The time to act is now - for all of us.
Climate change is a global challenge that transcends boundaries. It affects people and communities everywhere, placing a particular burden on people who are already marginalized based on their gender, race or geography. The risks associated with rising global temperatures include water scarcity, more frequent and severe weather-related natural disasters, sickness and displacement, food insecurity, disruptions to biodiversity and mass species extinction.
Climate risk is a key sustainability issue that will have a significant and increasing impact across our value chain. As a sector, the apparel industry accounts for 10 percent of global greenhouse gas (GHG) emissions, and without intervention, its emissions are set to increase by 50 percent by 2030. At the local, national and international levels, governments are setting increasingly stringent climate regulations for companies and, in alignment with the Paris Agreement, setting national reduction targets.
Managing this risk is critical for the long-term success of our business. We feel a responsibility to address climate change by aligning our goals and strategies with the best science and industry practices. The Governance and Sustainability Committee of Gap Inc’s Board of Directors is responsible for reviewing and evaluating company targets, policies and programs relating to climate change.
We view climate change as an environmental issue, a human rights issue and a business issue. We also feel an ethical responsibility to address climate change by aligning our goals and strategies with the best science and industry practices.
We take a multifaceted approach to addressing climate change as part of our long-term goal to achieve carbon neutrality across our value chain by 2050. The foundation of our approach are goals that align with the scientific consensus and core commitment of the Paris Agreement to pursue efforts to limit global temperature rise to less than 1.5 degrees Celsius. We are part of the Science Based Targets initiative (SBTi) and in 2020, we established and received approval for our comprehensive science-based targets for reducing emissions across Scope 1 direct emissions from company facilities; Scope 2 indirect emissions from purchased products and services; and Scope 3 supply chain emissions from products, logistics and waste.
Many of our actions on water are also helping our supplier communities build their resilience to the impacts of climate change. We also support broader change through a business-led advocacy initiative.
Scope 1 and 2 Emissions: Improving the Energy Efficiency of Retail Stores and Distribution Networks
Retail stores are the focus of Gap Inc.’s operational energy program since they generate approximately 85% of our direct (scope 1 and 2) GHG emissions.
To address our Scope 1 and 2 emissions, we have invested in energy-efficiency programs and store retrofits that reduce the GHG emissions of our owned and operated facilities. These include transforming the energy-management systems of our stores and replacing heating, ventilation and air conditioning (HVAC) units with more energy-efficient models. We have established protocols for new buildings and have rated all stores to prioritize retrofit projects for greater energy efficiency.
In addition to reducing the energy impacts of our retail stores, we also look for ways to improve the efficiency of our distribution networks. We continue to offer a low-carbon shipping option on our ecommerce sites and are committed to using cleaner modes of transportation, encouraging the use of fuel-saving strategies and technologies.
See our annual climate data here.
Investing in Renewable Energy
We have three renewable energy projects, power purchase agreements and an on-site installation that have the capacity to generate 400,000 megawatt hours of clean energy every year—enough to power 1,800 of our approximately 3,100 company-operated retail stores. These projects make Gap Inc. one of the largest purchasers of clean energy in the American retail industry.
Aurora Wind Project: This 90-megawatt off-site wind farm in North Dakota—one of the largest utility-scale installations ever contracted by a retail company—began generating power in late 2020.
Fern Solar Project: This 7.5-megawatt off-site solar project, which came online in late 2020, is generating enough power to offset 100% of Athleta’s retail energy use.
Gap Inc. Fresno Distribution Center Solar Project: This 3-megawatt onsite solar project at our Fresno, California, distribution center began generating power in the first quarter of 2020 and now covers more than half of the building’s energy.
Addressing Scope 3 Emissions
As an apparel company, the vast majority of our climate impacts lie within our Scope 3 supply chain emissions, so we work closely with our suppliers to address those emissions and improve the efficiency of their facilities. In addition to our existing energy-efficiency programs, we are engaging our main suppliers to commit to carbon-reduction strategies, and we are exploring renewable energy opportunities with strategic suppliers.
Supporting Broader Change
We are also supporting broader change beyond our company. Gap Inc. has committed to carbon neutrality by 2050 as part of the United Nations Framework Convention on Climate Change (UNFCCC). Since 2007, we have been actively engaged with Ceres, a leading nonprofit organization dedicated to mobilizing the business community to build a sustainable economy. As a member of Ceres’ Business for Innovative Climate and Energy Policy (BICEP) coalition, we advocate for progressive policy action on climate and energy issues, and publicly affirmed our commitment to the Paris Agreement on climate change.
We have also signed on to the UN Fashion Charter for Climate Action, and we are part of the CEO-led G7 Fashion Pact, a group of leading apparel and textile companies that are setting aggressive commitments, expanding solutions and directing investments toward three priority areas: oceans, climate and biodiversity. The coalition has established a common agenda to reach 100% renewable energy, reduce carbon, increase biodiversity and focus on resilient development by 2050. CEO Sonia Syngal is on the Fashion Pact Steering Committee for 2021.
In partnership with the Ocean Conservancy, we signed the Arctic Shipping Pledge and committed to not intentionally send ships through the Arctic’s fragile ecosystem.
To advance transparency across the industry, our CDP Climate Change response includes detailed information on our strategy and performance, which incorporates recommendations from the Task Force on Climate-related Financial Disclosures (TCFD).
We reached our goal to reduce GHG emissions by 50 percent in owned and operated facilities by 2020 from a 2017 baseline in early 2021 through our investments in renewable energy and expanding on our energy efficiency projects. Building on this, we established 2030 Scope 1, 2 and 3 emissions reductions goals, as well as a renewable energy goal to put us on the path to achieving a carbon-neutral value chain by 2050.
Due to COVID-19 lockdowns and store closures, our Scope 1 and 2 emissions declined in 2020. We also achieved a 39 percent cumulative reduction of GHG emissions in our owned and operated facilities, putting us nearly halfway to our new 2030 goal. In absolute terms, we reduced our GHG emissions by 39,803 metric tons of carbon-dioxide equivalents (CO2e) through investments in renewable energy.
Due to COVID-19, we paused and scaled back some of our Scope 3 supply chain environmental and energy-efficiency programs to reduce the cost burden to our suppliers. However, our ongoing partnership with Aii Clean by Design and PaCT in Bangladesh still drove meaningful reductions across our Asia-based Tier 1 and Tier 2 facilities.
Looking ahead, we are exploring climate adaptation strategies that can mitigate the financial and physical impacts of climate change, while building business and community resilience. We are also looking to identify opportunities for renewable energy projects in Asia and elsewhere within our supply chain. Our efforts with key suppliers currently target the development of specific emissions reduction plans including investments in renewable energy and the phasing out of coal. We are also seeking opportunities to accelerate the transition to raw materials that have lower carbon footprints and are leveraging the Higg MSI to help direct this across our brands.
A priority for people and our business.
Reducing impacts at every stage.
Great product designed with sustainability in mind.
Working towards 80% waste diversion.
Addressing hazardous discharge.