Climate

Scientific evidence shows that limiting global warming to 1.5°C compared to pre-industrial levels can reduce the risk of serious consequences such as extreme weather, rising sea levels and impacts on ecosystems, health and livelihoods.

Greenhouse gases (GHGs), such as carbon dioxide, methane and nitrous oxide, trap heat in the atmosphere and drive temperature increases. Activities across our value chain generate these emissions — from material production and manufacturing to transport, retail and what happens to products after use. This is why reducing greenhouse gas emissions in our own operations and across our value chain is an important part of our work.

H&M Group’s annual and sustainability report is the primary source for our latest reported information on our climate-related targets, methodology, actions, governance, allocated resources and progress. Our Climate Transition Plan, published in March 2024, is available in our archive and reflects information available at the time of publication.

Our climate targets have been validated by the Science Based Targets initiative (SBTi), an independent organisation that assesses whether corporate emissions-reduction targets are aligned with climate science. On this page, we summarise reported emissions progress and selected examples of actions across our operations and value chain.

Greenhouse gas emissions are commonly grouped into three categories, based on how directly a company controls them.

Scope 1 refers to our direct emissions from our own operations, such as fuel use for heating or company vehicles.

Scope 2 refers to emissions associated with the electricity, heat or cooling we purchase for our stores, warehouses and offices.

Scope 3 refers to our indirect emissions from activities outside our operations but linked to our business, including raw material production, manufacturing, transport and what happens to products at the end of their life, for example recycling or incineration for energy recovery.

In our 2025 annual and sustainability report, we reported a 41 percent reduction in Scope 1 and 2 greenhouse gas emissions compared with 2019, our baseline year. This reduction was mainly linked to increased purchasing of renewable electricity. For absolute Scope 3 emissions, we reported a reduction of nearly 35 percent compared with 2019.

The main factors contributing to these reductions include improved material efficiency, increased energy efficiency, greater use of renewable electricity, a reduction in on-site coal, and a growing share of recycled materials. Material efficiency refers to actions that reduce overall material use across our business.

Reducing emissions in our own operations and value chain is our priority. We do not use carbon offsetting to achieve our emission reduction targets or to claim reductions in our reported greenhouse gas emissions.

The examples below highlight some of the actions we are taking to reduce greenhouse gas emissions across our operations and value chain. Detailed information is available in our annual and sustainability report.

Renewable electricity in our operations

We have signed ten power purchase agreements in Poland, Sweden, Spain, the UK and the US to support the renewable electricity projects in markets where we operate. In 2025, electricity matched through our virtual power purchase agreements represented 49.1 percent of the electricity used in our own operations. Power purchase agreements are long-term contracts between a company and a renewable electricity provider. These agreements can provide longer-term revenue certainty for renewable electricity providers. Find out more in this case study.

Energy efficiency in our operations

Across our stores, we use a range of measures to improve energy efficiency, including real-time energy monitoring, LED lighting and automated controls for lighting, heating and cooling.

Supplier energy use

Removing on-site coal boilers from our supply chain is an important part of our work to reduce our Scope 3 emissions. We are supporting suppliers involved in garment manufacturing, fabric production and yarn spinning to phase out these boilers by the end of 2026. By Q3 2025, the number of on-site coal boilers in our supply chain decreased to 10 from 118 in 2022.

Energy efficiency at suppliers

Our in-house energy efficiency engineers work with suppliers to identify opportunities to improve energy efficiency, including solutions such as waste heat recovery from manufacturing processes. Read more in this case study.

Materials

Materials are an important part of our Scope 3 emissions footprint because emissions are generated during raw material production, including from farming, fossil fuel extraction, processing and associated energy use.

Changes in fibres, material efficiency and use of recycled materials can affect associated emissions. For example, recycled materials often have lower associated emissions than comparable virgin materials, depending on the material type, production process, energy source and methodology used.

Alongside work on material-related emissions, we also offer resale options to help extend the use of existing garments.

Transport

We use selected transport options that can reduce transport-related emissions, including electric vehicles and, where appropriate, biofuels. We also work to improve transport efficiency by increasing load capacity, consolidating shipments and reducing unnecessary transport movements through measures such as parcel collection points and delivery planning.

Financing for suppliers to reduce emissions

We offer suppliers financial support and financing at favourable terms for energy efficiency and renewable energy projects.

Since its launch in 2023, our Green Fashion Initiative has financed 24 supplier-led energy efficiency and renewable energy projects in our supply chain. During 2025, operational projects were estimated to reduce greenhouse gas emissions by 146,939 tonnes CO₂e (carbon dioxide equivalent, a common unit used to compare the impact of different greenhouse gases). Of the estimated reductions, 50,746 tonnes CO₂e were attributed to H&M Group under our reporting methodology.

The primary purpose of these investments is to support emissions reductions rather than generate financial returns.

Find out more about our financing initiatives and how we are installing rooftop solar panels, electrifying processes at a supplier and using biomass as a transitional fuel.

Our public affairs work supports our climate strategy by engaging on policy conditions that can affect access to renewable electricity and electrification in selected markets.

We engage with relevant stakeholders and governments at global, regional and national levels on policy conditions relevant to emissions reduction and renewable electricity access in selected production and retail markets. This includes work on long-term renewable electricity agreements and credible systems for tracking renewable electricity use. We also participate in partnerships including the UNFCCC Fashion Charter, WWF, RE100, Apparel Impact Institute and other relevant local organisations.

Key market developments and examples of our engagement are outlined below, with our role varying by market.

• Vietnam: Direct Power Purchase Agreement (DPPA) legislation was introduced in 2024, creating a framework for large electricity users to buy renewable electricity directly through private lines or the national grid. H&M Group has engaged with policymakers, industry initiatives and other relevant organisations on renewable electricity access and industrial electrification in Vietnam. Implementation details are still developing.
• Bangladesh: The CPPA legal framework was approved in 2025. H&M Group signed a Memorandum of Understanding (MoU) with the International Finance Corporation (IFC) and a local company to explore a first pilot under the framework.
• Indonesia: Two strategic suppliers signed Green Electricity Tariff Agreements (GEAS). These agreements are intended to support the suppliers’ access to renewable electricity in Indonesia. This is an example of supplier action in a market where H&M Group engages in renewable electricity access.
• Türkiye: A strategic supplier signed the industry’s first Corporate Power Purchase Agreement. This is an example of supplier action linked to renewable electricity procurement in the supply chain.
• China: H&M Group engages through relevant industry initiatives on the international recognition of China’s national Green Electricity Certificates, as part of broader work to support credible renewable electricity tracking.

We also engage on policy conditions that can support the electrification of production processes currently reliant on thermal energy. This includes issues such as grid capacity and stability, transition incentives, increased electricity demand from suppliers, and electricity pricing. Supportive legal frameworks for industrial electrification will be important for reducing emissions from textile production across the wider industry, but progress also depends on infrastructure, technology readiness, costs and market conditions.

Our work with WWF

Together with the World Wide Fund for Nature (WWF), we work on climate-related collaboration, knowledge-sharing and policy engagement. In 2025 and 2026, we joined forces with WWF and IKEA in Vietnam, one of H&M Group’s key production countries, to support early-stage policy dialogue on industrial electrification. As electrification of industrial heat is currently at an early stage in the country, the collaboration has focused on building an initial evidence base on electrification solutions, sharing insights from pilot projects and engaging policymakers and local stakeholders. The collaboration brings together WWF’s environmental expertise with industry perspectives from H&M Group and IKEA, with a focus on sharing evidence and practical insights related to renewable energy and the electrification of manufacturing processes.

Carbon removals

Carbon removals involve taking carbon dioxide out of the atmosphere and storing it, for example underground or in long-lasting materials. They are separate from reported emissions reductions and are not counted towards emission reduction targets.

Under the SBTi Corporate Net-Zero Standard, companies are expected to address residual emissions through carbon removals at the final stage of their climate targets. We only make claims related to carbon removals once removals have been delivered and verified.

Since 2022, we have engaged in this emerging field to build knowledge and support the development of permanent carbon dioxide removals that are assessed against relevant quality criteria. That year, we signed our first agreement for direct air capture and storage with Climeworks. We are also a member of Frontier, an advance market commitment that facilitates the purchase of permanent carbon dioxide removals from a portfolio of providers.

The future volume, timing and type of removals that may be relevant for H&M Group remain uncertain and relevant standards continue to develop. We therefore view our agreements related to permanent carbon removals as a way to build knowledge and support the development of the carbon removal market.

Supporting efforts outside our own operations

Reducing emissions to keep global warming within 1.5°C requires action beyond individual company value chains. While our priority is to reduce emissions in our own operations and value chain, we also support selected climate initiatives beyond our direct emissions footprint. In 2022, we joined the LEAF Coalition, a public-private initiative through which members can buy verified jurisdictional carbon credits linked to reductions in tropical deforestation.

Through LEAF, we have entered into an agreement to buy carbon credits from the Brazilian state of Pará, which is intended to support actions that reduce deforestation in the region once verified. These credits sit outside our reported Scope 1, 2 and 3 emissions accounting.