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 taking into account how their design affects the environment and individual users.

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 reduce our carbon emissions to the lowest practicable and economic level. We include in our carbon footprint those of our primary activities over which we have direct control – all our activities from the receipt of products into our warehouses to their 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.

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

Highlights of our carbon reduction programme in 2007 include:

• Completed energy audits in all our major facilities;
• New programmes and targets to reduce consumption through measurement, energy management and investment in energy efficient equipment;
• The piloting with our principal third-party logistics provider of monthly reporting of the carbon emissions created by our parcel distribution activity; and
• A sustainable procurement programme.

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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 the carbon reduction programme. All our larger facilities have teams of green champions and a further five of the Group’s facilities have achieved the green facility award this year, bringing the total to 12. In 2008 we aim to have all the remaining larger facilities accredited to this award.

In November 2007, Farnell in Leeds and CPC in Preston achieved accreditation 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.

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 and marketing material and packaging. We take a proactive approach to reducing the environmental impact of our publications and packaging, whilst taking into account economic and market factors.

Premier Farnell communicates with its customers via a combination of catalogues, direct mail and the web. Whilst 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.

This year we have formalised and published 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 setting and achieving targets to reduce the weight of the paper in our product catalogues for the last four years and to increase 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. This year we have developed and introduced new cell type packaging which, in addition to providing enhanced protection for the integrated circuits we supply, has the added benefit of being fully recyclable.

At our international distribution centre in Leeds we have replaced air-filled plastic protective packaging materials with an environmentally friendly alternative based on recyclable paper from sustainable sources. This packaging process is also more energy efficient. At our distribution centres in the US, we are increasingly re-using inbound packaging materials and shredded waste office paper for the same purpose.

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

Reducing waste to landfill

Premier Farnell has identified the generation of waste as one of its three significant environmental impacts. The nature of our business is such that we place orders on our suppliers in large quantities and then break down these orders into the quantities required by our customers. This process creates waste and we engage with our suppliers with the objective of minimising waste and specifying packaging which is recyclable, wherever possible.

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 89%.

Overall, the Group recycles 63% of its waste, up from 59% in 2006.

As a supplier of electrical and electronic equipment, we have producer obligations under the 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-use and recycle the industrial waste created by their manufacturing process.

Embracing environmental legislation

There is an ever growing list of European environmental legislation that impacts the Group’s electronic component distribution businesses. The Restriction of Hazardous Substances (RoHS) legislation restricts the use of certain hazardous substances in electrical and electronic equipment. These substances are restricted to complement the ease of recycling, re-use and recovery at the end of a product’s life under the Waste Electrical and Electronic Equipment (WEEE) Directive. Beyond Europe, countries such as China, Korea and Australia are all looking to implement their own versions of RoHS, with others to follow.

The Energy using Products (EuP) Directive looks at the energy consumption of a product from mining the raw material right through to its recycling at end-of-life. Finally, the REACH regulations impose tighter controls over the use of 30,000 chemicals in Europe.

All these pieces of legislation impact, and are clearly communicated to, the Group’s principal customer base of electronics design engineers. Representatives of the Group were invited to present three training programmes on European environmental legislation at a recent Academy of Certified Hazardous Materials Managers conference in India.

Evaluation

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

In order to ensure that we have representative and reliable environmental data, we review new data each quarter and compare it to 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.