GREENHOUSE GAS EMISSIONS (GHG)

We recognize that the retail industry and its supply chain are significant contributors to climate change. How we manage impacts of climate change provides both a risk and opportunity for our organization. We are committed to understanding the impact of our products and operations throughout the entire value chain — from raw materials to end of life — to take meaningful action to reduce our footprint. 

In May 2022, we established a Greenhouse Gas Emissions Task Force — representative of key stakeholders in our facilities, sourcing, supply chain, logistics, operations, finance, audit, legal and ESG teams — to collect our 2021 GHG emissions inventory, understand climate risks and opportunities to our organization and to analyze our emissions across the value chain. The following are VS&Co’s Scope 1 and 2 Emissions for FY 2021.

*Market-based emissions are lower than location-based emissions as market-based emissions includes offsets via the purchase of energy certificates.

This data has been validated by a third-party auditor, Apex Companies, LLC (Apex). The verification declaration letter from Apex can be found here. VS&Co is wholly responsible for the determination and presentation of the following greenhouse gas emissions data. 

We are in the process of analyzing and validating our Scope 3 emissions, and therefore this data is excluded from this report. In our evaluation to date, the majority of our emissions reside in Scope 3, primarily in our lingerie and apparel supply chain. This is in line with industry trends. 
 
To better understand emissions from our supply chain, we are analyzing 2019 and 2021 data to identify partners with the lowest and highest greenhouse gas emission intensities, both to prioritize partners for engagement, as well as to learn from partners who have already implemented best practices.

We regularly and proactively engage with our supply chain partners to understand their plans, progress and obstacles for reducing their emissions, and we encourage them to set their own targets. By the end of our 2022 fiscal year, 83 percent of our Tier 1 and 44 percent of our Tier 2 lingerie and apparel production partners have committed to emission reduction targets, and 71 percent of our Tier 1 vendors and 30 percent of our Tier 2 material suppliers (by sourcing volume) have committed to Science Based Targets initiatives. 

We continue to look for opportunities to support our supply chain partners on this journey, including sponsoring key supply chain partners participation in the Carbon Leadership Program (CLP) facilitated by the Apparel Impact Institute (Aii). This program accelerates action to meet climate targets by utilizing a carbon supplier toolkit. With the toolkit, each factory establishes its own carbon target and a personalized action plan to achieve it. To date, we have sponsored eight facilities to participate in the CLP. 

In addition to finalizing our 2021 Scope 3 inventory, we are also in the process of collecting and analyzing our 2022 emissions inventory, which will represent the first full year of our operations as a standalone company. We will continue to report on our emissions and evaluate our climate risks and opportunities annually. With this understanding of our impact, we are developing a climate strategy with targets to reduce emissions across our value chain. 

Addressing Emissions in our Supply Chain
An important step in lowering the environmental impact of our products is collaborating
with supply chain partners to improve manufacturing operations. Toward this aim, we are taking collective action with the Apparel Impact Institute’s Carbon Leadership Program (CLP). This program assists our supply chain partners in measuring their GHG emissions baseline, setting reduction targets, and creating a detailed roadmap for accomplishing those targets. To date, 47 percent of our materials suppliers have engaged in the CLP, and nearly half of these were directly supported by VS&Co. We have also started scaling the CLP among key Tier 1 vendors. Helping to support our partners’ greenhouse gas reduction strategies is key to reducing the environmental footprint of our value chain. 

Methodology and Boundaries 
Data provided represents emissions from fiscal year 2021. VS&Co calculates and reports emissions in accordance with: The Greenhouse Gas Protocol Corporate Accounting and Reporting Standard, The Greenhouse Gas Protocol: Scope 2 Guidance and US EPA Center for Corporate Climate Leadership: Direct Fugitive Emissions from Refrigeration, Air Conditioning, Fire Suppression, and Industrial Gases.

We use the operational control approach in conformance with the The Greenhouse Gas Protocol to report energy consumption, and direct and indirect emissions. There are no sources excluded from our selected reporting boundary.  

There are inherent limitations when calculating emissions due to estimations, lack of complete data, and the use of emissions factors. We will continue to refine emissions data annually as we access more granular data. 

Apex Companies, LLC. (Apex) independently verified the accuracy of emissions reported by VS&Co for fiscal year 2021, and on the underlying systems and processes used to collect, analyze and review the information.

TRANSPORTATION

The movement of freight around the world requires the use of fossil fuels, and we work with some of the leading logistics companies in the world to efficiently transport our goods using a variety of means. In order to minimize the impact of our supply chain logistics on the environment, Victoria’s Secret & Co. is committed to:

• Utilizing the most efficient means of transportation that meets our delivery needs and schedules; and
• Utilizing highly efficient trailer stacking techniques to optimize the use of trailer space and reduce the number of trucks and amount of energy required to transport our merchandise to our distribution centers.

BEAUTY SUPPLY CHAIN

In 2009, in partnership with L Brands, Victoria’s Secret & Co. participated with public and private entities to facilitate the development of an industrial park focused on the manufacture of personal care and beauty products. As of today, the 200-acre site is the home of 14 inter-connected personal care and beauty product vendors, including:

• personal care and beauty product manufacturers
• packaging component manufacturers,
• product fillers
• packaging companies

By vertically integrating the entire personal care product supply chain from beginning to end, Victoria’s Secret & Co. is able to shave both time (both production and transit time) as well as distance from our production process. Additionally, the reduction in the transit distance reduces the greenhouse gas emissions associated with the manufacture of our products.

PARTNERING TOWARD IMPROVEMENT

We’re especially proud to partner with suppliers that share our values and commitment to our community and the environment through responsible manufacturing practices.

Anomatic Corporation, a global leader in packaging design and manufacturing, is one such partner that demonstrates this commitment through their continual reinvestments in state-of-the-art recycling equipment and technologies. These efforts enable them to significantly recycle, reuse and reduce many of the materials used in their production process, as depicted in the following infographic:

Some of Anomatic’s most recent sustainability initiatives include:

• A new cleaning technology that reduces carbon consumption by 70 percent;
• New recycling systems that require fewer chemicals and support phosphate reclamation;
• Development of a new aluminum alloy containing 80% post-recycled content and requiring 75 percent less energy.

Brandix Group is another Victoria’s Secret & Co. partner that shares our values and demonstrates a deep commitment to the environment. Through its support of the Green Building Council’s “Go Green” Campaign where it has manufacturing operations in Sri Lanka, Brandix is dedicated to raising awareness on the importance of environment protection and sustainable, practical solutions. Consistent with this commitment to environmental sustainability, Brandix built the first LEED (Leadership in Energy and Environmental Design) Platinum-rated apparel factory under the Green Building Rating System of the U.S. Green Building Council (USGBC) and obtained LEED certification for three additional facilities. In addition, Brandix installed the largest rooftop solar plant in Sri Lanka as part of their efforts to reduce their carbon footprint.

By developing its own assessment tool - Eco Index, Brandix is able to quantify reductions in key environmental indicators for air, water and earth as they rollout initiatives to all of their locations in an effort to minimise CO2 emissions, energy and water consumption and solid waste disposal.

We’re also thrilled to highlight our partner, MAS Holdings. Our unique partnership with MAS Holdings has led to groundbreaking progress on the Forever Bra, which features our first bra pad designed for circularity. For over three decades, MAS has set out to reimagine the way the industry approaches manufacturing. At its core, MAS is committed to inspiring sustainable change in a way that works toward climate resilience, enriches lives and drives innovation that fuels positive change.