Press room

LPP S.A. Press room LPP sums up another year of implementing its sustainable development strategy

LPP sums up another year of implementing its sustainable development strategy

10.05.2022

• Already 26% of the clothes in the offer of all the company’s brands come from the Eco Aware line, i.e. more environmentally friendly products, and in the flagship Reserved it is 38%.

• Last year, the company eliminated 445 tonnes of single-use plastics, reducing the amount of this raw material in LPP packaging by a total of 1015 tonnes since 2017.

• The company has, for the first time, self-calculated its carbon footprint across all three scopes and categories in line with GHG Protocol guidelines with the aim of developing a detailed decarbonisation policy in 2022.

• 30% of factories sewing for LPP in South Asia is now covered by a more sustainable garment production scheme – Eco Aware Production.

• Already 70% of LPP garments produced in Bangladesh and Pakistan comply with the ZDHC chemical safety standards.

• Last year, the company allocated PLN 5.6m for improvement of safety and production conditions in its suppliers’ factories.

• LPP was awarded the title of Climate Conscious Company in the third edition of the study conducted by the Polish Association of Listed Companies, Foundation of Reporting Standards and Bureau Veritas Polska.

The past 2021/22 fiscal year was financially successful for LPP, which translated into a significant economic contribution to the Polish economy. The Polish clothing manufacturer contributed nearly PLN 1.6bn to the state budget. The record results and the attainment of the company’s business ambitions went hand in hand with consistent work towards the fulfilment of successive goals enshrined in the sustainable development strategy ‘For People For Our Planet’. Gradual implementation of further commitments is LPP’s response to contemporary climate challenges and market expectations directed at the company.

– In times of growing climate awareness and the increasing importance of business activities for the environment, a sustainable approach to development is now an obvious requirement for entrepreneurs. At LPP, for a long time now we have been operating on the basis of a comprehensive strategy encompassing all the processes in the company within the framework of four pillars: design and production, plastics management, chemical safety of production and ecological buildings. Being aware that ESG activities are gaining importance nowadays, we also focus on proper measurement and reporting of the objectives pursued and the results of our environmental and social activities – notes Dorota Jankowska-Tomków, Procurement and ESG Director at LPP.

In the area of product and production, in the past year the Polish company significantly increased the share of more environmentally friendly collections in all its brands.

– Products with the Eco Aware label, made from more environmentally friendly materials or created in a sustainable process, already accounted for 26% of the total offer, thus fulfilling our goal set for 2021. In the youngest brand, Sinsay, one-fifth of the collection, and in the flagship Reserved –every third piece of clothing sold – come from more sustainable collections – explains Dorota Jankowska-Tomków.

The company wants to constantly increase the share of environmentally friendly products in its collections, including those made of cellulose. Seeking good practices in this area, in the middle of last year LPP joined the Canopy initiative for sustainable use of forest resources. In appreciation of the opportunities offered by international partnerships supporting the achievement of sustainable development goals, LPP also partnered with Cotton made in Africa (CmiA) – an internationally recognised standard for sustainable cotton cultivation in Africa. Owing to that, as early as in 2023, 20% of the collections of LPP brands planned for sale will be made from cotton sourced sustainably, but also with appropriate labour standards for the farmers or cotton processing workers who grow it. Last year, the company contracted the purchase of CMiA-labelled cotton, the quantity of which will allow to manufacture as many as 60m items with the composition including 95 to 100% of this raw material.

In 2021, the company continued to expand its Eco Aware Production scheme. Currently, 30% of South Asian factories sewing for LPP have already been covered by this scheme and have undergone a detailed environmental audit. Among other things, the compliance of the factories’ production activities with LPP’s requirements for water and energy resource restrictions in garment production has been verified.

Developing practices aimed at safety and protection of water resources, last year the company continued to fulfil its commitments under the international Zero Discharge of Hazardous Chemicals agreement, which LPP joined in 2020 as the first Polish company. As part of this initiative, LPP has been supporting its suppliers in their efforts to eliminate harmful substances from their factories in production processes and to properly dispose of waste such as wastewater and post-production water.

– By the end of 2021, nearly 60% of the factories sewing garments for us in Bangladesh and Pakistan and over 82% of the jeans suppliers in these markets are already ZDHC members. This means that the ZDHC member factories working with us currently account for 70% of our production in these countries. We are aiming at full compliance with ZDHC standards in the LPP textile supply chain by 2025 – points out Dorota Jankowska-Tomków.

The company also continues its consistent approach in the area of plastics reduction and since 2017 has already reduced its consumption in packaging by a total of 1015 tonnes. In 2021 alone, after the complete elimination of foil from price tags, as well as the complete resignation from plastics in online shipments of Reserved and Mohito brands, LPP managed to reduce the use of this material by 445 tonnes.

– Recognising the importance of the problem, we are making efforts to eliminate single-use plastics and aim to use only reusable, recyclable and compostable packaging by 2025. To this end, we are committed to closed-loop economy initiatives but take an even broader perspective, aiming to save raw materials in packaging production. Thus, as part of the Control Tower logistics project, we developed a carton standardisation process that allowed us to reduce the use of bulk packaging and reuse it in the process of distributing goods to the stores. The reusability of cartons has thus increased from 10% to 50%, which translates into real changes in terms of reducing the use of trees and the raw materials derived from them to produce our secondary packaging – says the Procurement and ESG Director at LPP.

The company is also focused on increasing the energy efficiency of its stores, offices, and warehouses. On the one hand, by applying modern, environmentally friendly solutions in its stores as part of the Eco Aware Stores programme, which comprises the installation of telemetry systems in the stores. On the other hand, its new logistic infrastructure, including, among others, the Distribution Centre in Brześć Kujawski and the Fulfillment Centre Podkarpacie – currently under construction – is subject to BREEAM certification. Another important step in the emissions reduction plan was signing an agreement with Figene Energia for supplying energy coming exclusively from RES over a period of 10 years to the majority of LPP office buildings in Poland and the Distribution Centre in Pruszcz Gdański.

– In line with our strategy, we invest in solutions seeking to reduce greenhouse gas emissions related to our operations. Increasing the share of RES is in line with LPP’s overarching goal of reducing CO2 emissions. In 2019, we measured our carbon footprint by referring to the entire life cycle of our products. In the past year, by performing the measurements fully in-house, for the first time we included all ranges and all categories defined according to the GHG Protocol method. We already know that tailoring the indicators and standards of GHG calculation to the specifics of a particular business allows us to correctly identify targets and implement them effectively. Therefore, for 2022 we are planning to revise our strategy and make the LPP goals concerning minimizing GHG emissions more detailed – says Dorota Jankowska-Tomków, Procurement and ESG Director at LPP.

LPP’s good practices and initiatives in the field of responsible business have been appreciated in numerous rankings, in Poland (such as the Corporate Climate Awareness study or the Climate Strategy Benchmark) and internationally – such as the Carbon Disclosure Project – Climate Change, in which the Gdańsk-based company also ranked high.

– Treating the awards as a token of appreciation of our efforts, we are also motivated to continue working on the implementation of the highest standards of sustainable development in our organisation and value chain, not only in the climate area, but also in the social sphere. Last year, continuing our commitment to improving safety and production conditions in our suppliers’ factories, we allocated PLN 5.6m for this purpose. Since the beginning of our efforts in this respect, we have already invested nearly PLN 35m. We understand that as the industry leader in the Polish market, we are obliged to set the direction on the path of sustainable development and create a model for responsible fashion also in Poland. We are all the more pleased that in 2021, we managed to meet all the targets set for this year – says Dorota Jankowska-Tomków.

In addition to environmental activities, social initiatives are still recognised as an important area of the Polish clothing company’s commitment. Implementing them through its Foundation, LPP focuses on providing assistance in such areas as combating social exclusion, engaging in environmental protection and supporting local communities. In 2021, 374 LPP Group volunteers were involved in helping people in need. As part of the overall social activity, a total of over PLN 6.7m was donated, which reached over 160 charitable organisations. This amount covered financial assistance, including projects supporting health and environmental protection, as well as substantive partnerships, original social programmes for people at risk of social exclusion, and in-kind support.

– Despite the pandemic, the LPP Foundation has been actively supporting people in need, mainly in the places where the LPP offices and warehouses in Poland are located. For several years now, in Pomerania and Małopolska we have been regularly partnering with numerous NGOs. Example of projects that have become part of our regular activities for the local community include ‘Wyprawka dla pierwszaka’ [‘School starter kit’], and English lessons or additional classes for 8th grade students, carried out in cooperation with the municipality of Brześć Kujawski where our new Distribution Centre is located. Another project which is special for us is the pilot programme called ‘Moda na lepszy start’ [‘Fashion for a Better Start’] launched last year and addressed to wards of Tri-City children’s homes. Thanks to our support in the amount of a quarter of a million zlotys, from September 2021 to January 2022 a total of over 3000 hours of educational, therapeutic and developmental classes were carried out. The success of the programme made us decide to continue it also in 2022, this time allocating another half a million zlotys to this end – says Patrycja Zbytniewska, President of the LPP Foundation.

More information on social and environmental activities can be found in the full version of the LPP Sustainability Report for 2021/22, available at https://www.lppsa.com/en/sustainable-development/annual-report. This year’s edition was also supplemented with an extract of the most important ESG data and the first climate report in the company’s history prepared in accordance with the TCFD guidelines.

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LPP is a Polish family business and one of the fastest growing clothing companies in the region of Central and Eastern Europe. For 30 years, it has been successfully operating in Poland and abroad, offering its collections in such prestigious capitals as London, Helsinki or Tel Aviv. LPP SA manages five fashion brands: Reserved, Cropp, House, Mohito, and Sinsay, whose offer is available today in stationary and online stores in nearly 40 markets worldwide. The company has a chain of over 2200 stores with the total area of over 1.8 million m2. Based on a global distribution network located in 4 countries, it distributes clothing and accessories to 3 continents every year. LPP plays another important role as it employs 32 thousand people in its offices and retail structures in Poland, and in the countries of Europe, Asia, and Africa. The company is listed on the Warsaw Stock Exchange in the WIG20 index and belongs to the prestigious MSCI Poland index.