Oxfam Unwrapped: Cutting Carbon, Delivering Income

This case study has been written to document the sourcing of the Unwrapped catalogue from 2007-08 in line with Oxfam GB ethical and environmental policies, whilst delivering maximum income for our programme. It celebrates the success of purchasers working with staff, external organisations and the supplier, and identifies learning.

Background and business issue
Oxfam GB adopted an Ethical Purchasing Policy in 1997, in order to ensure our purchasing supports our mission to overcome poverty and suffering, and that we 'practise what we preach' in our campaigning. The policy incorporates the labour standards formulation of the Ethical Trading Initiative Base Code and some general environmental standards; implementation is led by an Ethical Purchasing Manager.

In the last five years there has also been a corporate drive to reduce Oxfam's carbon footprint, led by an Environmental Manager working with the Ethical Purchasing Manager and purchasing staff. Click here to see details of Oxfam's policies. For information on our approach and targets for 07-10 see the Oxfam Accountability Report 2006/07.

This case study documents an initiative from July 2007 onwards to source the Oxfam Unwrapped catalogue in line with these policies. Oxfam's published carbon footprint for 06-07 found printed materials for communications and fundraising to be the second largest contributor (16%) after property-related emissions (51%). 421 tons of paper had been used in publishing the 2006 catalogue. Involvement with Waste & Resources Action Programme (WRAP) had also brought to light the environmental harm caused by polythene wrapping and the benefits of sourcing recycled paper made from post consumer waste.

Objectives and anticipated benefits 
Unwrapped is the highly successful fundraising scheme whereby people buy eg a goat or latrine as a gift, but the gift is delivered to a local community in a developing country. Following the income generating success of the 2006 Unwrapped catalogue, objectives were agreed that the 2007 catalogue should be both commercially successful and sourced in line with ethical and environmental policies.

Supporter Marketing was the client department working with Print, Production and Resource Management, which in January 2009 became the Central Purchasing and Print department. 
Anticipated benefits were a reduction in carbon footprint from printed materials and a maximisation of income from Unwrapped, as well as a raising of standards in the supply market. More broadly, protection of Oxfam's brand and mission, especially in light of the organisation's increasingly vocal campaigns on climate change and poverty.

Implementation approach taken
In July 2007 tenders were invited for suppliers to work with Oxfam to deliver the Christmas 07 Unwrapped catalogue. Purchasers sought to get on board a supplier with a good all-round approach. Suppliers were pre-assessed for compliance and willingness to comply with Oxfam's Ethical Purchasing Policy before being invited to tender, then a range of criteria was used to assess bids as follows:-

• Price 35%
• Delivery, capacity, lead times and account management 30%
• Quality, production and technical systems 15%
• Environment 10%
• Ethical (labour, but see above re pre-assessment) 10%.

The successful preferred supplier was John Blackburn, a UK company that had supplied Oxfam for over ten years and had been through an ethical assessment process previously. The supplier had come out 'low ethical risk' based on their completed Oxfam GB Supplier Questionnaire, had joined the SEDEX on-line database to give Oxfam visibility of supply chain standards, and committed to an ethical audit and addressing issues that may arise from it. SEDEX is the Supplier Ethical Data Exchange.

The Oxfam team started looking at alternative types of poly wrap and took advice from compostable packaging specialists and the British Plastics Federation. They found that an alternative marketed as biodegradable was not what consumers understood by the term as it required an industrial catalyst or sunlight to break it down. An alternative made from corn starch cost was much more expensive and had other issues and recyclable poly-wrap was not collected by many kerbside schemes, so the team turned to alternatives to using polywrap of any kind.

Putting the catalogue into an envelope was not cost effective, so purchasers worked with the supplier to adapt a format known as Optipost, a self-enclosed paper product that was used for direct mail leaflets but had never been used with a magazine product before. After the tender was awarded, the supplier decided to invest in new machinery so they could manage the whole process in-house.

Efforts were also made to make it easier for consumers to 'get' the Unwrapped concept at first glance, to target people more accurately to minimise wastage and to make more use of the website.

Paper was bought in volume on an Office of Government Commerce (OGC) contract with highly competitive prices. This made it feasible for Oxfam to afford 100% post consumer waste paper and still achieve a small saving. A secondary benefit was that OGC provided verifiable figures on quantities bought that helped calculate the carbon footprint and report to the WWF-UK Forest & Trade Network against our agreed target to increase the amount of post consumer waste recycled materials. By WRAP's calculation (using a lifecycle analysis calculation that includes avoidance of landfill) every ton of post consumer waste paper used reduces CO2 emissions by 1.32 more tonnes than if sourced from virgin forests.

1.8 million catalogues were produced and distributed in 2007 at a cost of about £1m including postage, generating an exceptionally high return on investment for Oxfam. Further work was done for the Winter 08 catalogue on reducing the size to a standard C5 format which, without compromising product quality, used less ink and paper, reduced wastage and cost less in postage (using Royal Mail's new 'pricing in proportion'). It had not been possible to personalise an inside front cover before, but through innovation and problem solving this was also achieved.


Benefits realised
The number of printed materials distributed in 2006, 2007 and 2008 remained roughly the same, whilst the tonnage of paper used reduced from 421 in 2006 to 289 in 2007 to 150 in 2008. This contributed to an overall reduction of 37% in Oxfam's paper use between 2007 and 2008, demonstrating our commitment to responsible procurement, as well as delivering real cost savings that maximised income to Oxfam (£3 million in 2008).

The supplier has since used the Optipost technology to supply at least one other large charity.

Investment required
Significant time was spent on innovation and problem solving by Oxfam staff, and by the supplier, and direct investment was made by the supplier in new equipment.

More broadly investment was made by Oxfam in recruiting to the roles of Ethical Purchasing Manager and Environment Manager, gaining buy-in across senior management, training procurement staff, participating in external initiatives including the Ethical Trading Initiative, SEDEX and WWF Forest and Trade Network, and producing Oxfam's first Accountability Report in 2007.

Challenges experienced
Within Oxfam there are varying levels of commitment to achieving the wider ethical and environmental standards. The purchasers concerned had training and job profiles that incorporated these responsibilities, whereas for some stakeholders the business objective (income for Oxfam) was their primary focus. It was a challenge to assimilate and balance these competing priorities.

There was a specific challenge with sourcing the magnets which were given to customers as an 'involver', a tangible token of the gift they had bought. Sourcing the magnets was a logistical, as well as ethical and environmental challenge. Forecasting the right number of 50 different products was difficult, and 2.5 million magnets remained in stock after the 2007 mail-out. Their metal content meant they would be environmentally harmful to send to landfill. They also introduced an ethical risk as although the magnets could be printed and cut in the UK the sheets of magnetic material came from China, which meant working with the Scottish supplier on an ethical audit of the factory, and agreeing and managing a corrective action plan to ensure good working conditions.

The purchasers eventually arranged for 80% of the over-ordered magnets to be restamped with new images for the following year's catalogue, and the rest were sent for recycling.

Lessons learned and top tips

• Successful implementation of sustainable procurement requires internal champions who are aware of best practice, top management buy-in, and embedding of tools and processes in purchasing ways of working.
• Ensure the whole internal team has ownership of objectives at the outset including both business and wider organisational objectives. The internal client needs to assess ethical and environmental risks at an early stage.
• The organisational culture needs to include respect for other people's roles and letting them 'get on', whilst also respecting a degree of challenge.
• As well as purchasing experience, purchasers need technical knowledge about production and distribution and awareness of labour and environmental standards in the industry.
• Use an open brief to the supply market ie a performance rather than conformance specification, pre-assess potential suppliers before inviting to tender, and incorporate ethical, environmental and innovation criteria into supplier selection and management.
• Choose a supplier with whom you have good commercial leverage and a trusted relationship, who will work collaboratively to solve problems and sees the business benefits of innovating.

For more information contact Rachel Wilshaw, Ethical Trade Manager, rwilshaw@oxfam.org.uk