Client
Expertise
Climate change risks and opportunities
Impact
Decarbonising Dr. Martens business model with climate action.
Challenge
How can a footwear company move to decarbonise its value chain?
Carbon-intensive material use and multi-national value chains involved in apparel and footwear manufacturing are just some of the reasons why the industry has a tremendous responsibility to decarbonise and innovate. This also creates an opportunity to respond to growing interest among consumers and investors, wanting to know what action brands are taking to reduce their climate impact.
Dr. Martens, the iconic footwear brand, takes this responsibility seriously and recognised the opportunity. Next to assessing and reporting its climate-related risks and opportunities in line with the TCFD recommendations, the now public company sought to tackle its emissions where it matters most.
Task Force for Climate-related Financial Disclosures (TCFD)
A disclosure framework for businesses and financial institutions to report on their climate-related risks and opportunities. It’s a tool kit for companies to think long term and consider what climate change means for their business and value chain. TCFD-aligned reporting is already mandatory in the UK. More countries and regions are expected to follow on similar climate-related risk assessments, including the EU, Hong Kong and the US.
Solution
Integrating TCFD and Net Zero into Dr. Martens’ wider sustainability strategy
A company’s impact on the climate and the climate’s impact on a company are directly intertwined. As such, it is vital for businesses to take a holistic approach to climate action. In the case of Dr. Martens this meant understanding the company’s emission hotspots alongside its climate-related risks and opportunities. We conducted the following activities:
Calculated Dr. Martens’ footprint and found 99% of its emissions lie within its value chain. It makes engagement with suppliers and other value chain partners even more important as Dr. Martens has no direct control over these emissions.
Identified Dr. Martens’ climate risks and impact. E.g., carbon pricing, production standards and buildings energy efficiency.
Identified the commercial opportunities decarbonisation could bring. E.g., a repair and resale model emerged as a viable opportunity to meet changing customer demands. Following this, we explored to what extent Dr. Martens’ emissions can be reduced by adopting a more circular business model, particularly around a repair and resale model.
Provided feedback on Dr. Martens’ climate risk-related reporting in line with the TCFD framework.
Established a carbon reduction pathway in line with Net Zero and advised Dr. Martens on how to translate this into its wider business strategy.
Analysing the impact of a recommerce business model on Dr. Martens’ Net Zero commitment
Following our initial work, we helped Dr. Martens understand the carbon impact of a dedicated repair and resale model. For this, Dr. Martens needed to assess to what extent a recommerce model would help cut its emissions in line with the company’s growth projections.
We broke down the recommerce model into different life cycle stages, from material sourcing to logistics to the energy requirements for each repair. In tandem, we analysed the different levels of repair that would be required, whether this be minor defects right through to complete sole replacement. This enables us to model each life cycle stage for different repair levels.
The model included Dr. Martens’ key markets, which allowed future planning and analysis to be undertaken for different regions.
By providing this level of granularity, each shoe that passes through the recommerce model – regardless of country of sale, the level of repair, or the return conditions – can have its carbon impact and savings calculated and broken down. In doing so, Dr. Martens can assess the emissions hotspots of each boot. This helps inform the near- and long-term strategic planning for recommerce, not just how to implement the model but how to make the business model itself the most sustainable.
Impact
Bolstering the internal case for transformational climate action
By adopting this holistic approach, Dr. Martens can demonstrate the economic long-term benefits of integrating climate action and mitigation into its business strategy. It shows the significant emissions savings Dr. Martens can achieve per boot and promotes more sustainable procurement decisions, product innovation and supplier engagement.
This work bolsters the internal case for swift and transformative climate action. It has allowed Dr. Martens to:
Raise its climate ambitions and adapt its business model. Following this work, Dr. Martens is implementing a repair and resale model with a goal to significantly increase the percentage of sales from repair and resale over the coming decade
Understand where to engage with suppliers and other value chain partners to decarbonise the company’s environmental impact.
Build trust among investors and consumers. Dr. Martens’ climate disclosures and actions to mitigate risk through a repair and resale model build transparency. These disclosures also add credibility in line with the EU’s Corporate Sustainability Reporting Directive.
Empower stakeholders and set an example to the industry by setting a Net Zero commitment. This is currently awaiting validation from the Science Based Targets initiative.
At Dr. Martens we have made timeless, durable products for more than six decades. As we continue on this journey, we are committed to leaving things better than we found them through our sustainability strategy. Thanks to our partnership with the Carbon Trust, we are building a strong foundation of knowledge about our mutual interaction with the climate. This has empowered us to set science-based targets and make decisions which support the future of our planet.
Company growth doesn’t need to mean emissions growth. Driving Scope 3 emissions down to Net Zero will require a systemic shift in the apparel sector’s traditional business model. Yet, it also creates a great deal of opportunities. With our support, Dr. Martens have taken action which shows their enthusiasm and willingness to progress in this important space. By integrating Net Zero ambitions and the TCFD requirements into business models, the apparel industry can grow in a way that will benefit their bottom line without costing the planet.
