Kimberly-Clark’s ambitious sustainability strategy won’t be derailed by current global upheaval, as Oriol Margo, sustainability transformation leader (EMEA), explains to Karen Southern.
We’re living in unprecedented times. The rulebook for industry ‘norms’ has been ripped up as economic turmoil continues. So does sustainability still have value in the current climate?
The answer is a firm ‘yes’, according to Oriol. Kimberly-Clark, he says, remains focused on the bigger picture when it comes to sustainability, with plans to halve direct (Scope 1 and 2) emissions by 2030. Plans are also underway to cut indirect (Scope 3) emissions by 20% within the same timeframe.
The US multinational produces a vast amount of consumer products (toilet rolls, wipes, nappies, sanitary products) that are global household names … think Huggies, Kleenex, Andrex. With a customer base representing a staggering quarter of the global population – or two billion people – using its products every day, it follows that the company’s manufacturing processes and consumer habits have been historically environmentally intensive.
“We get asked about the value of sustainability a lot, and of course it’s a difficult situation,” Oriol explains. “We are tackling many inflationary pressures in energy and materials, and ideally wouldn’t want to pass these costs on to our consumers.
“Kimberly-Clark prefers to focus on the long-term outlook, not short-term challenges. Our strategies, targets and ambitions haven’t changed. We are here to deliver what customers want, and they tell us they still want sustainable choices.”
Oriol concedes, however, there is a clear gap between intent and outcome in consumer behaviour. “It takes only a few seconds to choose a product, and sustainability is not always the top choice for purchasing.
“Even before this crisis, the majority of consumers weren’t prepared to pay more for sustainability. This was already a challenge for us, so we decided to concentrate on innovation in new energy sources and materials which will help us maintain and improve performance and affordability.
“Our teams are used to adapting to change, you know, it’s not a problem for them. They remain totally committed to reducing our environmental footprint to its smallest possible size.”
Oriol points out that Kimberly-Clark has long championed good environmental husbandry, “but the challenge now is to deliver grassroots ‘greener’ solutions quicker than ever.”
Energy and climate concerns are naturally high on the company agenda, and Kimberly-Clark is using the UK as an incubator market for testing and piloting some of its latest net zero strategies, which include bumping up hydrogen and biomethane production. “The regulatory framework is moving fast here, and we have a good track record of partnering with government agencies,” Oriol explains.
“Investment to decarbonise gas and electricity is intensive, running into billions of pounds, and we’re not in the business of energy generation, so another of our strategies is partnering. We act as an anchor for long-term commitments that enable such investment.
“We’ve partnered with Octopus Energy on a new Scottish wind farm (a Kimberly-Clark EMEA first) to make almost 80% of our UK electrical power renewable. Octopus has invested £75m in this project, and we are in it for the long run. From here, we will use similar investment models for hydrogen and other innovations. Materials is a different challenge, but basically we are building a model to evaluate a proper return on sustainability – not just monetary but non-monetary returns as well.
“Our teams are also working on an internal mechanism for an holistic assessment of these returns, which will really support our decision-making.”
Elsewhere, a biomass boiler – again an EMEA company first – has been installed at a Spanish manufacturing facility to reduce gas consumption emissions by 40%, with biomass mostly sourced from waste forest residues within 100km.
Kimberly-Clark is also channelling formidable resources into plastic product and packaging alternatives, including biodegradable, recycled and reused materials. For instance, plastic-free Huggies Naturals baby wipes are already available in the UK, but the drive for continuous improvement and performance is relentless.
“We keep a close eye on the EU regulatory framework – sometimes it’s not clear how directives on certain products will evolve, so we continue to explore a number of options,” Oriol explains.
Leaving aside the EU’s perspective, how does the UK’s attitude to sustainability compare with the rest of the EMEA?
“I would say that the UK is moving a bit faster on the net zero support mechanisms front than other markets, and we certainly get a lot of feedback on materials, plastics and circularity.
“We’re looking to reduce emissions here by 76% between 2015 and 2023, and have recently invested £92m in state-of-the-art manufacturing assets.”
Oriol does however agree there are significant differences in some regions (outside of Europe), in terms of fewer regulatory guidelines and lower consumer sensitivity to the issues at hand.
“We are aware some of our products may have a bigger impact in certain markets, and we are accelerating our sustainability drive to benefit their infrastructure. Not necessarily because the consumer is asking for change, but because the impact may be different than it is in Europe.”
Change may be the one constant in life, but while Oriol doesn’t see any trends of particular concern, he notes there is a definite shift in support for circularity. “Many of our products are single use, so we do need to look at a true circular economy.
“With this in mind, Kimberly-Clark recently became a majority stakeholder in Thinx, a company working on reusable feminine care.
“It’s a very new area of R&D for us and the solutions aren’t all cut and dried. We’re looking at hybrid solutions, such as reusable frames with disposable parts, but we are very aware that our customers want a wide range of choices to meet their individual needs.”
“The pace of change continues to be very fast. Kimberly-Clark is constantly adapting, hitting new targets, setting new goals. So even within a couple of months – in areas like hydrogen energy – we will have more exciting developments to announce.”
In other words, ‘Watch this space!’
Kimberly-Clark’s annual sustainability report* is now available.
