Supply Chain

Sustainability Survey

Since 2009, Kohl's has implemented a formal sustainability survey process that asks vendors to complete a 38 question sustainability self-assessment each quarter. The survey is broken into the following six categories:

Management/Policy	20%
Energy/Emissions Management	35%
Waste Management	15%
Partnerships	5%
Supply Chain-Water, Raw Materials, Factory	10%
Merchandise Packaging	15%
	100%

The survey scoring is weighted to the award vendors for taking initial foundation-setting steps for long-term sustainability actions. Kohl's initially encouraged vendors to embrace sustainability by setting a mission or policy statement and assignment to a functional area or management member for overall accountability. In 2011, the focus of the survey shifted to energy and climate measurements, with 30 overall points being assigned.

Survey Results

2011 Survey Results:

Education

In 2011, Kohl's conducted a series of webinars to help vendor partners get organized around sustainability. The webinar topics were as follows:

• Strengthening the Supply Chain
• Sustainability Policy and Getting Started
• Energy Management and Emissions
• Waste Management and Moving Upstream

To drive supply chain sustainability, Kohl's believes that collaboration and discussion lead to small everyday actions that can drive improvement. Sustainability must be a business concept that strives for operating efficiency that will ultimately result in long-term resource conservation.

In 2011, Kohl's announced its participation in the Sustainable Apparel Coalition. The Sustainable Apparel Coalition is an industry-wide group of leading apparel and footwear brands, retailers, manufacturers, non-governmental organizations, academic experts and the U.S. Environmental Protection Agency working to reduce the environmental and social impacts of apparel and footwear products around the world.

The Sustainable Apparel Coalition's vision and purpose are based on a set of shared beliefs that:

• The environmental and social challenges around the global apparel supply system affect the entire industry.
• These challenges reflect systemic issues that no individual company can solve on its own.
• Pre-competitive collaboration can accelerate improvement in environmental and social performance for the industry as a whole, and reduce the cost for individual companies.
• This collaboration enables individual companies to focus more resources on product and process innovation.
• Credible, practical and universal standards and tools for defining and measuring environmental and social performance support the individual interests of all stakeholders.

The Sustainable Apparel Index

The Sustainable Apparel Coalition's first major project is the development of a common, industry-wide tool for measuring the environmental and social performance of apparel products and the supply chains that produce them. The Coalition believes that:

• A common approach for measuring and evaluating sustainability performance is essential for driving a 'race to the top' in the apparel supply chain. Apparel retailers and brands can compare performance of upstream supply chain partners, and those partners will have a single standard for measuring and reporting performance to their downstream customers.
• This Sustainable Apparel Index will help identify and drive improvements in energy, waste, water and toxics in the supply chain and help reduce operating costs and risks.
• This measurement standard will serve as a foundation for eventual reporting to consumers on the sustainability performance of the products they purchase.
• The Index will also help to highlight opportunities for pre-competitive collaboration to improve performance, where demand creates stronger influence on the supply chain and combined support may make investments in technology innovations more feasible.

Kohl's is an active participant in the Sustainable Apparel Coalition on several working groups, including Communication, Governance, Administration and Facility sustainability.

In fall 2011, Kohl's began pilot testing the first version of the Sustainable Apparel Index for two key private brand styles and for several factories that produce products for Kohl's. This work will further drive sustainability actions and innovations in Kohl's supply chain.

In early 2011, Kohl's contracted with a consultancy in Great Britain called Trucost to calculate its supply chain footprint based on cost purchases. Trucost provides a uniquely fast and systematic approach to managing supply chain environmental impacts through its data: the world's most comprehensive data on corporate environmental impacts. Kohl's will use the data to identify merchandise vendor hotspots for future engagement and collaboration.

Merchandise Packaging

Shipping products to Kohl's stores requires packaging to ensure the delivery of exciting value-oriented merchandise for the Kohl's customer. Our logistics teams work to set standards to minimize the amount of packaging needed to deliver our merchandise to our stores every day. In 2011, Kohl's worked with the merchandise vendor community to find solutions to reduce packaging.

• Styrofoam reductions
  Styrofoam is used to package many items sold at Kohl's especially in the home area. Kohl's is actively seeking ways to replace Styrofoam in its packaging or to find an outlet to recycle Styrofoam.
• Plastic Packaging reductions
  Kohl's requires its vendors to use only Polyethylene plastic or no plastic at all when sending apparel to Kohl's stores. Kohl's actively recycles the plastic used to protect the merchandise during shipping. Even better, Kohl's associates prefer no plastic when processing goods for sale at Kohl's stores. Kohl's has eliminated plastic on many merchandise categories, including denim jeans, intimate apparel and children's clothing.