Photo Courtesy of REUTERS/Krishnendu Halder
Kering (formerly PPR), through its PUMA company, released the first-ever Environmental
Profit and Loss Account (EP&L)—an enterprise and supply chain view of environmental impacts expressed in monetary terms so that a business can strategically understand
and embed these benefits and losses into the company’s strategic planning and decision-making processes. Phase One of the EP&L reported on the environmental impacts of PUMA’s operations and supply chain. As a result, PUMA learned that 94 percent of its environmental impacts arise in the supply chain; 57 percent are related to production of raw materials, such as leather, cotton, and rubber; and 6 percent from its core operations (offices, warehouses, stores, and logistics).
Placing a monetary value on natural services (impacts) helped to illustrate the potentially negative impact depleted ecosystems can have on a business’ future performance.
The economic valuation provided data and insights that informed corporate strategy, operational decisions, and risk assessments, but not net earnings. For example, PUMA analyzed opportunities to influence tiers of its supply chain that in the past received
less attention. They also identified more sustainable materials, investigated the development of broadly accepted definitions of sustainable cotton and rubber and engaged in cross-industry cooperation to find ways in which excess materials can
be re-used by other industries.
Kering wanted to understand the feasibility of developing a Social Profit and Loss Account (SP&L).
Working in partnership with Ideal Philanthropy, pfc undertook a landscape analysis of
the field and identified opportunities and challenges in developing a SP&L for luxury
and sport & lifestyle premium brands. This included undertaking research and convening an international advisory committee to review findings