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BFS Group: On the journey but needs to change direction

By elaine cohen (BeyondBusiness) on February 29, 2012 at 3:35pm.

About BSF Group:

BFS Group Limited (BFS) is part of Bidvest Group Limited (Bidvest), an international company, listed on the JSE Securities Exchange South Africa. BFS serves over 77,500 customers from two main trading divisions: 3663 Wholesale (including Swithenbank Foods and Catering Equipment) and Bidvest Logistics (BVL). 3663 Wholesale is a foodservice provider in the UK supplying fresh, chilled, frozen, ambient food, wines beers and spirits, including  750 own brand products. BVL is a provider of a distribution service to national food producer clients in the UK. BFS employs over 5,400 people and has revenues of GBP 1.8 billion, operating out of 32 sites in the UK. Both 3663 Wholesale and BVL have separate operating structures and corporate Boards of Directors.

Content: 

This fourth report from BSF Group is a well-written, comprehensive report of the company's direct impacts and activities in the field of sustainability. The scope of social and environmental activities is impressive and the report clearly demonstrates on-going efforts to improve the way the Group does business. Several important achievements are described in the report, including:
• Investments in double-deck trailers, voltage optimisation units and commissioning of a first electric vehicle.
• Reduction in carbon emissions of 2.1%, reaching a total of 20% reduction from the 2007 baseline.
• A significant target for reduction of waste of zero to landfill by 2015 and recycling of over 1,300 tonnes of cardboard and plastic in 2011 and collecting over 2 million litres of waste oil each year for recycling.
• Donations of 10 tonnes of surplus stock to FareShare, providing over 23,000 meals for disadvantaged people.
• 95% of BSF  electricity consumption is from certified renewable sources.
• Rainwater harvesting is maintained at four sites. Water recycling saved over 13 million litres of mains water consumption in 2011.
• Several packaging improvements have reduced environmental impacts, such as a move to PET bottles and elimination of shrink-wrap.
• BSF engages in range of community involvement and investment projects, with a core charity ‘Hospitality in Action’.
• Use of telematics resulting in reduced fuel consumption of 4% since commencement in 2010.
• Increasing sales of Fair Trade products.
• Supply of over 100 British Red Tractor assured products including: fresh milk, cheese, fresh meat, frozen meat, butter, chips and sausages and an MCS approved fish range.
• BSF operates a Positive Steps Program for products that contain no more than 3% fat or contain at least 30% less fat than a comparable product, and low sugar and sodium content.
• An internal network of over 65 voluntary Sustainability Co-ordinators.
• Encouragement of employees to use public  transport. High mileage company car users are required to undertake a risk assessment with a primary view of ensuring employee health and safety.
• Improvements in workplace accidents and injury levels.
• 38.1% of women in management.
• In a survey, 74% of employees agree that BSF Group is company is socially and environmentally responsible.

These are some examples of activities and achievements which characterize BSF Group's Sustainability Performance and Reporting. While the Group does have a structured CSR Strategic Framework, for communities, people, environment and products, material issues are defined in headline terms and described as "resulting from stakeholder engagement processes". These are: demand for reduction of environmental impacts through logistics; demand for healthier and more sustainable foods; demand for accurate and robust information on food labelling and demand for British and seasonal produce. These, rather generic, issues are dealt with in the BSF report, but suggest that the materiality analysis was more of a paper exercise than a true analysis of all stakeholder inputs gained through meaningful dialogue processes.

What is most surprising about the BSF Group report is the lack of attention to customer relationships and impacts. As a wholesaler, the BSF Group deals with tens of thousands of customers which impact its business and on whom BSF has the potential to impact quite significantly. Despite having Vision and Mission statements which are focused on helping customers succeed, this report contains no serious treatment of how the Group is doing this, with the exception of a short section on customer service and provision of nutritional advice. There is therefore no assessment of the true scale of BSF's impact in the food and beverage industry. Who are BSF customers and what specific challenges are they facing? Is BSF Group contributing to new levels of customer awareness in sustainability issues? Are customers stocking different types of products as a result of BSF's sustainability focus? How has BSF's transportation efficiencies enabled customers to improve their carbon footprints, and how has BSF engaged customers in partnering efficiency programmes? Ultimately, what benefits do end-consumers gain from BFS's role in this complex supply chain? These are questions that remain unanswered in the BSF report, though they are, ultimately, the core issues that a company such as BSF would do well to address.  BSF's Corporate Responsibility Strategic Framework does not mention customers at all!

Communication: 

The 50-page report is compactly presented and easy to navigate with clear sections headings and performance data embedded in the relevant sections. The core structure is in four sections: communities, people, environment and products. One issue is in the design of the report where jpeg picture representations of data graphs are not legible and the numbers cannot be discerned. The report includes occasional quotations from external stakeholders, which is a nice touch and could be expanded in future reports. The joint statement from the Managing Directors is rather internally focused ("we do, we have done" style) but mentions that "Sustainability is now a fundamental consideration within the foodservice industry", which I suspect is accurate, but it would have been nice to find more contextual information in this report.

Credibility: 

This is a fairly credible report, demonstrating performance improvements which have been sustained over several years and multi-year themes which demonstrate that BSF Group is here for the long-run.  A public commitment to targets (environmental targets) is contained in the report. This being said, the Assurance Statement does not add to the report credibility – it appears to be (only) an evaluation of the report against the GRI 3.1 Guidelines (this report is published at Application Level C+), and no account is provided in the report of activities undertaken to reach the consultation that the report provides a "fair and balanced representation" of the company's sustainability performance. BFS Group seems to be on the responsibility path, but there is still a long way to travel, including expanding the Group's Vision beyond its role as a supplier of products and services to the impacts the Group is accountable for and its role in  the entire food supply chain.

Recommendations:

1. Undertake a Materiality Analysis in a more structured way and define material issues which are based on dialogue processes and use this to inform reporting.
2. Move from describing actions to understanding and reporting on impacts – especially customer impacts.
3. Improve/expand scope of external Assurance and include greater clarity on what was assured /verified and how.

elaine cohen is the CEO of Beyond Business Ltd, www.b-yond.biz/en , a CSR consulting and Sustainability reporting firm.