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The analysis of raw materials and their supply chain laid the foundations of a process aimed at safeguarding biodiversity, outlining a range of activities for more responsible use of natural resources and for reducing the impact of the supply chain on ecosystems.
In fact, since 2021 the Group has actively involved its suppliers in identifying the main areas of supply of its strategic raw materials and quantifying, for each of them, the impact in terms of land use, climate change, water stress and land and marine pollution. The approach, constantly evolving in alignment with the guidelines of the Science Based Targets for Nature (SBTN)35 and the AR3T (Avoid, Reduce, Restore and Regenerate, and Transform) framework, enabled the identification and prioritisation of mitigation actions.
The analysis conducted by the Group in 2021 showed that the greatest biodiversity impacts are associated with animal fibres, mainly wool

and cashmere, related to the use of soil during grazing. It also emerged the presence of some areas at risk of water stress along the down and cotton supply chain. On the basis of this analysis, the first projects were defined, both at the Group’s activities and along the supply chain, aimed at minimising the impact on biodiversity by 2030. In particular, the Group is committed to supporting regenerative farming practices in the cotton and wool supply chains, with mitigation effects on both the impact on biodiversity and greenhouse gas emissions. Regenerative farming is an approach that aims to improve the health and fertility of the soil, increasing its capacity to absorb carbon from the atmosphere, while also protecting water resources and biodiversity.
In 2022 projects were identified to support regenerative practices linked to the cotton and wool supply chains.
In 2023 the Group took part in two specific

projects related to the cotton sector: the pilot project Unlock Programme, organised by The Fashion Pact, and the Cotton 2040 project of the Ecosystem Services Market Consortium (ESMC)36, both of which aimed to provide incentives for cotton farmers to apply regenerative and low-impact farming practices. At the end of the year, the Group also launched a regenerative farming project in the wool supply chain in Australia with PUR Projet37, promoting the use of regenerative practices in animal rearing, with the aim of improving the farming practices used.
In view of constant improvement, thanks to the data obtained from the traceability project carried out throughout the supply chain, in 2024 the Group will update the analysis to quantify the impacts on biodiversity and align the methodology with the developments of the new guidelines of the SBTN framework.

NOTES

35 SBTN guidelines outline new methodologies for implementing and measuring targets on a scientific basis for freshwater and soil. These methodologies, which are being validated by a small group of companies in various sectors, can then be used on a large scale by companies that wish to define such targets.
36 A non-profit organisation that recognises and rewards farmers for their environmental practices.
37 An organisation active in insetting since 2008, PUR Projet is a certified B Corp and a global leader in the implementation of nature-based solutions.