Chief Executive's Introduction

Philip Clarke Chief Executive

The last three years at Tesco have been all about one thing: making Tesco better for everyone in society – our customers, colleagues, shareholders, suppliers and the communities we serve.

We have been working to build a better Tesco, improving our offer for customers across the whole shopping trip by focusing on what matters most.

In the UK, by far our largest business, we have been strengthening our foundations – investing in the shopping experience and improving our range, quality and service. We are pleased to say that many of our customers are now seeing the difference and that over the next three years we will bring the new Tesco to each and every one of our UK stores. My team is excited about the prospect.

We have also been pioneering in the new era of retailing. As the world steps deeper into the digital age, we will lead the industry by providing the most compelling multichannel offer for our customers.

But building a better Tesco is about more than providing a great shopping trip.

As I wrote in our first Tesco and Society Report a year ago, the world's expectations of business are undergoing a profound transformation. More and more people want to know: are you part of the problem or part of the solution? Do you use your skills and capabilities in a responsible way? Customers want to feel good about shopping with us: they want to build a relationship that goes beyond the transactional.

“If we are to succeed in the future, we need to become a sustainable retailer in every sense of the word. We need to make what matters better for society as a whole. Quite simply - better is better.”

Philip Clarke, Chief Executive

In other words, what matters to people is changing – so we too are changing.

I have devoted my forty-year working life to Tesco and I believe fundamentally that at the core of our work lies the creation of social value. This is intrinsic to our long-term commercial success and to the creation of shareholder value. Today, through our stores and other channels tens of millions of people have access to high quality, affordable products on a daily basis.

Thanks in no small part to our skill and to our scale, many communities around the world enjoy a selection of fresh fruit, vegetables, meat and fish at prices they can afford for the first time because of Tesco. It's one of the things I am most proud of.

I am a realist and I recognise that in this new world biggest isn't necessarily considered best. There are long-term challenges that have the potential to impact our business seriously. There are global challenges which, because of our core skills and capabilities, we can help to address.

If we are to succeed in the future, we need to become a sustainable retailer in every sense of the word. We need to make what matters better for society as a whole. Quite simply – better is better.

That's why last year we announced our new value: we use our scale for good. It's based on the recognition that if we harness the breadth of our skills, scale and the can-do spirit of our colleagues, and work together with our partners in the supply chain, we can make a major contribution to some of the biggest challenges of our time.

“The focus of this year has been gathering the best possible insights to set long-term direction.”

Philip Clarke, Chief Executive

As a signal of this new intent, we chose to take a lead in tackling three challenges where we can make a contribution – reducing food waste globally, improving health and providing opportunities for millions of young people.

These three ambitions, together with our essential responsibilities as a good corporate citizen – in terms of trading responsibly, reducing our impact on the environment, being a great employer and supporting local communities – make us a better business, one which can lead in the new era of retail.

During the last twelve months more of our colleagues have got behind our ambition and our new value has already proved a powerful motivating force. It's the first phase of a journey and we have still only achieved a fraction of the change we ultimately want to see.

One of the biggest improvements we have made over the last year is in the scale of our engagement. We were determined to seek out the best advice and support for all of our ambitions, which meant joining the global conversation around each of these issues.

We have held meetings with campaigners and experts. We have held roundtable discussions on a range of subjects including health, young people, food waste and food sourcing. Representatives from across the business have participated in key conferences. I was pleased to speak at the Global Green Growth Forum in Copenhagen. By sharing these platforms, we have helped to raise awareness of these challenges and boosted, in particular, the profile of food waste as a social and environmental concern.

We have also worked hard to move to a more open, transparent conversation. We are starting to share details of our activities, progress and challenges on our different channels throughout the year.

But the most important change we have made has been in the way we have approached our ambitions. In each case, we want to make significant, lasting changes – not launch short-term superficial initiatives.

That's why the focus of this year has been gathering the best possible insights to set long-term direction, whether it's research on the specific challenges facing young people, our “ealthy Little Differences Tracker” to measure the nutritional profile of shopping trips, or producing detailed food waste profiles for our most popular products – together with action plans to reduce waste at each part of the value chain.

This insight-to-action approach holds the key to our success for the future. It's the theme of this year's Tesco and Society Report. As we continue down this path over the coming years, we can use our scale for good across society and make what matters better, together.

Philip Clarke

Philip Clarke Chief Executive