Suppliers’ of adidas Changing the Game with SBTi Program

 

Supporting: adidas suppliers

Sustainability and the shifting apparel and footwear landscape

The fashion industry is estimated to be responsible for 10% of global carbon emissions – more than international flights and maritime shipping combined – and is under the sustainability spotlight for good reason. Supply chains contribute heavily to the total emissions, accounting for nearly 90% of total absolute GHG emissions.

A step change is aligned with consumer demand; increasingly, the use of sustainable materials and a brand’s sustainability commitments are important purchasing factors. Accordingly, apparel and footwear brands are taking action and setting ambitious carbon reduction targets across their entire value chain. UN’s Fashion Industry Charter for Climate Action require companies to set up science-based emissions reduction targets across scope 1, 2 and 3. The charter is signed by over 80 signatories including adidas, Decathlon, CHANEL, GAP Inc. and Nike. So, what are companies doing to ensure their supply chains meet their targets? A case study of adidas’ Strategic Suppliers’ SBTi Program offers insight into an innovative approach.

The Objective

adidas has committed to achieving carbon neutrality across its own operations by 2050 and reducing absolute GHG emissions across its entire value chain by 30% by 2030.

To support suppliers on their path to sustainability, act renewable partnered with adidas and developed its Strategic Suppliers’ SBTi Program.

The objectives of this program are to help key suppliers take full ownership and responsibility of their decarbonization journey and provide support every step of the way. act renewable drives the program end-to-end, engaging top management and operational teams, compiling Scope 1-3 emissions data, preparing SBT and application documents, and most importantly, helping suppliers develop and implement a roadmap to achieve their Science Based Targets (SBT).

Set an SBT, which must be approved by SBTi

Map and quantify all emissions along the supplier’s value chain

Develop low-carbon roadmap

Identify and implement carbon reduction opportunities

Publicly report SBT and progress through CDP

Environmental stewardship:

adidas suppliers takes the lead and validate their targets

PT. Parkland World Indonesia

Parkland World is a footwear manufacturer group operating three FTW T1 facilities in Indonesia. Parkland World and its affiliates service global sportswear brands including adidas and New Balance and is in the process of implementing onsite rooftop solar (RTS) across its locations.

Target Summary

Near Term: 42% by 2030 (Scope 1&2) / 25%  by 2030 (Scope 3)

Long Term: 90% by 2050

Net Zero: commited by 2050

♦ Business Ambition for 1.5°C commitment.

Jia Hsin Co., Ltd

Jia Hsin is a footwear manufacturer group with operation in Vietnam. They are a sandal manufacturer, producing products for sports brands, such as adidas, the North Face, Reef, Columbia, UA, etc.

Target Summary

Near Term:42% by 2030 (Scope 1&2) / 25%  by 2030 (Scope 3)

Long Term: 90% by 2050

Net Zero: commited by 2050

♦ Business Ambition for 1.5°C commitment.

New Wide Co., Ltd. (Vietnam)

New Wide Co., Ltd. (Vietnam) was established in June 2015, with 100% investment from the New Wide Group in Taiwan, is a subsidiary company under New Wide Group. The company primarily focuses on the production of knitted fabrics, dyeing, and printing on various types of textiles.

Target Summary

Near Term: 42% by 2030 (Scope 1&2) / 25%  by 2030 (Scope 3)

Long Term: 90% by 2050

Net Zero: commited by 2050

♦ Business Ambition for 1.5°C commitment.

Huge Bamboo Textile Co., Ltd.

Huge Bamboo Textile Co., Ltd., established in July 2002, is a Taiwanese enterprise with 100% investment from Taiwan, is a subsidiary company under New Wide Group. Huge Bamboo specializes in manufacturing, processing textiles, knitting fabrics, and garments for export.

Target Summary

Near Term: 42% by 2030 (Scope 1&2) / 25%  by 2030 (Scope 3)

Long Term: 90% by 2050

Net Zero: commited by 2050

♦ Business Ambition for 1.5°C commitment.

Changzhou New Wide Knitting & Dyeing Co., Ltd

Changzhou New Wide Knitting and Dyeing Co.Ltd., established in 2003, is a leading textile manufacturer in China, is a subsidiary company under New Wide Group. In Changzhou New Wide, there are R&D center, in-house lab, intelligent data control room (IDCC), knitting mill, dyeing mill, and wastewater treatment area.

Target Summary

Near Term: 42% by 2030 (Scope 1&2) / 25%  by 2030 (Scope 3)

Long Term: 90% by 2050

Net Zero: commited by 2050

♦ Business Ambition for 1.5°C commitment.

Dong Jin Textile Co., Ltd

Dongjin Textiles is a textile manufacturing company with production facilities in South Korea, Vietnam, and Indonesia. Dongjin purchase raw yarns, perform the knitting and dyeing process, and deliver finished products to shoe OEM companies.

Target Summary

Near Term & Long Term commitment

Awaiting validation for their target from the Science Based Targets initiative.

♦ Business Ambition for 1.5°C commitment.

Flourish Thrive Developments Ltd.

Flourish Thrive Developments Limited is a footwear manufacturer group servicing global apparel, footwear and sportswear brands with operations across eight facilities in Vietnam, China and Myanmar. It specializes in the production of various vulcanized shoes, sports shoes, cold-fit shoes, and special function shoes.

Target Summary

Near Term: 42% by 2030 (Scope 1&2) / 25%  by 2030 (Scope 3)

Long Term: 90% by 2050

Net Zero: commited by 2050

♦ Business Ambition for 1.5°C commitment.

Evervan International Limited

Evervan International Limited is a subsidiary company under EP Group, headquarter in Hong Kong. Evervan International Limited operates 2 manufacturing facilities:  Evervan Qinyuan Footwear Co.,LTD (EVN) and Evervan Deyang Footwear Co., LTD (EVH) in China. The facilities produce products e.g., footwear for adidas.

Target Summary

Near Term: 46.2% by 2030 (Scope 1&2) / 25%  by 2030 (Scope 3)

Long Term: 90% by 2050

Net Zero: commited by 2050

♦ Business Ambition for 1.5°C commitment.

Evervan International Vietnam Limited

Evervan International (Vietnam) Limited: is a subsidiary company under EP Group and Hong Kong headquartered company operates one manufacturing facility Saigon Jim Brother’s Corp in Vietnam. The facility first started operations in 1999 and produce products e.g., footwear for adidas since 2006.

Target Summary

Near Term: 46.3% by 2030(Scope 1 & 2) /25% by 2030 (scope 3)

Long Term: 90% by 2050

Net Zero: commited by 2050

♦ Business Ambition for 1.5°C commitment.

Evervan International (Cambodia) Limited

Evervan International Limited is a subsidiary company under EP Group, headquarter in Hong Kong. The facility is located in Phnom Penh, Cambodia and produce products such as footwear for adidas.

Target Summary

Near Term: 42% by 2030 (Scope 1&2) / 25%  by 2030 (Scope 3)

Long Term: 90% by 2050

Net Zero: commited by 2050

♦ Business Ambition for 1.5°C commitment.

Star Asia Trading Pte. Ltd

Star Asia Trading Pte. Ltd is a subsidiary company under EP Group, headquarter in Singapore. Evervan International Limited operates 2 manufacturing facilities: PT. Panarub Industry (PRB) and PT. Bintang Indokarya Gemilang (PBB/PBS) in Indonesia. The facilities produce products e.g., footwear for adidas.

Target Summary

Near Term: 42% by 2030 (Scope 1&2) / 25%  by 2030 (Scope 3)

Long Term: 90% by 2050

Net Zero: commited by 2050

♦ Business Ambition for 1.5°C commitment.

Note:  SBTi commitment and target approval status can be checked here: https://sciencebasedtargets.org/companies-taking-action

These suppliers have developed Near-term SBT and Net zero target to be achieved by 2030, and by 2050 respectively. SBTi recommends companies must set near-term science-based targets to roughly halve emission before 2030 and set long-term science-based targets /net zero target to achieve more than 90% of emissions before 2050. Suppliers’ collective scope 1 and 2 emissions covered under the target is ~395,000 tCO2e. These suppliers will make an emissions reduction of ~1,72,000 tCO2e to achieve near-term SBT by 2030, roughly 44% of emission reduction as compared to the base year emissions. This is in line with the level of decarbonization required as stated by SBTi.

~395,000 tCO2e

Collective Scope 1 and 2 Emissions Covered by the 11 Suppliers

~30%

Share of Total Scope 3 Emission of the 11 Suppliers

The Low-Carbon Roadmap

A detailed low-carbon roadmap – Scope 1 and 2 emissions has been developed for suppliers.  It covered gap-to-target analysis, identification and quantification of carbon reduction opportunities across suppliers operations (e.g., energy efficiency, onsite renewable electricity, offsite renewable electricity, and coal phase-out) and fianancial implications of emisison reduction initiatives.

Transparency through CDP reporting:

Carbon Disclosure Project (CDP)

is a not-for-profit charity that runs the global disclosure system for investors, companies, cities, states and regions to manage their environmental impacts. Over 23,000 companies reported their environmental performance through CDP in 2023.

act renewbale supported suppliers in establishing system for reporting to the Carbon Disclosure Project (CDP) using its Climate Change questionnaire on an annual basis. Most of these suppliers have made their first disclosure in 2023. Some suppliers will be reporting to CDP for the first time in 2024.

The success of adidas’ Strategic Suppliers SBTi Program speaks for itself: it is proof of what can be achieved when brands take the lead, set the standard, and enable their supply chain to meet that standard. In aligning with adidas’ vision, suppliers are stepping up and helping to revolutionize the apparel and footwear industry.

act renewable is immensely proud of the part we played in helping adidas’ suppliers to set science-based targets, gain SBTi approval, enable first-time CDP disclosure and develop a low carbon roadmap. If your organization needs support in guiding your suppliers toward SBTi ambition, get in touch with our team here.    

To read more on adidas’ commitment to manage the environmental impacts on their  sites and across the entire value chain read more here

Adidas Commits to Decarbonization 

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