Iceland heats up the battle against plastic
IN the battle against plastic, an unlikely retail warrior has appeared. Iceland Foods, a brand that even its own corporate affairs director describes as ‘Marmite’, last year pledged to remove single-use plastic from its own-brand products by 2023 and become the first UK supermarket to remove palm oil from own-label foodstuffs – an accomplishment it largely achieved – by the end of last year.
It is trialing the country’s first reverse vending machines, which reward customers with a 10p Iceland voucher for every plastic bottle they recycle, and even launched a paper bag initiative to encourage shoppers to forgo plastic carrier bags. And last November, Iceland bested all the other supermarkets when its festive campaign was banned from television after Clearcast, the body charged with vetting adverts before they air, ruled that it breached political advertising rules.
The animated short film featuring orangutan Rang-tan, which was voiced by actress Emma Thompson and originally produced by Greenpeace, highlighted the destruction of rainforests as they are cleared to grow palm oil crops. It has since been viewed by more than 70 million people while research by Kantar Millward Brown found it to be the most effective Christmas advert last year.
But these were not examples of a company jumping on a populist bandwagon. The #TooCoolforPlastic campaign, which launched in January 2018, builds on a long- standing ethos that has seen Iceland Foods lead the supermarket sector on many issues surrounding the safety of food and the environment.
For example, it was the first UK supermarket chain to cut artificial colourings, flavourings and non-essential preservatives from its own-brand foods more than 30 years ago, back in 1986 – 13 years before Marks & Spencer, according to its website – along with scrapping monosodium glutamate (MSG).
Iceland followed this with a pledge to remove mechanically recovered meat from its shelves in 1990, and 21 years ago became the world’s first supermarket chain to remove genetically modified (GM) foodstuffs. Hydrogenated fats, otherwise known as trans fats, were removed in 2006. It has also led on around ozone-depleting chlorofluorocarbons (CFCs), which are used in refrigerators.
‘It was all initially driven by Malcolm [Walker, founder of Iceland Foods]. It was his personal belief, for example, that GM was damaging the planet,’ says Keith Hann, now in-house as corporate affairs director after more than 30 years acting – on and off – as Iceland’s external PR consultant.
There should be no difference between being in a business for profit and leveraging the power of a business for good
Walker also believed that it was wrong for consumers to have no choice but to buy GM foods. ‘Observers at the time claimed such a move [eradicating GM foods] was impossible to achieve, as GM foods were often blended with soya so that you couldn’t tell they were there. Every other retailer said we were idiots. By and large, we’ve been years ahead of everyone else,’ adds Hann.
The consumer response to the move was so positive that within months, every other supermarket chain had followed Iceland’s lead. Today, British food is predominantly GM free, and no GM crops are grown commercially in the country – a result many have attributed to Malcolm Walker’s actions.
So fervent was Walker about the cause that, when he heard that Lord Melchett, the former executive director of Greenpeace UK who died last August, had been arrested with 27 environmental activists for destroying a trial field of genetically modified maize in Norfolk in 1997, he delivered a frozen Iceland gateau, complete with buried file, to the peer at Norwich Prison.
‘That’s when we realised that the prison authorities didn’t share our sense of humour,’ concedes Hilary Berg, head of sustainability and CSR at Iceland. ‘I was saying Please leave it sticking out, Malcolm, so they know it’s a joke. We told the Guardian, and there was a terrific photo of an Iceland delivery man handing the gateau to the prison guards. But actually, nothing has changed. That’s the culture of our business: no other supermarket would do that.’
Walker’s son Richard is leading the current sustainability charge. A keen scuba diver and long-term supporter of Greenpeace, Walker Jr, who was promoted to managing director of Iceland Foods last August, has seen first-hand the effects of plastic on the ocean.
‘It is his personal passion,’ says Hann. ‘He is as passionate about this initiative as Malcolm was about GM foods.’ Berg agrees: ‘It’s the same principle. What Iceland does is to disrupt the market. The business is small enough to have self-determination and agility and to take risks, and big enough to make a noise.’
Indeed, so passionate is 37-year-old Richard Walker about the issue that, having initially eschewed the family firm, he joined after recognising the potential for 900 plus stores, 25,000 employees and a weekly customer base of five million shoppers to make a difference. He started on the shop floor, working as a cashier before getting promoted to store manager, familiarising himself with the day-to-day challenges, reaching the executive suite four years ago.
Despite Iceland’s reputation for ‘inventive radical thinking’, Walker recently told an audience at a Surfers Against Sewage event that he had to first persuade the Board that it was possible to remove plastic packaging ‘without bankrupting the business through increased costs and without creating a whole of lot of other problems, such as shortening the shelf life of products’.
He argued that Britain’s supermarkets are responsible for generating one million tonnes of plastic every year, and that somebody had to take the lead. ‘There should be no difference between being in a business for profit and leveraging the power of a business for good,’ added Walker. His comments echo the supermarket’s corporate purpose To grow a profitable business that allows us to do the right thing for our people, our customers and their communities, and our planet.
The views of 5,000 customers were also sought: 81 per cent said they would support the plastic pledge. Hann likens the move to the switch from cardboard egg boxes to plastic ones many years ago. ‘No one can quite explain why we used plastic in the first place,’ he says. ‘It costs a lot more.’
Work to remove single-use plastic from Iceland’s own label products began more than two years ago, but the company is still unsure how much the initiative will ultimately cost. By the end of last year, Iceland had eliminated more than 1,500 tonnes of plastic from own label packaging. A further 600 tonnes will disappear as it reverts to pulp trays for eggs, but it has taken slightly longer than anticipated to completely remove non-recyclable black plastic trays from its own brand frozen meals, of which Iceland sells around 100 million per year.
Berg explains: ‘We now have all the contracts and agreements in place to stop manufacturing, and during the first half of this year we will be completely out of black plastic trays.’ The supermarket is also looking at other alternatives for meal trays, such as sugar beet, bagasse (from sugar cane) and bamboo, and working on removing the thin plastic laminate used to line cardboard meal trays – making them entirely free of plastic. Cellulose films are being trialled to replace the cling film wrap currently used in food packaging.
Iceland is also working with paper tub manufacturers, looking for solutions to the issue of yoghurt pots, and examining potential alternatives for milk containers. Progress on this front may be slow, however, as the dairy industry has invested heavily integrating plastic into the bottling process.
And therein lies a problem: this is not just a packaging issue. It is about rethinking factory processes and retooling machines if necessary. For example, frozen beef burgers used to be sold in simple cardboard packaging. Today, each burger is individually wrapped in plastic – an unnecessary addition – before being put into the box.
‘Sometimes plastic exists because products move around factories,’ explains Berg. ‘How do you solve that so that the flow of products doesn’t depend on plastics? We are looking at retooling machines and helping suppliers with investment. It is only when you go into the factories that you can see this is a production issue more than a plastic issue.’
She adds: ‘The number of conversations going on every day in the business is enormous. We are completely reinventing processes. I’ve got senior colleagues in packaging, in buying, right across the business – it is now embedded into our roles. No silo is working on this agenda. It is across the business.
It is only when you go into the factories that you can see this is a production issue more than a plastic issue
‘This is absolutely not about press coverage or generating column inches. This is driven by passion. This is about leadership – disruptive leadership – which is in the DNA of Iceland. Going back to the 1990s, when people started talking about greenhouse gases, Malcolm Walker developed a range of ozone-friendly freezers and fridges, which were endorsed by Greenpeace, and sold in Iceland [at a cost around £100 cheaper than rival items],’ says Berg.
Walker also threatened to quit using suppliers who did not upgrade their refrigeration facilities.
Iceland stopped selling five pence single-use bags last year, which equates to a further 1,500 tonnes of plastic. Customers are now offered a more robust Bag for Life alternative. ‘That is rather more complicated,’ explains Berg. ‘We are watching that carefully as it does depend on customers changing their behaviour. I’m a bit loath to show off about these extra tonnes because some of it will be replaced by Bag for Life plastic.’
Where plastic can be easily removed, it has been. Iceland does not offer the option to weigh products in stores, so bananas were previously sold in set numbers in polythene bags; today, they are sold with a cardboard band holding them together, taking out ten million single-use plastic bags.
Even the plastic tube in till rolls has been removed. Iceland is also the first UK supermarket to sell plastic free chewing gum Simply Gum, made from a tree sap called chicle which is completely biodegradable. The supermarket’s own research revealed that 85 per cent of British adults did not realise chewing gum contained plastic while four in five had no idea how it was made.
Iceland has also extended its reverse vending machine trial to five locations – Fulham, Wolverhampton, Musselburgh near Edinburgh, Mold in North Wales and, more recently, Belfast. By the end of November, 311,000 bottles had been returned, and the number is growing week-by-week, averaging around 2,500 in the run up to Christmas. While Iceland is still monitoring the trial, it has already spotted that children are a major driver in its success, persuading their parents and grandparents to try out the machines.
Berg returned to Iceland in 2016, having left in 2001, when the Walker family temporarily lost control. On her return, she ‘looked at the research on the emerging themes in CSR, such as packaging, plastics and food waste’. Today, she is ‘going to recycling centres, and waste disposal facilities, and asking questions’. Greenpeace recently highlighted that two thirds of the plastic sent for recycling in the UK, is simply being sent overseas – often to end up in landfill sites.
‘It is difficult for recycling centres to keep tabs on this,’ says Berg. ‘We applaud all efforts towards recycling, but we need to turn down the tap. We need to use less plastic, and to take it away from processes where it is not necessary. If a product is in a cardboard box, does it need to have a plastic liner?’
She pauses, to make a point: ‘At any talk I do on plastics, I ask people Do you remember your first toothbrush? Because, wherever you used to live, it is probably somewhere around there for the next 400 years. We’ve all been silently complicit in the acquisition of plastic.’
Iceland is aware that removing plastic from its own products is only one piece of the puzzle. ‘There is a big piece about collaboration here,’ says Berg. ‘We know that we are only tackling our own brands, and journalists were quick to say Half your stores are filled with other companies’ brands; what are you doing about that? Well, we are collaborating and sharing.
‘Big brands are coming to us and asking us to share what we are doing and how we are doing it with them. And we are very open to doing that. But it is not a one-way conversation by any means. We are also learning from them. We are collaborating with non-governmental organisations, and bringing them into the conversation.
‘Things are moving quickly. It is not just about what is currently available in the market, but it is about looking at what is becoming available.’
We applaud all efforts towards recycling, but we need to turn down the tap
Iceland is also talking to the Government – Richard Walker now plays a major role on DEFRA’s Council for Sustainable Business – and Berg points out that it took legislation to reduce demand for single-use plastic bags. Since the introduction of a compulsory charge, sales have fallen 86 per cent. ‘It shows its power. Legislation can be a big driver of change.’
Iceland has also partnered with Greenpeace, who provided expertise and evidence about plastic pollution, and acts as a critical friend. Greenpeace’s executive director John Sauven describes #TooCoolforPlastic as a ‘bold pledge’, adding: ‘It’s now up to other retailers and food producers to respond to that challenge. The tidal wave of plastic pollution will only start to recede when they turn off the tap. They know the scale of systemic change we need, and yet their responses have been timid and piecemeal. Iceland has offered a more radical solution that shows the way forward for the sector.’
The NGO sent a petition to more than one million supporters calling for other supermarkets to follow suit, and last November in a joint report with the Environmental Investigation Agency, Greenpeace ranked Iceland’s plastic policy the best of the UK’s leading supermarkets. Sainsbury’s came in at tenth place in the report, which claimed supermarkets have more than 59 billion pieces of single-use plastic passing through their stores every year.
But, not content with campaigning on plastic, last April Iceland announced that it would remove palm oil from its own label food by the end of the year without increasing prices for customers. The initiative was prompted by a visit to West Kalimantan in Borneo where Richard Walker saw first-hand the damage that the palm oil industry is wreaking on the rainforest. The announcement resonated with shoppers: a survey of 50,000 customers found 85 per cent did not want palm oil in their products.
‘We knew it would be difficult but that it was achievable,’ says Berg, who had started talking to suppliers about the issue more than two years previously. ‘When it comes to palm oil, again everybody tells you it’s impossible but we decided to do something about it,’ says Hann.
Unlike the #TooCoolforPlastic initiative which is trying to jolt the industry into action, however, this is more of a solo project. Iceland is keen to promote debate around the issue but is not expecting other supermarkets to follow its lead. The starting point in eradicating palm oil from products, according to Berg, is to consider how they used to be made. ‘Most products were already there before we started using palm oil, which was cheap and easy to use in production processes,’ she explains. ‘But they were made with different things. We have found that palm oil replacements tend to be rapeseed and sunflower oil. The first question we have asked is how people would make these items at home. Nobody uses palm oil in their home. They would more naturally use butter in pastry, for example.’
Iceland’s in-house development chef Neil Nugent, who works in a £2 million state-of-the-art kitchen, has been responsible for reconfiguring recipes to remove palm oil. The recipe for mince pies, for example, dates back centuries, and it is only in the past 20 years that palm oil was introduced into the mix. It was not found, as might have been expected, in the pastry but instead lurked in the suet that made up the mincemeat.
The first question we have asked is how people would make these items at home; nobody uses palm oil
Historically, mincemeat must include 2.5 per cent fat so Nugent played around with the recipe and found, rather surprisingly, that a mixture of rapeseed oil and rice flour had the same impact as palm oil. So successful was his recipe that last year, in one of the most unusual collaborations of recent years, Selfridges stocked Iceland’s palm oil free mince pies. They sold out. (The department store has also committed to go palm oil free by the end of 2019, and saw the association as accelerating its progress.)
But the initiative has not been without its critics, who argue that banning palm oil simply passes the environmental burden to another crop, such as sunflowers. ‘They are making a valid point,’ says Berg. ‘But it is about being thoughtful about where you source your produce.’
There was also criticism earlier this year when it emerged that several Iceland products still contained palm oil. Berg explains: ‘We stopped manufacturing with palm oil during December, but there are a handful of products in store at the moment, with long shelf lives, and they are just selling through. From 31 December, we no longer use palm oil in the manufacturing process and most of our own label products in store are new recipes ones.’
Where items previously included palm oil, the packaging now carries a No Palm Oil flash. Of 911 own label products, just 32 – or three per cent – failed to meet the deadline. Richard Walker explained: ‘It’s not just a matter of replacing one ingredient with another. In many cases, suppliers have had to invest – with our support – to change their whole production process.’
In some cases, this proved impossible, leading Iceland to seek new suppliers. Similarly, there are 15 chilled products where, on investigation, it has emerged that it would be impossible to replace palm oil without a massive impact on costs.
One third of the population love us. One third loathe us
Iceland is privately-owned, which Hann concedes is an advantage when it comes to taking a stand. ‘We don’t have shareholders to report to. We are funding this with our own money.’ The company set aside £5 million to remove palm oil from its own brand products. | January/February 2019 1
Berg adds that the business is also ‘able to innovate and be agile’, adding: ‘We are big enough to make a huge difference and small enough to be agile. Others find that they are in more unwieldy organisations.’ But culture also plays a role. ‘We have a JGDI (or JFDI) – Just go and do it – culture. The speed of decision making is extraordinary. If you have a great idea, you could have a chat about it at 9am, by 11am the Board will have discussed it and by 1pm you’ll have the budget,’ says Berg.
However, Iceland’s ground-breaking strategies have not found unanimous favour, with one tabloid columnist claiming that, despite such well-meaning intentions, she could never bring herself to shop in the supermarket. ‘One third of the population love us,’ explains Hann. ‘One third loathe us. The reasons for loathing us do not always relate to the brand experience; we got a bad reputation for using [former Atomic Kitten singer and reality star] Kerry Katona in our adverts.’
Fresh from winning I’m a Celebrity, Get me out of here in 2004, the mother of four was recruited as the face of advertising campaign That’s why mums go to Iceland. Katona was fired five years later, following a series of high-profile personal problems, including bankruptcy and the publication of images of her allegedly snorting cocaine.
‘The adverts delivered five consecutive years of double-digit growth,’ says Hann. ‘I don’t question that they were the right thing to do at the time, but in the long-run [the association] may have been damaging to the brand.’ Iceland has since abandoned celebrity endorsements, preferring instead to use real-life customers in its adverts.
It is also refitting its stores. It started with Clapham in South London more than three years ago, where Iceland redesigned an existing store, introducing more extensive fresh produce and wine ranges as well as new luxury products, such as whole Dover Sole and Wagyu beef, in order to compete against a Little Waitrose next door.
Sales doubled, while the store attracted customers who would previously not have shopped at Iceland. Today, around one in five Iceland customers is categorised as A and B socio economic status (upper and middle class), while it has been named Britain’s top supermarket for customer satisfaction for the past two years, scoring highly for transparency and caring for customers. It has also ranked among the Best Big Companies to Work For in the UK in each of the past 13 years, which coincides with Malcolm Walker’s return to run the business (after an ill-fated attempt to retire and bring in new management).
‘There is a strong moral compass in this company, which is perhaps not perceived by the public,’ says Berg. ‘The people who run the businesses are very hands on, they literally are all at the end of the corridor. Corporate hierarchy doesn’t exist here. There is a family atmosphere here.’
‘The best publicity we can have now is word of mouth,’ says Hann. ‘We have learned that personal recommendations are the ideal way to grow the business.’ Consumers used to perceive Iceland as poor on sustainability issues. ‘We have now shot to the top of the list,’ he adds. ‘If brand perception improves, it will help to boost sales.’