Environment

The pervasion of electronics in every aspect of today’s world means that we all rely on electronics for innumerable tasks each day. Electronic design engineers are under pressure to design more electronic products, faster, while still taking into account the effects that their designs have on the environment and individual users both during the product’s use and at its end-of-life.

Our responsibility to our customers and the environment is at the heart of everything we do. It is critical that we meet our customers’ growing needs for environmentally friendly products, while decreasing our own environmental impacts.

Our principal environmental impacts are carbon emissions, our use of paper and packaging and waste. We have set the following programmes and targets in order to reduce our impact on the environment.

Three year carbon reduction programme

We have defined our carbon footprint and developed a strategy and three year plan to increase energy efficiency and reduce our carbon emissions to the lowest practicable and economic level. We include in our carbon footprint those primary activities over which we have direct control – all of our activities from the receipt of products into our warehouses to their final preparation for despatch to customers, including the production of catalogues and marketing material; our use and the disposal of packaging; business travel and the energy required to operate our facilities. We exclude the physical delivery of products from the manufacturer to the warehouse and from the warehouse to customers, as we do not have control over the associated emissions.

In those areas outside of our direct control (for example the delivery of products to our customers by third party carriers), we are working to understand better the opportunities to collaborate with our parcel carriers for improved efficiency and reduced environmental impact.

Highlights of our carbon reduction programme in 2008 include:

• The Company has begun to collect carbon emissions data monthly and produce management reports quarterly as part of the mainstream reporting of each business unit.
• Plans agreed and budgeted by business units to further reduce energy consumption and carbon emissions during 2009.
• Reduced our carbon emissions to 79% of those of the baseline year of 2006.

One of the principal drivers of better energy management is employee behaviour and we actively encourage employees to conserve the Company’s resources through our own “green facilities” award scheme. This promotes environmentally friendly working practices, enabling individual sites to self-assess their performance, earning points for conserving energy, reducing waste disposal and increasing levels of recycling. The scheme, which has been running since 2003, has this year been given added impetus by our carbon reduction programme. All our larger facilities have teams of green champions and all of the Company’s larger facilities have now achieved the green facility award (16 in total).

Beginning in 2010, many larger businesses in the UK will be required to report their carbon emissions to the government-led cap and trade scheme, the Carbon Reduction Commitment. They will also be required to purchase allowances for the carbon that they emit through their use of energy. We have been tracking the progress of this legislation, and planning for its impact on our business and our carbon reduction activities leave us well-placed for its implementation.

Farnell in Leeds and CPC in Preston are accredited to the Energy Efficiency Accreditation Scheme (EEAS), which recognises businesses that are making positive moves to reduce energy consumption, become more energy efficient and reduce carbon emissions

As part of their audit this year, we have been advised by experts at SGS that a more representative metric for measuring our energy usage is to compare them to facility size, rather than to sales figures. For this report, we are applying both metrics, to facilitate transparency and consistency with the previous year.

Driving high standards in our use of paper and packaging

One of our principal environmental impacts is the use of paper in the publication of our product catalogues, marketing material and packaging. We take a proactive approach to reducing the environmental impact of our publications and packaging, while taking into account economic and market factors.

Premier Farnell communicates with its customers via a combination of catalogues, direct mail and the web. While it is the Group’s strategy to increase the level of web-based business, paper materials continue to be important in offering customers choice in the way they select and order products.

The Group has formalised and made publicly available our policy and guidelines detailing the ways in which we aim to mitigate the impact on the environment of our paper publications by setting appropriate minimum standards for their production (paper and print), distribution and recyclability.

It is our policy to:

• Engage with suppliers of paper and print who can demonstrate their commitment to mitigating the environmental impacts of their production processes through certification to a recognised and properly managed and audited scheme;
• Specify either virgin paper from certified, sustainable sources or recycled paper with the highest available post-consumer recycled content according to cost considerations and the production constraints of individual publications;
• Only place contracts with printers who have a published environmental policy and recognised environmental certifications;
• Specify that the packaging used for protecting catalogues and direct mail in the delivery system is manufactured with recycled and recyclable materials;
• Ensure we maintain up to date customer data which ensures that the publication is relevant to the end customer, thereby minimising wastage; and
• Encourage our customers to recycle all publications and packaging at the end of their lifespan.

We have been reducing the weight of the paper in our product catalogues for the last five years and increasing the proportion of post-consumer recycled material where appropriate.

We are also concerned with reducing the environmental impact of the packaging we use to protect the products we supply and to ship our customer orders. We are continuing to develop an environmentally friendly packaging solution for components in the form of biodegradable, static dissipative bags and expect to launch this innovative product during 2009.

At our international distribution centre in Leeds we have replaced air-filled plastic protective packaging materials with an environmentally friendly alternative. We now use recyclable paper from sustainable sources. Our new packaging process is also more energy efficient. In the US, MCM now reuse the void fill from inbound deliveries and donate their used office paper to a recycler for Habitat for Humanity. Akron Brass use recycled newspaper that is prepared for them by a local community group as void fill in their deliveries.

At the same time, we are moving to packing boxes which are manufactured from sustainable, managed sources that are fully recyclable.

Reducing waste to landfill

Premier Farnell has identified the generation of waste as one of its three key environmental impacts. The nature of our business is such that we order product from suppliers in bulk and then break these orders down into the quantities required by our customers, resulting in waste packaging.

We also focus our efforts on minimising the volume of waste which goes to landfill. Where possible we re-use waste packaging and, where this is not achievable, we ensure that it is sorted and recycled.

All our large facilities have recycling programmes and initiatives in place to increase the volume and types of waste that are recycled. The CPC facility in Preston, UK currently achieves the highest proportion of waste recycled at 90% and the Leeds facilities recycled 77% of their waste this year.

Overall, the Group recycles 71% of its waste, up from 63% in 2007.

As a supplier of electrical and electronic equipment, we have producer obligations under the European Union’s WEEE legislation to provide our customers with a service to enable them to dispose of their waste electrical and electronic equipment correctly in compliance with the legislation. Akron Brass, which manufactures fire-fighting equipment from brass and aluminium, re-uses and recycles the industrial waste created by its manufacturing process.

Embracing environmental legislation

European environmental legislation is continually evolving and affects the Group’s electronic component distribution businesses. The Restriction of Hazardous Substances (RoHS) Directive restricts the use of certain hazardous substances in electrical and electronic equipment. Changes to the original legislation made by the so-called “RoHS2” will further affect industry by extending the scope of the original directive. By restricting the hazardous substances in electrical equipment, recycling, re-use and recovery become easier, and safer at the products’ end-of-life. Beyond Europe, China is expected to announce its first restricted products under its own RoHS legislation during 2009.

REACH Regulations impose tighter controls over the use of around 30,000 chemicals, in particular Substances of Very High Concern that cause considerable harm to human health and the environment.

Finally, the Energy using Products Directive tracks and sets measures to improve the energy consumption of a product from the mining of the raw material right through to its recycling at end-of-life.

All these pieces of legislation affect, and are clearly communicated to, the Group’s principal customer base of electronics design engineers through a variety of methods including e-shots, blogs and the Group’s own web pages at www.global-legislation.com. For more detailed information on how Premier Farnell is embracing environmental legislation, see case study Better products for a better planet.

Evaluation

We collect data on the amount of energy used and carbon dioxide emitted, waste disposed and waste recycled by the Group’s operations in order to assess our environmental impact.

To ensure that we have representative and reliable environmental data, we review new data each quarter and compare it with data from prior years. This continual review and comparison allows us to detect and correct any errors and may result in the restatement of certain prior year figures. We have also engaged the SGS Group as expert external consultants this year to assess our data collection processes to ensure that they are robust. The SGS audit statement appears at the end of this report.

Committed to sustainability

We extend our approach to sustainability to our EDE customer base through Live EDGE. Our first Live EDGE competition winner was the developer of an energy-efficient ceiling fan, who Premier Farnell will support in the product’s development and distribution. We held a second Live EDGE competition during 2009, to continue to promote the environmentally-friendly design of electronic products. In total we received innovative, environmentally friendly designs from more than 650 registrants in 65 countries. The winner of this year’s Live EDGE competition was Pedro Rodrigues from Portugal. Pedro designed an Intelligent Standby Energy Saver. Mr. Rodrigues won a $25,000 cash prize and a support package worth the same that will help him bring his design into production and distribution. The Live EDGE technical judges noted that the design takes a radically different approach to determining power usage and we are very proud to support this design.

In addition, the Live EDGE competition announced the creation of an engineering scholarship to support engineering students.