Letter from our Head of Sustainability

Leyla Ertur, Head of Sustainability, H&M Group

What a transformative year we have experienced. Against a backdrop of ongoing global change and uncertainty, we have intensified our focus on finding effective and scalable solutions to the complex challenges facing our industry and world.

We continue to shift gears as we work towards achieving our 2030 sustainability goals and aligning ourselves towards upcoming legislation. Keeping collaboration at heart, I have been constantly inspired by all the conversations we have had this past year with our partners, peers, and change makers throughout different forums.

The mood of these conversations has been one of both urgency and expectation: expectation to turn ambition into action. The fashion industry, innovators, policymakers, and other partners must truly work together to turn words into results, and this has been our focus for 2023. We have been taking concrete actions backed with science-based targets to make progress across our impact areas, starting with investments to address climate impact.

An example of this is H&M Group’s Green Fashion Initiative, which is driving the agenda of collaborative financing solutions towards impactful climate action. To realise this ambition, together with DBS, Southeast Asia’s largest bank, we have initiated a first-of-its kind Collaborative Financing

Tool that facilitates supply chain decarbonisation in the apparel sector. Another game-changing collaborative initiative, led by Global Fashion Agenda, is our plan for co-investment in a large-scale wind farm in Bangladesh — helping to enable the transformation of the country’s renewable energy market. This year, we reached a 22% reduction in our scope 3 emissions from our 2019 baseline, excluding direct use-phase emissions, putting us on track for our 2030 goal of 56%.

Our impact on the planet goes beyond reducing emissions. We are one of 17 companies piloting the Science Based Targets Network validation process for science-based targets for nature. We are investing in partnership projects to accelerate the transition to regenerative agriculture for key materials such as cotton and wool. And we have reached 14% reduction in freshwater consumption from our 2022 baseline, achieving our 2025 target of 10% two years early.

We are committed to placing people at the centre of the transition to a more sustainable fashion industry, and we continue to work with our suppliers on social dialogue, gender equity and wages. We have been gathering more evidence on how our input can make a difference. For example, our recent gender pay gap study shows that wage management systems contribute towards decreasing gender pay disparities in our suppliers’ factories.

In this report, we share our reflections and learnings alongside our actions, recognitions, and progress towards our goals.

I hope you enjoy reading our 2023 Sustainability Disclosure.

Leyla Ertur

Head of Sustainability, H&M Group