LIDL’S CIRCULAR JOURNEY

Lidl’s Corporate Social Responsibility (CSR) strategy, 'A Better Tomorrow', focuses on six pillars: 

1. Sustainable range: A quarter of Lidl's turnover comes from products with a sustainability label. Lidl believes in local sourcing and organic farming, selling approximately 220 organic products in their store across both food and non-food ranges. Sustainability is also a part of their own-brand and is reflected in the range across their own-brand products. 

2. Healthy lifestyle: By 2025, Lidl plans for its own-brand products to contain  20% less sugar and salt compared to 2015 levels. 

3. Preventing food waste: Lidl aims to match supply and demand more closely, and is looking for alternative routes to its food surplus such as collaborating with food banks and community programmes. Lidl has announced its commitment to reduce food waste by 30% by 2025 and 50% by 2030. Its future goal is to become totally food waste-free. 

4. On the way to circularity: Currently more than 90% of its residual flows such as film wrappings, organic waste, paper, wood etc. are recycled into new raw materials. 

5. Packaging: Its goal is to use 20% less packaging material, 20% recycled material and 100% recyclability of their own brand plastic packaging by 2025.

6. Societal benefits: Lidl is organising community- and sustainability-first initiatives such as harvest festivals to demonstrate where their produce comes from.

Lidl’s parent company, the Schwarz Group, comprises Lidl, Kaulfand (retailers), Prezero (waste management and recycling business), and Schwarz Produktion (production facility). As a highly integrated Group, Lidl—and in particular Lidl Netherlands—was able to kick-start its circular ambitions as it was already part of a nearly closed-loop ecosystem with a streamlined supply chain, scaled sourcing and logistics centres and systems, and holistic recycling and waste management. 

Lidl Netherlands focuses on engaging in long-term relationships with its suppliers and develops long-term strategies without external (market) pressures. This has allowed the company to invest in energy-efficient buildings, target a complete overhaul of their electric/gas-run transport fleet, and strive for their ambitious zero-waste warehouses. Moreover, motivated by their long-term partnerships along the value chain, the company assists local suppliers in reducing their waste production and incorporating the concept of recycling right from the production stage. 

A pillar of this approach has been the external collaborations that Lidl Netherlands has had with research partners to further the company’s sustainability and circular goals. For instance, the advisory partnership between Lidl Netherlands and Technical University of Delft to increase its built environment circularity. Moreover, this culture of promoting external collaborations extends across different country offices. Some examples of other partnerships are: 

1. Partnership between Lidl Switzerland and EMPA (Swiss Federal Lab for Materials Science and Technology) to develop bio-coating to replace plastic packaging.

2. Partnerships between Lidl UK with start-ups to pilot novel ideas, e.g. offering refill own-brand laundry detergent,.

3. Partnerships between Lidl Germany and established environmental and sustainable product companies such as Bioland.

Why is Lidl embracing and implementing circularity in its business strategy?   “Circularity really is an opportunity for us. What I still hear far too often: discount and sustainability: that's a crazy combination, that's not possible! For us, however, this is where we know we can make a difference”

- Quirine de Weerd – Head of Corporate Communications and CSR

HUMAN RESOURCE MANAGEMENT (HRM) SPECIFIC OPPORTUNITIES AND CHALLENGES IN THE CIRCULAR TRANSITION

- The CSR team in Lidl Netherlands leads the implementation of the company’s ambitions and is also responsible for communicating its progress externally. While sustainability and communication fall under the same department, it is a role that requires a jack of all trades, as it is seen as an holistic, cost-lowering endeavour throughout the company. 

- The company’s cost optimization approach to sustainability was developed, and is actively encouraged, by the company’s top management—to the extent that the CSR team in the Netherlands reports directly to the CEO. 

- Every department connected to the implementation of the sustainability strategy has a sustainability ambassador, including the HRM department. 

- The importance of top management in shaping the company’s culture is further illustrated with the increased knowledge sharing between Lidl and the Schwarz group that the management actively advocates for. Such a decision has also allowed HR departments in different countries across the two groups to share their expertise, best practices and learnings. 

- While decisions are mainly developed in the German headquarters, the instilled frugal company culture allows cost-saving to be the buy-in argument for new circular business strategies in the Netherlands. 

- Lidl's sustainable character is already an important reason why new talents want to work there, and HR obviously already plays a major role in this. In addition, with the many training opportunities and good employment conditions, they ensure the sustainable employability of the employees. However, they are not yet involved in co-shaping the circular strategy.

- While there is no formal sustainable or circular skilling programme, there is a skills development and career progression tracking system. Often departments and branches bring in external partners or tap into other countries’ experiences to address skills gaps required in implementing HQ strategies—for example, bringing in external experts to future-proof operations.