Environmental Policy, Objectives and Targets.

At Graham’s Family Dairy Group we are committed to minimising our potential impact on the environment by exercising responsible policies in respect of resource efficiency and waste management, minimising our energy consumption and raising awareness amongst employees. We will operate in compliance with all relevant environmental legislation and we will strive to use pollution prevention and environmental best practices in all we do. We are committed to achieving high standards of environmental management in all areas of our business, and fostering concern and respect for the environment. We will communicate this policy and emphasise each employee’s responsibility. We also expect similar environmental standards from all suppliers and contractors.

We will:
• Promote good environmental practice
• Continuously improve our environmental performance
• Comply with all relevant legislation
• Reduce our usage of non-renewable materials
• Prevent pollution as far as is possible.

Our objectives and targets will allow us to monitor improvement in our performance.

Promote good environmental practice

Management targets
We look to promote good environmental practice throughout the company by informing employees of their environmental responsibilities and therefore reduce our environmental impact. In order to help us achieve this, we will run a ‘Switch Off’ campaign during ‘national energy saving week’ in October 2008. We will endeavour to provide quarterly annual updates on our environmental progress. We are also keen to liaise with the local community on any issues which they feel are important and have not been addressed by us.

Recycling
We are keen to increase the level of our waste that we recycle. We will look into the other areas of our business where recycling levels could be increased, as well as encouraging our staff to recycle waste paper within the office. Our aim is to recycle at a level of 10% as of August 2008. We will also ensure that all paper bought for use within the office is post consumer recycled and that any new and replacement printers that we invest in are duplex.

Continuously improve our environmental performance
Here at Graham’s, we look to continuously improve the level of our environmental performance. We believe that there are several areas of our processes within which we can do this and we regularly review and monitor our objectives in order to ensure that we are on track for achieving them.

Chemicals
The use of chemicals allows us to ensure the highest possible level of hygiene and quality of product. We always ensure that we minimise the risk of spillages of our chemicals within the factory by storing them in a safe and secure place. We will carry out a risk assessment of all chemicals in use by 2009.

Energy
Our key aim concerning energy is to develop a means of measuring and thus reducing our energy consumption. We are currently undertaking several initiatives in order to achieve this objective. We are also planning to undertake a review of the energy we use at our main site and develop an energy saving plan for implementation by 2009. Additionally, we are planning to investigate auto switch off programmes for the computers within the office. Our target is to have reduced our electricity consumption by 10% by the end of 2009.

Transport
Transport is one of the biggest areas of environmental impact for our company. We are committed to reducing the levels of emissions from our fleet. We run some of our vehicles on a mix of 3% bio fuel and 97% ultra low sulphur diesel. We are also currently trialling one of our vehicles at 30% bio fuel and are investigating others options such as a trial of 50% bio fuel in the near future. In addition to this, we are looking into the feasibility of using electrically powered vehicles for deliveries. Furthermore, we are considering enrolling our drivers on a SAFED (Safe and Fuel Efficient Drivers) training course, which will train them to drive in the most environmentally friendly way possible. We look to prevent pollution by ensuring that no lorries leave the site with a minimum load and additionally we are constantly reviewing our delivery routes to ensure maximum efficiency. We are also investigating the feasibility of other forms of more environmentally friendly transport for our employees. We are constantly looking to reduce the damage that our processes have on the environment. One of the major ways that we can do this is to reduce our vehicle emissions and we aim to have achieved a 5% reduction by the end of 2009.

Reduce our usage of non-renewable materials.
Reducing energy use and minimising waste before it has occurred is something that we at Graham’s are keen to do. There are several areas of our operations that we focus upon for this aspect of our environmental management. We are keen to promote the efficient use of materials, especially non-renewable materials.

Water Consumption
We have recognised that water is an increasingly scarce resource and we are currently researching several means of reducing the level of our water consumption. Ultimately, we aim to have reduced our water consumption by 5% by 2009. We will look to achieve this through several means. We will establish a procedure which allows us to measure the level of water consumption within the company and then look for ways to reduce this.

Packaging
Packaging is an area of our environmental impact which is at the forefront of our minds. We are eager to reduce the impact of our packaging on the environment and have several options for achieving this. As a company, we are preparing to include a recycled plastic content in our bottles which will commence in autumn 2008; however, we also believe that it is important to encourage our consumers to recycle their empty milk cartons. All cardboard used by us is recycled; in particular the cardboard that we used for butter boxes is 100% recycled. As a further effort to reduce our packaging, we deliver our products to the supermarket on trolleys which reduces the amount of packaging needed for delivery purposes.

Waste Management
We believe that waste management is a vital part of Graham’s environmental performance. 73% of all waste produced in the UK goes to landfill, even though 90% of this is recoverable - it could be recycled, composted or used to generate energy. Projects which promote waste minimisation and resource efficiency or find innovative alternative uses for waste will help to reduce the amount sent to landfill. We feel passionately about this area of environmental impact and believe that this is an area within which we could make a big difference. We will encourage all employees to adopt best practice with regards to waste management and in order to aid this we will prepare an information pack and distribute it to all employees. We now recycle all cardboard, paper, timber, polythene on site and are working towards further plastic recycling. By the end of 2009 we will have reduced the amount of waste that we send to landfill by 10%.

We are working closely as a team in order to make the biggest difference possible to the
environment and to substantially reduce the impact of our processes. We are also currently working closely with Scottish Enterprise, The Business Environment Partnership and The Carbon Trust in order to continuously improve our environmental management system.

Carbon Management Policy

We believe that the climate change impact facing our planet from rising carbon emissions requires a specific commitment. This policy outlines our approach to reducing the significant carbon impacts of our business operations, namely energy use and fleet fuel consumption. Graham’s Dairies is a family dairy with environmental responsibility as a core business principle. Since 2008 we have been committed to environmental improvement by developing an Environmental Management System and have set objectives and targets which we aim to meet in 2009.

To this end we will:
Improve energy efficiency continuously by establishing and implementing effective energy programmes that support all operations and customer satisfaction whilst providing a safe and comfortable working environment throughout the company.

Our Carbon Boundaries
In accordance with generally accepted principles for boundary setting for organisations, our carbon management policy is based upon the significant emission sources for which we have operational control:

• Direct energy consumption at our offices & factory
• Company owned vehicles
• Indirect energy consumption such as purchased electricity and daily emissions from employee travel to and from work.

Our approach to carbon management is based on the following principles:

• Deliver real carbon reductions instead of carbon neutrality through offsetting
• Apply the carbon management hierarchy to our key business decisions
• Create and deliver carbon reduction objectives and to review progress
• Engage and motivate our staff to deliver our carbon management programme
• Transparent reporting of our performance.

Carbon Management Hierarchy
Carbon Management hierarchy initially focuses on avoidance followed by more efficient processes before considering the need to invest in new technology or renewable energy.

Our key objectives for 2008/9

• Establish procedures to measure water and electricity consumption monthly
• Reduce Electricity Consumption by 10% by the end of 2009
• Reduce vehicle emissions by 5% by the end of 2009
• Reduce water consumption by 5% by the end of 2009
• Reduce the amount of waste sent to landfill by 10% by the end of 2009

We are currently working towards the Carbon Trust Standard which will enable us to demonstrate a commitment to and achievement of carbon footprint reduction. There are three main steps that we must achieve in order to calculate the footprint. These are defining the organisational boundary, defining the operational boundary and collecting the energy and emissions data and calculating the footprint. We must also create reduction targets and make clear reductions in our carbon emissions. Gaining the Carbon Trust Standard will show that we are acting effectively to respond to climate change.

This policy is communicated to our staff and is publicly available and our progress is available upon request.