Target released four new corporate responsibility goals in 2011:
- Increase sustainable seafood selection
- Improve owned-brand packaging sustainability
- Increase diabetes HbA1c testing compliance
- Increase reading proficiency
Now, Target's 2011 CSR Report offers pages of graphs measuring the Minneapolis-based retailer's progress against these goals. While the graphs look promising and underscore the challenges of operating in a competitive market with multiple layers of stakeholders, I wanted to understand the context behind these goals and what the execution would look like.
I sat down with Tim Baer, Executive Vice President, General Counsel and Corporate Secretary with Target, for a conversation about the goals and how his team plans to demystify complicated supply chains and motivate its employees and customers toward healthy and sustainable choices.
Aman Singh: While the PDF of goals and progress gave me a sense of exactly that, i.e., progress, it didn't give me a sense of Target's mission/values. Can you elaborate?
Tim Baer: At Target, we’re committed to positively impacting the lives of our guests and team members. Since 1946, our legacy of giving and service has been reflected in a commitment that today totals more than $3 million a week to our communities. And at the end of the day, by continuing to serve our team members and communities, we ensure our future success. As a result of our giving model, we benefit from being a workplace and shopping destination of choice for our team members and guests. Not only do our guests value our commitment to communities and giving, but our team members do as well.
To bring our vision of strong, healthy and safe communities to life — which we can’t do alone — we work with community, business and civic partners who inform and share in our approach. We know we can make a meaningful impact, so we set goals to guide our work in three focus areas — helping to put more U.S. children on the path to graduation, reducing our impact on the environment and helping Target team members live healthy, balanced lives.
AS: Why is education such a big goal for Target?
TB: Education, specifically K-3 literacy, is important to Target for three primary reasons. First, we believe that every child deserves the opportunity to reach his or her full potential. And, we’re compelled to do our part to address the education challenge in America, putting more kids on the path to high school graduation.
Second, based on guest surveys, we know that our guests care about education more than any other social issue, and we’re committed to giving to communities in a way that positively impacts our guests and their families.
Third, we know that reading proficiently by the end of third grade is a significant milestone on the path to graduation. This is the time when a child transitions from learning to read, to reading to learn. A child who cannot read proficiently by the end of third grade is four times more likely to drop out of high school when compared with a child who can.
Ultimately, education is critically important to the success of our children and our economy. By supporting education, we are investing in developing an educated workforce that is prepared for today’s and tomorrow’s challenging work environment. At Target, our team is our competitive advantage, and preparing future team members with a quality education today makes good business sense.
AS: Your data shows that you were not able to achieve your water reduction goals? Can you give us a sense of the challenges and where improvements need to be made?
TB: To recap the report, Target used 3.45 billion gallons of water, representing a 0.3 percent reduction in water use per square foot from our 2009 baseline. Although our absolute water use exceeded our initial baseline, we also increased our total real estate square footage, which led to a decrease in water use per square foot.
The most significant challenges we faced in 2011 were drought-like conditions in some of our mature markets like Texas, Minnesota and Iowa, where we have a relatively high concentration of stores requiring increased irrigation. This negative impact was modestly softened by our rollout of several water-saving initiatives, which we estimate will contribute a reduction of 1.4 percent annually starting this year.
A few examples of our water-saving initiatives include:
- Expanded installation of smart irrigation controllers that irrigate based on real time local weather data in lieu of set times,
- Use of ultra-low flow urinals and water closets, and
- Elimination of continuously running dipper wells for ice cream and coffee stations at Target Café and Starbucks locations in our stores.
We’re also in the process of installing real time water submeters in a number of stores to pinpoint the quantity of water a typical store uses for various operations. This will help improve our evaluation of water-saving opportunities moving forward.
AS: You have a goal of reducing owned-brand product packaging for at least 50 product designs by 2016. Is that aggressive enough?
TB: While we’ve targeted 50 packaging designs, these changes will be implemented for a much larger number of items that use the same packaging.
We know environmental stewardship is important to Target guests, and our sustainable packaging designs will let them know that Target’s commitment to reducing our environmental impact begins before our products hit shelves.
Over the next five years, Target will be developing sustainable packaging designs that yield at least a 10 percent improvement in one of several attributes of our existing owned-brand packaging. We’ll do this in several ways, including reducing overall packaging, using more recycled or renewable content, and reducing product waste. We’ll also look to use more recyclable materials in our packaging, counting these improvements toward our goal only if the updated packaging is 100 percent recyclable.
AS: The goals indicated regarding packaging are limited to your owned-brand products. Are there any plans to push your suppliers and CPG partners into more responsible, transparent and environmentally friendly actions?
TB: We believe in leading by example and hope that by creating more sustainable packaging for our owned brands, we can inspire our suppliers, CPG partners and peers to implement more sustainable packages in their own products.
AS: The report indicates strong progress toward empowering employees to be more health-conscious. Can you discuss some of the challenges behind the numbers?
TB: For us, 2011 was a year of learning in regards to team member wellbeing.
We recognized goals specific to preventive service utilization rates were difficult to measure consistently and accurately, so we adopted HEDIS [National Committee for Quality Assurance’s Health Effectiveness Data and Information Set] measures. By doing so, we can support our wellbeing efforts by comparing our utilization rates to those of other employers or healthcare entities like medical groups or health plans.
The size and geographic distribution of the Target team member population reaches across 49 states, 1,700 stores, 37 distribution centers and nine domestic headquarters locations. We employ more than 365,000 team members and know they have varying degrees of health engagement, variable disease prevalence and differing perspectives on healthcare services. This is an opportunity for us to develop tailored programs that address these differences, more effectively reaching every team member, regardless of where and how they live and work.
AS: Can you summarize some key highlights of the report that you'd want every reader to remember?
TB: All of Target’s corporate responsibility objectives ladder up to our larger goal of creating a brighter future for our team members, our communities and the world we live in. Target is here for good. Through all of these initiatives, we’re committed to positively impacting the lives of our guests and team members.
Additionally, Target’s 2011 Corporate Responsibility Report is the most transparent corporate responsibility report we’ve ever released. It represents the first time Target declared a GRI Application Level and obtained a GRI Application Level Check. [For more information, Target’s GRI Application Level/Check Statement from GRI were posted on www.Target.com/hereforgood on July 13, 2012.]
AS: Why bother reporting on this set of internal goals? How do you measure the "success" of your CSR report?
TB: Our commitment to our guest extends far beyond our stores, and we believe truly great service includes supporting the communities where we live and work. In business, Target collaborates and innovates to drive results. Key to that collaboration is transparency when it comes to measuring and reporting progress toward goals, allowing us to grow as a company.