CEO Introduction

“In 2011, the new Ethical Plan sets out our ambition to reinforce our position as the UK's most socially responsible business.”

Peter Marks, Group Chief Executive, The Co-operative Group

The Co-operative’s history is characterised by moments when vision, innovation and ethics come together to drive bold ideas that rewrite the rules of the game. Be it the creation of the co-operative business model in the nineteenth century; our pioneering approach to Fairtrade; or the launch of the bank’s Ethical Policy in 1992, The Co-operative has a rich history of leadership and innovation in the field of corporate ethics.

Now, in 2011, the new Ethical Plan sets out our ambition to reinforce our position as the UK’s most socially responsible business, and our ‘Join the Revolution’ campaign calls on our customers and members to take action and help change their world. I believe that, in years to come, we will look back on this point in time and judge it to be yet another defining moment. The Plan injects a new radicalism into our business, with some 47 commitments signalling our intent to bring about step changes in a raft of sustainability impacts. As a result, ethical targets and performance will now be fully integrated into three-year financial planning, and the way in which we measure our success. This move codifies the long held view of The Co-operative, that our business exists to do so much more than create profit, and seeks to raise the bar for our peers.

The last five years has marked a period of expansion that is unprecedented in our recent history, seeing mergers with United Co-operatives and Britannia, and the acquisition of Somerfield. Throughout, we’ve remained true to our heritage and continued to lead the way in sustainability. While sales have gone up, environmental impact has significantly reduced, with absolute reductions made in areas such as waste and carbon emissions. We’re now able to bring ethical offerings to more customers than ever before; ensuring these are affordable to shoppers on a range of budgets. Customers who previously shopped at Somerfield now have widened access to Fairtrade and higher animal welfare products, and in 2009, the bank’s Ethical Policy was rolled-out across Britannia.

Our performance in 2010 further supports our contention that putting sustainable development at the heart of our strategy is simply good for business – and good for everyone. Against the backdrop of a challenging economy, The Co-operative has once again returned record profits, whilst delivering on its key sustainability commitments. The Executive Summary, which opens this report, highlights the most notable examples of performance, such as the launch of a flagship programme to inspire young people, the investment of 4% of pre-tax profits to support communities at home and abroad, and a record share of profits earned by members of £70.5m. Last year, I had the privilege to see first-hand the difference our Fairtrade projects make to communities in Africa; as such, I’m especially proud to say we’ve tripled Fairtrade sales over the last three years.

This impressive performance is only made possible by the considerable efforts of many colleagues and members. Their contributions were also central to The Co-operative receiving a host of prestigious accolades – not least The Co-operative Financial Services winning the Financial Times Sustainable Bank of the Year Award, and The Co-operative Food being named both the Responsible Retailer of the Year, for the fourth year running, and the RSPCA’s People’s Choice Supermarket for the second consecutive year. This report details our performance across 17 areas in a candid and balanced way, and does not shy away from disclosing performance that has fallen short of our expectations. The Ethical Plan heralds a new era for sustainability reporting at The Co-operative, which takes the guiding co-operative values of openness and honesty, and our determination to continue to push the boundaries of corporate disclosure, to a new level.

I would personally like to invite all our customers, members, and staff to join the revolution and help us build a better society.

Peter Marks

Group Chief Executive, The Co-operative Group