H&M Group shared an update on its decarbonization strategy, announcing several initiatives the company undertakes to achieve its SBTi-verified targets.
While these initiatives rightly and importantly focus on emissions reductions, H&M Group took a first step as part of a long-term commitment to high-quality carbon removals, signing a multi-year agreement with Climeworks, which covers the removal of 10,000 tons of CO₂.
Multi-year agreements like this one are crucial in two ways: first, they support the scale-up of CDR technologies like DAC+S as the guaranteed demand helps project developers like Climeworks to accelerate growth planning and second, they allow companies to build long-term relations in this sector today to be well positioned to secure CDR at more affordable prices at scale.
In order to keep the 1.5°C goal of the Paris Agreement within reach and avoid the most drastic effects of climate change, the world needs to get to net-zero emissions by mid-century. To achieve this, global emissions need to be reduced by 50% by 2030 and at least 90% by 2050, while the remaining 10% of unavoidable emissions must be removed by CDR solutions such as DAC+S, as suggested by the Science-Based Targets initiative (SBTi). In its latest report, the IPCC estimates that DAC+S alone will need to remove up to 310 billion tons of CO₂ by 2100.
A fundamental transition of the global economy across all sectors is required to achieve such goals, and the private sector is and will continue to be a key driver of the CDR industry’s growth.
We do our utmost to decarbonize our value chain in line with the global 1.5C target. By 2030 we aim to reduce absolute emissions by 56% from a 2019 baseline. Alongside reducing fossil fuel emissions by switching to renewable energy and improving energy efficiency, we will continue our journey towards the circular economy and reduce our dependency on virgin resources. We have a dedicated budget and team in place to financially support the transformation of our supply chain. Return on investment is measured in emission reductions, not financial gain. However, focusing only on our value chain is not enough to achieve climate goals. We also must invest in much needed climate action beyond our value chain. Scaling the Carbon Dioxide Removal market starting now is essential to enable both H&M Group and the global economy to achieve net zero in the coming decades. We are therefore excited about our agreement with Climeworks. We believe that agreements like this can have a catalytic role in building the Carbon Dioxide Removal market and will seek additional impactful collaborations in this area.
The multi-year CDR agreement with Climeworks is H&M Group’s first step in their long-term commitment to building a portfolio of high-quality, durable CDR solutions. For Climeworks, the guaranteed demand resulting from the growing number of multi-year agreements allows accelerated growth planning, contributing to the company’s journey to gigaton scale by 2050.
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