Client story: Euronics - 'How do we develop an effective sustainability strategy?'

International electronics retailer Euronics has become increasingly conscious of sustainability challenges in recent years, such as the increasing amount of electronic waste, the use of critical materials, CO2 level increases and an ever-growing climate footprint. All these are sustainability challenges which focus mainly on the environment. Several Euronics member countries were already looking for ways to take action on sustainability themselves, which was the decisive factor for the company to start working on it organisation-wide and to develop an overall sustainability strategy that can be effectively implemented in the short term up to 2025, but also extends further to 2030 and even 2050. John Olsen, Managing Director at Euronics says: "When we refreshed our brand identity six years ago, we asked ourselves: what do we stand for? And the answer is that we stand for a human touch in a digital world. Why? As an omnichannel retailer, we are in touch with people. And that includes sustainability. We can make a difference for people and for treating this planet well. That's what we want."

To achieve this, KPMG was asked to join as a partner in helping to develop a sustainability strategy, implement it and, of course, achieve the goals. One of the main goals here is undeniable: to reduce CO2 emissions to zero by 2050.

Euronics had worked with KPMG before and met the KPMG Sustainability team in the Netherlands. John Olsen recalls: "We did have ideas regarding sustainability, some initiatives here and there, such as selling electric cars in Germany or installing solar panels on roofs in the UAE, but it was not from one mind yet, one shared vision from all the countries, let alone a clear strategy." To arrive at that strategy, KPMG suggested conducting an ESG (Environmental, Social, and Governance) scan first. Bart Hoogland, Manager ESG & Sustainability Strategy at KPMG explains: "An ESG scan is a review of, among other things, the existing sustainability strategy and several external developments where we answer multiple questions. For example: what is the organisation already doing to take action on sustainability, or has it not taken any action yet? What developments do we see in the market? What do employees and customers expect from you as an employer and an organisation? What about legislation and regulations? In short: we look at sustainability from different perspectives and to what extent the organisation is already acting on it." Out of the scan, a blueprint emerges for the strategy to be developed next. In Euronics' case, this was the first building block towards reducing its CO2 emissions to zero by 2050. 

The key insight that came out of the ESG scan was that steps could be taken across four strategic pillars to achieve the ultimate goals: CO2 reduction, the transition to a circular economy, a sustainable portfolio and compliance.

John Olsen adds: "You also immediately realise that you cannot do it alone. In the area of products, for example, we need to work closely with our suppliers to achieve a sustainable product portfolio."

Another insight was that it is impractical for an international organisation such as Euronics to instantly expect the same sustainability ambition from all of its member countries. John Olsen explains: "Some countries are simply more advanced than others, so it also comes down to learning to understand each other, to understand what is already possible and what may not yet be, and to inspire and motivate each other." Bart Hoogland adds: "It is a great process in which we seek a balance between developing an ambitious strategy in relation to what is realistically achievable for the whole network of Euronics’ member countries."

After mapping the strategic pillars, the team determined KPIs and targets for each pillar. John Olsen explains: "At Euronics, we have a balanced score card for all our member countries. This means we have targets for organisation wide areas such as finance, sales and marketing. But we didn't yet have that for sustainability. But now we are incorporating that! That is a real breakthrough."

In cooperation with KPMG, Euronics is confident that it will be able to meet its long-term targets. The Net Zero goal, for example, through first calculating our emissions, and second  mapping out the steps to be taken to reduce emissions.

With the Green Product Passport, Euronics aims to generate a sustainability score per product for its entire product portfolio, to become a trusted advisor on sustainability to the consumer. This involves repairability, reuse (circularity), and connectivity, apart from energy consumption which is already in place.

Not only does the Green Product Passport inform and inspire customers to consume in a more sustainable manner, it also encourages the member countries to include more sustainable products in their assortment.

And finally, in the area of compliance and regulation, KPMG, as an expert in the audit field, knows exactly what is going on now, what is coming in the near future and how to prepare the organisation to be compliant. Bart Hoogland states: "We look at all guidelines per pillar to make sure we comply with them, and that we can also respond to (possible) changes."

We are on the road. The strategy has been developed. The KPIs and targets have been set. The first steps in achieving the targets have been made and the end goal is clear. KPMG is working together as a partner and as Euronics' Sustainability Office to really make a difference. John Olsen is confident that in looking ahead to: "2025, 2030, 2050, we know exactly what we have to do and with the expertise of KPMG, we will build plans on how to achieve these targets."

John Olsen is enthusiastic about the collaboration and how KPMG currently acts as Euronics’ Sustainability Office: "KPMG is a strong partner, and it needs to be because we have set quite ambitious goals. But I am convinced that with KPMG's help we will achieve those goals." To achieve those goals, KPMG's involvement is growing. Bart Hoogland says: "It is great to see that based on the ESG scan and the resulting strategy, we are now really working on achieving milestones. We do this in close and good contact with John and with the Euronics board, but also with all the different countries. That feels very valuable, because we are doing something good together."