LONDON, United Kingdom — If Puma had to pay for the impacts from its water use and greenhouse gas emissions, the shoe and sportswear company would be paying around $133 million (€94.4 million) a year.
Puma is developing an environmental profit and loss statement to put a monetary figure on its various environmental impacts, and has first revealed the cost of its two biggest impacts.
In determining the figures, Puma also broke down which costs are attributable to different areas of its supply chain and regions its works it, laying down a roadmap for where it needs to focus its energy to bring those figures down.
Puma's direct operations are responsible for about $10 million (€7.2 million) out of the total, and its supply chain is responsible for the remaining $123 million (€87.2 million). The total cost is evenly split between GHG and water impacts.
The biggest impacts come from sourcing raw materials; cotton farming, cattle ranching and natural rubber production account for 36 percent of Puma's GHG emissions and 52 percent of its water consumption.
Puma's direct operations, including electricity, business travel and logistics, account for 15 percent of its GHG emissions and 0.001 percent of water use. The remainder of the impacts come from raw material procession like leather tanning, outsourced steps like printing and sole production, and manufacturing.
To move the needle on GHGs and water, Puma will need plenty of supplier engagement and collaboration with other companies. To that end, Puma's parent, PPR Group, recently joined the World Business Council for Sustainable Development and Puma plans to joins the Sustainable Apparel Coalition.
Puma will also use the figures to compare the impacts of sourcing from different countries and regions, and will work with other players in the sportswear industry to help suppliers pinpoint and fix faults in their operations.
In addition to using the figures as a measurement in reducing its impacts, Puma researched the figures to be prepared if laws are eventually passed that require such disclosure.
PricewaterhouseCoopers determined the GHG cost, and Trucost figured out Puma's water costs. The GHG figure is the value of damage caused by emissions, and the water figure is the value of damage from water scarcity.
Puma's environmental profit and loss statement will eventually include other environmental impacts such as waste and land use change, and social and economic impacts like job creation, taxes and philanthropy.
Puma shoe - CC license by Davichi/Flickr