There were several major developments relating to life-cycle thinking and Design for Environment in 2008.

Life-cycle thinking

In the U.K., our Consumer Tissue and Personal Care businesses partnered with the Carbon Trust to test the British Standards Institute (BSI) methodology for calculating a product’s carbon footprint on Andrex and Huggies products. We learned that manufacturing our products and their components is the biggest contributor of greenhouse gases over their life-cycle.

We are using these results to focus our efforts to reduce greenhouse gases, both internally and within our supply chain. For example:

Andrex

• Improving energy efficiency in manufacturing Andrex tissue.
• Setting new sustainability objectives with key wood pulp suppliers.
• Removing 30mm from the length of each bag and trialing plastic that is 10 percent thinner.

Huggies

• Using lightweight materials and setting new sustainability objectives with key suppliers.
• Increasing manufacturing efficiency through our Vision 2010 environmental program.
• Reducing impacts from transportation and logistics.

We do not currently plan to label our products with information about their carbon footprint for several reasons. First, there is no international standard for calculating a product’s carbon footprint, making comparison between products impossible. Second, it is clear that most consumers do not have a good understanding of carbon footprints. Finally, while it is important to reduce greenhouse gas emissions, focusing only on this metric fails to recognize other important environmental concerns such as water and waste.

Design for Environment

In the U.K., Andrex Longer Lasting bath tissue offers 50 percent more sheets per roll, reducing the number of deliveries made to customers as well as the amount of packaging materials required. We estimate that this change, introduced in 2007, saved 57,000 miles in deliveries in the first year – the equivalent of a truck travelling twice around the world. Also, by trimming 30mm from Andrex tissue packaging in the U.K., we have saved around 83,000kg of plastic a year.

In the U.S., we collaborated with our suppliers to incorporate less absorbent material into Huggies diapers while maintaining the same product attributes. We then calculated the environmental benefits of this change accounting for manufacturing and logistical improvements. Overall, we estimate that these changes provide the following annual environmental benefits:

• Save fossil fuel reduction equivalent to more than 42,000 barrels of oil.
• Reduce greenhouse gas emissions equivalent to removing 7,900 cars from the road in the U.S.
• Reduce acid rain-causing air pollution equivalent to turning off 15,100 central air conditioning units for one year.

Also in the U.S., K-C Professional introduced its new Intrepid Filtration Media for air conditioning systems in Leadership in Energy and Environmental Design (LEED) certified buildings. The new media was developed to meet the U.S. Green Building Council's standards for filtration performance in new buildings and major renovations. It has low resistance to airflow, which means air conditioning fans work more efficiently to provide enough airflow and effective particle filtration. This reduces energy costs and greenhouse gas emissions.

End-of-life products

The final stage of the product life-cycle is waste disposal. Our products are designed to be compatible with the most common waste disposal systems in each region. For example, in New Zealand landfill is a big concern. Huggies is contributing approximately $53,000 per year to a composting trial for used personal care items, particularly diapers. The industrial composting machines used are highly energy efficient. The process is safe and hygienic, as the temperature and microbes involved kill germs, and odors are filtered out. At the end of the process, just 5 percent of a diaper goes to landfill.

In the U.S., we are in talks with the RecycleBank about participating in their programs to increase household recycling. This scheme encourages recycling by awarding points for items recycled, which are saved up and redeemed for vouchers for popular products. We hope to be included in the process by May 2009.

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