Sustainability Update Supplier Board 14th December

Sustainability Update NHS Supply Chain Achievements 2011: Target NHSSC (end AP10 2010) Carbon tonnes per £million revenue (target to reduce by 16.24% against 2008 baseline) 26% decrease Reduce the kwh of electricity used from our distribution centres by 12.5% from a baseline of 2008 by 31/12/11. 18% decrease Reduce the kwh of gas used from our distribution centres by 17% from a baseline of 2008 by 31/12/11. 40% decrease Increased the % of waste recycled from our distribution centres to 75% by 31/12/11. 71% Reduce the total waste arisings tonnes per £ million revenue from all distribution centres by 15% from a baseline of 2008 by 31/12/11 15% decrease Reduce water consumption by 10% per employee across all distribution centres by 31/12/11 relative to 2008 levels (including the box wash) 28% decrease This target comes from the DHL Climate Protection Programme – Go Green. Target to reduce by 15% by end of 2012 and 30% by end of 2020,based on 2008 levels. Data from all business units is reported on a monthly basis and includes energy used in the warehouses and the diesel litres used by our fleet vehicles. Although the corporate target is linked to sales revenue we are also showing actual decreases in kilo watt hour consumption of both our electricity and gas consumptions, as shown in the table. Our electricity reduction has been driven by 3 re-lighting projects where we have replaced the warehouse lighting with light fittings that shut down due to detecting no movement and also sufficient lighting levels, so making use of natural lighting particularly during the summer months. In addition we have replaced the mechanical handling equipment at 5 sites and seen reduction due to more efficient battery charging. Our gas reduction has been driven by warmer temperatures over the year and also through placing stronger emphasis on appropriate shut down procedures. We are slighting under target on our waste recycling as we are missing some data for one of our sites, this will be rectified in the next month. Our water consumption has been driven by good site management and improved procedures for the tote box washing machines.

Sustainability Update Further details can be found in our Sustainability Report 2010. Covers period January to December 2010 We will be circulating some hard copies for you to take away – however we have tried to limit the numbers printed in the interests of the environment.

Which Areas? Key areas for working together: Carbon reduction – for example opportunities to reduce supplier delivery mileage Ethical sourcing Packaging opportunities Identifying innovation under this agenda Any other areas that should take priority? We would welcome the opportunity to work more closely with suppliers on the sustainability agenda. The areas we feel are key are shown on the slide: Carbon reduction – primarily through reducing supplier delivery mileage – moving to blue diamond, delivery into one depot, opportunity for collection when we have empty vehicles on a return leg back to the depot. Ethical sourcing – ensuring transparency along the supply chain is becoming increasingly important for customers. You may have seen the recent Panorama programme on the manufacture of surgical instruments which along with quality issues highlighted some of the issues with poor labour standards associated with the manufacture of these products. We are in the processes of improving information in this area and would be interested to hear any experiences that you have had. Packaging – are there opportunities to improve on current packaging either through changing the type, reducing the amount, increasing the units per box etc. Any changes would have to ensure the integrity of the product is not compromised. Sharing what you are doing with regards to your sustainability agenda or any environmentally related product innovations. If you have any further areas you feel should be considered please let us know.

How? Best mechanism for working together: 1:1 through contract review meetings Via industry bodies Create a forum which suppliers could attend Any other ideas that would work better? What are the best mechanisms for us to work together?