WEBVTT 00:00:00.160 --> 00:00:03.680 Sustainability in chemicals is a license-to-sell topic. 00:00:03.880 --> 00:00:07.240 And so if we don't start now, we face the risk of stranded assets 00:00:07.240 --> 00:00:08.840 against future fiscal policies. 00:00:09.080 --> 00:00:09.840 Hi, David. 00:00:09.960 --> 00:00:13.560 Sustainability in chemicals is a license-to-sell topic. 00:00:13.800 --> 00:00:15.440 It's getting more and more strategic. 00:00:15.760 --> 00:00:19.000 Can you tell us how Reckitt is managing all those goals? 00:00:19.480 --> 00:00:24.160 As you say, chemicals is a big chunk of the global carbon footprint. 00:00:24.160 --> 00:00:25.800 And although we're not a chemical manufacturer, 00:00:25.800 --> 00:00:29.040 we know that we have to decarbonize our products 00:00:29.040 --> 00:00:33.720 because otherwise we face the risk of stranded assets against future fiscal policies. 00:00:33.720 --> 00:00:38.160 And so if we don't start now, creating and achieving our goal of 00:00:38.160 --> 00:00:42.640 net zero by 2040 is something that's going to be really challenging in the long term. 00:00:42.880 --> 00:00:46.200 So we've been looking across the whole portfolio and thinking, 00:00:46.200 --> 00:00:49.960 how do you prioritize and where do you invest wisely now 00:00:49.960 --> 00:00:51.400 to make real good start points. 00:00:51.720 --> 00:00:57.040 And can you tell us a bit more how you've been going deep into your supply chain emissions 00:00:57.040 --> 00:00:59.880 to actually go and act where it matter the most? 00:01:00.120 --> 00:01:02.080 Well, that's where the partnership with yourselves 00:01:02.080 --> 00:01:04.480 at CO2 AI has been so helpful. 00:01:04.680 --> 00:01:06.800 Because what it's allowed us to do is 00:01:06.800 --> 00:01:09.800 really understand the detail down to substance level, 00:01:09.800 --> 00:01:13.920 not just raw material level, but substance level in the ingredients that we use 00:01:14.480 --> 00:01:19.880 so that we can track and really dig into where the hotspots of emissions are. 00:01:20.200 --> 00:01:22.600 So we started off, we looked at a thousand supply partners, 00:01:22.600 --> 00:01:25.760 we identified key strategic relationships, 00:01:26.120 --> 00:01:28.800 and what that led us to was recognition 00:01:28.800 --> 00:01:33.920 that 24 raw materials are 40% of our total carbon footprint. 00:01:34.480 --> 00:01:38.640 Indeed, six of those raw materials are 25% of the carbon footprint. 00:01:38.920 --> 00:01:41.120 So that's where we knew we had to start, 00:01:41.120 --> 00:01:45.680 because that analysis gave us the real detail of where to invest first. 00:01:46.120 --> 00:01:49.640 What type of tangible business value do you expect from this work? 00:01:50.040 --> 00:01:53.640 Well, what it means is we can direct our own resources 00:01:53.640 --> 00:01:58.000 to where we'll have the most impact in the short to medium term. 00:01:58.480 --> 00:02:03.280 And that means we can identify and work with solutions through suppliers, 00:02:03.280 --> 00:02:05.120 new strategic opportunities. 00:02:05.400 --> 00:02:08.600 So we're insulating ourselves, building resilience, if you like, 00:02:08.600 --> 00:02:13.000 into the business, into those products against future fiscal policies. 00:02:13.360 --> 00:02:18.800 And we make the most effective use of our resources so that as we innovate, 00:02:18.800 --> 00:02:19.920 we decarbonize. 00:02:20.200 --> 00:02:22.240 We innovate to be effective, 00:02:22.240 --> 00:02:25.040 the most effective disinfectant, for example, 00:02:25.040 --> 00:02:28.080 but we also innovate to decarbonize at the same time. 00:02:28.080 --> 00:02:30.880 So we actually manage those two things side by side. 00:02:31.040 --> 00:02:34.360 So for us, it's very much around putting cash and 00:02:34.360 --> 00:02:36.000 carbon on the same page. 00:02:36.200 --> 00:02:40.280 How do you operationalize all these sustainability strategy across the 00:02:40.280 --> 00:02:42.480 across the Reckitt teams? 00:02:42.480 --> 00:02:45.120 Well, one of our five core business priorities 00:02:45.120 --> 00:02:46.720 is embedding sustainability. 00:02:46.720 --> 00:02:49.200 But the operative word there is embedding. 00:02:49.840 --> 00:02:53.360 It's no use if the only person who thinks about the carbon footprint is somebody 00:02:53.360 --> 00:02:55.080 with sustainability in their job title. 00:02:55.520 --> 00:03:01.560 We need to use systems and tools that help put that cash and carbon question 00:03:01.560 --> 00:03:03.520 very much in everybody's minds. 00:03:03.520 --> 00:03:07.080 The minds of the product developer, the mind of the procurement person 00:03:07.080 --> 00:03:12.000 talking to different suppliers, the mind of the marketer, 00:03:12.000 --> 00:03:18.560 when we're making design choices so that we can address both of those issues for 00:03:18.560 --> 00:03:21.080 the medium to long term in one throw. 00:03:21.080 --> 00:03:24.800 It's no good if the only person who thinks about that is a sustainability person. 00:03:24.800 --> 00:03:26.520 It has to be everybody's job. 00:03:26.680 --> 00:03:29.200 So when we talk about embedding sustainability, 00:03:29.200 --> 00:03:34.120 it's about taking that data, turning it into insightful information 00:03:34.320 --> 00:03:39.840 that the people who do that job day in and day out can use and make informed choices. 00:03:39.840 --> 00:03:43.880 It doesn't mean that every time we'll go for the lowest carbon option, 00:03:43.880 --> 00:03:47.360 because we still have to be the most effective disinfectant. 00:03:47.560 --> 00:03:52.040 It's no use being lower carbon if you don't do the disinfectant job. 00:03:52.280 --> 00:03:57.280 But allowing that information to flow through to those decision makers in the 00:03:57.280 --> 00:04:02.680 innovation process means they can balance and blend those different options and get 00:04:02.680 --> 00:04:05.120 the best balance that we possibly can. 00:04:05.480 --> 00:04:07.000 That builds business resilience. 00:04:07.400 --> 00:04:12.800 It gives something to talk to consumers about because we know they want lower carbon, 00:04:12.800 --> 00:04:14.480 more sustainable products. 00:04:15.040 --> 00:04:19.480 And it means we can make strategic choices about not only how we design a product, 00:04:19.480 --> 00:04:21.120 but the suppliers we choose and 00:04:21.120 --> 00:04:24.200 how we manufacture that product in our own sites as well.