The Lego Group

RATING

SECTOR

Leisure

WEBSITE

CONTACT

Højmarksvej 8, 7190 Billund, Denmark

STOCK EXCHANGE

N/A

LISTING

  • #92 World’s Most Valuable Brands Forbes

EMPLOYEES

17,534

CHIEF SUSTAINABILITY OFFICER

Loren Shuster

AWARDS

N/A

CONTENT SOURCE

FURTHER READING

Report created by Kavita Kripalani

Company Title

SECTIONS :  Sustainability    Evaluation  •  Progress  •  Watch  •  Overview

Company Activity

The Lego Group is a Danish-American toy production company based in Billund, Denmark. The company is best known for the manufacture of Lego-brand toys.

The Lego Group has also built several amusement parks around the world, each known as Legoland, and operates numerous retail stores. 

The Lego Group has come a long way over the past almost 85 years – from a small carpenter’s workshop to a modern, global enterprise that’s now one of the world’s largest manufacturers of toys.

The brand values consist of imagination, creativity, fun, learning, caring, and quality. According to Lego, the LEGO brick is their most important product.

Despite their products undergoing extensive development over the years, the LEGO brick has remained traditional to the company and its design.

Company Sustainability Activity

The LEGO Group takes a role in building a sustainable future and creating a better, brighter world for our children to inherit. Their sustainability actions are divided in three main groups; children, environment, and people. The following is stated by The Lego Group.

Children: They believe every child should have an opportunity to achieve their potential. And learning through play is a powerful way to develop skills that will allow children to tackle challenges that lie ahead. By 2022, they aim to bring learning through play to 8 million children each year.

Environment: They are committed to protecting the environment and the planet our children will inherit. It’s not enough to just reduce their impact on the environment, they want to go further and have a positive impact – that means phasing out single use plastic in all their boxes by 2025.

People: They value the people, partners and suppliers who make LEGO® play experiences possible and we work hard to make their workplaces inclusive, safe, and motivating.

Highlights

Children

  • More than 1.8 million children reached through local community engagement activities
  • Together with the LEGO Foundation they partner with UNICEF to advocate for the rights and wellbeing of children
  • Launched the first Braille bricks and audio building instructions together with the LEGO Foundation, supporting children with impaired vision to play
  • Donated 1 million DKK to support children in India affected by flooding, as part of the new Emergency Relief Response Policy, supported by the LEGO Foundation

Environment

  • Launched LEGO® Replay and received more than 50,000lbs (22,000 kg) of LEGO bricks
  • Began to phase out plastic bags and phase in paper bags in LEGO® retail stores
  • Recycled 93% of all waste, including 100% of plastic waste from their molding machines
  • Continue to be 100% balanced by renewable energy, through investments in solar energy, and offsite wind energy by their parent company KIRKBI A/S
  • 2% of LEGO elements (80 of the 3,600 currently available) are made from sustainable sources
  • They’ve changed the entire lighting system at their factory in Mexico. This saves more than 1,300 tons of CO2 emissions annually.
  • Innovative new cooling system in the Danish factory provides a significant energy reduction of more than 538,000 kWh, the equivalent of an annual CO2 emission reduction of 111 tons

People

  • Held a Summer camp program at their factory in China, supporting 500 children of migrant workers
  • Made progress on Workplace safety with 0.9 injuries per million working hours
  • 69% of suppliers audited had zero nonconformities with our Responsible Business Principles that required immediate correction, and we worked with suppliers to resolve non-conformities
  • 43% women appointed and promoted to manager level and above, and 63% women appointed and promoted to VP and SVP levels

Targets

REDUCING ENVIRONMENTAL FOOTPRINT 

  • Sustainable materials ambition and reducing CO2 impact through investments in renewables by 2030
  • By 2025, aim to have 100% sustainable packaging

BIODIVERSITY 

  • Sustainably sourced paper usage in retail bags that is made from 100% Forest Stewardship Council® (FSC®C117818) certified materials by 2025

MINIMIZING WASTE AND LITTERING 

  • No waste from any LEGO® factory, office or store globally will be landfilled by 2025

Progress

Renewable Energy 

  • In 2019, Lego installed 3,570 solar panels on the roof of their factory in Kladno, Czech Republic, the second facility after the LEGO® Campus in Billund, Denmark to be partially powered by solar energy.
  • In 2019, total energy output from investments in renewables exceeded the 340 GWh of energy used at their factories.

Waste Efficiency 

  • In 2016 Lego partnered with WWF to improve waste efficiency from their operations by 10% by 2020. 
  • In 2019, Lego improved waste efficiency by 0.5%

Certificates

  • 100% production sites are certified ISO 14001 
  • 100% Forest Stewardship Council™ (FSC™C117818) certified paper and cardboard packaging
  • Transforming OHSAS 18001 certification to ISO 45001

UN Sustainable Development Goals

UN SDGs Compliance

SDG 4

  • Lego advocates for the transformative power of play to be adopted in education and early childhood development around the world. To do this, they provide high-quality products that stimulate learning through play. The LEGO® Education solutions promote play in the classroom, and partnerships and projects supported by the LEGO Foundation support education around the world. 

SDG 12

  • The company launched the first LEGO elements made from plant based plastic. Over 80 LEGO elements are now being made using sustainably sourced sugar cane.

SDG 13

  • In 2018, Lego invested DKK 8 million in 4,150 solar panels, so the LEGO Campus will meet leading standards for sustainability and energy efficiency.

SDG 17

  • The Lego Group was the first toy company to sign up to the Children’s Rights and Business Principles, developed by the United Nations Global Compact, Save the Children and UNICEF. The company uses these partnerships as a guiding framework to assess their operations. The company also entered into a global partnership with UNICEF in 2014.

Secondary SDGs: 1, 15

Evaluation

The Lego Group is a Danish privately owned maker of plastic bricks toys and world’s largest toy maker by both revenues and profits.

The brand was recently on the news with their radical decision for replacing their plastic material (ABS) to more sustainable material.

The brand uses plant based plastic in their 2% of brick toys. On top of this, Lego bricks are used as educational toys.

The brand has a sustainability agenda, KPIs, and progress report. Both Kirkbi A/S (parent company) and The Lego Group are looking to make progress with UN Global Compact.

Although the brand looks very promising for sustainability in the future, they are rated a C because of their enormous plastic usage, need to expand on their sustainability approach. 


Analyst Outlook: 
Neutral

Lego is engaged in sustainability, as seen through their initiatives to use plant based plastic, however, they could benefit from having comprehensive targets and progress.

Key Points

  • The Lego Group consumes vast amounts of plastic, although the company is trying to find a substitute material. 
  • The Lego Group is not open to recycling old products due to sensitive color matching (FT article). Instead, the company prefers that people hand them down to the next generation. 
  • Low progress on KPIs from 2018 to 2019
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