contents 1. 2018 in review 2. about this report 3. sustainable sourcing of coffee 4. sustainable sourcing of other products 5. reducing our environmental impact 6. investing in our people 7. engaging with our community 8. governance, monitoring and learning p2 p4 p6 p18 p24 p32 p38 p44
• banana trees intercropped with coffee at the capucas cooperative, honduras reduction in our carbon footprint in real terms. in respect of people we have achieved our pledge to offer work experience to young people equivalent to 2% of our workforce. putting sustainability at the heart of our product development has meant that we’ve been able to make additions to the espresso warehouse catalogue to offer our customers more sustainable products and options. for example, the launch of minor figures oat milk, and vegware paper cups which are made from plants, not plastic, and are suitable for commercial composting. and who partners to make great strides a huge thank-you again to all our customers, employees have helped us this year. we are looking forward to continuing to stretch ourselves, ensuring we keep innovating and working collaboratively to progress towards our five year plan. ewan reid managing director at matthew algie 2018 in review building on our longstanding commitment to sustainability, we launched our five year plan in 2017. since then, we have really started to see the benefit of embedding our annual cycle of monitoring, reporting and most importantly learning, into our strategic way of working. our results for 2018 are testament to the impact of our activities across our five pillars from coffee sourcing through to engaging with our community. joined up the conclusion of our supply chain sustainability programmes is an in uganda and peru 3 sustainability report individual opportunity for reflection and learning, as well as for celebrating the massive efforts that have been undertaken by farmers and their broader coffee communities. these are relationships that i am personally very passionate about investing in for the future, because these producer groups have the capability to produce excellent quality coffees while adapting to what we now accept to be the climate crisis. it’s fantastic to have reached some key milestones outside of coffee sourcing as well. we are thrilled to have attained carbon neutral status through a new offsetting partnership backed up with a like for like 1
sustainability report 4
about this report where we’ve come from… where we are now… where we’d like to be… this report reviews the progress made in 2018, two years into our five year plan. for each strategic pillar we have included an update on progress against our goals as well as some case studies to highlight the areas where we have had the biggest impact and what we have learnt along the way. a review of the specific goals that we would like to achieve between 2017- 2021 are at the start of each chapter. at the end of the report we give an overview of our governance structure and chosen methodology for monitoring, evaluating and learning. our five year sustainability plan was launched internally at the start of 2017. the plan was a couple of years in the making and our thoughtful approach to developing these goals in alignment with the sustainable development goals is detailed first sustainability report, published in 2018. furthermore, the intention with our first report was to bring to life our longstanding commitment to sustainability, spanning the five strategic pillars of our approach. in our our five strategic pillars 1 2 3 4 5 sustainable sourcing sustainable sourcing of environment our people community of coffee other products treatment & end relationships with stakeholders along the cof- fee supply chain. this focuses on ensuring environmental, social and economical sustainability. delivering consistency in our reducing our environmental approach to sustainable sourcing across espresso warehouse, machines and internal products. impact. ensuring matthew algie is a great place to work & that we invest in our employees. fulfilling our social responsibility by engaging with our community. 5 sustainability report 2
sustainability report 6
• female coffee farmers from the ejo heza women’s group in rwanda sustainable sourcing of coffee3 trading environment coffee farmers have faced a particularly challenging in 2018, with coffee prices on the arabica futures market falling to their lowest levels for 12 years. this fall in coffee prices to below $1 per pound has led to pleas from coffee producers worldwide for fairer trade terms and warnings that the price received by many will be below their cost of production. even if prices recover quickly, this downturn will inevitably have wider repercussions in 2019 and beyond as farmers have less capital for investment in their farms and some will have even turned their back on coffee production altogether. included key milestones during 2018 have completing our programmes with the san juan del oro cooperative in peru and meacce cooperative in uganda. partnerships like this are intended to help the most vulnerable producer groups in our supply chain to become more resilient. as detailed in the following case studies, both programmes have been a great opportunity for learning as well as having a positive impact. this price crisis, as well as hearing first-hand from our producer partners the impact that this is having on their members, has reaffirmed our commitment to championing certifications. through purchasing fairtrade and organic certified coffee we not only pay the fairtrade minimum price ($1.40/lb) and the fairtrade and organic premiums ($0.50/ lb), but also an additional premium to reflect the quality. in the current climate, this guarantees our certified producer partners receive a much higher price for their coffee than those bought purely against the futures market. in total, 95% of the coffee we contracted during 2018 held at least one certification, equating to £1,454,129 paid in certification premiums. 7 sustainability report
sustainability report 8
2017-2021 goals: our progress in 2018 theme consolidate our supply base 2017-2021 goals progress 2018 1. increase proportion of coffee purchased from “core” and “developing” suppliers by 5% (target: 78%) 1. 79% volume contracted from “core” & “developing” suppliers. 2. provide “core” suppliers with volume commitments prior to commencement of the next harvest season. 2. 60 % of “core” suppliers had contracts confirmed prior to the season commencing 3. proactively support suppliers to transition 3. 2 additional suppliers categorised as “core” from “developing” to “core”. theme achieve mutual benefits 2017-2021 goals progress 2018 through collaboration 1. partner on 3 new projects at origin with selected “core” and “developing” cooperatives. 1. 2 of 3 new projects underway. in total, four projects in bolivia, rwanda, uganda and peru are ongoing. 3 4 2 1 9 sustainability report
theme 2017-2021 goals progress 2018 champion certifications 1. more than 90% of coffee purchased 1. 95.2% of coffee held at least one certification consistently has at least one certification. 2. continue progression towards 100% rainforest 2. progression is on track. on average our ra alliance (ra) certified coffee in ra matthew algie blends. certified blends contained 69% certified beans. coinciding with the transition plan, some blends already have 100% ra beans whilst others are currently at 50%. all blends comply with the 30% minimum content and labelling requirements. 95.2% of coffee held at least one certification theme improve knowledge sharing & understanding 2017-2021 goals progress 2018 1. visit 100% of “core” producer partners and 1. 50% of “core” and 23% of “developing” suppliers visited 50% of “developing” suppliers to date. we visited the meacce, kopakama, san juan del oro, capucas, cocafelol & coagricsal cooperatives in 2018. 2. increase our supplier’s understanding of our 2. in 2018, we sent 3 supplier newsletters and hosted 2 priorities & requirements, the uk coffee market & end consumer, and, the other suppliers we choose to work with. cooperatives in the uk and ireland (mzuzu cooperative from malawi and the coagricsal cooperative from honduras). 3. 100% of coffee containers contracted must 3. complete – full implementation on all contracts. meet our traceability code of practice. 4. embed our approach and information 4. in 2018, we completed an extensive review of our requirements when sourcing microlots for our hand-roasted range. existing product range. as a result, we have decided to make some changes to our microlots and hand-roasted range which will be implemented in 2019. the new approach will ensure quality and sustainability are still at the forefront of every purchase. sustainability report 10
• coffee picking at the san juan del oro cooperative, peru 3.1 coffee & collaboration: a success story from peru in our 2017 sustainability report, we highlighted our pilot collaboration with the san juan del oro coffee cooperative in southern peru. this award-winning project assisted producers in becoming more resilient to the impacts of climate change that they were so keenly feeling. encouraged by the progress made, we were eager to use this programme as a launchpad for further work with san juan del oro. to that end, between 2015 and 2018 we partnered in a multi-stakeholder programme alongside uk retailer marks & spencer; coffee roasters taylors of harrogate and ngo and not-for profit trader, twin. this alliance sought to address a number of issues impacting smallholder coffee communities at 11 sustainability report the san juan del oro & pangoa cooperatives. hazel culley, senior food sustainable product and raw material manager at marks and spencer said: “ what i like most about this project is that it hasn’t tackled one particular issue in isolation. it’s looked at women’s economic empowerment, climate change and the issue of youth empowerment together.” “
the result? in july 2018, we travelled to san juan del oro to understand whether addressing these interrelated issues together had yielded sustainable, long-term results which would benefit all parties involved. sustainable farming through training in new farming techniques, producers are now generating their own organic compost and fertilisers. their improved practices have seen a dramatic 56.8% increase in yields - from an average of 10.5qq/ha to an average of 15.9qq/ha. cupping scores have also improved, with the san juan del oro cooperative recording consistent cup scores of 80 points and above. youth engagement over 450 young people across both cooperatives have been trained via workshops such as barista training, cupping, cacao processing, leadership, farm management and the coffee value chain. this has led to an increased number of young people becoming members of the cooperatives, from an average of 8% to 20%. gender equality following the gals (gender action learning system) training, 94% of participants said that it has had a direct impact on gender roles and dynamics within their households. they reported the biggest impacts to be that more responsibilities are shared, there’s increased decision making by women, and even greater ‘tranquillity’ at home. both cooperatives have also witnessed an increase in female membership and the number of women in leadership positions grew from 3 to 31. the programme has seen improvements across all three themes – with coffee yields increasing by 56.8%, the number of women in leadership positions growing from 3 to 31 and number of young people becoming cooperative members rising from 8% to 20%. • coffee farm at the san juan del oro cooperative, peru sustainability report 12
award wins we are thrilled that the programme has been awarded the community impact award at the business charity awards, and the international aid and development award at the charity awards. a true testament to the hard work of our partners in peru and the impact that the programme has had for coffee farmers. • vegetable garden at coffee farming household in pangoa cooperative, peru 13 sustainability report full details of the project, including video footage and our project report, can be accessed here: www.twin.org.uk/projects-partnerships/m-and-s-matthew-algie-taylors/
• launch of peru single origin in m&s cafes launch of single origin in m&s cafes back in the uk, one of the really exciting project outcomes has been the opportunity to showcase the coffee from san juan del oro through the launch of a single origin product in m&s cafes. available as both a guest espresso and as retail packs for customers to take away, the coffee from san juan del oro has proven a real favourite with consumers. what have we learnt? our key take-away lessons from this programme are as follows: participatory, open, programme design and delivery was critical to its success. a holistic project focussing on a range of topics has built the overall resilience of farmers. a sustained focus on sustainable production practices has increased yields and coffee farm profitability. we are replicating this approach with one of our other suppliers in bolivia, the asocafe cooperative, and seeing similar results. changing perceptions and traditional attitudes around gender and youth takes time. a pre-competitive collaboration incorporating all value chain actors brought different perspectives and enabled increased project investment. sustainability report 14
relationships with suppliers: interview with mateo quispe 3.2 estelle macgilp, our green coffee buyer, interviewed mateo quispe, general manager at the san juan del oro cooperative to find out more about the impact of our trading partnership. when did you start working and why? in coffee my family has always been connected with coffee and so since i was a kid i have been interested in coffee. in university i started to understand about transforming food production and i got as much experience working in coffee as i could. i started working with the cooperative since 2002 until 2014, and then again from 2016 until now. in the gap i was working on other projects in the area but still in coffee and cacao. tell us a bit about the san juan del oro cooperative? san juan del oro is the only cooperative in peru that has a long history. in 1956 farmers were organised into a coffee association and in 1961 we formed a cooperative, meaning we can call ourselves the first cooperative in peru! in 1994, we started organic production and in 1998 we gained fairtrade certification. matthew algie has been to visit us various times and know the reality. you know that our work at san juan del oro is a very different type of work and we are in a region which is extremely complicated to access. we are located in the high jungle and also near the equator and this means that there are many microclimates - from one valley to the next 15 sustainability report there are varying temperatures. this means that the cup quality is extraordinary. we started exporting speciality coffee in 2008. think have been what do the biggest successes or milestones for san juan del oro in your time as general manager? the first successes were in developing trust between the cooperative and the producers. then improving the financial stability of the company, and establishing the direct relationships with our customers. it has also been a great success to maintain our certifications – fairtrade, organic, rainforest alliance. there was a time when we found it difficult to meet the organic standards because we weren’t as well organised as a group, but now we are very clear on what we need to do and we have the right people in place to help farmers to meet the requirements. the certifications have helped us to have more transparency, to be much clearer with clients and our members. now transparency is one of our top priorities. how have farmers at san juan del oro been affected by climate change? the coffee leaf rust outbreak was a big problem for us. we had a unique quality but it started to decrease - it decreased a lot! the social impact after the coffee leaf rust was also really strong. as it is custom here, men left to go to the mines or the coast, to bring money back to sustain their families here in the coffee lands.
• mateo quispe introducing amy oroko, sustainability manager at matthew algie, to cooperative member at san juan del oro, peru • mateo quispe, general manager of the san juan del oro cooperative how would you describe san juan del oro’s relationship with matthew algie? the relationship is not something i see as purely business or economic relationship, it is beyond that – it is something we feel sentimental about, it gives us a good feeling. matthew algie is the only client that we have been selling to since 1999 and they have been here for us in many ways. they have helped us to keep going, creating a financially stable business, helping us through the worst times, giving us jobs and extra business and contracts. it brings us a sustainable partnership and we feel as coffee producers and exporters that we have a partner in another part of the world. they have created that sensation that we have an ally and a part of their hearts in europe. there are now longer periods of very hot, dry weather, a change in temperature that prolongs the harvest. this affects the farmer in the way that they have to invest a lot more time now into the coffee. now they are having to be there about four months, sometimes even five for the harvest whereas before it was between two and three months. and so they have more expenses. how has the project with twin, m&s, pangoa and taylor’s had an impact in the community? the impact of the project is considered one of the biggest successes in the region – i was even asked to present on the project and talk about the impact with the local government. the project was very important in providing technological innovation and educating producers. it has helped producers to have a thriving farm, producing more and better beans. we now have consistently extraordinary quality coffee and we will never go below this standard. the understanding from the project is spreading through the puno region – for example, all of the ngos, projects, local governments are now talking about liquid fertilisers and their applications and we are really proud of this. we want to share the knowledge from the project with many coffee farmers in peru. sustainability report 16
3.3 the establishment of the meacce cooperative has given the 1,674 farmer members access to international markets on fairtrade terms, as well as a premium price for quality. uganda: learnings from mount elgon our partnership project with our supplier, the meacce cooperative, had its fair share of challenges over the three years of the programme. meacce’s predecessor, the gumutindo cooperative unfortunately went through financial collapse in 2016. this left farmers with no route to market besides local traders or multinationals. the challenge then, was how to set up a new cooperative structure at pace that would be more financially resilient and would be able to re-engage farmers - even with the gumutindo legacy fresh in their minds. ourselves and our trading partner, twin, knew that we would, in all likelihood, lose our trading relationship with farmers that we had been supporting here, if we were not able to proactively help with the establishment of a new cooperative. our investment, combined with grant funding from comic relief, was used to give support in the formation of meacce. - developing good governance practices and re-certification. • view looking down the mountain from the slopes of mount elgon, uganda • maria kirya at the ndokwe community washing station, mount elgon, uganda 17 sustainability report the result? we returned to mount elgon in eastern uganda in march 2018, keen to discover the impact that the programme has had for farmers amongst the changes in governance and complex local politics, but also to reflect on our own experience of working on a programme when things did not quite go to plan. the cooperative is undoubtedly still on a journey, but the great strides that have been made stand the organisation in good stead for future growth. meacce and their exporting partner, mountain harvest, have been working with 1,674 farmers on the mountain and exported 7 containers of coffee in their first season. achieving these sales in the first year was essential for maintaining existing relationships with buyers such as ourselves, but also for re-engaging farmers and covering the organisation’s overheads to ensure the cooperative was not dependent on donor support. farmers here are, from technical expertise and assistance, an incentive for improved quality (the highest price on the mountain!) and increased value being brought back to the communities through certifications such as fairtrade. through meacce, benefiting meacce and mountain harvest have also put an emphasis quality, offering farmers the highest price on the mountain for coffee that has been carefully handpicked, sorted and processed to preserve quality. we’ve seen the impact of this approach in the cup here – our average cupping scores for gumutindo contracts in 2016 was 77.6, but our 2018 scores for meacce contracts have been consistently higher, increasing the average to 82.5 – officially the best coffee that’s ever been delivered to us from this region!
what have we learnt? the programme has been a really strong opportunity for learning. most importantly: it has proven that it is possible to work with a fledgling cooperative and inject programme funding to hasten its maturity. taking a longer view and looking at the three years as a whole, the programme has helped emphasize the need for thorough due diligence when working with producers facing really challenging local contexts. this is learning we’ve already taken forward when formulating new project partnerships, for example our current programme with one of our bolivian suppliers. it is possible to work with suppliers who are particularly vulnerable, recording the risks as they change over time and planning relevant mitigation actions. this is a new way of working for us which will help us to continue to partner with the groups in our supply chain who are most in need. there’s a real need for a joined-up approach between the sustainability and buying functions who sit within the private sector stakeholders involved in project partnerships. sustainability report 18
l e u g o a t a c e s u o h e r a w o s s e r p s e , e t t a l c i r e m r u t • sustainable sourcing of other products reflecting our commitment to sustainability in coffee, we are determined to offer customers products sustainability credentials in our espresso warehouse and machine ranges. our biggest milestones in 2018 included launching our vegware commercially compostable disposables, giving customers greater choice about how they tackle the challenges around single-use items. we also added squirrel sisters raw energy bars to our range as a healthier snack option and launched minor figures oat milk and nitro brew cans which have a lower environmental impact compared to their dairy- based counterparts. furthermore, we have been doing work behind the scenes to improve the way we risk assess suppliers and evaluate packaging options from a sustainability point of view. excellent with 2017-2021 goals: our progress in 2018 theme supplier management 2017-2021 goals progress 2018 1. implement formal method for supplier 1. risk assessment methodology updated. prioritisation and risk assessment based upon future business requirements and sustainability objectives. 19 sustainability report 4
theme giving more sustainable options theme packaging 2017-2021 goals progress 2018 1. review where there are opportunities for including healthier alternatives in our range. made with only natural ingredients and no added sugar. these are suitable for vegans, vegetarians, dairy and gluten free diets. 2. consider opportunities for offering customers a more environmentally sustainable alternative. 1. squirrel sisters raw energy bars launched. 2. minor figures oat milk and dairy-free nitro cold brew cans. non-dairy milk products such as oat milk are known to have a lower environmental impact, producing less emissions and using less land and water, than dairy milk. 2017-2021 goals progress 2018 1. seek opportunities to reduce packaging 1. reducing use of problem plastics. we launched paper straws and vegware commercially wherever possible and to transition away from non-recyclable packaging. compostable disposables. the material used for our suki tea pyramids were changed from nylon to a bioplastic derived from corn starch. 2. all changes to existing or new product packaging will be assessed from a carbon footprint and recyclability standpoint. 2. introduced “life cycle perspective” training for our purchasing and technical teams. carbon footprint of coffee laminate. we compared the carbon footprint of our coffee laminate to a reusable case to consider which option has the lowest overall footprint. theme human rights theme sustainable purchases for internal operations 2017-2021 goals progress 2018 1. share information with key suppliers on best 1. human rights policy launched. this document practice in the prevention of human rights abuses in their operations and supply chains. makes explicit our expectations for adherence to the ethical trading initiative base code. 2017-2021 goals progress 2018 1. all office-based employees use reusable 1. fully implemented in 2017. (instead of disposable) cups. 2. define sustainability criteria and guidelines for 2. this is done on a case by case basis. for example, purchases of products and services that we use internally. we introduced online payslips for employees, reducing unnecessary paper usage sustainability report 20
21 sustainability report
single-use: we all know the challenges, but let’s explore a plant-based solution! 4.1 l e u g o a t a c e s u o h e r a w o s s e r p s e , e r a w g e v m o r f s p u c r e p a p e b a t s o p m o c y l l l i a c r e m m o c • l e u g o a t a c e s u o h e r a w o s s e r p s e , e p p a r f d a e r b r e g n g i • for our customers, and in our previous report we highlighted our commitment to promoting reusable cups, internally both within our own operations. minimising the use of disposable cups is important from an environmental perspective, but we recognise that in many instances, it will not be practical to stop using paper cups, and other single-use items, completely. whilst recycling services for paper cups are growing in outreach in the uk, coverage is not nationwide, and we wanted to be able to offer customers catering disposables that did not use virgin plastic. with this in mind, we launched our vegware commercially compostable take-away cup in august 2018. vegware is an edinburgh based specialist in plant- based foodservice packaging. their catering disposables are made from plants using renewable, lower carbon, reclaimed or recycled materials. all their products – hot and cold drinks cups, lids and straws – can be placed in food waste bins in locations where this waste is destined for commercial composting. the materials have been tested and proven that in the right conditions this waste becomes nutrient-rich compost in under 12 weeks, helping to nourish soil and grow new plants. the part of our partnership with vegware that we believe makes it a true success, is the support that we’re able to jointly offer customers to them to integrate compostables into their business. navigating the confusing world of waste infrastructure in the uk can be a little overwhelming, but we are on hand to discuss the options available to individual customers – for example they might be in a region where commercial composting of food waste is widely available or be able to access composting via vegware’s close the loop service. we find that some customers are keen to use vegware’s products even where they can’t currently access commercial composting. in doing so, foodservice businesses can actively drive change in uk recycling. the more compostables there are in use, the more the waste sector will be encouraged to extend collections uk wide. a significant proportion of our paper cup sales have transitioned over to vegware, and we’re hoping to see this trend continue. sustainability report 22
• minor figures dairy-free oat m*lk, espresso warehouse catalogue 4.2 a delicious dairy-free milk veganism is a growing trend in the uk and further afield with many consumers, not only those who are lactose intolerant, choosing to cut out or reduce the amount of meat and dairy in their diet. many of these consumers have chosen to do so to reduce the impact their diet has on the environment. it’s estimated that food production is responsible for a quarter of all human-produced greenhouse gas emissions and most of these emissions are from meat and other animal products.** we started working with minor figures in 2018, offering their oat milk to customers via our espresso warehouse range. oat milk is a fantastic dairy alternative for baristas and has a lower environmental impact than dairy milk in terms of carbon emissions, land use and water use. demonstrating demand for this type of product, we sold more than 240,000 litres of oat milk in 2018. we also launched a range of nitro cold brew cans which tap into this rising new trend and use the oat milk as a base. 23 sustainability report ** poore and nemecek (2018) “reducing food’s environmental impacts through producers and consumers” published by the university of oxford.
• brown bag crisps have a post-back service for recycling their packaging, espresso warehouse catalogue 4.3 brown bag crisps get recycling crisp packets have long been a it comes to problem material when recyclability. mounting public pressure on walkers crisps, one of the most widely recognised crisp brands in the uk, led to development of a nationwide recycling scheme, managed by the waste handler, terracycle. this means that everyone who enjoys our brown bag crisps or portlebay popcorn has the option to recycle the empty packets at a local recycling point. brown bag crisps has gone one step further, setting up a freepost address for customers to send back empty bags to them for recycling on their behalf. it’s a great step more information on in the right direction! for visit: scheme, the www.teracycle.com sustainability report 24
reducing our environmental impact 5 progress in this area has been challenging in and office space to support business growth 2018, with our expansion into a new warehouse impacting our gas and electricity usage more than we had anticipated. nevertheless, we are really proud to be able to say that our glasgow roastery is now zero waste to landfill through a partnership with our waste contractor who sends all of our non-recyclable waste to be processed for energy generation. we are excited to say it’s the first year that we have achieved net zero emissions through carbon offsetting. 2017-2021 goals: our progress in 2018 theme environmental management system 2017-2021 goals progress 2018 1. maintain iso 14001 certified environmental 1. recertification achieved. management system 2. 2 representatives completed green champions 2. train environment committee so that they are equipped and empowered to be ambassadors for change training from resource efficient scotland. 3 representatives took completed our new internal training module on “life cycle perspective”. 4 representatives took part in a love food hate waste workshop. 25 sustainability report
theme reduce waste 2017-2021 goals progress 2018 1. reduce percentage of waste to landfill to less than 1% of total waste 2. reduce total waste per tonne of roasted coffee by 5%. 1. our waste contractor no longer sends any residual waste to landfill – all our non-recyclable waste goes to energy from waste processing. 2. 3% increase in waste generated per tonne of coffee from 2016 baseline. we have seen an increase in waste materials such as cardboard from other parts of the business that are not directly related to coffee processing. theme 2017-2021 goals progress 2018 reduce energy consumption 1. reduce our net carbon dioxide emissions per 1. we have achieved net zero emissions through our tonne of coffee roasted by 10% offsetting partnership with one carbon world! 2. no increase in our absolute electricity usage 2. 5% increase in electricity usage compared to 2016 baseline. so far, the efficiencies made at our main site have not fully compensated for the usage at our new warehouse and office space, however, we see a promising trend here. 3. increase the fuel efficiency of journeys 3. 27% increase in gas usage per tonne of roasted driven by field staff by 10% coffee from 2016 baseline. the increase has been primarily driven by space heating. similar to the electricity indicator, it has been significantly impacted by the establishment of our new warehouse and office space which has increased our square footage by 31%. theme inspire behaviour change 2017-2021 goals progress 2018 1. at least one employee engagement campaign 1. completed in november. all employees received per year which reaches 100% of employees campaign emails. 107 employees actively participated in the activities and competitions. sustainability report 26 we are now a zero waste to landfill site! theme reduce water usage 2017-2021 goals 1. reduce the amount of non-production water used per £1,000 of company turnover by 5% progress 2018 1. 2018 was our baseline year for this indicator because previously we had been unable to measure water usage at all of our sites. we now have comprehensive data for all our glasgow-based offices, warehouses and production area.
carbon neutral gold standard we know that climate change is having a damaging impact on global coffee production with drastic consequences for our producer partners around the world. we therefore have every reason to take a proactive and holistic approach to mitigation and adaptation. reducing our footprint as far as possible is a key first step, but we are also committed to offsetting the remainder of our footprint through purchasing and retiring verified carbon credits. a carbon credit is a unit of one tonne of carbon dioxide equivalent (co2e) that has been reduced or sequestered via a project. we are delighted to be able to share that 2018 is the first year that we achieved carbon neutral status! working with one carbon world we have verified our carbon footprint methodology and results,and offset our emissions through purchasing certified credits from a tree planting 5.1 project in uruguay and wind energy project in india. not only do these programmes deliver our 2018 footprint s a r u d n o h n i e v i t a r e p o o c s a c u p a c , m r a f e e ff o c n o s e e r t e d a h s • carbon credits, they have been selected for their clear sustainable development benefits to the communities involved, such as job creation and supporting educational programmes. as part of our commitment to net zero emissions, we have joined the climate neutral now initiative. this scheme was launched by the un in 2015, aiming at encouraging and supporting all levels of society to take climate action to achieve a climate neutral world by mid- century, as enshrined in the paris agreement. 27 sustainability report our reporting methodology is based on the greenhouse gas protocol and we have categorised the emissions into three areas – scope 1, 2 and 3 – accordingly. the indirect, scope 3 emissions includes business travel, water consumption, waste, losses during electricity distribution, fuel consumption in vehicles and product distribution. the utility usage information currently relates to our main site roastery in glasgow as we do not have accurate data for our training premises in dublin or london. our carbon footprint for the 2018 calendar year was 2,275 tco2e showing an overall absolute increase in the emissions related to our operations of 4% from our baseline year of 2016. the findings tell us that, consistently there are four key areas that contribute over 85% of our carbon footprint – namely, fuel used in leased vehicles for field staff, gas use, electricity usage and product deliveries to customers. these findings reinforce our strategic prioritisation within our five year goals. we are disappointed to have seen a gradual increase in our absolute footprint over the last few years. the primary challenge has been that we have expanded and taken over a new premises in glasgow, increasing our square footage by 31%. comparing like for like and taking the emissions from the activity at this new building out of the footprint data, the carbon emissions in the other areas of the business have decreased by 1% since 2016.
a. 2018 carbon footptint by scope b. 2018 carbon footprint by source 12% 25% 63% 3% 9% 19% 2% 31% 24% 12% a. scope 1. direct emissions - gas (25%) scope 2. direct emissions electricity (12%) b. 1. field staff car journeys (31%) 2. electricity (12%) 3. gas (24%) scope 3. indirect emissions (63%) 1. deliveries to 2. coffee deliveries 3. plane travel (9%) customers (19%) (3%) other (2%) what have we learnt? firstly, big changes to our operations, including expansion of our warehouses and office areas, have a significant impact on our environmental footprint. we must challenge ourselves to take bigger steps in order to mitigate for the additional emissions as and when our operations change. secondly, leased vehicle fuel, gas and electricity, three of our largest sources of emissions, should always feature in our annual internal environmental key performance indicators. doing this will ensure our focus on these priority areas is consistent. sustainability report 28
focusing on fuel efficiency 5.2 starting to undertake our annual carbon footprinting exercise has really emphasised to us the importance of making the journeys undertaken by our field- based employees more efficient. one of the two metrics we have focused on is fuel efficiency – aiming to increase our fuel efficiency across the fleet by 10% over five years. since our baseline year of 2016, we have made improvements by raising awareness amongst field-based employees of the importance of improving fuel efficiency. we have started regularly communicating our performance, as well as providing employees with information on the simple measures they can take to improve their miles per gallon. we are really pleased to see the 9% increase in fuel efficiency, not far off our five year goal, but we are conscious that there is still more that we could be doing and we are currently looking at ways to further engage staff, as well as increasing the number of electric vehicles in our fleet. 29 sustainability report s a r u d n o h n i e v i t a r e p o o c s a c u p a c e h t r a e n k r a p l a n o i t a n e u q a e c l •
5.3 led lighting roll out one of the key investments we have made in 2018 to reduce our electricity consumption is replacing lighting in our main office areas with energy efficient led lights, as well as sensor controlled lighting where practical. the results have been really impressive, accounting for the consistently lower electricity usage at this building since quarter two of 2018. overall we have seen a reduction of 9% in electricity usage at this building since our 2016 baseline, helping to mitigate for some of the increases we have had to take on in other areas, for example in our expansion into the new warehouse and office space. the success of the initiative has led to a continuation of the roll out into other parts of our glasgow site in the hope of achieving our five year goal for no increase in absolute electricity usage. sustainability report 30
• russel, darren and stephen receive their free brita fill & go water bottles • liquidambar organic coffee farm, honduras staff engagement: understanding recycling 5.4 is our sustainability week annual campaign to engage staff on how they can live healthier lives in a way that preserves and cares for the environment. active participation in the week’s activities was especially high in 2018 because we organised a team challenge for glasgow- based staff, promoting better understanding of recycling and waste segregation. with problem materials such as single use cups and straws continuing to be in the media’s spotlight, and a renewed focus on some of the challenges in waste processing infrastructure in the uk, this was a brilliant opportunity to highlight best practice in waste segregation, both at home and at work, to employees. it also gave us a really good insight into employee’s level of understanding of good segregation practices and any variation throughout the business. all employees who took part in the challenge received a free fill & go active water bottle, provided through our relationship with brita. we hope this will incentivise these employees to use less single use water bottles, as well as encouraging them to stay hydrated! 31 sustainability report
sustainability report 32 book of coffee 32
investing in our people t he past couple of years has seen some changes in culture and leadership within our organisation, bringing renewed focus on making matthew algie a great place to work and enabling our people for success. we know we are still on a journey, but some important steps have been made in 2018 to better engage and listen to our employees, including introducing a monthly staff newsletter, making our employee forum meetings more regular and introducing departmental briefings for food production and logistics. furthermore, we are really pleased to see the completion of our lean management green belt training programme and to have achieved our pledge to offer work experience to young people equivalent to 2% of our workforce. 33 sustainability report n i l b u d , s r a b o s s e r p s e d n u o r g y b d e t s o h t n e v e ” r e m r a f e h t t e e m “ • 6
sustainability report 34
2017-2021 goals: our progress in 2018 theme 2017-2021 goals progress 2018 skills and employee development 1. achieve investors in people silver 1. currently at “accredited” level. we standard. 2. increase in number of roles filled internally to 20%. continue to work on our roadmap to silver. 2. 33% of vacancies were filled internally, continuing great work from 2017 where 29% were filled internally. 3. reduce the ratio of agency workers to fulltime staff to 1 in 50 employees. 3. 1 in 25 employees were on temporary contracts. this is relatively low for our sector, however, we aim to reduce it further in 2019. theme employee engagement 2017-2021 goals progress 2018 1. response rate to culture survey 1. 75% response rate to our culture survey. consistently over 80%. 2. meet industry benchmark for “employee engagement” in annual culture survey. 2. 79% average score for “employee engagement” = benchmark of 79%. this also marks an increase from 78% in 2017. 3. 100% of employee forum members 3. employee forum members have the skills have received the necessary training. they need to represent the workforce. 35 sustainability report
theme fair treatment and protection of human rights theme diversity and inclusion 2017-2021 goals progress 2018 2017-2021 goals progress 2018 1. percentage of staff logging employee 1. no formal grievances made. this is grievances at less than 1% per year. also a reduction from 2017 where 0.4% 1. offer work experience scheme for young people where uptake is equivalent to 2% of workforce. 1. 6 individuals, equating to 2.4% of workforce, offered experience through a youth employability scheme, apprenticeship or student placement. 2. report our gender pay gap on an annual 2. planned implementation in 2019. of staff logged grievances. 2. training delivered to managers basis. responsible for procurement and supply chain management. 2. supervisors and managers receive training on the prevention of modern slavery in the workplace. theme employee wellbeing 2017-2021 goals progress 2018 1. absenteeism due to sickness 1. 1.6% absenteeism due to sickness. this less than 3%. marks a decrease on 2.9% in 2017. 2. 12.5% of workforce take up cycle2work 2. cumulatively, 16.4% of employees have scheme. 3. promote healthier lifestyles through at least one targeted internal campaign per year. signed up to our cycle2work scheme, up from 15% in 2017. 3. our sustainability week campaign included wellbeing themes including the importance of keeping fit and cancer awareness. 16.5% of employees have signed up to our cycle2work scheme to date. 6 young people offered work experience and on the job training sustainability report 36
6.1 following this, a further 21 employees have been trained to green belt standard, including involvement in cross-functional teams tasked with designing business improvement projects. investing in this skills development has created a good platform for moving forward. we now feel equipped for managing an ongoing continuous improvement programme in a way that fits our business needs and strategic way of working. enhancing skills in lean management equipping employees with a better understanding of lean management has been a key priority for us over the last few years. we believe that by empowering our employees and encouraging a culture of continuous improvement we can make our operations as efficient as possible and give excellent value to our customers. recognising the value of expanding the reach of this training beyond the more traditional areas for lean application, the vast majority of employees undertook lean awareness training. business-wide engagement ...................................................................................................................................................... 2016 2017 2018 200 employees took part in lean awareness training 14 employees 7 employees completed green completed green belt training belt training 37 sustainability report it has been a pleasure to support matthew algie and their continuous improvement journey. key to the success of interaction with matthew algie is certainly the development of process and improvement activity however this has fundamentally been a product of the enabling culture of engagement and improvement, exemplified by leadership and staff alike. the willingness of the company to engage in staff development is matched by employee engagement to further develop skills, process and performance. the company is an excellent example of a company with a flexible approach to customer and market needs – continuously improving to service the needs of customer and consumers alike.” ~ ian collinson, regional lead practitioner at scottish manufacturing advisory service. “
expanding opportunities for young people 6.2 into employment in in our previous sustainability report we highlighted our passion for getting more young people the coffee industry through our barista training capabilities. opportunities for offering work experience to young people within our business has historically been quite difficult to facilitate but in 2018, we were able meet our pledge for offering work experience to the equivalent of 2% of our workforce. working with several partners we used different models to suit different departments – offering apprenticeships in our machine repair centre and it department and student placements in our technical and quality assurance department. out of the six individuals who took part in work experience, we have been able to employ three of them on a permanent basis so far. • caragh setting up a coffee tasting in the qa lab, matthew algie roastery caragh mcnamee first joined matthew algie as a placement student in 2018. since graduating she has taken up a full time position as development & process improvement technologist. she said about her placement: “ during my honours year at university i had the opportunity to complete a 12-week placement with matthew algie. this benefited me greatly as it provided me an insight into what a career in the food industry would be like, and i got to put my learning into action. this experience made me eager to take my first steps in my career as it was such a positive experience. i was provided with the opportunity to carry out a wide variety of tasks, and the staff were extremely welcoming and supportive.” sustainability report 38
engaging with our community our “coffee community” extends beyond glasgow and our own operations which is why our community strand reflects our commitment to making a positive difference within our different spheres of impact. we were pleased to be able to uphold our existing commitments to charitable partners in 2018, as well as running a fundraising campaign throughout the month of september to raise £1,870 for macmillan cancer support. it was also a great year for advocacy and engagement, with opportunities to speak at industry events to share our passion for fair terms of trade and getting young people into the food and drink sector. 39 sustainability report g n i t s a t e e ff o c a g n i t s o h s e e y o p m e e g a w e h t t a m l • i l 7
sustainability report 40
2017-2021 goals: our progress in 2018 theme 2017-2021 goals progress 2018 giving back to coffee communities 1. donate towards a community development project in coffee 1. we donated £10,000 towards construction of drying beds for members of the growing communities (not necessarily linked to our supply chain) cocasmil cooperative in honduras. every year. 2. provide consistent support to the david williamson rwanda 2. since 2017 we have donated £3,700 to the dwrf. foundation to achieve a total cumulative donation in excess of £9,000 3. promote fairer terms of trade for coffee farmers through advocacy 3. ewan reid, our managing director, was invited to speak at the scottish fair trade and knowledge sharing. nation lecture, scottish government’s cross-party group on fair trade and the fairtrade foundation’s “the future of trade – can it work for everyone?” industry event. theme positive customer influence 2017-2021 goals progress 2018 1. engage our customers in opportunities to make their operations more socially and environmentally sustainable. 1. we continue to take every opportunity to speak to customers about sustainability when they visit us in glasgow. in 2018, we increased our engagement with customers specifically on disposables and packaging in line with the vegware cups launch. theme 2017-2021 goals progress 2018 local community 1. support the prince and princess of wales hospice’s “brick by brick” 1. we donated £1,870 in 2018, helping the hospice reach it’s fundraising goal of appeal. £21m for the “brick by brick” appeal! 2. facilitate at least one fundraising activity or volunteering event per 2. as well as the big hospice hike fundraiser, we organised a 20 days of macmillan year for employees to take part in. campaign, raising £1,716 for macmillan in september. 3. provide coffee school training to those in need of employability 3. in partnership with hit hospitality academy and hub international our training skills. 4. encourage young people to consider a career in the food and drink industry. team have been busy delivering barista workshops for young unemployed people in england and scotland. 4. as well as our ongoing partnership with holyrood secondary school, amy oroko, our sustainability manager, was invited to speak at the food & drink federation scotland parliamentary reception – “my career in food and drink” – as part of scottish government’s “year of young people”. 41 sustainability report 5. seek out partnerships with research institutions to further public 5. we continue to look for new opportunities to collaborate on research understanding of best practice in sustainability. partnerships but we do not have any live programmes at present.
20 days of macmillan september takeover 7.1 though macmillan cancer support is not one of our official charity partners, many of our employees are passionate about the work of the charity and have organised an annual bake sale at our roastery in support of their world’s biggest coffee morning for many years. we decided to step our fundraising up a notch in 2018. a team of employees volunteered to organise a variety of fundraising events throughout the month of september. from a competitive tug of war, to leg waxing challenge, to jumble sale, to a raffle for an extra day of annual leave – there was something for everyone! our “20 days of macmillan” september takeover raised an amazing £1,716 for this great cause, which was rightly celebrated over coffee and cake at the coffee morning finale event. we donated over £15,400 to charitable initiatives in 2018 through our fundraising activities. • cal, saf and alan show-off their hair-free legs after taking part in the charity leg wax • michal, paul and nikki taking part in the fundraiser tug of war sustainability report 42
back to school we have a longstanding partnership with holyrood secondary school which is very close to our roastery on the south side of glasgow. we give presentations to the business studies pupils to provide them with an insight into how a local business operates, and in particular, our approach to sustainability. we usually select a different topic to highlight each year, helping students to understand a subject that is relevant to our current operations and priorities. focused our presentations on modern slavery prevention. this was a great opportunity to raise awareness of modern slavery amongst the pupils as well as demonstrating how legislation such as the modern slavery act (2015) can positively shape business activities and due diligence practices. in 2018, we 7.2 43 sustainability report . m o c h s a p n u l , s r e k c o l l o o h c s f o e r u t c p • i
7.3 big hospice hike contributes to £21m fundraising goal we are delighted to have supported the hospice in reaching its fundraising goal of £21m. achieving this fantastic milestone has funded their new purpose-built facility in the leafy surrounds of bellahouston park, helping the hospice to lead the way in palliative care in our local community. • view from ben lomond summit as part of the big hospice hike fundraiser the prince and princess of wales hospice has been our local charity partner for a number of years. as well as donating products in kind to keep their café well supplied with all the essentials, we have focused our fundraising efforts on raising money for their brick-by-brick appeal to fund their relocation to a brand new facility. employees have really rallied around the cause, raising over £8,300 for the campaign by taking part in our fundraising activities or sponsoring their colleagues. 2018 was no different, with six willing volunteers taking part in the big hospice hike, climbing ben lomond, scotland’s most southerly munro. the team were spurred on by the sunshine and clear views across loch lomond and the trossachs national park, only coming close to the clouds at the 974m lofty summit. sustainability report 44
u r e p , y e l l i a v a d n a s e h t n governance, monitoring and learning i a t a p o b m a t r e v o e g d i r b • overall responsibility for the sustainability 5 year plan and goals sits within the technical and quality assurance team. however, crucial to successful implementation is the involvement of other internal stakeholders. have been invited to comment on our approach includes quantitative data for reviewing progress in specific areas – including contributions against goals combined with qualitative from mateo quispe from the san juan del oro evaluation from internal and external stakeholder cooperative, and ian collinson from the scottish representatives. we believe this methodology is manufacturing advisory service, in this report. fit for purpose, although we are hoping to improve we hope that having external engagement will the way we share data internally and increase our a project team was formed during the initial bring greater accountability, as well as help us engagement with external stakeholders going strategy design phase, engaging employees to drive forward the changes we want to see. forward. whose role directly relates to sustainability. these employees are involved on an on- two of the biggest opportunities for learning going basis in achievement of the plan and and development in 2018 were the completion effective monitoring and reporting of progress. of our supply chain programmes in uganda and peru. our project partner twin coordinated the further engagement with the broader workforce evaluation of these programmes and we are very is managed primarily via two existing forums – grateful to them for their thoughtful approach, the environmental committee and the employee and their expertise in analysing the findings. forum. both platforms bring together volunteer representatives from different areas of the an annual review cycle has been implemented business and they are therefore a fantastic to give us a means for staying on-track and medium for progressing attainment of our goals continuing to have an impact, accounting for and evaluating our progress collaboratively. unforeseen changes in circumstances. as representatives from key external stakeholders demonstrated in this report, the annual evaluation make changes to the annual milestones as required stakeholder consultation implementation evaluation of progress data collection 45 sustainability report 8
sustainability report 46
acknowledgements our sincerest thanks to the following organisations for partnering with us on our sustainability initiatives and for helping us to assemble this report. brown bag crisps one carbon world scottish manufacturing advisory service cooperativa agraria cafetalera san juan del oro ltda. jobs and business glasgow cooperativa agraria cafetelera pangoa ltda. glasgow caledonian university mount elgon agroforestry communities the fairtrade foundation cooperative enterprise mountain harvest twin & twin trading taylors of harrogate marks and spencer comic relief vegware minor figures scottish fair trade forum prince and princess of wales hospice david williamson rwanda foundation macmillan cancer support hit hospitality academy hub international holyrood secondary school food & drink federation scotland we hope that you found this report like to send us any comments or helpful and insightful. if you would feedback so that we can improve our future 47 sustainability report communications, please do get in touch via our website www.matthewalgie.com/contact