Key Performance Indicators 101 - Walmart.com

1 Productsfor a Sustainable PlanetKey Performance Indicators101 September 19, 20172 THE SUSTAINABILITY CONSORTIUM | 2017 ARIZONA STATE UNIVERSITY AND UNIVERSITY OF ARKANSASThe Sustainability Consortium is committed to facilitating a robust, open and honest exchange of ideas and information among its participants on subjects relevant to the agenda of Consortium meetings. It is also committed to compliance with all applicable laws, including antitrust and competition avoid any possible problems, communications and exchanges of information at, or attendant to, any Consortium-related proceeding should directly relate to the issues on the should be no discussions or exchanges of information regarding (1) what price any participant has or may charge for its products or services; (2) strategic business plans or (3) whether or not to do business with any person or entity.

2 The Sustainability Consortium does not condone disparagement or untrue statements in any of these policies could jeopardize other participants and the goals of the Consortium and will not be tolerated. Let TSC staff know immediately if you have a concern or question about a possible violation of this Statement3 THE SUSTAINABILITY CONSORTIUM | 2017 ARIZONA STATE UNIVERSITY AND UNIVERSITY OF ARKANSASTSC Marketing PolicyTSC has embraced many different types of organizations across the value chain because we view all as critical order to maintain a professional environment where people feel open to sharing information and opinions.

3 We ask that all participating companies refrain from discussion during TSC meetings that which could be construed by other members as direct selling of products and you feel that another member or participant is engaging in this behavior, please contact Euan Murray, CEO or Jon Johnson, Chairman of the are free to use the information received, but statements shall not be attributed to speakers or participants unless permission has been Rule4 THE SUSTAINABILITY CONSORTIUM | 2017 ARIZONA STATE UNIVERSITY AND UNIVERSITY OF ARKANSAS TSC s Approach Understanding TSC KPIs Design and How to Respond to Them Getting Business Value from the ResultsToday s Agenda WITHITSEXTENSIVESETOFPARTNERSANDDATA, TSC OFFERSAUNIQUEVIEWONHOWPROGRESSTOWARDSUST AINABLECONSUMPTIONISACTUALLYGOING.

4 ANDREWWINSTONTHE SUSTAINABILITY CONSORTIUM | 2017 ARIZONA STATE UNIVERSITY AND UNIVERSITY OF ARKANSAS5 The Sustainability ConsortiumFounded in 2009 The mission of TSC is to transform the consumer goods industry, and make the mainstream consumer goods we buy every day better, more sustainable THE SUSTAINABILITY CONSORTIUM | 2017 ARIZONA STATE UNIVERSITY AND UNIVERSITY OF ARKANSAS6 Consumer Awareness Increasing consumer sensitivity to packaging, chemicals, deforestation, landfill waste, environ-mental degradation, GHG etc. Retailers Implementing Sustainability ProgramsMost leading retailers have programs in place and will expect more of suppliers in the future.

5 Growth Potentially Limited by ResourcesGrowth from increasing consumers potentially capped by resource Increasingly ActiveRegulations on environ-mental and social compliance increasing and getting more Demand: Pressure is increasing to address product and supply chain visibility THE SUSTAINABILITY CONSORTIUM | 2017 ARIZONA STATE UNIVERSITY AND UNIVERSITY OF ARKANSAS7To capture the growth opportunity the consumer goods industry has to decouple growth from the sustainability impact -which requires addressing supply chain sustainability and visibilityAddressing the sustainability price tag of consumer goods is tied to supply chain visibilitySource.

6 TSC Impact Report, 2016, Greening Global Supply ChainsAs global economic development continues over the next few decades, nearly billion people are expected to join the consuming class THE SUSTAINABILITY CONSORTIUM | 2017 ARIZONA STATE UNIVERSITY AND UNIVERSITY OF ARKANSAS8 TSC s Theory of changeTHE SUSTAINABILITY CONSORTIUM | 2017 ARIZONA STATE UNIVERSITY AND UNIVERSITY OF ARKANSAS9 Transparency of reportingHarmonized and transparent system reduces complexity and saves coststhroughout the supply chainStandard metrics enable suppliers and buyers to work together on the same environmental and social goalsReducing cost and complexity of sustainability research and reporting allows companies to tackle impact areas faster

7 And more efficiently Standardization of metricsReduced cost and complexityDriving Impact by Unlocking the Value of the Supply ChainTHE SUSTAINABILITY CONSORTIUM | 2017 ARIZONA STATE UNIVERSITY AND UNIVERSITY OF ARKANSAS10 Product Category-Level Reporting Scalability in both development and deployment Compatible with existing procurement practices for many retailers Works well for aligning with sector initiatives Focal point for engaging both supply chain and other stakeholders Can provide specific metrics for material environmental and social issues while covering much of a company s activities Differentiation within a single supplier/manufacturer Reusability of reporting for multiple customersCorporate reportingProduct levelProduct categorySpecificityScaleTHE SUSTAINABILITY CONSORTIUM | 2017 ARIZONA STATE UNIVERSITY AND UNIVERSITY OF ARKANSAS11 Category Sustainability Profile (CSP) Scope of coverage Key Performance Indicators (KPIs) Details of KPIs Hotspots Improvement Opportunities Summary of the research used to identify the relevant issues Sustainability InsightA short summary of relevant issues, hotspots and improvement opportunities for a product category in an accessible overview.

8 TSC Measurement and Reporting SystemDownload: metricsSupply Chain DiagramsIllustrations created to highlight relevant issues across the value chain. Members have access to more than 50 diagrams as a part of the SUSTAINABILITY CONSORTIUM | 2017 ARIZONA STATE UNIVERSITY AND UNIVERSITY OF ARKANSAS12 Full value-chain materiality based in science2 Review Scientific Sources1 Define the Product Category3 Research Lifecycle Hotspots7 Multi-Stakeholder Review4 ResearchImprovement Opportunities5 Evaluate the Evidence6 Design Key Performance Indicators8 Publish the Toolkit9 Update and Revise the ToolkitTHE SUSTAINABILITY CONSORTIUM | 2017 ARIZONA STATE UNIVERSITY AND UNIVERSITY OF ARKANSAS13 Behind the Metricsto academic articles and peer reviewed studies75

9 Multi-stakeholder informedIn 2016 alone:380stakeholders165organizationsSci ence-basedScalable ImpactCovering>90%of Consumer Goods Impacts>2,060references toAligned with Key Initiatives>3,325citations431 Certifications, standards, and toolsTHE SUSTAINABILITY CONSORTIUM | 2017 ARIZONA STATE UNIVERSITY AND UNIVERSITY OF ARKANSAS14 Many-to-Many Reporting14 From 1 Supplier 1 Retailer 2 Retailer 3 Retailer ..Supplier 2 Supplier 3 Supplier ..Retailer 1 Supplier 1 Retailer 2 Retailer 3 Retailer ..Supplier 2 Supplier 3 Supplier ..Shared metricsTo this. To date, more than a dozen different retailers are using TSC metrics in the US and Europe Over 2,500 major suppliers are already reporting the sustainability Performance of goods worth over $200 billion in annual salesTHE SUSTAINABILITY CONSORTIUM | 2017 ARIZONA STATE UNIVERSITY AND UNIVERSITY OF ARKANSAS15 Companies from around the world are already reporting to their retail customers using TSC KPIs on the SAP Product Stewardship NetworkAdoptionAs well as projectswith major retailers in Germanyand the UK>$200 BMore than a dozen retailers have worked with TSC and/or are utilizing TSC Toolkits, including.

10 Retail participants: CVS, Sephora, Target, Walgreens, Walmart2500+16 THE SUSTAINABILITY CONSORTIUM | 2017 ARIZONA STATE UNIVERSITY AND UNIVERSITY OF ARKANSAS TSC s Approach Understanding TSC KPIs Design and How to Respond to Them Getting Business Value from the ResultsToday s Agenda THISGROUPWILLHELPYOUIDENTIFYISSUESBEFORE THEYBECOMEISSUESFORYOU. -UNILEVER17 THE SUSTAINABILITY CONSORTIUM | 2017 ARIZONA STATE UNIVERSITY AND UNIVERSITY OF ARKANSASA natomy of a TSC Key Performance indicator (KPI)THE SUSTAINABILITY CONSORTIUM | 2017 ARIZONA STATE UNIVERSITY AND UNIVERSITY OF ARKANSAS18 Question and Response OptionsTitle: contains information about both the impact and activity addressed by the KPIQ uestion: A description of the measurement in the form of a question.