ulgari is one of the pillars of the Jewellery and Watchmaking division of LVMH, the world leader in luxury goods. The group’s approach to ESG matters, both because of the number of brands it owns, and therefore the impact it has on the ground, but also because of the signals it sends to the entire industry.
In its 2021 Sustainability Report, LVMH reported global emissions for the group as a whole of 4.8MTeqCO2 (million tonnes of carbon equivalent), but there’s no breakdown by brand. So it’s worth taking a closer look at the specific cases of each member of the group.
What impact does a leading global brand like Bulgari have in the jewellery and watchmaking sector? What specific actions is it taking in terms of ESG? And what are its goals and deadlines? To find out more, we met Eleonora Rizzuto, Chief Ethics & Compliance Officer and Director, Corporate Sustainability & Responsibility at Bulgari.
Europa Star: LVMH publishes a a group-level sustainability report, but there is no brand-by-brand breakdown. Can you give us any details about Bulgari specifically?
Eleonora Rizzuto: Our brand reports and measures its environmental impact every year and the results are communicated annually at the group level. In order to be fully transparent, we are in the process of finalising our carbon footprint calculations for autumn 2022. We started working on this a long time ago. As early as 2012, we prioritised renewable energy at our production sites. Today, 100% of our production is powered by renewables, at our sites in Valenza, Florence, and in Switzerland. Similarly, each of the 200 boutiques that have been renovated since 2013 use recycled materials. Electricity consumption is strictly monitored, and they are equipped with 100% LED bulbs.
Bulgari has created an action plan to measure and act on its emissions at all key levels, including production, points of sale and transport. At our production sites, we have implemented certification systems (ISO14001, ISO 45001) that enable us to move towards ongoing reduction of our carbon footprint and continuous improvement of our environmental performance.
- Eleonora Rizzuto, Chief Ethics & Compliance Officer and Director, Corporate Sustainability & Responsibility, Bulgari
Given the urgency of the climate, environmental and social crises we face, the time for action is running out.
To combat global warming, the aim is to contribute as much as possible to the group’s objective of having a carbon trajectory compatible with the 2015 Paris Agreement, by reducing greenhouse gas emissions related to the energy consumption of production sites and boutiques by 50% by 2026 (from 2019 levels), thanks to the 100% renewable energy policy already applied by Bulgari.
We have an ongoing commitment to sustainable and ethical practices in all aspects of our business. We have been a certified member of the Responsible Jewellery Council since 2006 and Chain of Custody since 2015, and we are working to reduce our carbon emissions both in-house and with all our partners. Mined gold for watches and jewellery has been 100% ethically sourced since this year, and recycled gold is also 100% traced thanks to our partners including Metalor. All our suppliers are part of an integrated, global system. We are working with the group to implement a similar system for coloured stones, as there is no global standard at the moment.
LVMH has put in place an ESG roadmap called Life 360, which has four main pillars. How do you fit into this framework?
One of the concrete actions in this area is the partnership with Forestami, an urban reforestation project that aims to plant 3 million trees in Milan by 2030. Bulgari will help to finance the planting scheme. This project contributes to the LVMH Group’s goal of regenerating and/or rehabilitating 5 million hectares of wildlife habitat by 2030. Bulgari’s ambition is to do the same around our Valenza site.
In line with the commitments of the LVMH Group, we are also contributing to the goal of zero virgin plastic by 2026. In order to pursue this goal, in 2019 Bulgari pledged to gradually eliminate single-use plastics from its offices, boutiques and production sites, and share best practices with its employees with the aim of raising awareness of environmental issues.
What about packaging?
Last year we introduced new plastic-free packaging for our basic lines of jewellery and watches. Thanks to this new packaging, which represents a 96% reduction in plastic compared to the current version, Bulgari will save more than 160 tonnes of plastic each year (based on 2019 volumes).
In October 2021, Bulgari also introduced its new plastic-free warranty and certificate of authenticity cards, made of 100% recyclable paper, for watches, jewellery and accessories. As a tangible result of this effort, an additional seven tonnes of plastic will be saved each year.
The circular economy is the third pillar of LVMH’s Life 360 programme. It’s a particularly important point for your brand, isn’t it?
For us, the circular economy means adopting models of reuse, recycling and innovation, to ensure not only responsible sourcing and traceability of raw materials, but also the recovery of secondary raw materials. With this in mind, in 2017 Bulgari supported the creation of the Italian Alliance for the Circular Economy, whose principles and actions are helping to drive production towards a more circular structure, while enhancing Italian excellence. One of the main assets of the Alliance is the involvement of companies operating in a variety of different sectors, which creates synergies between industries and opportunities to generate shared value.
For Bulgari, this also involves thinking about the lifecycle of products, encouraging greater attention to the design of products to reduce waste at source, and increasing the rates of reuse and recycling of waste. For example, Bulgari is currently implementing the Life Cycle Assessment approach to scientifically measure the environmental impact of its products, starting with perfumes and accessories.
The final component of this programme is traceability. On its website, Bulgari mentions the creation of a dedicated identification system on all new products by 2026. What is this about?
The idea is to take what is happening with gold, like Metalor’s biometric gold passport, and apply it to all materials to ensure traceability. In January 2021, the OECD’s global due diligence process was put in place. Everything is moving in the same direction. It’s far from easy, and we are still in the experimental phase, but things are moving quickly.
Bulgari created the Swiss Genius award to promote innovation in corporate social responsibility. In 2022, three young women were recognised for developing an app to promote best practices in ESG communication in the luxury industry. Wouldn’t it be better to promote concrete approaches, rather than virtuous communication?
What this award shows above all is that the young generation will not even consider working for any company that does not have a sustainable or environmentally responsible approach. This project links the whole ecosystem of universities and industry around this theme. Bulgari is giving all these young people the opportunity to test themselves in the real world of business. It’s a global approach.
You talk about the need for closer collaboration in the industry to create greater efficiency. Would you be willing to join the Watch & Jewellery Initiative 2030, for example?
There are many collaborative initiatives between companies. For example, the Dragonfly Initiative for gemstones was launched back in 2014 and is still ongoing. It’s clear that we need to collaborate to move forward. Nothing has been decided about the Watch & Jewellery Initiative 2030, but I’m always open to opportunities to coordinate our efforts.
Should luxury rethink its growth model, and inspire its consumers towards more respect, responsibility and contribution to the common good?
For Bulgari and LVMH, the first challenge is to meet the objectives we set out in the Life 360 programme, and to make progress through synergies within the group, by making the best use of everyone’s skills. As far as the luxury industry is concerned, it has already made a lot of progress. This benefits society as a whole.
But the industry must do more, that is certain. The growth of the second-hand market is also a step in the right direction. Luxury must of course be exemplary in its environmental footprint. Finding the right balance between social ethics and the environment is the most difficult challenge. But it must be done. I am a great believer in innovation. It will allow us to achieve 100% traceability, which will offer real transparency, as well as facilitating sustainable design and promoting the circular economy, which must imperatively form the basis for a new economic model. To achieve this, we need a global vision that creates synergies within the industry.