How we report

We are committed to transparent reporting on the progress we make towards achieving our sustainability strategy.

H&M Group produces an annual sustainability report that covers sustainability strategies, challenges, activities, goals and performance for the global group operations of H & M Hennes & Mauritz AB (also called H&M Group in this report). The report includes all H&M Group brands (H&M, COS, Weekday, Cheap Monday, Monki, H&M Home, & Other Stories, ARKET, Afound), as well as its wholly- or partially-owned subsidiaries globally during our financial year from 1 December 2017 to 30 November 2018 unless stated otherwise. Please see our Annual Report 2018 for a full list of entities. Wherever possible, we report how we are addressing our key positive and negative impacts across our value chain. This often involves reporting beyond or even outside our own operations, for example when we report on the suppliers manufacturing our products. We always clearly state when information is limited in scope, such as for specific brands, parts of our operations or our value chain. Unless otherwise stated, we do not cover franchise operations. The report has been reviewed by the highest executive management and external assurance has been performed for selected indicators (clearly marked where applicable, as well as in regards to materiality and stakeholder engagement). We have included stakeholder comments and interviews throughout this report. Our sustainability teams collect data from the relevant functions within H&M Group and from external parties such as suppliers or implementation partners. This data is always reviewed by our internal controlling team, relevant experts in our sustainability team and expert functions following a two-tier quality control principle. We clearly indicate any extrapolations or estimations. The same rule applies for any changes in data methodologies or scopes that may influence data comparability. We always base our data on the best possible systems that are currentlyavailable to us and, where applicable, align it with recognised standards. However, it is important to understand that there are continued improvements in data systems, methodologies and scientific uncertainties. For example, while our GHG emissions accounting and reporting is aligned with the GHG Protocol, the emission factors we use are from publicly-available sources such as the International Energy Agency (IEA 2017), the Network for Transport Measures (NTM), Reliable Disclosure System for Europe (RE-DISS) and supplier-specified emission factors. The global warming potential (GWP) factors used in the calculation of CO₂e are based on the IPCCs Fourth Assessment Report (AR4) over a 100-year period. The scientific knowledge used to determine emission factors is incomplete. This means GHG emission data, as with other data, is subject to inherent uncertainties that ultimately affect all measurements and estimations. Our reported energy usage is based on invoiced data, data from real-time electricity meters and data as reported by transport providers. We convert between fuel usage and energy content using energy values specified by the supplier or by using tabled values provided by national bodies. We are required to make certain assumptions about waste factors, weight per sizes, etc. for our material reporting. We are continuously working to improve those aspects of reporting that may lead to minor updates in our yearly material consumption reporting, as well as our data systems and accuracy to report onmaterial consumption. Unless otherwise specified, all data concerning business partners and supplier factories includes all suppliers and factories that were active and approved for production during the reporting period. We include the following factories in our scope: tier 1 manufacturing or processing (i.e. washing or dyeing), factories that are owned or subcontracted by our suppliers and, where stated, selected tier 2 suppliers and suppliers for non-commercial goods (such as store interior suppliers). The tier 2 suppliers we have selected so far are mostly fabric and yarn suppliers that account for about 60% of our products. We report monetary amounts mainly in the currency of transaction. Additional currency values are conversions as approximate figures based on the conversion rate on 30 November 2018, unless stated otherwise. We provide additional information at sustainability.hm.com and in our financial and corporate governance reporting. Our most recent sustainability report was published in April 2018. We are signatories to the UN Global Compact and our annual sustainability report also serves as our Communication on Progress (COP) for the UN Global Compact as well as the CEO Water Mandate.


GLOBAL REPORTING INITIATIVE (GRI)
We have prepared this report in accordance with the GRI Standards: Core Option. We have also included material indicators from the pilot of the Apparel and Footwear Sector Supplement. You can download a detailed GRI index at sustainability.hm.com


UN GUIDING PRINCIPLES REPORTING FRAMEWORK
We were one of the first companies in the world to report on human rights in line with the UN Guiding Principles Reporting Framework. This framework is the first comprehensive guidance for companies to report on human rights issues in line with their responsibility to respect human rights set out in the UN Guiding Principles on Business and Human Rights. Detailed references to the UN Guiding Principles Reporting Framework can be found at sustainability.hm.com

We identified our salient human rights  in 2015, following a comprehensive process that involved a variety of internal and external stakeholders. We plan to conduct this process every third year, or as deemed necessary. On an annual basis, we will review the relevance and definitions of the issues identified and discuss emerging issues. This complements our materiality assessment (described below), which identifies human rights as a highly material topic.


PROCESS FOR IDENTIFYING THE MOST MATERIAL TOPICS AND THEIR BOUNDARIES*
1. Identification: Mapping aspects and creating a gross list
We conduct an annual review of our gross list of aspects. This is based on an analysis of external standards, such as the GRI Standard topic list, legislation, investor and NGO questionnaires, peer reviews, business intelligence, lifecycle assessment results, stakeholder dialogues and stakeholder reports, and media coverage. The gross list has been checked against GRI’s Sustainability Context and Stakeholder Inclusiveness tests most recently in 2016.

2. Prioritisation: Scoring and prioritising topics**
We prioritise the most material topics from this gross list by scoring different aspects on their frequency (how often they are raised by stakeholders) and their significance for economic, environmental and social impacts. We then break these categories down further. For frequency, we look at frequency raised by key defined sustainability stakeholders and experts (weighted x3), frequency featured in media (weighted x1) and frequency raised in key sustainability benchmarks, rankings and indices (weighted x1). For impact, we look at social and environmental impacts (weighted x1) and importance to business strategy (weighted x2). At least two internal experts per category gave scores, which were based on lifecycle assessment (LCA) data and existing strategy documents. We also chose at least one representative from each of our key stakeholder groups (which includes customers, colleagues, communities, suppliers and their employees, industry peers, NGOs, IGOs, policymakers and investors). We asked eleven stakeholder representatives to feedback on our materiality matrix.


3. Regular review of our materiality matrix with key stakeholders***
We review our materiality matrix on an annual basis. This can mean conducting a full materiality analysis (as conducted in 2013 and 2016) as described in points 1 and 2 or a review of previous year’s matrix considering feedback received.

* Please find an independently-verified assurance statement on defining report content and topic Boundaries GRI 102-46 on page 106.

** Please find an independently-verified assurance statement on list of material topics GRI 102-47 on page 106.

*** Please find an independently-verified assurance statement on defining report content and topic Boundaries GRI 102-46 on page 106.

Sustainability Reports

Here you can find our Sustainability Reports.

GRI Index

We are committed to transparent reporting and want to provide information in a way that is most valuable to our diverse stakeholders.

Supplier compliance in detail

We dedicate major resources to monitor our suppliers` sustainability performance and support them in making improvements.

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