Corporate Responsibility Report
2018 Report ¹
(Including disclosures under the California Transparency in Supply Chains Act of 2010)
Table of Contents
- In Our Communities
- In Our Stores
- In Our Facilities
- Social Compliance
- Our People
- Corporate Governance
Since our inception in 1971, Bed Bath & Beyond has been dedicated to being a responsible corporate entity by offering attractive and increasingly differentiated merchandise at competitive prices, supported by exceptional customer service. In addition to these core principles, the Company is committed to being a positive economic force, a responsible citizen in the communities we serve, and a mindful steward of the resources we consume. Our Company continues its efforts to decrease its own energy consumption in our stores, distribution centers, and corporate offices. We also continue to pay attention to our waste stream and that of the products we sell. As with all things we do, we know we can do better and we strive to find ways to improve, in a manner consistent with our obligations to all our constituencies.
The following report has been completed in October 2018 by Bed Bath & Beyond Inc., 650 Liberty Avenue, Union, New Jersey 07083, the parent company that, together with a group of subsidiaries, is an omni-channel retailer selling a wide assortment of domestics merchandise and home furnishings, which operates under the names Bed Bath & Beyond, Christmas Tree Shops, Christmas Tree Shops andThat! or andThat!, Harmon, Harmon Face Values or Face Values, buybuy BABY and World Market, Cost Plus World Market or Cost Plus. In addition, the Company operates Of a Kind, an e-commerce website that features specially commissioned, limited edition items from emerging fashion and home designers; One Kings Lane, an online authority in home décor and design offering a unique collection of select home goods, designer and vintage items; PersonalizationMall.com, an industry-leading online retailer of personalized products; Chef Central, an online retailer of kitchenware, cookware and homeware items catering to cooking and baking enthusiasts; and Decorist, an online interior design platform that provides personalized home design services. The Company also operates Linen Holdings, a provider of a variety of textile products, amenities and other goods to institutional customers in the hospitality, cruise line, healthcare and other industries. Additionally, the Company is a partner in a joint venture which operates retail stores in Mexico under the name Bed Bath & Beyond. The Company operates multiple retail channels, including retail stores in the United States, Puerto Rico and Canada, and various websites and applications, including bedbathandbeyond.com, bedbathandbeyond.ca, worldmarket.com, buybuybaby.com, buybuybaby.ca, christmastreeshops.com, harmondiscount.com, ofakind.com, onekingslane.com, personalizationmall.com, chefcentral.com, decorist.com, harborlinen.com and t-ygroup.com. References contained within this report to "Bed Bath & Beyond Inc." or "the Company" refer to the enterprise as a whole or, depending on context, to the parent entity in its corporate capacity, while references to an individual brand (Bed Bath & Beyond, Christmas Tree Shops, Christmas Tree Shops andThat! or andThat!, Harmon, Harmon Face Values or Face Values, buybuy BABY and World Market, Cost Plus World Market or Cost Plus, Of a Kind, One Kings Lane, PersonalizationMall.com, Chef Central, Decorist) discuss topics specific to that individual brand. Because domestic Bed Bath & Beyond stores constitute the vast majority of the Company's locations and activity, in the absence of a specific designation indicating otherwise, these materials should be read as applying to the U.S. operations of Bed Bath & Beyond stores and bedbathandbeyond.com.
The Company has reviewed various methodologies for sustainability reporting in the collection of information and development of this corporate responsibility report, though no single set of protocols has been exclusively adopted.
This report may contain forward-looking statements. Many of these forward-looking statements can be identified by use of words such as may, will, expect, anticipate, approximate, estimate, assume, continue, model, project, plan, goal, and similar words and phrases. The Company’s actual results and future financial condition may differ materially from those expressed in any such forward-looking statements as a result of many factors. Such factors include, without limitation: general economic conditions including the housing market, a challenging overall macroeconomic environment and related changes in the retailing environment; consumer preferences, spending habits and adoption of new technologies; demographics and other macroeconomic factors that may impact the level of spending for the types of merchandise sold by the Company; civil disturbances and terrorist acts; unusual weather patterns and natural disasters; competition from existing and potential competitors across all channels; pricing pressures; liquidity; the ability to achieve anticipated cost savings, and to not exceed anticipated costs associated with organizational changes and investments; the ability to attract and retain qualified employees in all areas of the organization; the cost of labor, merchandise and other costs and expenses; potential supply chain disruption due to trade restrictions, political instability, labor disturbances, product recalls, financial or operational instability of suppliers or carriers, and other items; the ability to find suitable locations at acceptable occupancy costs and other terms to support the Company’s plans for new stores; the ability to establish and profitably maintain the appropriate mix of digital and physical presence in the markets it serves; the ability to assess and implement technologies in support of the Company’s development of its omnichannel capabilities; uncertainty in financial markets; volatility in the price of the Company’s common stock and its effect, and the effect of other factors, on the Company’s capital allocation strategy; disruptions to the Company’s information technology systems including but not limited to security breaches of systems protecting consumer and employee information or other types of third-party product or service; reputational risk arising from challenges to the Company’s or a third party supplier’s compliance with various laws, regulations or standards, including those related to labor, health, safety, privacy or the environment; reputational risk arising from third-party merchandise or service vendor performance in direct home delivery or assembly of product for customers; changes to statutory, regulatory and legal requirements, including without limitation proposed changes affecting international trade; changes to, or new, tax laws or interpretation of existing tax laws; new, or developments in existing, litigation, claims or assessments; changes to, or new, accounting standards; foreign currency exchange rate fluctuations; and the integration of acquired businesses. The Company does not undertake any obligation to update its forward-looking statements.
If you have any comments or suggestions relative to this report, please feel free to contact us at firstname.lastname@example.org, where they will be considered, acted upon if appropriate, and in all cases appreciated.
The Company’s mission is to be trusted by its customers as the expert for the home and heart-felt life events. These include certain life events that evoke strong emotional connections such as getting married, moving to a new home, having a baby, going to college and decorating a room, which the Company supports through its wedding and baby registries, mover and student life programs, and its design consultation services.
Bed Bath & Beyond’s customer-centric and high-performance culture inspires our associates to do whatever it takes to satisfy the customer. The Company is committed to the highest level of customer service in order to exceed customer expectations and provide a noticeably better shopping experience. We are never satisfied and we strive to be the best in providing our customers differentiated products, services and solutions at the right value.
The Company’s ability to achieve its mission is driven by three broad objectives: first, to present a meaningfully differentiated and complete product assortment for the home, of the right quality, and at the right price; second, to provide services and solutions that enhance the usage and enjoyment of its offerings; and third, to deliver a convenient, engaging, and inspiring shopping experience that is intelligently personalized over time. The Company is undertaking a number of strategic initiatives to support each of these objectives, as well as to drive change across the organization in order to improve operational efficiencies and create future growth. Through this focused approach, the Company believes it will further its efforts to be trusted as the expert for the home and heart-felt life events and continue to achieve long-term success.
II. In Our Communities
Bed Bath & Beyond Inc. is committed to being a good corporate citizen and neighbor by ensuring that we give back to the communities we serve. In our decentralized culture, local managers are empowered to support local events and do so on a frequent basis. In addition, the Company has a number of relationships through which we can engage to serve our customers and give back to the communities in which we do business.
Corporate Campus Partnership with Union, NJ School District
Bed Bath & Beyond's Corporate Campus, which is located in Union, NJ, has partnered with the local school district to support its educational goals and provide enrichment opportunities for students. To date, this support has included hosting field trips to our corporate office for educational presentations and interactive learning activities, participating in classroom projects as mentors and project judges, and providing guest speakers.
Investment in American Farmers
Bed Bath & Beyond is proud to support American farmers by sourcing the majority of the cotton used in Bed Bath & Beyond’s private label sheets from farms in the United States. For example, Bed Bath & Beyond’s Wamsutta® private label sheet program is now made with PimaCott®, a verified pure pima cotton grown in San Joaquin Valley, California.
Support for Parents
buybuy BABY (the only national baby retailer) is committed to providing parents with the information they need to prepare for their new baby, whether through the guides and advice section of the buybuy BABY website, which includes product descriptions and helpful links to respected references, or via in-store interactions with our associates. The topics covered include car seats, childproofing (such as the use of tip resistant kits to secure furniture to the wall), and other safety tips.
In particular, buybuy BABY is a leader in promoting safe sleep environments for babies, via various efforts displaying educational signage in stores, distributing safe sleep educational materials to baby registrants and customers both in-store and online, as well as providing thorough training to buybuy BABY associates.
In 2001, Bed Bath & Beyond Inc. formed a partnership with Good360 (formerly known as Gifts In Kind International), a non-profit organization based in Alexandria, Virginia, that has enabled us to provide product donations to those most in need.
Merchandise is donated from participating Bed Bath & Beyond and buybuy BABY stores to local 501(c)(3) charities across the United States, Canada and Puerto Rico. Merchandise donations provide relief and assistance to many people in difficult situations, such as victims of natural disasters, transitional housing needs for families in crisis, youth in low income situations, and support for mentally and physically disabled individuals.
For 2017, we estimate the fair value of our product donations to have been nearly $170 million. The Company has been recognized by Good360 for outstanding corporate citizenship and effective product philanthropy. Stories of some donations made possible by Bed Bath and Beyond's partnership with Good360 are available here: https://good360.org/tag/bed-bath-beyond/
Corporate Campus Events
At the Corporate Campus in Union, NJ, we sponsor a number of philanthropic initiatives through partnerships with local charities and organizations. These include our annual food drive supporting the Community Food Bank of New Jersey, a holiday gift drive which collects toys for children and clothing items for homeless veterans in conjunction with the Union New Jersey Police Department’s “Santa in Blue” program, and regular blood drives that support the Blood Center of New Jersey. These programs are held on-campus and all Corporate associates are encouraged to participate.
In an effort to promote a healthy lifestyle for women and their families, Bed Bath & Beyond Inc. has partnered with HealthyWomen.org (formerly the National Women’s Health Resource Center) since 2004. HealthyWomen.org has become the nation’s leading independent health information source for women providing unbiased and accurate health information for more than 30 years. Utilizing the various customer-facing digital channels available at Bed Bath & Beyond, buybuy BABY and Harmon Face Values, we are happy to provide our customers access to a broad assortment of valuable and reliable health information for themselves and their families supplied by HealthyWomen.org while promoting a healthy lifestyle. A link to content from HealthyWomen.org is also available on the Company’s www.harmonfacevalues.com website.
Head Injury Association
The Company is a supporting partner of The Head Injury Association (“HIA”), an independent, non-profit agency widely recognized for its innovative programming for survivors of head injury and their families, based in Hauppauge, New York. The HIA offers support services to traumatic brain injury survivors and their families through clinical treatment, as well as vocational, educational, cultural, and recreational experiences that help survivors adapt to the daily challenges of life. In addition, the HIA provides the necessary residential programs to help traumatic brain injury survivors achieve four valued outcomes: Individualization, Independence, Integration, and Productivity. The Company assists the HIA in its annual fundraising activities.
United States and Canada Armed Forces & Military Appreciation Event
Bed Bath & Beyond Inc. recognizes and honors the service of the United States and Canadian Armed Forces, including Active Duty, Retired, Veterans and their families by offering them a 25% off entire purchase during the weekend of Veterans Day and Remembrance Day. This event is just one, small way to express our appreciation.
Community Emergency Assistance Program
The Community Emergency Assistance Program is designed to assist our valued customers as they recover and rebuild after an emergency in their area. In the aftermath of an emergency, such as a hurricane, wildfire, or flooding, the Company authorizes local stores to provide a 25% discount off the entire in-store purchase for residents with completed insurance claim forms or similar documentation from an agency such as FEMA.
RecycleBank partners with cities and brands to reward residents for helping to make their communities cleaner, greener places.
In 2005, Bed Bath & Beyond became one of the first businesses to partner with RecycleBank, and buybuy BABY became a partner in 2008. RecycleBank currently provides service to more than 4 million members in the United States and the United Kingdom. We continue to expand our participation in the program as RecycleBank expands into new markets. We are proud of our partnership with RecycleBank and are excited to be a popular choice of the participants who are doing their part to recycle.
To receive a Bed Bath & Beyond or buybuy BABY reward, RecycleBank members earn points by recycling and taking green actions. They then use these points to order Bed Bath & Beyond coupons for approximately 150 points or buybuy BABY coupons for approximately 50 points. The result is a highly engaged customer who is helping the environment.
For more information on RecycleBank:www.recyclebank.com/about-us
III. In Our Stores
A. Environmentally Conscious Assortment Offerings
As a Company, we recognize that our customers desire an assortment of environmentally conscious products made from recycled, repurposed, and organic materials, and products having energy saving properties. Customers who are interested in purchasing these types of products can find them in our various concepts as detailed below. Consistent with our customer-centric culture, we continue to explore additional opportunities to satisfy customer needs in this area.
Bed Bath & Beyond
Bed Bath & Beyond offers products made from recycled, repurposed, and organic materials and products having energy saving properties in a number of categories such as cleaning, bedding, bath, kitchen, and window.
Bed Bath & Beyond offers a broad array of non-toxic cleaning products that are free of PVC, formaldehyde, parabens, phosphates, and chlorine, among other chemicals. Plant-based cleaning products that are non-toxic, biodegradable, and free of genetically modified organisms and volatile organic compounds are also available. Examples of textile offerings made from renewable or recycled materials are 100% organic cotton towels and sheets, comforter sets with 100% recycled polyester fill, and luggage constructed with textiles made from post-consumer recycled materials. Bamboo, a fast growing renewable resource, is used in bath furniture, bath accessories, placemats, cutting boards, utensils, serve ware, and snack tables. Customers can also choose from a growing assortment of organic teas, coffees, juices, pastas, and snack foods.
Energy saving products are increasingly important to our customers. Included in our offerings are window treatments with insulating properties under the INSOLA® brand and others. All shower heads in the current in-store assortment have a maximum flow rate of 2.0 gallons per minute, which helps reduce water consumption. Smart home products, such as smart thermostats, are also available for our customers looking to achieve energy savings.
buybuy BABY offers a variety of organic products. The assortment includes layette and bedding made of organic cotton, organic fiber plush toys, as well as organic cotton towels and washcloths. buybuy BABY also offers mattresses made with organic materials and a number of GREENGUARD certified mattresses and cribs, as well as crib mattresses, gliders, and car seats that satisfy federal flammability requirements without the use of chemical flame retardants. Products bearing the GREENGUARD mark are certified by an independent third-party organization as having low emissions of volatile organic compounds. Customers can also choose from an assortment of organic baby food options and natural cleaning products.
Christmas Tree Shops, Christmas Tree Shops andThat!, andThat!
Within the constantly changing merchandise selection at Christmas Tree Shops, Christmas Tree Shops andThat!, and andThat!, customers have been presented with energy saving items such as insulated window treatments, door and window insulation kits, and weather stripping. In season, the selection has also included items such as outdoor solar lighting and solar driveway markers. A selection of bamboo cutting boards and other housewares, as well as a wide selection of natural woven products, such as baskets made of sea grass, bamboo, and straw, are regularly offered.
Harmon, Harmon Face Values
Harmon and Harmon Face Values carry lines of natural and organic health and beauty care products. These types of products are available in a variety of product categories including household cleaning products, baby personal care products for the skin (including diaper rash creams and lotions), shampoo, as well as an abundance of adult personal care products.
World Market, Cost Plus World Market, Cost Plus
World Market, Cost Plus World Market, and Cost Plus offer customers a broad selection of unique, authentic and affordable products sourced from over 50 countries in Europe, Asia, North and South America, Africa and Australia. Certain products are handcrafted by local artisans using recycled materials. Current examples of such products include Chindi Rugs from India that are hand woven from reclaimed silk and chiffon Sari fabric, as well as, woven dhurrie PET Rugs from India that are made from recycled plastic bottles spun into yarn and then dyed. Additionally, World Market, Cost Plus World Market, and Cost Plus offer collectible bowls, candleholders, jewelry boxes, and animal and shape decorative pieces that are hand carved out of Kisii Soapstone found in Western Kenya.
Of a Kind
Of a Kind has worked with over 500 emerging fashion and home designers, the vast majority of whom are based in the United States. Many of the items available on the site are handmade, sustainably produced, and/or made of recycled, organic, and ethically sourced materials, and the stories of the designers behind the products are shared alongside their work.
B. Product Safety & Compliance
At Bed Bath & Beyond Inc., we choose our vendor partners carefully, knowing the importance of responsibly managed factories, production, material choices, and output. In addition to requiring safe and compliant merchandise, we require vendors to comply with industry safety standards, company product standards, and our Code of Conduct.
Bed Bath & Beyond Inc. is committed to providing its customers with safe, high quality products. In order to achieve this goal, through our partnerships with accredited, world-wide, independent testing laboratories, the Company maintains a Product Safety & Compliance Testing Program (“Testing Program”). We have established extensive test protocols to evaluate product for compliance with applicable regulations, industry safety standards, and company product standards. We continually review, refine, and update our Testing Program.
Proactive Company Product Standards
We are diligent in our monitoring of industry and regulatory developments and trends, which allows us to be proactive in establishing Company product standards. In a number of cases, Bed Bath & Beyond Inc. requires its vendors to implement product standards ahead of government regulatory requirements. Bed Bath & Beyond Inc. has also established Company standards for certain product categories above and beyond regulatory requirements. Examples include:
- Policy established to mitigate the risk of furniture tipping by requiring a tip resistant kit and warnings to be included with any furniture item 30 inches or more in height that can be placed on the floor and against a wall. buybuy BABY also makes information available to consumers on the importance of using tip resistant kits.
- Policy requiring that expanding materials in toys meet the requirements of EN 71-1:2011. Expanding material is defined as a material that increases in volume when exposed to water. Toys with materials that expand in excess of the standard may pose a choking risk if swallowed.
- Policy prohibiting the use of feathers or down obtained by live plucking of birds. Vendors are required to take reasonable steps to ensure that feathers and down contained in their products are the by-product of the food chain.
Proactive Company Chemical Standards—Chemicals
Bed Bath & Beyond Inc. recognizes our customers’ interest regarding chemicals of potential concern in consumer products. In addition to diligent monitoring of regulatory and industry developments in this area, as part of our above and beyond requirements we have established the following:
- The Company maintains a Restricted Substances List ("RSL") identifying substances that are of potential concern to human health and the environment, although they may not be the subject of current legislation in North America. It is recommended that vendors exercise efforts to reduce or eliminate these substances of potential concern in their products. Vendors are reminded to avoid replacing substances of potential concern with another substance of equal or greater concern. Vendors are encouraged to always seek safer known alternatives. The RSL is reviewed and updated at least annually. A copy of the Restricted Substances List can be found here.
- Policy prohibiting use of certain flame retardants in all products.
- buybuy BABY makes available to customers information regarding the chemical flame retardant content of the crib mattresses, and nursery gliders and ottomans, and foam changing pads it offers for sale on its website.
- Policy aimed at reducing the use of lead and cadmium in products by requiring a more stringent chemical content level for private label products than required by current regulation. Policy to achieve phthalate reduction in plastics by extending the scope of regulatory phthalate limits for childcare articles to all private label products where phthalates may be present.
C. Product Packaging
Shipments to Customers
Our goal is to place our product in a package that reduces the amount of air space in each package. Bed Bath & Beyond strives to be as efficient as possible in packaging, including reducing package cube size where possible and, in those cases, using less material, optimizing shipping containers, and reducing fuel costs.
Private Label Packaging
Packaging decisions are more directly under our control on our private label merchandise. We have ongoing efforts in place to reduce printed surfaces, to use less ink and to increase our use of PEVA bags, the preferred option versus vinyl. For example, bamboo bath furniture products (a private label brand) are packaged in craft-style boxes, using less printing, in turn reducing our ink usage.
Progress continues on increasing our use of alternative packaging materials in our textiles, or soft side, categories. Some examples are:
- Pure Beech® modal and Eucalyptus Origins™ Tencel® lyocell private label textile products are packaged in PEVA bags.
- All EVA shower liners are packaged in EVA packaging.
- Continuing to incorporate self-fabric bags for sheets, duvets and comforters when possible, eliminating the need for vinyl.
We continue to seek and identify ways we can increase our use of PEVA bags and other alternative materials.
Hard Goods Packaging
As in our textiles areas, we continue to look for ways to improve the types of materials used in packaging our hard side goods. We use brown corrugate boxes with printed labels instead of printing on all surfaces on certain products. This reduces the use of ink, and we continue to look for opportunities to reduce our use of printed surfaces in other areas.
IV. In Our Facilities
Safe Handling and Disposal of Chemical Containing Products
We recognize the need for safe handling, transport and disposal of chemical containing products in order to protect the health and safety of our customers, our associates and the environment. Bed Bath & Beyond has partnered with The Worldwide Environmental & Regulatory Compliance Solution (“WERCS”), which is part of UL LLC (formerly known as Underwriters Laboratories), a global leader in the safety science industry. The WERCS program was developed specifically to give retailers access to accurate regulatory compliance data. Product manufacturers provide WERCS with detailed formulation information for their chemical containing products, such as household cleaners, personal care products and cosmetics. WERCS analyzes this information and provides us with the data necessary to comply with a variety of regulations relating to the proper handling, storage, transport, and disposal of these products. In addition, we regularly participate in conferences hosted by WERCS, where retailers share knowledge and best practices in this important safety and environmental field.
Reusable Shopping Bags
The introduction of the Bed Bath & Beyond reusable shopping bag has been a success for our customers looking for a shopping bag alternative. Our goal with this program has been the reduction of the distribution of single-use plastic bags.
We continue to evaluate other means of addressing issues related to single-use plastic bags, including the introduction of additional alternatives, and, in some areas, recycling. We believe plastic bag use is an area in which we have an ongoing opportunity to improve, and one in which we will continue to work with our customers to explore mutually beneficial ways to reduce their potential environmental impact.
Stretch Wrap Recycling
A component of waste frequently generated by our Company is stretch wrap. Stretch wrap is generally used during shipping to secure cartons of goods to pallets.
In late 2006, Bed Bath & Beyond began its first recycling program for stretch wrap. As of August 1, 2017, there are 440 Bed Bath & Beyond locations, 53 buybuy BABY locations, 54 Christmas Tree Shops, Christmas Tree Shop andThat! andThat! locations, 43 World Market, Cost Plus World Market, Cost Plus locations, and 12 Harmon, Harmon Face Values locations involved in the stretch wrap recycling program.
For the 12 month period August 1, 2016—July 31, 2017, we recycled 248 tons of stretch wrap.
According to http://www.helpsavenature.com, one ton of plastic saves 7.45 cubic yards of landfill space. By recycling stretch wrap in the programs noted above we saved 1,860 cubic yards of landfill space between August 1, 2016—July 31, 2017.
The Company continues to look for additional opportunities to expand the stretch wrap recycling program.
Bed Bath & Beyond purchases used boxes to meet some of our internal shipping and storage needs. For the twelve month period August 1, 2016—July 31, 2017, we have purchased 43,190 used boxes, or 21 tons of used corrugated.
Using the Environmental Paper Network Paper Calculator (www.papercalculator.org), this is an annual reduction of 106,155 lbs. of CO2 emissions, which equates to removing 10 cars from the road each year. It is a reduction of 68 tons of wood, which equates to 435 trees saved. It also equates to 30,370 lbs., or 1 garbage truck, of solid waste not generated.
As a Company, the single largest waste component we generate through operation of our stores is cardboard. Cardboard accounts for roughly 75% of all the waste the Company generates at store level. Ninety percent of our stores recycle their cardboard. Our cardboard is sent to various recyclers and processors for eventual use in the production of new cardboard products.
From August 1, 2016—July 31, 2017, we recycled 55,881 tons of cardboard.
According to www.recycleacrossamerica.org, for every ton of cardboard recycled, 46 gallons of oil is saved. Based on this information, we saved 2,570,526 gallons of oil from being used from August 1, 2016 —July 31, 2017.
Since 2007, it has been a Company requirement that all beverage vending machines be Energy Star compliant or have an external Vending Miser installed. The external Vending Miser reduces energy consumption so that the machine’s energy use is comparable to an Energy Star compliant machine.
As of December 1, 2017, the Company has 549 Energy Star compliant machines and 661 machines with the Vending Miser installed. The Company works with a vending management company to assure this requirement is met for all new locations, as well as maintained for existing locations.
Using the energy savings calculator found on www.energystar.gov, the Company estimates that we are saving 2,007,390 kwh per year. This equates to an annual reduction of 3,091,380 lbs. of CO2 emissions. The website www.energystar.gov also equates this to removing 274 cars from the road and saving 298 acres of forest each year. These calculations are based on the number of machines listed above.
On May 10, 2010, the Company energized its first solar power system at its corporate headquarters located at 650 Liberty Avenue in Union, New Jersey, totaling approximately 1.2 megawatts. The system provides a way to defend against rising electricity rates during the course of its more than 25 years of expected service. Since then, and as of March 1, 2017, the Company has energized solar power systems in its other corporate headquarters building located at 700 Liberty Avenue in Union, New Jersey, in six distribution centers located in Stockton, California, Middleboro, Massachusetts and Florence, Port Reading, Totowa, and Secaucus, New Jersey, and in 31 stores located throughout New Jersey, New York, Massachusetts, Ohio, California, and Connecticut.
These solar power systems have helped avoid emissions in an aggregate total of 20.64 megawatts or 28,307,767 kilowatt hours. The figures of avoided emissions equivalency data were obtained from www.epa.gov using the EPA’s Green Power Equivalency Calculator. The following data demonstrate the expected positive impact of the aggregate of the solar power systems installed in the facilities described above, over a one year period:
Energy Savings from solar power systems installed by the Company (as of July 03, 2018)
- New Jersey - Total of 16.86 mwh
- Massachusetts - Total of 3.15 mwh
- New York - Total of 0.90 mwh
- Ohio – Total of 0.34 mwh
- California – Total of 6.32 mwh
- Connecticut – Total of 0.737 mwh
Aggregate total of 28.31 mwh, which equates to 28,307,767 kwh.
Currently Installed Generation Will Avoid Greenhouse and Noxious Gas Emissions through the Reduction in Electrical Production (Greenhouse Gas Emissions based on EPA's Green Power Equivalency Calculator)
- 18,690 Tons Carbon Dioxide
- These Avoided Emissions are equivalent to:
- Annually removing 4,511 cars from the road; or
- Saving 2,370,555 gallons of gas each year; or
- Saving 48,775 barrels of oil each year; or
- Powering 3,158 homes each year.
For 2018, the Company anticipates solar system installations in two additional store locations in New Jersey. The solar power systems in these new stores will help avoid additional emissions in an aggregate total of 0.75 megawatts or 846,457 kilowatt hours.
The Company continues to explore the feasibility of energizing more solar power systems in additional states throughout the United States. The Company's implementation of solar technology is one more step in our continuing efforts to improve energy efficiency, while at the same time providing very real environmental benefits.
The Company has taken significant measures to modify lighting throughout its stores, warehouses and offices in order to reduce energy usage. These measures have resulted in a classic "win-win" scenario: Good for our Company and great for the earth.
The Company’s facilities/energy department teamed up with our lighting vendors to develop fixtures currently being installed in our stores that use High Efficiency Lumen Output ("HELO"). This technology provides the same or increased lighting levels in the stores and has a longer life and warranty period that results in fewer re-lamps and reduces lighting energy costs by approximately 34%. As of October 1, 2018, there are over 1,574 HELO lighting systems installed throughout the Company, which is comprised of installations in 236 new and 786 retrofitted Bed Bath & Beyond stores; 43 new and 40 retrofitted Christmas Tree Shops, Christmas Tree Shops andThat!, andThat! stores; 113 new and 9 retrofitted buybuy BABY stores; 26 new and 32 retrofitted Harmon, Harmon Face Values stores; and 97 new and 183 retrofitted World Market, Cost Plus World Market, and Cost Plus stores. Please note the foregoing electric expense reduction numbers assume a constant rate per kilowatt hour for comparison purposes.
The table below demonstrates the accumulated reductions in Greenhouse Emissions that our Company has achieved as a result of the HELO retrofitted locations only, measured from the date of each individual installation through October 1, 2018, as compared to the 12-month period of use prior to each specific HELO installation (avoided emissions equivalency data obtained from both www.epa.gov and www.abraxasenergy.com and is based on New Jersey Efficiency Levels):
Positive Environmental Impact of Bed Bath & Beyond Inc.’s Lighting Installations
- Energy Savings:
- 2,083,274,923 kwh
- Greenhouse and Noxious Gas Emissions Avoided Yearly:
- 1,612,503,922 lbs. Carbon Dioxide
- 4,289,472 lbs. Sulfur Dioxide
- 2,500,005 lbs. Nitrogen Oxides
- 208,334 lbs. Carbon Monoxide
- 208,334 lbs. Particular Matter
- 19,166,713 lbs. Mercury Compounds
- 57,083,473 lbs. Lead Compounds
- These Avoided Emissions are Equivalent to Any One of the following:
- Annual greenhouse gas emissions from 139,804 passenger vehicles
- CO2 emissions from 82,274,810 gallons of gasoline consumed
- CO2 emissions from 1,701,193 barrels of oil Consumed
- Carbon sequestered annually by 155,606 acres of pine forest
- Greenhouse gas emissions avoided by recycling 245,907 tons of waste instead of sending it to the landfill
While the HELO lighting project has been extremely successful, the Company has not stopped there in implementing measures to reduce energy consumption. It has instituted many other lighting modifications throughout its stores that include reducing the number of lamps used in stockrooms, displays and corridors; dimming lighting fixtures; converting exterior lights from high energy to low energy usage by using new long life technology; implementing advanced control programming from the Novar energy management system (discussed in more detail below); testing light sensors that monitor the level of natural light available and dim the lights when sufficient daylight is available; significant reductions of lighting exterior building signs throughout the night; delaying the time customer lights are turned on throughout our stores; and requiring LED lighting that has a longer life span, produces less heat and uses significantly less energy than typical neon signs. Monitoring light levels in the stores has reduced energy consumption and the amount of energy required to cool the building, as lights give off heat. As of October 1, 2018, there are 45,579 specialty lighting fixture LED lamps installed by the Company, resulting in an annual reduction of 2,825,898 kwh. In addition, 4,123 conventional exterior security light fixtures have been converted to HELO lighting technology by the Company, resulting in an annual reduction of 1,158,563 kwh.
In late 2013, the Company started retrofitting parking lot lights. As of October 1, 2018, 850 conventional parking lot light fixtures have been converted to HELO lighting technology by the Company, resulting in an annual reduction of 238,850 kwh.
In 2016, the facilities/energy department again teamed up with our lighting partners to reduce our energy usage and operational cost. The new project would replace our T8 Fluorescent lamps with LED lamps, reducing wattage from approximately 32 watts to 15 watts per lamp (lamp wattage). The project took full advantage of our maintenance relamp cycle, utility incentives, EPAct tax reduction credits and warranties. The LED lamps will increase lamp life, and reduce maintenance cost. The result is approximately 18% energy reduction per store.
As of October 1, 2018, there are over 989 LED lighting systems installed throughout the Company, which is comprised of installations in 3 new and 652 retrofitted Bed Bath & Beyond stores; 65 retrofitted Christmas Tree Shops, Christmas Tree Shops andThat!; 2 new and 77 retrofitted buybuy BABY stores; 1 new and 30 retrofitted Harmon and Harmon Face Values stores; and 3 new and 156 retrofitted World Market, Cost Plus World Market, Cost Plus stores, resulting in an annual reduction of 100,867,912 kwh.
More than 88% of Bed Bath & Beyond locations and most new Christmas Tree Shops, Christmas Tree Shops andThat!, buybuy BABY, Harmon, Harmon Face Values locations are serviced by the most energy efficient Heating, Ventilating, Air Conditioning ("HVAC") equipment available for commercial buildings. Older stores receive the newer energy efficient equipment when their old HVAC equipment is replaced. In 2005, we became one of the first retailers to adopt the use of environmentally friendly HVAC equipment, which uses non-CFC refrigerant R410A. In late 2012, the Company started installing Variable Frequency Drives ("VFD"). The VFD units reduce the speed of the fan in the HVAC units, while still providing comfort.
In 2017, as part of our HVAC replacement project, 28 locations had their HVAC equipment replaced, which included 300 pieces of new equipment. As part of our replacement program, we have contracted with a national recycling company and have recycled 2,900 pounds of refrigerant, 143,074 pounds of ferrous materials, and 30,880 pounds of non ferrous materials. During the course of the replacement program, we have removed and recycled over 218,164 pounds of materials from the waste stream.
Energy Management Systems
Nearly every Bed Bath & Beyond, Christmas Tree Shops, Christmas Tree Shops andThat!, andThat!, buybuy BABY, World Market, Cost Plus World Market, Cost Plus and many Harmon, Harmon Face Values locations use the Novar energy management system to monitor and control energy use, lighting, heating, cooling, signs and even the amount of electricity that the stores use. As of October 8, 2018, the Company utilizes 1,494 energy management systems. Retrofitted stores experienced an average reduction of fifteen percent in their electrical consumption.
The new lighting and HVAC reduction and monitoring projects have provided, and will continue to provide, immense benefits for the environment. The following figures were provided in recognizing the expected positive impact of the lighting and HVAC changes in a single Bed Bath & Beyond store, over one year:
Energy Savings in both lighting energy and HVAC reduction (less cooling required):
- 107,989 kwh
The Following Greenhouse and Noxious Gas Emissions Avoided Due to the Reduction in Electrical Production (Greenhouse Gas Emissions):
- 44.8 tons Carbon Dioxide
- 243 lbs. Sulfur Oxide
- 139 lbs. Nitrogen Oxides
- 12 lbs. Carbon Monoxide
- 12 lbs. Particulate Matter
- 1,056 lbs. Mercury Compounds
- 1.6 tons Lead Compounds
These Avoided Emissions are equivalent to:
- Planting 19 trees every week; or
- Planting 12 acres of forest per year; or
- Saving 4,982 gallons of gas each year; or
- Annually removing 9 cars from the road; or
- Driving 310 fewer miles each day.
While the operation of the Company does not result in substantial water usage, Bed Bath & Beyond Inc. is committed to water conservation where feasible. As a result, metered faucets are now used to save on water. In addition, the new .5 gallon/ flush urinals being used in most stores in the Company use half the amount of water of a regular urinal, which reduces water consumption. Total water savings of these combined efforts is approximately 9,000 gallons a year.
White “Cool” Roof
Many stores have a white roof which reflects the sunlight, prevents the absorption of heat into a building and allows a savings in energy cost per year (estimated at $0.03 / sf) by reducing heat gain inside. Conventional black roofs absorb heat resulting in increased air conditioning costs. A single 30,000 square foot store saves $900 a year. As of June 2018, the Company has 459 Johns Manville cool roofs.
Other Green Building Measures
The Company continuously looks for new ways to improve operations within the store and its impact on the environment, whether such measures have a significant impact like the HELO lighting project or only a minor impact. No measure is considered too insignificant if it makes sense for our Company to implement it. As a result, other measures that have been taken in our stores throughout the Company include use of sensor operated hand dryers in lieu of paper towels, which conserve paper; vinyl flooring adhesive that gives off zero toxins to provide a healthier indoor environment for customers and associates; and reduction in the use of metal. Further, since March 2011, all wall bumpers installed by the Company in new stores are one hundred percent vinyl free and made of polycarbonate which is one hundred percent recyclable.
Balancing the amount of packaging needed for safe shipping of product with space efficiencies is key in waste reduction. If goods are damaged in transit, product waste is incurred. If overprotected, packaging is wasted. Maintaining the balance is our goal at Bed Bath & Beyond. One initiative to attain this goal is to optimize the number of units in each carton shipped to our stores. Ongoing efforts are in place to ship the most efficient number of units per carton, saving corrugated packaging. The related weight reduction translates into a reduction in fuel consumption as well. This ongoing "Freight Think/Case Pack Optimization" program expects to continue to find opportunities that will result in more "right-sized" packaging, resulting in more efficient use of corrugated packaging and, therefore, transportation.
Use of Paper in Marketing Communications
Sustainable Paper Procurement Policy
At Bed Bath & Beyond Inc., we recognize our role in the lifecycle of our print advertising material, and we embrace the responsibility for making that lifecycle as environmentally sustainable as we can. From our founding in 1971, word-of-mouth has defined our approach to communicating with our customers, allowing the quality and selection of our merchandise to speak for themselves. Consequently, we believe we have traditionally relied less on paper to deliver our message than comparable enterprises.
Print ads remain essential marketing tools. Our goal is to increase the sustainability and reduce the environmental footprint of these tools to the greatest extent practicable through our paper selection and use. We encourage the continuing environmental performance improvement of our paper suppliers.
Our Approach to Sustainable Paper Procurement
Although there is no universally accepted definition of sustainable paper, Bed Bath & Beyond Inc. achieves its sustainable paper procurement goal by meeting specific commitments in five key areas:
- Fiber from Non-Endangered, Sustainable Forests
- Certified Fiber
- Environmentally Superior Manufacturing
- Energy and Greenhouse Gas Reduction
- Minimum Use of Paper
To meet these commitments we use an internal action plan, minimum supplier requirements, supplier preferences, and wherever possible, quantifiable targets. Rather than drafting and redefining new forestry, manufacturing or other sustainability standards and imposing them on ourselves and our suppliers, we have chosen from existing, widely-accepted and respected national and international standards wherever possible. For our forestry requirements, our suppliers will have the option of complying with the relevant provisions of one or more of the following forest certification standards:
- Forest Stewardship Council ("FSC")
- Sustainable Forestry Initiative ("SFI")
- Programme for the Endorsement of Forest Certification Schemes ("PEFC")
Fiber from Non-Endangered, Sustainable Forests
Minimum supplier requirement: Suppliers must demonstrate that none of the fiber in the paper they supply the Company originates in forests that are illegally harvested or endangered, as defined by the FSC, SFI, or PEFC standards. Suppliers also must demonstrate compliance with the Lacey Act, the U.S. law enacted to prevent the importation of illegal wildlife, fish and plants. In 2008, the Act was amended to include illegally harvested wood and wood products, including pulp and paper.
Supplier preference: The Company prefers suppliers who document that all of the fiber in the paper they supply is at least "controlled wood" as defined by the FSC standard or the SFI Fiber Sourcing standard.
Company target: 100 percent of the fiber in our print advertising material is documented as at least controlled.
Minimum supplier requirement: All paper sold to the Company must be certified to either a chain-of-custody or sustainable fiber procurement standard. In addition to the forest certification standards listed above, we will accept certification to other credible standards, including the American Tree Farm System ("ATFS") and Master Logger.
Although the focus of our policy is sustainability, we strive to use paper with recycled content when it is available at price parity with virgin fiber paper, as long as it meets our rigorous print quality standards.
Supplier preference: The Company prefers suppliers who can document the highest percentage of the fiber in their paper back to forests certified to the FSC standard.
Company target: 100 percent of the paper used in our circulars is FSC, SFI and PEFC certified. Much of the fiber in all our other print advertising material is also certified and will work with our suppliers to continue increasing our certified paper purchasing, with the ultimate goal of certifying 100 percent of that fiber.
We expect that all paper merchants keep their certifications (FSC, PEFC and SFI) current to maintain chain of custody.
Environmentally Superior Manufacturing
Minimum supplier requirement: All suppliers must demonstrate to the Company that they operate in an environmentally responsible manner, encourage pollution prevention and seek continuous environmental performance improvement.
Supplier preference: The Company prefers suppliers who:
- Report their environmental and sustainability performance using Metafore’s Environmental Paper Assessment Tool® (“EPAT”);
- Have adopted, implemented and maintain an Environmental Management System (“EMS”) with elements the same as or comparable to the ISO 14001:2004, EMAS including equivalent company programs; or
- Qualify for eco-labels like Blue Angel and Nordic Swan.
Company Target: 100 percent of the Company paper suppliers publish a publicly available Sustainability or Environmental Report.
Energy and Greenhouse Gas Reduction
Minimum supplier requirement: The lack of binding state, federal and international standards for greenhouse gas emissions combined with differing supplier operational considerations makes it difficult to set a specific greenhouse gas reduction requirement for all suppliers. Until clear standards are established, we ask our suppliers to demonstrate a commitment to continuous performance improvement in both overall energy efficiency and greenhouse gas reductions.
Supplier preference: The Company prefers suppliers who demonstrate continuous energy-related performance improvement, including increased overall energy efficiency in the amount process waste, finding beneficial uses for their process waste, decreased fossil fuel use, reductions in the amount of process water used per ton of product produced, increased use of renewable energy and decreased greenhouse gas emissions per ton of production (intensity).
Company target: The Company seeks to reduce the carbon footprint of our catalogs, inserts and circulars by moving toward lighter-weight paper grades where practical. Lightweight papers require less energy to manufacture and ship, thereby reducing greenhouse gas emissions that contribute to climate change.
Minimum Use of Paper
Responsibly managed forests where trees are grown, harvested and re-grown in harmony with nature provide a perpetual resource for papermaking. Even so, the Company believes we have a responsibility to use this valuable resource as efficiently as possible. To minimize our use of paper we:
- Conduct regular mailing list maintenance to assure lists are accurate and up to date.
- Maintain in-house do-not-market lists for customers and prospects who do not wish to receive circulars from us.
- Participate in the DMA Choice program of the Direct Marketing Association (“DMA”), which allows consumers to opt-out of unwanted catalog mailings via the internet.
- Design catalogs, inserts and circulars for maximum economy of space.
- Work with our printers to eliminate overprinting and reduce waste.
- Encourage recycling through our participation in programs like the DMA’s Please Recycle campaign.
- Benchmark and implement best environmental practices through our participation in the DMA Green 15 program.
Beyond Our Walls
Since May 2006, hybrid vehicles have been used by Bed Bath & Beyond. As of July 1, 2018, we have 99 hybrid vehicles in our fleet, of which 55 are being used by Bed Bath & Beyond associates, 19 by Christmas Tree Shops, Christmas Tree Shops andThat!, andThat! associates, 7 buybuy BABY associates, and 3 by Harmon, Harmon Face Values associates, and 15 by Cost Plus World Market associates.
The Ford Fusion Hybrid is the Hybrid vehicle being purchased at this time. The 2017 Ford Fusion Hybrid achieves 42 mpg. By using the Fusion Hybrid rather than the standard Fusion, we are reducing our carbon emissions by 40%. Calculations come from the Carbon Footprint Calculator on www.terrapass.com.
The EPA rates vehicles in two categories: smog and greenhouse gas. The results are scored on a scale of 1 (worst) to 10 (best). The Ford Fusion Hybrid received a smog rating of 8.0 and a greenhouse gas rating of 9.0. The Ford Fusion Hybrid earned the SmartWay recognition from the EPA. This goes to those vehicles that have a smog rating of 5 or higher and a greenhouse gas rating of 7 or higher.
The movement of goods is a prime example of an area of our enterprise where the benefits of seeking greater efficiency extend beyond the strict limits of the Company’s business. The Company has had success in finding ways to reduce expense and emissions in its supply chain, and this remains an area where opportunities for improvement still exist. This section will discuss some of those achievements and areas of further potential. The activities described below pertain both to Bed Bath & Beyond and buybuy BABY product supply chains, except for the SmartWay Partnership discussion, which information reflects all concepts.
Pool and Consolidation
In 2004, the Company began a program called Pool and Consolidation. This program takes Less than Load and Parcel purchase order quantities shipping to individual stores and groups them together by region to make fewer larger shipments to stores. By shipping through this mode, Bed Bath & Beyond has reduced the number of individual carriers handling its products and delivering to its stores. As a result we have reduced the overall miles a package travels, as well as decreased the number of trucks handling our package volume. Overall Collect Managed Freight for inbound Bed Bath & Beyond merchandise volume is 75% of these packages moving through this consolidation network.
Since 2007, and each subsequent year thereafter the Company has strived to move an increasing percentage of its domestic transportation on intermodal transportation rather than traditional "Over the Road" trucking. In fiscal 2017, we moved 71% of our Truckload miles via intermodal service on the four main railroads. In fiscal 2018, we are on pace to move an equivalent percentage of Truckload volume via rail. We estimate that will equate to 423 million lbs. taken off the interstate highways. We also estimate that we will reduce 65% of Carbon Footprint by using an intermodal rail solution instead of "Over the Road" trucking by reducing 2,345million metric tons of CO2 equivalent emissions.
Partnering with railroads and intermodal service providers to move our domestic freight has enabled us to reduce transportation related emissions, reduce highway congestion and improve our visibility to Bed Bath & Beyond freight in transit.
SmartWay® was launched by the U.S. Environmental Protection Agency ("EPA") in 2004. It is a brand that identifies products and services that reduce transportation-related emissions. SmartWay symbolizes environmentally cleaner, more fuel efficient transportation options.
The Company became a SmartWay Partner in August 2009. This collaboration challenges us to improve the environmental performance of our freight operations and helps us to know what environmental impact we are having through the carriers we select and modes we transport goods to our stores. Based on the tonnage we ship today, over 68% is transported and handled by carriers who are SmartWay Carrier Partners. The use of the SmartWay Partner label requires that the carrier report certain base line equipment, emissions and fuel consumption data to set a baseline and then they must report an action plan and demonstrate progress to maintain a certain score levels. Our objective in this area is to continue to increase the percentage of Company freight moving with SmartWay Partners and to utilize this information as a factor in our decision-making when awarding contracts to service providers in transportation and warehousing. As a SmartWay Partner, we have committed to improving energy efficiency, reduce greenhouse gas emissions, and improve air quality.
Since 2004, SmartWay Partners have reported reducing harmful air pollutants by 103 million tons. SmartWay Partners also report to have saved an equivalent of up to 215.4 million barrels of oil ($29.7 billion dollars in fuel costs saved) and eliminating 9,000 tons of particulate matter. (The emissions data is from the EPA SmartWay website, www.epa.gov/smartway).
Rules/Standards for Carriers
Carriers that choose to become SmartWay Partners commit to improving freight carrying operations. They agree to set and strive for attainment of environmental and fuel efficiency goals that improve the environment. SmartWay recommends simple actions to make ground freight more efficient and cleaner for the environment. Some of the strategies include: Idle Reduction, Improved Aerodynamics, Automatic Tire Inflation Systems, Wide-Base Tires, Driver Training, Low-Viscosity Lubricants, Weight Reduction, Intermodal Shipping, and Hybrid Powertrain Technology.
Benefits of SmartWay Partnership
Benefits of the SmartWay Partnership include:
- Access to information on how to reduce fuel consumption and emissions.
- Assistance developing a quantifiable program to improve our environmental impact.
- List of partner carriers.
- Recognition for improving our environment.
Most Bed Bath & Beyond carriers are SmartWay Partners and have joined the initiative to improve on their own fuel efficiency and other green initiatives. Bed Bath & Beyond will continue to improve its supply chain to target efficient modes of transportation and packaging to reduce the negative environmental impact of its supply partners.
In Our Offices
Paper Best Practices
Bed Bath & Beyond follows a “Best Practices” policy for reducing copy paper consumption. Some of the practices include elimination of fax confirmation pages, a commitment to duplex printing, and an annual review of regularly generated documents.
These practices not only impact the amount of paper used, but the amount of toner as well. Some other practices include limiting the use of shading, use of print preview to better format documents, and electronic review and filing of documents. Since 2008, all printers purchased for our corporate office and warehouse locations have duplex capability and are defaulted to duplex printing. As of 2010, all printers purchased for the stores throughout the Company are also duplex capable and default to duplex printing.
Electronic Data Interchange ("EDI") is defined as the process of using computers to exchange business documents between companies. EDI is a more environmentally friendly process that minimizes paper use and storage requirements.
The Company implemented EDI as a preferred method of purchase order and invoice transmission for corporate purchasing expenditures beginning in November 2008. Prior to EDI, the Company printed hard copies and utilized fax machines to issue purchase orders to our suppliers. There are approximately 50 corporate purchasing suppliers participating in EDI. The Company has reduced fax transmissions by approximately 85,000 pages (17,000 purchase orders x average of 5 pages / order).
In addition, the Company uses a similar approach to receiving supplier invoices. Invoices are also transmitted via EDI reducing inbound standard mail by approximately 85,000 pages.
Since the implementation of EDI, the Company has discontinued the filing and storage of paper purchase orders and invoices for suppliers. Using the Environmental Paper Network Paper Calculator (www.papercalculator.org), eliminating 170,000 pages represents an annual reduction of 4,760 lbs. of CO2 emissions.
The Company started EDI for store purchase orders of merchandise in 1997 and started receiving EDI merchandise invoices in 1998. Bed Bath & Beyond and buybuy BABY process over 12 million purchase orders and 18 million invoices via EDI annually.
Bed Bath & Beyond Inc. has been using remanufactured printer toner cartridges rather than newly produced cartridges for several years. For the twelve month period August 1, 2016—July 31, 2017, 93% or 17,909 cartridges used, were remanufactured. In addition to purchasing remanufactured cartridges, it is our policy to return used cartridges to our provider so that the material can be used again.
As a further attempt to reduce toner waste, the Company encourages its associates to reduce printer toner by changing the density setting from high to medium. This will reduce the consumption of toner in all stores and offices.
We continue to look for more opportunities to use remanufactured cartridges rather than purchase newly manufactured cartridges and look for other ways to reduce toner throughout the company.
Copier / Fax Machines
The U.S. Environmental Protection Agency and the U.S. Department of Energy have established the Energy Star program which is designed to prevent greenhouse gas emissions by having products that meet strict energy efficiency guidelines.
The company has been purchasing fax machines and copiers that are Energy Star rated since 2003. As of December 1, 2017, we have 145 Energy Star qualified copiers and 24 Energy Star qualified fax machines.
Using the energy savings calculator found on www.energystar.gov, Company estimates that we are saving 104,900 kwh per year. This equates to an annual reduction of 161,000 lbs. of CO2 emissions. The above energy savings calculator also equates this to removing 14 cars from the road and saving 19 acres of forest each year. These calculations are based on the number of machines listed above.
The Company continuously looks for opportunities to reduce energy within its corporate offices as part of its Corporate Campus Energy Awareness Program. Some of the measures that continue to be taken are to enable the energy saver function on all monitors and PC's so they will power down after fifteen minutes of non-use, deploy flat panel displays that require less power in replacement of broken CRT's, purchase smaller form factor PC's that use less energy, utilize servers that require less power to run, acquire new green printers that require less power, place printers into sleep mode so they shut down after a period of time, and install multi-function printers in areas that had a copy, fax and printer previously, thus reducing power consumption. Associates are encouraged to pitch in by turning off lights in conference rooms when not in use and shutting off their computers and business equipment at the end of the day. Many of these solutions are used in our stores as well.
Corporate Campus RubberWay® Walkway
In support of our continued commitment to healthy lifestyles, Bed Bath & Beyond installed a 10,500 square foot RubberWay® rubberized walkway and installed 21,500 square feet of porous rubber pavement to create an associate walkway. The use of these recycled materials provided an immediate environmental benefit.
The installation of the RubberWay paving systems diverted 198,000 pounds of passenger tire rubber which equates to the diverting of 16,500 passenger tires from local landfills. Bed Bath & Beyond had the vision to make an environmental impact in the community while providing an excellent walkway surface for staff recreation.
Corporate Campus Parking Lot
When Bed Bath & Beyond demolished a two-story office building and developed an employee parking lot for 247 corporate campus employees, the Company reused all of the masonry and concrete from the building and all of the excavated soil from the site. Additionally, all site water sheet flows to supply water to the perimeter landscaping. During this project, Bed Bath & Beyond recycled 3,600 yards of concrete and reused 2,100 yards of dirt fill.
V. Social Compliance (including disclosures under the California Transparency in Supply Chains Act of 2010)
Bed Bath & Beyond Inc. is committed to sourcing quality merchandise while developing meaningful, long-term relationships with vendors who share common principles of social responsibility. In connection with this effort, we encourage our vendors to adopt a comprehensive program of responsible practices and to prepare a corporate responsibility (or “sustainability”) report if they do not already do so.
In addition, all vendors and their factories must adhere to our Code of Conduct
which details our policies in regard to child labor, involuntary labor, human trafficking, disciplinary practices, non-discrimination, health and safety, environmental protection, wages and benefits, working hours, employee relations, and other items. Vendors must also follow our Conflict Minerals Policy included below.
Vendor compliance with the Code of Conduct is verified in part through our Social Compliance Audit Program detailed below. Information on the Social Compliance Audit Program, the Code of Conduct and Conflict Minerals Policy are made available to vendors in our Quality Assurance Manuals.
Social Compliance Audit Program
As an additional measure in support of responsible sourcing, the Company maintains a Social Compliance Audit Program (“Audit Program”). The structure of the Audit Program varies by concept and can consist of vendor self-validation, review of existing third party audits, and/or onsite factory audits. The Company has partnered with a third-party provider to help facilitate and manage the Audit Program. The Audit Program covers all aspects of the Code of Conduct including assessing risks of human trafficking and slavery. When third-party on-site audits are conducted they include meetings with factory managers, a factory tour, and worker interviews outside the presence of factory management, as well as document review. Each supplier is notified in advance of a two-week window when an on-site audit is expected to take place, but the actual audit date is unannounced. When an area of noncompliance is identified, the factory is required to develop a corrective action plan. Depending on the severity and type of non-compliance, factories are given 30, 60, or 180 days to correct the problem. At the end of the corrective period, the factory is re-audited. The Company may deny business after certain types of noncompliance and when suppliers do not meet the corrective action plan and re-audit requirements. The Audit Program is currently maintained by Bed Bath & Beyond, buybuy Baby, Christmas Tree Shops, Christmas Tree Shops andThat!, andThat!, World Market, Cost Plus World Market, Cost Plus, Harmon and Harmon Face Values. The Company is looking to expand the Audit Program to its other businesses.
The Product Safety & Compliance team meets with Company executives at least annually, and typically more frequently, to review the Audit Program. The Board of Directors is also updated periodically on the status of the Audit Program. The Product Safety & Compliance team, as well as other associates with roles related to the supply chain, participates in meetings and webinars provided by third-party providers to stay current on the subjects of human trafficking and slavery and to further develop the Audit Program. The Code of Conduct and specifically issues of human trafficking and slavery are addressed in the Company’s training of new associates with supply chain responsibility. The training is repeated annually for those associates. All Company associates are expected to adhere to the Code of Conduct and Company Ethical Policies and report any violations to the General Counsel.
Conflict Minerals Policy
Rule 13p-1 under the Securities Exchange Act requires U.S. publicly traded companies that manufacture or contract to manufacture products to report to the Securities and Exchange Commission (“SEC”) annually on whether those products contain tin, tungsten, tantalum, and/or gold necessary to the functionality or production of the products and whether those minerals were derived from Covered Countries. The "Covered Countries" include: the Democratic Republic of the Congo; Angola; Burundi; Rwanda; South Sudan; Tanzania; Central African Republic; Uganda; Republic of the Congo; and Zambia. Additional information can be found at .
Bed Bath & Beyond Inc. takes its obligations under SEC regulations and other regulations seriously. Bed Bath & Beyond Inc. has adopted the supplier requirements contained herein as part of our Conflict Minerals Program. Suppliers are expected to review the Conflict Free Sourcing Initiative's lists of compliant (conflict-free) smelters and refiners and strive to only accept tin, tungsten, tantalum, and gold that derive from smelters and refiners on these lists, including smelters and refiners that source from the Covered Countries. The lists are available at http://www.conflictfreesourcing.org/conflict-free-smelter-refiner-lists/.
In furtherance of the foregoing, Bed Bath & Beyond Inc. also specifically expects all suppliers of Bed Bath & Beyond Inc. imported and domestically sourced private label products to:
- Adopt and comply with a conflict free sourcing policy that is consistent with these requirements and Bed Bath & Beyond Inc.'s publicly posted Code of Conduct, and to require its direct and indirect suppliers to do the same;
- Determine which of the products incorporate tin, tungsten, tantalum, or gold, regardless of country of origin;
- Map its supply chains associated with those products, including by engaging its suppliers to identify the smelters and refiners used in its supply chain to process the tin, tungsten, tantalum, or gold and determining whether those minerals are recycled, scrap or original extraction;
- Obtain and prepare documentation supporting the origin determination for any tin, tungsten, tantalum, or gold incorporated into the products; and
- Otherwise put in place policies, procedures and frameworks that are consistent with the Organisation for Economic Co-operation and Development's Due Diligence Guidance for Responsible Supply Chains of Minerals From Conflict-Affected and High-Risk Areas.
Bed Bath & Beyond Inc. will annually require sourcing and related information from certain suppliers in the form of a survey that must be completed for imported and domestically sourced private label products supplied to Bed Bath & Beyond Inc. Bed Bath & Beyond Inc. reserves the right to request this information on a more frequent basis and to request additional or supplemental information. If any information concerning the usage or source of tin, tungsten, tantalum, or gold furnished to Bed Bath & Beyond Inc. is later determined by the supplier to have been inaccurate, the supplier shall promptly (and in any event within 72 hours) notify Bed Bath & Beyond Inc.
Bed Bath & Beyond Inc. also reserves the right to periodically request documentation evidencing a supplier's sourcing policies and practices and the efforts the supplier has taken to identify the source of the tin, tungsten, tantalum, or gold used in Bed Bath & Beyond Inc. imported and domestically sourced private label products.
Bed Bath & Beyond Inc. believes in establishing and maintaining long-term relationships with suppliers whenever possible. If Bed Bath & Beyond Inc. determines that a supplier may be violating any of the foregoing expectations, Bed Bath & Beyond Inc. may require the supplier to commit to and implement a corrective action plan within a reasonable timeframe. Continued failure to adhere to these expectations and refusal to address issues of concern may lead to termination of Bed Bath & Beyond Inc.'s business relationship with the supplier. Nothing contained herein shall be interpreted to preclude Bed Bath & Beyond Inc. from terminating any supplier relationship at any time for any reason.
Violations of the Conflict Minerals Policy can be reported to Bed Bath & Beyond Inc.’s Legal Department (Attention: General Counsel) at 908-688-0888 so that the matter may be fully investigated and appropriate remedial action taken.
Failure to adhere to the above policy or to provide requested information to Bed Bath & Beyond Inc. may result in vendor chargebacks or vendor payment hold.
VI. Our People
The integration of retail store and digital channels is providing new job opportunities throughout the Company that are being filled, in part, by promotions from within the Company, as well as by hiring the most qualified candidates. As we continue to transform the Company to meet and exceed the needs of our customers, our "promote from within" philosophy will continue to offer the opportunity for advancement of qualified associates. We offer numerous opportunities for people who wish to move ahead in the retail field and demonstrate commitment, motivation, and ability. We also welcome new associates who bring new perspectives and experiences that are valuable in strengthening our teams.
The Company celebrates diversity and believes that our diverse workforce contributes to the strong bond our associates have with our customers. We also believe that our commitment to diversity and the outstanding opportunities for professional and personal growth we offer to all associates, regardless of background, contribute to the high associate retention rate that we have long enjoyed.
For more information see our Complete Commitment to Equal Opportunity and Diversity Statement.
The Company has zero tolerance for any form of harassment or unlawful discrimination. Our policies relating to workplace issues revolve around a philosophy of mutual respect.
Since its founding in 1971, the Company has been committed to working directly with our associates with respect to any issues that may arise. Our actions over the years demonstrate our desire to have our managers available for our associates. Our associates share a common mutual interest to do what is right for our customers and our business. We are proud of the environment we provide our associates. We have a commitment to communicating with our associates, ensuring they work in a safe environment, providing recognition and feedback, training and developing our associates, treating them consistently, and having our leadership team act with integrity and lead by example in all instances.
We have developed a culture that believes in empowering our people with a decentralized management structure. We give them the autonomy to run the business and be an entrepreneur. This empowerment and decentralized decision-making process includes many responsibilities, such as intellectual honesty.
We remind our associates that they are representatives of the Company and, as such, it is expected that their behavior and conduct are appropriate and beyond reproach in all professional and personal dealings and interactions with all levels of associates, vendors, customers, or others.
The Company is also committed to maintaining a working environment completely free from harassment, unlawful discrimination or intimidation of any kind. We have policies and procedures in place to discourage such conduct and enable associates to report such conduct (including anonymously) so that it can be promptly and fairly addressed. Appropriate disciplinary action will be taken against any associate who harasses or unlawfully discriminates in violation of this policy.
Safe Work Environment
It is the policy of Bed Bath & Beyond Inc. to provide a safe and accident free environment for our associates and customers.
The success of Bed Bath & Beyond in preventing accidents from occurring is dependent upon three critical elements:
- Established safety standards
- An awareness and training program
- Safe work practices consistently enforced
The Company has an established safety program and encourages safe work practices. We provide awareness and training programs for all associates. The specific awareness and/or training programs includes: Regulated Waste Program, Lifting and Ladder Certification, Fire Safety Training, Material Safety Data Sheets ("MSDS"), Safety Knife, Workplace Violence training, and Code Adam alerts.
The safety of our customers and associates requires that we address violations of safe work practices. Safety guidelines provide a fair and consistent approach to counseling when unsafe practices are observed.
Employment at any of our locations is based solely on job-related qualifications: we recruit, hire, train, promote and compensate our associates and provide all other conditions of employment including company sponsored events without regard to race, color, creed, religion, national origin, age, sex, gender identity, genetic information, marital status, lawful alien status, sexual orientation, physical or mental disability, citizenship status, veteran status, employment status, or any other basis prohibited by applicable law. Employment actions are based upon our operating needs and individual associate or applicant merit, including but not limited to: qualifications, experience, ability, availability, cooperation, and job performance.
Our Associate Referral Bonus Plan is designed to provide incentive to associates to encourage and recommend friends, acquaintances, former work associates, or people met while shopping who provided excellent customer service for possible employment with us.
In addition, our recruiting efforts are widespread via such means as the Internet, college campus visits, job fairs, and venues designed to increase our access to qualified minority candidates.
Bed Bath & Beyond Inc. provides its eligible associates with a variety of benefits, including:
- Medical & Dental Benefits
- Personal Life Insurance
- Short and Long Term Disability
- Health Care Savings Accounts
- Dependent Care Flexible Spending Account
- Health Care Flexible Spending Account
- Paid Sick Days
- Paid Vacation
- Paid Personal Days
- 401(k) Savings Plan
- Associate Purchase Discounts (internal and external)
Training and Education
Bed Bath & Beyond’s strong, service-oriented culture is based on a philosophy of promoting from within. Our many training programs, such as Associate Development Training, Management Development Training, Leadership Development Training, and Product University Training, are designed to give our associates the skills that will enable them to grow as far as their ability will take them in our Company.
Associates are considered for advancement based on their performance in their present position and the skills they demonstrate. There are many career opportunities available to qualified associates. Associates are encouraged to let their supervisors know exactly what their interests are, to learn as much as possible about the various careers within the Company and to be certain that their performance is at its best.
VII. Corporate Governance
A. Governance Structure of the Organization
The Company lists its Directors and Executive Officers in the Investor Relations section of its website at www.bedbathandbeyond.com. The Board of Directors is made up of three executive and nine independent members.
The Board of Directors, upon the advice of the Nominating and Corporate Governance Committee, has determined that each of Mmes. Bell-Rose, Morrison, Ruesterholz, and Messrs. Adler, Barshay, Eppler, Gaston, Heller and Osborne are "independent directors" under the independence standards set forth in the Nasdaq Listing Rule 5605(a)(2). This determination was based on the fact that each of these directors is not an executive officer or employee of the Company or has any other relationship which, in the opinion of the Board of Directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director.
More information is available in the Company’s 2018 Proxy Statement, in the Board Independence section (pg. 15).
The Company’s executive officers are elected by the Board of Directors for one-year terms and serve at the discretion of the Board of Directors. No family relationships exist between any of the executive officers or directors of the Company.
Co-Chairmen Warren Eisenberg and Leonard Feinstein, founders of Bed Bath & Beyond Inc., and Chief Executive Officer Steven Temares, are executive officers in addition to being members of the Board of Directors.
Committees and Governance Documents , including Committee charters, are available in the Investor Relations sections of the Company’s website, including the following documents:
- Audit Committee
- Compensation Committee
- Nominating and Corporate Governance Committee
- Incentive Compensation Committee for Non-Senior Persons
- Policy of Ethical Standards for Business Conduct
- Corporate Governance Guidelines
- Policies Regarding Director Nominations, Shareholder Communications and Annual Meeting Attendance
- Compensation Committee Equity Grant Procedures
- Procedures for the Grant of Equity Awards to Non-Senior Persons
Information about Committees of the Board
All members of the Audit, Compensation and Nominating and Corporate Governance Committees are considered independent pursuant to applicable Securities and Exchange Commission ("SEC") and Nasdaq rules. None of the members of the Compensation Committee was (i) during fiscal 2017, an officer or employee of the Company or any of its subsidiaries or (ii) formerly an officer of the Company or any of its subsidiaries. None of our executive officers currently serves, or in fiscal 2017 has served, as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving on our Board of Directors or Compensation Committee.
Messrs. Eisenberg, Feinstein and Temares function together as the senior leaders of the Company. Since Messrs. Eisenberg, Feinstein and Temares are not "independent directors" within the meaning of the Nasdaq Listing Rule 5605(a)(2), the Board of Directors appointed an independent director to serve as the outside Lead Director. Mr. Eppler has served as the outside Lead Director since 2002. The general authority and responsibilities of the outside Lead Director are established by the Board of Directors. In that capacity, Mr. Eppler presides at all executive sessions of the independent directors, has the authority to call meetings of the independent directors, acts as a liaison between the members of the Board and management, functions as Secretary of the Board (including with respect to the proposal and maintenance of Board agendas and schedules for meetings), arranges for Board committee functions and acts as Secretary of all Board committees, and receives communications from the Company’s shareholders.
B. Policies, Guidelines and Practices
Corporate Governance Guidelines
This document includes the Company’s policies on Board composition, responsibilities of the Board of Directors, Board meetings and materials, Board committees and shareholder communications with the Board.
The Board’s general policy, based on experience, is that the positions of Chairman of the Board and Chief Executive Officer should be held by separate persons. The Board may, at its discretion, appoint Co-Chairmen, each of whom may exercise the full powers and authorities of the office of Chairman.
Members of the Board of Directors shall act at all times in accordance with the requirements of the Company’s Policy of Ethical Standards for Business Conduct, which is applicable to each director in connection with his or her activities relating to the Company. This obligation shall at all times include, without limitation, adherence to the Company’s policies with respect to conflicts of interest, confidentiality, protection of the Company’s assets, ethical conduct in business dealings and respect for and compliance with applicable law. Any waiver of the requirements of the Policy of Ethical Standards for Business Conduct with respect to any individual director shall be reported to, and be subject to the approval of, the Board of Directors.
Processes for Evaluating the Board of Directors
Board Membership Criteria
The Board has adopted a policy regarding specific, minimum qualifications for potential directors. These factors, and others as considered useful by the Board and the Nominating and Corporate Governance Committee, are reviewed in the context of an assessment of the perceived needs of the Board at a particular point in time. Board members are expected to prepare for, attend, and participate in all Board and applicable Committee meetings. Each Board member is expected to ensure that other existing and planned future commitments do not materially interfere with the member’s service as a director. These other commitments will be considered by the Nominating and Corporate Governance Committee and the Board when reviewing Board candidates.
Selection of New Director Candidates
Through the Board’s adopted policy regarding the process for identifying and evaluating director nominees, the Nominating and Corporate Governance Committee identifies individuals qualified to become Board members and considers, evaluates and recommends for the Board’s selection nominees to fill positions on the Board. The Board shall give due consideration to the Committee’s recommendation in selecting the slate of directors to stand for election by the Company’s shareholders.
The Board receives, at least annually, a report on the material risks facing the Company, which risks are identified through the Company’s Enterprise Risk Management (“ERM”) process. This report is presented to the Board by a committee of key executives representing legal, compliance, finance and internal audit, and results from a formal process where members of the committee meet with executives of each principal business function to identify and assess the significant risks in each such business function’s areas of responsibility. The committee then analyzes with those executives what risk mitigation efforts are or should be in place to eliminate or reduce such risks to acceptable levels, where possible, and then engages on these matters with the full Board of Directors. In the annual ERM report, areas of risk and mitigation efforts reviewed with the full Board in furtherance of its oversight responsibilities generally include: general business risks, such as economic forces, competition and weather; employment-related risks, such as recruitment and retention, succession, labor costs and associate relations; data security risks with respect to Company, associate and customer data; compliance risks associated with the range of legal, accounting, tax, and financial reporting systems under which the Company operates; supply chain risks, including disruption arising from political instability or labor disturbances, supplier financial stability and legal compliance; and compliance with a variety of product, labor, social, and environmental standards. The Board is updated on certain risks more frequently than annually, upon request or as developments warrant.
The ERM process and report to the Company’s Board of Directors also informs the more detailed Risk Factor disclosure in the Company’s annual report on Form 10-K, filed with the Securities & Exchange Commission.
Code of Conduct
It is the policy of Bed Bath & Beyond Inc. to conduct all business transactions in accordance with the highest ethical standards. The Company’s Policy of Ethical Standards for Business Conduct sets forth the ethical standards all associates (including all officers) and members of the board of directors are expected to abide by when acting on behalf of the Company.
This policy includes our policies on business ethics and conduct, conflicts of interest, associate honesty standards, use of company property, privacy, and confidential information.
Commitments to External Initiatives
Bed Bath & Beyond Inc. is a member of the National Retail Federation and the Retail Council of Canada. These associations are valuable resources allowing the organization to remain informed about developments impacting the retail industry across a number of functional areas.
Critical Accounting Policies
The preparation of consolidated financial statements in conformity with Generally Accepted Accounting Principles (GAAP) requires the Company to establish accounting policies and to make estimates and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The Company outlines these policies in its 2017 Annual Report under Critical Accounting Policies. (pg. 29 and following).
C. Stakeholder Engagement
Policy Regarding Shareholder Communications with the Board
The Board welcomes communications from the Company’s shareholders. Shareholders may communicate directly to the Board of Directors, or to any particular director, by mailing a letter to the Lead Director with an address provided in the Policies for Shareholder Communication. Comments and questions made by shareholders are regularly reviewed and taken into consideration for decisions in regards to corporate policies or processes, in order to achieve further operational excellence.
The Company’s Investor Relations department also regularly communicates with shareholders.
The Company communicates with its associates regularly through a series of internal communication formats, generally including daily store meetings, as well as email and intranet postings. Topics communicated include Company news, training, merchandising, and human resources and customer service policies and procedures. All associates are trained on the Company philosophy of intellectual honesty, taking ownership of decisions, reporting any unethical behavior, and admitting mistakes or problems, and they are encouraged to communicate freely under an open door policy. Associates may also use an anonymous hotline to report questionable conduct or theft concerns. Comments and questions from associates are encouraged and considered in our continuing effort to refine and improve operating and corporate policies and/or processes.
The Company seeks to continually improve and expand communications with our customers. Customers may communicate with the Company by direct contact with store associates, using the toll-free customer service number and by use of email available through the Company’s customer-facing digital channels including, bedbathandbeyond.com, bedbathandbeyond.ca, worldmarket.com, buybuybaby.com, buybuybaby.ca, christmastreeshops.com, harmondiscount.com, ofakind.com, onekingslane.com, personalizationmall.com, chefcentral.com, decorist.com, harborlinen.com and t-ygroup.com. The Bed Bath & Beyond, buybuy BABY, and World Market, Cost Plus World Market and Cost Plus sites also accept customer reviews of specific products. In addition, Bed Bath & Beyond, buybuy BABY, Cost Plus World Market, Christmas Tree Shops andThat!, Harmon Face Values, Of a Kind, One Kings Lane, and PersonalizationMall.com and Decorist maintain Facebook pages, and Bed Bath & Beyond, buybuy BABY, Cost Plus World Market, Of a Kind, One Kings Lane, PersonalizationMall.com, and Decorist maintain Twitter accounts. Customers engage through these channels on all matters, including merchandise and order issues, or questions or comments on corporate philosophy. Comments and questions from customers are reviewed daily by senior management and considered when making decisions with respect to store and corporate policies or processes.
D. Economic Responsibility
Bed Bath & Beyond Inc. has detailed its recent financial performance in its 2017 Annual Report as detailed in the Consolidated Selected Financial data summary.
We remain disciplined in our efforts to achieve positive returns, and improve long-term profitability. Our healthy cash flows, and strong balance sheet, enable us to fund our investments and build upon our operational achievements, while also returning value to our shareholders.
In recognition of our strong cash flow generation and confidence in our business, our Board declared a quarterly dividend increase to $0.16 per share in April 2018. In addition to the dividend, we continue to return value to shareholders through share repurchase. As of March 2018, the Company employed approximately 65,000 associates in full-time and part-time positions. Our associates are the principal connection between our Company and our customers. Their creativity and innovation have been among the principal reasons for the success of the programs designed to sustain our corporate responsibility mission. Our associates remain our most valuable asset.
See Prior Reports
¹The 2018 Report presents 2017 data. Prior report names reflected the calendar year of the data being presented. Due to this change in naming convention, there will be no report entitled 2017 Corporate Responsibility Report.