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Target

Target is a department store supported by a strong brand heritage and characterised by quality, fashion and basics at low prices. The business sells a wide range of products for the whole family, including apparel, homewares and general merchandise.

Target operates a national network of more than 300 stores, as well as an online business. The business’s objective is to provide quality, fashion and basics for everyone at low prices. Target employs more than 16,000 team members across its stores, support offices and direct sourcing operations in Asia.

Material issues

Our business focuses on the following key areas to improve our sustainability:

  • Ethical sourcing and supplier relationships
  • People development and engagement
  • Climate change resilience and waste management
  • Community issues, product safety and product quality
  • Diversity
  • Safety
  • Community contributions

Ethical sourcing and supplier relationships

We continue to focus on an ethical and transparent supply chain. In 2016, auditing of direct source supplier factories for non-merchandise goods started and we published complete factory lists for production of Target house brands. Reflecting our continued focus, we received a B- rating in the Baptist World Aid’s Australian Fashion Report.

As part of our ongoing commitment to source responsibly and improve social, economic and environmental practices, Target joined the Action, Collaboration, Transformation (ACT) initiative. We participated in other global ethical sourcing initiatives and joined with non-government organisations in discussions and workshops on global living wages, modern day slavery and forced labour issues.

We remain focused on improving conditions for workers in supplier factories through a transparent supply chain. Target is committed to ensuring the safety and wellbeing of workers in supplier factories, and is a signatory to the Accord on Fire and Building Safety in Bangladesh and the Responsible Sourcing Network’s Cotton Pledge. Target is also involved in Impactt’s Benefits for Business and Workers program in Bangladesh. Team members and external stakeholders continue to receive targeted training on our Ethical Sourcing Code, including training on the protection of human rights as aligned to Target’s Code of Conduct.

 

We continue to rationalise our supplier base to enable more meaningful relationships and deliver ongoing improvements in social and environmental practices with suppliers.

In June 2016, we held supplier forums in Hong Kong, Shanghai, Bangladesh and Melbourne. The time spent together played an important role in suppliers understanding Target’s revised strategy and priorities aimed at turning around operational and financial performance. The forums also afforded both Target and suppliers an opportunity to gain a greater understanding of how, together, both businesses can grow to drive improved profitability and long-term business sustainability. Suppliers were taken through Target’s 2017 Vision and Strategy outlining and reinforcing Target’s key focus to always be ethical, respectful, accountable and work together as one team. This includes how Target interacts and works with suppliers.

People development

Development

'Retail Leaders' is a development program focusing on high potential and high performing team members at Target. The program was launched in 2014 and aims to accelerate the development and progression of future store leaders. Participation in the Retail Leaders program includes structured development, residential workshops, caretaking activities, business improvement projects, peer support through the Retail Leaders Buddy network, mentoring and coaching. This year, 98 participants and 60 coaches have been involved, with a balanced representation of male and female participants and coaches.

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Engagement

With the announcement of the new management structure at Target in February 2016, we embarked on a 'Discovery' phase to listen to team members and suppliers in Australia and Asia. The purpose of these listening sessions was to gain an understanding of the team and supplier views. It was also an opportunity to communicate Target’s vision to work together, safely, as one team, ethically, with care and trust.

Climate change resilience and waste management

Energy

Following the commencement of Target’s energy program in 2014, environmental and economic benefits have continued to be delivered this year. In addition to refitting existing stores with LED lights, the team’s monitoring and benchmarking activities have contributed to stores reducing energy use by eight per cent compared to the previous year. These demand reductions are equivalent to greenhouse gas emission reductions of 10.4 per cent.

Energy use

0.7

petajoules
2016   0.7
2015   0.8
2014   0.9
2013   0.8
2012   0.8

Waste

Target continued to undertake waste reduction initiatives throughout the business in line with packaging commitments under the Australian Packaging Covenant. 'Follow me' printing has been rolled out in the Geelong and Asia offices reducing unnecessary printing and saving on toner, cartridges, maintenance and paper.

Target worked on removing excess packaging, maximising the use of shelf ready packaging and re-defining apparel folding standards to reduce the amount of packaging sent to stores. Transit packaging has been optimised by reducing the number of cartons available to suppliers and increasing the number of products being packed in each box. These cartons are then being reused in distribution centres to distribute replenishment lines to stores.

This year, Target funded the collection and recycling of more than 17,489 kilograms of unwanted televisions and computer waste, under the National Television and Computer Recycling Scheme Product Stewardship Agreement.

Waste

29

tonnes '000
Disposed
2016   8
2015   8
2014   8
2013   7
2012   8
Recycled
2016   21
2015   20
2014   22
2013   21
2012   21

Illegal logging

Target undertook a comprehensive due diligence program to ensure regulated timber products were not imported from illegally logged sources. This was in response to an Australian Federal Government initiative to follow Europe’s lead by enacting the Illegal Logging Act 2012 (and its Regulations) in November 2014.

Buying and procurement teams in Asia and Australia have established systems to verify and trace the origins of timber and document associated risks. A government assessment and audit of Target’s systems resulted in a favourable outcome which acknowledged effective process and due diligence.

 

Community issues, product safety and product quality

Target continually strives to improve quality and safety standards to ensure its customers can be confident in the products they buy. Target is currently reviewing all quality standards and procedures for clothing. This will ensure that fabric quality such as weights, wash durability, shrinkage, stretching and lightfastness are to high customer satisfaction standards. Processes continue to be reviewed to ensure that products that do not meet these strict standards are not shipped.

In relation to battery sales, warning messages now appear on Target branded products and packaging, battery compartments are more child-proof and replacement button batteries are being sold in child-proof packaging. In addition, Target provides the Australian Competition and Consumer Commission (ACCC) Battery Controlled Fact Sheet inside the Target branded button battery pack.  

We also presented at an Australasian College of Emergency Medicine forum and participated in the ACCC-facilitated industry working group tasked with developing an industry code for button battery safety.

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Diversity

This year, Target focused on identifying key actions in building its diversity and inclusion strategy.

Indigenous engagement

Target conducted cultural awareness training at new stores and worked with the Korin Gamadgi Institute to recruit and prepare Indigenous jobseekers for Victorian stores. Target supported AIME (the Australian Indigenous Mentoring Experience) by supplying apparel for AIME's key fundraiser, National Hoodie Day.

Other activities included sponsorship of the Geelong Football Club's 'Closing the Gap' program, a healthy lifestyle program for Indigenous children in Geelong and south west Victoria. In addition to featuring Indigenous models in our marketing, we also facilitated a design exchange between Indigenous designers from the Cairns Indigenous Art Fair to encourage development of an Indigenous print program.

Diverse shapes and cultural diversity

Target was the first Australian retailer to introduce size 16 mannequins in stores to better reflect the average female customer. This was complemented by the 'Every Body' advertising campaign featuring women of different ethnicity, ages, shapes and sizes in catalogues, television advertisements and billboards.

Target employees represent many nationalities that positively contribute to the business. To celebrate cultural diversity, Target supported Taste of Harmony lunches and morning teas to encourage team members to come together to share food and stories from their cultural backgrounds.

Safety

Target achieved its lowest ever recorded incident and injury frequency rates throughout the 2016 financial year. This included lost time injuries (LTIs) decreasing 16 per cent on last year and total recordable injuries reducing 10 per cent for the same period. The reduction in LTIs resulted in a 10.5 per cent decline in lost time injury frequency rate to 4.28, continuing a positive trend of reduced injuries. The results have been attributed to ongoing simplification of Target’s Safety Management System and also a strong safety focus across all levels of management and operations.

Key safety projects for the year included the introduction of a new team member safety training program, the upgrade of Target’s incident reporting database and delivery of a safety focus week. An agreed plan is in place for next year to further improve Target’s proud safety performance.

Safety Performance

29.2

total recordable injury frequency rate
2016   29.2
2015   30.31
2014   38.0
2013   43.7
2012   54.6
1Restated due to maturation of data.

Community contributions

Target is an active supporter of its local communities and partners with organisations that support women’s health and children’s safety.

Throughout the year, we supported more than 2,700 local communities through the national community gift card donation program, distributing over $132,000 in gift cards. A further $260,000 was provided through product donations and fundraising events.

UnitingCare is one of our key partners. During the 2015 Christmas appeal, we raised more than $580,000 through the sales of gift tags, as well as collecting 20,000 gifts for distribution by UnitingCare to disadvantaged people nationally.

We also support the Alannah and Madeline Foundation though bag sales and volunteering; SIDS and Kids Red Nose Day through sales of red nose product in stores; Care Australia Safe Motherhood program in Gazipur; donations of product samples to the School of Hope educational institute in Dhaka; providing collection points in stores for the Nappy Collective; and through McGrath Foundation donations.

Community contributions

3.0

$m
Direct
2016   1.3
2015   1.4
2014   1.5
2013   0.9
2012   1.4
Indirect
2016   1.7
2015   2.2
2014   1.0
2013   0.9
2012   2.1

2016-17 priorities

Target is committed to proactively managing our team member safety, embracing diversity, supporting the communities in which we operate as well as focusing on environmental practices and ethical supply chain transparency. In doing this, Target continues to: 

  • work towards improving working conditions within offshore supplier partner factories through a transparent and ethical supply chain;
  • create a culture that supports positive performance management conversations through continuous feedback;
  • rationalise our supplier base to enable more meaningful relationships and deliver ongoing improvements in social and environmental practices with our supply partners;
  • reduce the environmental impact of our store network through energy efficiency initiatives, packaging reduction and waste diversion;
  • review existing policies;
  • improve current quality standards and processes for clothing, including the offshore product approval process;
  • embed new organisational and store management structure, with a commitment to diversity, and continue to include diverse shapes, ages and cultural diversity in marketing campaigns;
  • maintain a robust safety record;
  • continue to partner with organisations that support women’s health and children’s safety and being active supporters of local communities.

GRI Reference: G4-DMA (Product and Service Labelling), G4-12, G4-EN33, G4-PR3