CO-OP

The Co-op has banned chemicals which have been linked to cancer, fertility problems and environmental damage even though they are still legally usable. Head of Co-op Brand David Croft said there was "credible evidence" against the chemicals which could be replaced. The banned substances, nitro and polycyclic musks and phthalates among them, are chemicals found in cleaning products, and artificial musks used in perfume products which can be absorbed by the body.

Studies suggest that the build up of these can cause harm. The Co-op says where there is conflicting evidence and there is even a hint of a risk it will apply the precautionary principle and eliminate it from its products. The move comes as the supermarket attempts to spearhead an initiative to raise ethical standards in supermarket products in the UK. Mr Croft says consumers want and expect high standards of integrity. "They'll vote with their wallet and support or veto our products," he said. "They're no longer passive consumers, but want to play an influencing role as active citizens. That's why the Co-op is embarking on the most radical review of a supermarket own-brand range, food and non-food, ever undertaken," he added.

And to help it, the Co-op has recruited a 10-strong panel of experts chaired by Tim Lang, Professor of Food Policy at City University. The panel brings together recognised independent expertise in food policy, public health, ethical trading, animal welfare, agricultural sustainability and environmental issues. "Where the panel will come into its own is in helping us to identify and act on issues which challenge the industry view that everything in the garden is rosy," said Mr Croft.

An industry spokesman said all supermarkets were getting rid of chemicals deemed to present more risks than benefits. A recent study carried out by NOP for the supermarket found six out of 10 shoppers would boycott goods that were ethically unsound. The survey of 30,000 consumers found nine out of 10 wanted tougher monitoring of retailers and the industry on ethical issues.

Co-operatives UK's takeover strategy has led the business to its biggest trading improvement since the 1960s. Annual profits have gone up by 38% for the group of consumer-owned societies including supermarkets, travel shops and undertakers. Turnover increased by 6.4 to £13.3bn, while net profits rose to £441m from £320m, year on year. The progress is largely due to the Co-op's acquisition strategy in food retailing, which has pushed its share of the food market up from 5.6% to 6%.

Co-operatives UK chief executive Dame Pauline Green said there had been a "gradual and solid" improvement over the last five years. "Our improvement in both profitability and market share is the result of a greater focus on business performance, acquisitions and improved financial management," she said. Co-operatives UK, formerly known as Co-operative Union, brings together thousands of individual co-operative businesses.

The Midlands Co-op, which has a branch in Albion Street, Derby, returned a "healthy profit" in 2004 despite "a challenging year". Profit before distribution to shareholders was £20.3m, up 11% compared with the year before. Turnover was up 3.8% to £787m. All sectors of the business, retail, dairy, travel and funeral, contributed to overall sales growth, the firm said. Retail achieved turnover of £437.2m, an increase on a like-for-like basis of 2.3%. Food sales reached £351m, a like-for-like increase of 2.2%, and non-food sales increased 15% to £86.2m.

Dairy sales were up on the previous year, achieving gross sales of £83m, an increase of 7% on 2003/04. Travel sales increased by £4.6m, despite the effect of the Indian Ocean tsunami on the final weeks of trading. Foreign exchange sales were particularly strong, increasing by more than 14% to £50m. The company has invested £47m in capital projects over the past year. Major acquisitions included three Budgens stores and eight Metro stores. Chief executive Willie Tucker said, "I am delighted Midlands Co-op has once again demonstrated that it is a force to be reckoned with."

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