected in everyday operations within a fiercely competitive business environment.The tensions between the aspirations and realities of CSR will provide fertile, thoughcontested, ground for future enquiry and research.

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