63 RESPONSIBLE BUSINESS MANAGEMENT62 RESPONSIBLE BUSINESS MANAGEMENT MONCLER GROUP 2022
RISK DESCRIPTION AND IMPACT MITIGATION ACTIONS
Intensification of extreme and chronic climatic phenomena
The progressive intensification of extreme and chronic climatic phenomena (heavy rainfall, tornadoes, heat or cold waves, storms, fires, drought phenomena, etc.) could potentially impact the physical operational sites of the Group and its supply chain, resulting in pos- sible disruption or reduction of production levels (business continuity).
The Group has adopted insurance cover aimed at limiting the economic impact of any damage caused by extreme climatic events.
For new corporate sites, the Group carried out a de- tailed assessment of physical climate related risks (e.g. the area s exposure to hydrogeological and geo- morphological risks). Based on the results of the risk assessment, the Group adjust the project design to minimise its exposure to the identified risks.
The Group has defined specific action plans to deal quickly and effectively with any emergency situations relating to its logistics services or its supply chain in order to guarantee business continuity.
The Group has adopted a procurement strategy aimed at diversifying its supply chain as much as possible both in geographical terms and in terms of indepen- dence from individual suppliers.
Increase in the cost/decrease in the availability of raw materials
Climate change such as rising temperatures and droughts could impact the production capacity of some natural raw materials. This could affect both availability and pur- chase price.
The Group has adopted a strategy to diversify its sup- ply chain so that it can effectively manage any fluctuations in the price/availability of raw materials in certain geographic areas, while establishing long-term relationships and agreements that result in beneficial business relationships.
The Group has set strategic objectives on lower- impact materials, considering that those deriving from organic or regenerative agriculture are more resilient to climate change and their cultivation has a lower en- vironmental impact:
50% cotton from organic/regenerative agriculture by 2025;
70% wool certified Responsible Wool Standard (RWS) by 2025.
The Group is always looking for new and innovative solutions on materials.
Introduction of legislation to curb climate change The adoption of energy and climate policies to limit emissions could have an impact on business in terms of taxation on generated emissions.
As recommended by the guidelines of the Science Based Target initiative, the Group committed to reduce by 2030:
absolute scope 1 and scope 2 CO2e emissions by 70% from a 2021 base year;
scope 3 CO2e emissions per unit of product sold by 52% from a 2021 base year.
Lastly, the Group is committed to achieving net zero emissions by 2050.
In line with the Science Based Targets commitment, the Group has formulated a strategy and has already invested in operating activities:
100% renewable energy (e.g. through the pur- chase of energy from renewable sources, renew- able energy certificates (RECs) and guarantees of origin (GOs)) at corporate sites worldwide by 2023 (approximately 90% in 2022);
90% of low environmental impact vehicles in the Group s company car fleet worldwide by 2024 (63% in 2022);
Efficiency initiatives: over the years, traditional lighting systems have
been replaced with LED lights and thermal insulation systems have been adopted to en- sure greater energy efficiency;
application of Building Management System (BMS) at Moncler stores for more efficient management of energy consumption;
progressive replacement of air conditioning and gas heating systems with more efficient systems;
where necessary, replacement of obsolete office windows to ensure thermal insulation.
The Group is working with its supply chain to pro- mote certification of energy/environmental manage- ment system, the use of energy from renewable sources and the production of materials with lower impact. Among the main objectives: at least 55% of nylon production scrap recycled by 2023; 50% of nylon used in the collections from recycled materi- als by 2025; 50% of cotton from organic or regener- ative agriculture by 2025; 70% wool certified Re- sponsible Wool Standard (RWS) by 2025.
RISK DESCRIPTION AND IMPACT MITIGATION ACTIONS
Change in client purchasing dynamics The increasing sensitivity of end and wholesale clients towards companies with strong social and environmental commitments, as well as products with lower environ- mental impact, could directly reflect on purchasing pref- erences.
The impact of rising mean temperatures in relation to di- rect sales of Moncler s core products (down jackets) is not currently quantifiable. In fact, despite the increase in average seasonal temperatures and the potentially shorter winter seasons forecasted by 2050, there is also evidence of the increase in extreme weather events, as demonstrated by studies by the NOAA (National Oce- anic and Atmospheric Administration), MIT (Massachu- setts Institute of Technology) and Stanford University. When combined, these factors appear to be difficult to evaluate in terms of potential impact.
The Group has already been working for some time to integrate lower-impact materials into its collections:
In 2021, Moncler launched Born To Protect range of jackets made from lower-impact materials. In 2022 the project was expanded into a collection.
The Group is committed to introduce 50% yarns and fabrics made from lower-impact materials across all collections by 2025:
50% of the nylon used in collections will be from recycled materials by 2025;
50% lower-impact cotton (organic/regenera- tive) by 2025;
70% wool certified Responsible Wool Standard (RWS) by 2025;
The Group pays particular attention to create value for its clients and establish relationship of trust; to this end, a Strategic Sustainability Plan has been defined and achievement of its objectives is periodi- cally and transparently reported in the Group s public documentation, which describes the Group s commitment to sustainable development and under- lines how environmental and social responsibility are increasingly an integral part of the business model, focusing on five strategic priorities: climate change and biodiversity, the circular economy, responsible sourcing, valuing diversity and supporting local com- munities.
Over the years, Moncler s product range has been expanded to include, in addition to other categories, such as t-shirts, sweatshirts, knitwear, shoes and other accessories, also light jackets (100 grams) that can be used at warmer temperatures.