Climate

Science clearly shows that global warming must stay below 1.5°C to reduce the risk of serious consequences such as extreme weather, rising sea levels, loss of wildlife, and impacts on people’s health and livelihoods.

Rising concentrations of greenhouse gases (GHG), such as carbon dioxide, methane and nitrous oxide, trap heat in the atmosphere and drive temperature increases. Most activities across our value chain generate GHG emissions — from growing cotton, spinning, dyeing and garment production to transportation, retail, use and end-of-life. We actively work to mitigate these emissions across our value chain.

In September 2022, the Science Based Targets Initiative (SBTi) verified our climate targets. This organisation helps companies set targets based on the latest science, so businesses can contribute to limiting global temperature rise.

To be able to reduce emissions, we need to know where they come from. Greenhouse gas (GHG) emissions are grouped into three categories, based on how directly a company controls them.

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

Scope 2 are emissions from electricity, heat or steam we buy to power our own operations, e.g. electricity and district heating for stores, warehouses and offices.

Scope 3 are indirect emissions from outside our operations but still relate to our business, e.g. cultivation of raw materials such as cotton, manufacturing by suppliers, product transport and what happens to products at the end of their life, for example recycling or incineration for energy recovery.

Please note, emissions from when customers use and care for our sold products are not included in our Scope 3 targets.

Further details on our approach to recalculating emissions are available in our Greenhouse Gas Emissions Recalculation Policy.

Reducing emissions is our priority. At H&M Group, we do not use carbon offsetting to achieve our emission reduction targets.

Achieving global net-zero emissions is a shared responsibility. Alongside reducing emissions across our value chain, we recognise our role in contributing to this broader goal. Supporting projects that mitigate climate impacts beyond our value chain is one way of doing this, such as our work with LEAF Coalition.

Across our stores, we are rolling out programmes to improve energy efficiency. These include real-time monitoring of energy use, LED lighting, motion sensors to automatically turn off lights when spaces are empty and temperature adjustments to avoid unnecessary heating or cooling.

We have signed ten power purchase agreements in Poland, Sweden, Spain, the UK and the US to add new renewable electricity generation to the grids where we operate. In 2025, these agreements covered 49 percent of our electricity use.

These agreements are long-term contracts between us and a renewable energy provider. By agreeing to a fixed price over several years, these agreements helps the provider to build and operate new solar parks. Find out more in this case study.

In 2025, we reported a 41 percent reduction in scope 1 and 2 GHG emissions since 2019, our baseline year. This improvement was largely driven by an increase in the amount of renewable electricity we purchased.

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

Since it was launched in 2023, our Green Fashion Initiative has supported 24 projects in our supply chain. During 2025, the operational projects reduced emissions by 147,000 tonnes CO2e, of which 51,000 tonnes CO2e are attributable to H&M Group.

The return on these investments is measured in GHG emissions reductions, not in financial gain.

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

Removing coal boilers from our supply chain is one of the most impactful actions we can take to reduce our scope 3 emissions. We are supporting the first three levels of our supply chain (also known as tiers 1, 2 and 3) to phase out these boilers by the end of 2026. These factories make our garments, produce fabric and spin yarn. By Q3 2025 the number of on-site coal boilers in our supply chain dropped down to 10 from 118 in 2022.

Our team of experts provides free audits to suppliers to identify potential efficiency improvements, such as waste heat recovery from manufacturing processes. Read more in this case study.

The production of raw materials such as cotton, wool and synthetics generates greenhouse gas emissions through the energy used in farming, fossil fuel extraction and agricultural sources of methane and nitrous oxide.

By switching the type of fibres we use, we can reduce emissions. For example, recycled materials generally have lower associated emissions than their virgin counterparts.

We also offer resale to prolong the life of existing garments and reduce raw material consumption.

We’re cutting emissions from how we move goods and materials by using lower-emission transport options, including electric vehicles and, where needed, biofuels. We’re also reducing the number of journeys through changes like using parcel collection points and improving how we manage returns and restock stores. To make transport more efficient, we’re increasing load capacity, consolidating shipments and adjusting delivery schedules.

 By the end of 2025, we have reduced absolute Scope 3 emissions (excluding indirect use-phase) by 35 percent compared to our 2019 base year, keeping us on track to meet our 1.5°C-aligned science-based target.

This progress also supports our ambition to achieve a 56 percent reduction by 2030.

Our public affairs work is an important enabler of our climate strategy.

We aim to support the creation of the legal frameworks needed to reach our climate targets by engaging with governments at global, regional and national level. A fundamental part of our public affairs work on climate is our direct engagement with national policymakers in key production and retail markets to improve access to renewable electricity. In addition to our own engagement, we actively participate in stakeholder platforms, including through leadership positions in some of them, as well as through impact-driven partnerships. These include the UNFCCC Fashion Charter, WWF, RE100, Apparel Impact Institute and other relevant local organisations.

A central focus of our public affairs strategy is promoting Corporate Power Purchase Agreements (CPPAs) to enable the selective procurement of renewable electricity. In close connection with our PPA advocacy, we also advocate for robust, transparent and internationally recognised Energy Attribute Certificates, so that the use of renewable energy can be correctly attributed. Key actions and outcomes in this area include:

• Vietnam: Direct Power Purchase Agreement (DPPA) legislation was introduced in 2024, but advocacy continues to receive further guidance on pricing and the participation of industrial zones.
• Bangladesh: The CPPA legal framework was approved in 2025; we signed an MoU to launch a first pilot with IFC and a local company.
• Indonesia: Two strategic suppliers signed the newly launched Green Electricity Tariff Agreements (GEAS).
• Türkiye: A strategic supplier signed the industry’s first CPPA.
• China: Support for the international recognition of national Green Electricity Certificates.

Complementing our efforts to secure CPPAs in key markets, we have also initiated policy strategies to support the electrification of production processes currently reliant on thermal energy. This includes addressing grid capacity and stability, transition incentives, supplier electricity load increases, and electricity pricing impacts. Ensuring that enabling legal frameworks are in place for the electrification of production processes in the textile industry will be a critical pillar in securing a decarbonised future for our industry.

We are committed to reducing our emissions beyond 2030, by at least 90 percent by 2040 compared with 2019. Several of the actions outlined above will continue to play a key role, including improving energy efficiency and expanding the use of renewable energy.

But these steps alone won’t be enough. We need to close existing gaps – such as scaling up recycling technologies and keep improving manufacturing processes. Meanwhile we also need to increase the focus on electrification of our supply chain, removing obstacles such as lack of infrastructure or prohibitive pricing.

While not all solutions exist yet, we are focused on driving progress and supporting the changes needed to reach our goals.

Our aim is to reduce emissions as far as we can by taking actions like those detailed above. However, there will be some remaining emissions that we cannot reduce, for example, from agricultural practices used to produce raw materials. To balance out these emissions, we invest in projects that will remove an equivalent amount of carbon dioxide from the atmosphere and store it. That’s what we mean by net-zero. These projects are not counted in our emissions reduction figures.

Current options for permanent carbon dioxide removal are limited. By committing to purchase carbon removal credits now, we can help scale solutions so more organisations can access them in the future. In 2022, we signed a multi-year deal with Climeworks for direct air capture and storage with final delivery in 2033. In 2023, we joined Frontier, an advance market commitment that speeds up the development of carbon removal technologies by promising to buy carbon removal credits once the technologies are ready. Since then, we have signed fourteen offtake agreements due for delivery in 2030.

Carbon removal credits are only counted once the carbon has been taken out of the atmosphere and the removal is verified. This means we don’t claim any climate benefit from these agreements until the removals are actually delivered. And we never claim these credits against our emission reduction targets.

Reducing emissions to keep global warming within 1.5°C is a shared responsibility. Alongside efforts to cut emissions from our business, we have a responsibility to contribute to this wider goal. In 2022, we joined the LEAF Coalition to help protect tropical forests, important carbon stores. The coalition members buy verified carbon credits from tropical forest countries that reduce deforestation.

Through LEAF, we have entered into an agreement to buy carbon credits from the Brazilian state of Pará, which will directly support actions that reduce deforestation in the region once verified. Please note, we do not use these credits to offset any of our emissions.