Adidas has begun working with a large proportion of its “strategic” (major) Tier 1 and 2 suppliers to increase the adoption of renewable energy in its supply chain, which is an essential step forward. But to keep up with its competitor PUMA, it should set a concrete target of 100% renewable energy across its Tier 1 and 2 suppliers. adidas took important steps forward by developing its “Decarbonization Manifesto” for major suppliers, and reports providing both financial and informational support to suppliers to transition to renewable energy, which is key to supporting the fossil-free transition. However, adidas’ supply chain emissions target is still only at 30% reduction, which is too low to be in line with a 1.5 °C pathway. It reported an increase in supply chain emissions between 2019 and 2021. It is essential that adidas increases its supply chain decarbonisation ambition and takes rapid action to transition to renewable energy to cut the biggest source of its emissions.
Total Score
Emissions
About the Scorecards
The fashion industry is responsible for 2- 8% of global emissions but are fashion brands doing enough to tackle their growing climate impact? The updated 2023 Fossil Free Fashion Scorecard analyses 43 fashion companies on their climate action.
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GHG emissions:
adidas has committed to achieving climate neutrality across its own operations by 2025, and across its value chain by 2050.
To achieve this target the company commits to reducing absolute Scope 1, 2 and 3 emissions by 30% by 2030 from a 2017 base year, including a 90% reduction in Scopes 1 and 2. adidas should aim to increase its Scope 3 target to address its primary source of emissions.
Renewable energy:
As a signatory of the renewed UN Fashion Charter, adidas has committed to sourcing 100% of electricity from renewable sources in its own operations by 2030, and has committed to using electricity that is additional to the grid.
adidas has worked with strategic Tier 1 and Tier 2 supplier facilities on the increased adoption of renewable energy. But it has yet to set a target of 100% renewable energy for its supply chain by 2030, which is an essential step for decarbonising its manufacturing.
Coal phase out:
adidas has publicly set a target to phase out coal-fired boilers from its Tier 1 and Tier 2 supply chain by 2025, which is 5 years ahead of the 2030 target set by the UN Fashion Charter.
GHG emissions:
adidas publicly reports GHG emissions in its own operations, and in its supply chain. The company does provide a full breakdown of its Scope 3 emissions.
Energy use:
adidas publicly reports its energy use for its own operations, including a breakdown of its renewable energy use and how that energy is sourced.
For its supply chain, adidas does not publicly report its energy use, and it does not provide a breakdown of its suppliers’ renewable energy use and how that energy is sourced.
Suppliers:
adidas provides a partial supplier list to Tier 1 and Tier 2.
adidas provides its suppliers with training and resources to help them make energy efficiency improvements, including co-developing an online climate action training program with Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) which will be made available to all of the UN Fashion Charter signatory brands and their supply chain. According to adidas, incentive systems and measures in place will prioritise supplier partners who not only demonstrate commitment towards the “Decarbonization Manifesto” but also show impactful results, but adidas does not report providing its major suppliers with specific financial incentives for energy efficiency measures. adidas does not currently require suppliers to make energy savings as a condition of contract, but plans to implement conditions from 2025.
adidas will no longer install coal-fired boilers, heaters or power generators from 2022 onwards. As of 2021, adidas has further developed a coal replacement guideline to provide guidance and support for the supply chain’s transition from coal to renewable energy and other lower emission fuels.
adidas does report providing some suppliers with training and resources to help them transition to renewable energy, including in 2021 adidas funded technical expertise for solar rooftop feasibility studies in key sourcing countries such as Vietnam, Cambodia, China, Indonesia, and Myanmar. These studies covered 80% of the company’s main suppliers. The company does report providing financial support or incentives to make the energy transition, such as contractually securing additional capacity. adidas developed a “Decarbonization Manifesto” for all of its finished goods and materials manufacturers and suppliers, which includes renewable energy. The company does not currently require suppliers to use renewable energy as a condition of contract but will do from 2025.
adidas does require its suppliers to disclose GHG emissions data and it does require Tier 1 and Tier 2 suppliers to set GHG emissions reduction targets or set science-based emissions reduction targets, but it does not require suppliers to provide facility level data.
adidas has not made any commitments to phase out fossil fuel based materials.
adidas has not made a public policy to ban the sourcing of leather from the Amazon Biome, but the company does have processes in place to avoid leather sourced from deforested regions, including a partnership with the Leather Working Group that covers 90% of adidas leather material. adidas was found to be at high risk of sourcing leather from deforestation in the Amazon Biome in Stand’s Nowhere to Hide report.
Low-carbon materials:
It is not discernible that adidas is working to increase closed-loop apparel-to-apparel recycling for synthetics or plant-based fibres, instead focusing on a goal to source 100% recycled polyester from non-textile sources by 2024 which does not contribute to reducing textile waste. adidas has not committed to reduce the impact of its raw materials sourcing by switching to organic cotton or cotton sourced from regenerative agriculture by 2030, although it does report sourcing 100% Better Cotton”since 2018.
Increasing circularity:
adidas is partially acting to increase circularity and address overproduction by policies to improve circularity by increasing its take back program in global markets and launching the “Made to be Remade” label for garments to be returned to fabric circularity, though it is not clear how this will contribute to reducing production.
adidas does not publicly report its material mix, its volume of deadstock. But it does report how it manages or disposes of its deadstock to reduce waste.
adidas did report its shipping emissions in 2020 and 2021. However, the 2019 shipping emission data is not available. And only shipments from Tier 1 suppliers to its distribution centers were counted in supply chain emissions. It does include shipping emissions in its GHG reduction targets. adidas does not provide a breakdown of its transportation methods.
adidas does have a policy to avoid aviation and commit to slower shipping methods such as maritime, rail and land. The company does not report a near-term plan to ship its cargo via cleaner methods. It reported a significant (27.9%) increase in its upstream transportation and distribution emissions from 2020 to 2021.
adidas has not committed to transitioning to zero emissions vessels (ZEV) by 2030. The company has not used its voice publicly to advocate for Zero Emission Shipping.
adidas has yet to commit to transitioning its last mile delivery to zero emission vehicles.
adidas engaged in some proactive advocacy during the 2023 Scorecard period, including supporting the publication of a EuroCham position paper on renewable energy in Cambodia. The paper pushes the government to refocus on renewable energy, remove capacity charges, and promote rooftop solar in addition to private PPAs. adidas signed on to a letter with 68 other companies to the German government advocating for a comprehensive climate neutrality implementation plan. adidas is also part of the Fashion Pact, a global initiative of companies committed to common environmental goals.