SAFEGUARD BIODIVERSITY

Moncler Group is committed to promote the protection of natural habitats and animal welfare in the areas where its production sites and supply chains are located, recognising the importance of safeguarding ecosystem and biodiversity.

The first step the Group took in line with this commitment was to identify the main biodiversity risks present within its value chain. In the past years the Group, with the active involvement of its suppliers, carried out a hotspot analysis to identify the main areas of supply of its strategic raw materials, quantifying, for each of them, the impact in terms of land use, climate change, water stress, land and marine pollution.

This assessment was done using a location-specific approach that enabled the evaluation of the impact-related biodiversity risks both of Group’s own operations sites and of its value chain. The approach, developed on the basis of the guidelines of the Science Based Targets for Nature (SBTN)¹ and the AR3T (Avoid, Reduce, Restore and Regenerate, and Transform) framework, enabled the identification of the impacts generated by the Group, and the prioritisation of mitigation actions.

Regarding its own operations, based on the WWF Biodiversity Risk Filter tool, there are no corporate and production sites directly operated or managed by the Group in or adjacent to Protected Areas.

Regarding the impact-related risks along the supply chain², the Group analysed every life cycle stage, from cultivation and extraction of raw materials to the production of semi-finished and finished products. The analysis showed that raw material cultivation and extraction are the most impacting life cycle stages for the majority of raw materials assessed.

In particular, greatest biodiversity impacts are associated with animal fibres, mainly wool and cashmere, related to the use of soil during grazing. 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.

In addition, the results of the analysis were shared with the risk management team, which evaluated them and integrated them in the Enterprise Risk Management (ERM) model and in the Risk Register; in particular, the risk assessment was done based on the analysis of the Group’s dependence on operations and on the sourcing of certain raw materials from certain Regions where the impact on biodiversity was found to be greatest.

This approach was updated in 2024 with the support of a qualified third-party organization. The analysis focused on raw materials with potentially relevant impacts on biodiversity, specifically those of natural origin, mainly wool, cashmere, cotton and down, used in the Spring/Summer (SS) and Fall/Winter (FW) 2024 collections.

The update included an initial assessment phase that identified land and water use and pollution as the key areas of potential impact of the value chain on nature. Based on these findings, the prioritization phase began, taking into account the relevance of the impact, the urgency of the actions, and the technical and economic feasibility.

In particular, as of today, a series of actions have been prioritized to mitigate potential risks, following the AR3T (Avoid, Reduce, Restore and Regenerate, and Transform) framework, both within the Group’s operations and along its supply chain.

The actions implemented focus to:

Restore & Regenerate

• Increasing the use of raw materials sourced from agricultural or farming practices with a lower impact on biodiversity compared to traditional methods
As outlined in the Raw Material Manual, the Group is progressively incorporating certified materials into its collections for natural raw materials. These certifications include the Global Organic Textile Standard (GOTS), RegenAgri, the Organic Content Standard (OCS), the Responsible Alpaca Standard (RAS), the Responsible Mohair Standard (RMS) and the Responsible Wool Standard (RWS), all of which aim to reduce environmental impact and protect biodiversity. These standards promote responsible land use, combat deforestation and seek to preserve natural ecosystems, while limiting pollution and land degradation.
Approximately 37% of the cotton used in the 2024 collections comes from organic practices (up from over 10% in 2023) and around 70% of wool is certified according to specific standards (up from over 45% in 2023).

• Promotion of regenerative agriculture projects
Since 2022, the Group has been committed to supporting regenerative farming practices in the

cotton and wool supply chains, contributing to both biodiversity impact mitigation and the reduction of greenhouse gas emissions. Regenerative agriculture is an approach aimed at improving the soil health and fertility, increasing its capacity to absorb carbon from the atmosphere, while also protecting water resources and biodiversity.

Since 2023, the Group has participated in two specific projects related to the cotton supply chain: the Unlock Programme pilot project in India and the United States, promoted by The Fashion Pact, and the Cotton 2040 project of the Ecosystem Services Market Consortium (ESMC)³ in Alabama and Tennessee, both of which aimed to support cotton farmers in the application of regenerative farming practices. In 2024, the Group continued to support the collective Unlock project, which during the year involved more than 10,000 Indian and American farmers. Additionally, the collaboration with ESMC was strengthened, expanding projects in Tennessee.
In 2023, the Group also launched a regenerative agriculture project in the wool supply chain in Australia with PUR Projet⁴, promoting the adoption of regenerative farming practices in animal rearing. During 2024, this project was further extended by increasing the number of participating farms and refining specific agricultural practices, supported by local collaborations and expertise.

Reduce

•  Progressive introduction of “preferred” materials, including the recycled ones
As stated in the Raw Material Manual, the Group is progressively introducing “preferred” materials into its collections. These include, in addition to organic materials, materials certified according to specific standards and recycled ones, which help reduce the use of virgin raw materials.
To date, 100% of key raw materials comply with the Raw Material Manual, and in the Group’s 2024 collections, over 43% of yarns and fabrics are made with “preferred” materials (up from over 25% in 2023).

•  Use of reused wood in logistics processes
For years, the Group has been using in its logistics processes pallets and other wooden tools made from reused wood.

Avoid

•  Key raw materials traced with the aim, among others, of identifying areas that are at potential risk for biodiversity

An essential activity for environmental analyses, not only concerning biodiversity, but also climate change, as well as for social assessments, is the traceability of products and production processes. This practice is holding an increasingly central role in business strategies, supporting the identification and assessment of risks, opportunities and impacts across the supply chain.

Since 2023, the Group has tracked, at regional level, over 80%⁵ by volume for each of the nylon, polyester, cotton and wool fabrics and yarns, in addition to the 100% traceability already achieved for down raw material since 2015. In particular, raw materials of natural and animal origin, specifically cotton and wool, were traced from the growing or farming stages, including, where applicable, the processes of spinning, weaving, knitting, dyeing and finishing. Synthetic raw materials, specifically nylon and polyester, were traced from the spinning phase, including, where applicable, weaving, dyeing, printing and finishing processes.
Depending on the material type and the maturity of technical solutions available on the market, various activities and projects to verify the information have been explored. These include laboratory tests and certifications to ensure the reliability and robustness of the collected information. For instance, isotope tests are used for cotton materials to verify the declared geographical origin, while DNA tests are carried out for organic cotton materials to investigate the presence of genetically modified organisms (GMOs). Finally, for materials made from recycled polyester, tests are conducted to investigate the presence of specific indicators relating to the recycled content. For certified materials (such as GOTS, OCS, GRS, etc.), suppliers are required to provide certifications and/or documents proving compliance with the required standard.
In 2024, the digitalisation and consolidation of traceability data were further enhanced through a platform managed in collaboration with a third-party entity, optimising the data collection from suppliers. The project has proven crucial in deepening the understanding of supply chain dynamics and improving the quality of primary data, enabling more accurate carbon and water footprints analyses.

•  Promotion of sustainable forest management

The Group uses paper, cardboard and wood materials – the only materials used significantly by the Group that are linked to deforestation risk – made exclusively from recycled and/or reused raw materials and/or sourced from responsibly managed supply chains, ensuring no deforestation, through recognised certifications such as the Forest Stewardship Council (FSC) and the Programme for the Endorsement of Forest Certification (PEFC).
In 2024, 100% of paper and cardboard materials were FSC or PEFC certified and, as previously mentioned, 100% of the wood used in logistics processes was reused.

In this context the Group has set the target to continuously not contribute to deforestation for all Group’s paper, wood and wood-pulp based packaging materials by sourcing only recycled and/or Forest Stewardship Council (FSC) and/or Programme for the Endorsement of Forest Certification (PEFC) certified materials.

Transform

•  Participation in biodiversity working groups
For several years, the Group has been actively involved in working groups and roundtables with industry peers and experts in the field, such as the SBTi, the SBTN and The Fashion Pact, to gain deeper insights into the issues related to biodiversity and the impact of various activities on it, with the aim of participating also in collaborative projects.