Climate Change Data

Dunelm Group plc

Climate Impact & Sustainability Data (2023, 2024)

Reporting Period: 2023

Environmental Metrics

Total Carbon Emissions:1,385,312 tCO2e (including indirect use of sold products)
Scope 1 Emissions:7,044 tCO2e
Scope 2 Emissions:27 tCO2e
Scope 3 Emissions:893,918 tCO2e (within target boundary)
Renewable Energy Share:99.7% (electricity)
Waste Generated:13,990 tons
Carbon Intensity:Reduced Scope 1 CO2e/£ Group revenue by 32% vs FY19.

ESG Focus Areas

  • Climate Change
  • Responsible Sourcing
  • Diversity & Inclusion
  • Colleague Wellbeing
  • Supply Chain Ethics
  • Community Engagement

Environmental Achievements

  • Reduced Scope 1 carbon intensity and plastic packaging ahead of targets.
  • Launched Remade range using recycled fibres from textile take-back.
  • Increased recycled materials in products.
  • Reduced natural gas emissions by 41.9% against FY19 baseline.
  • Reduced generated waste by 7.0%.

Social Achievements

  • Launched and grew Conscious Choice range to ~15% of own brand products.
  • Increased support for colleague financial wellbeing.
  • Increased colleague retention to 87%.
  • Raised over £800k for charities, including over £700k for Mind.
  • Collected and distributed ~62,000 gifts during Delivering Joy campaign.

Governance Achievements

  • Undertook first third-party materiality assessment.
  • Reviewed progress against ESG metrics linked to loan facility.
  • Continued engagement with ESG rating agencies.
  • Updated Health and Safety Policy.
  • Refreshed fraud risk assessment.

Climate Goals & Targets

Long-term Goals:
  • Achieve net zero emissions by 2040.
Medium-term Goals:
  • Reduce Scope 1 and Scope 3 CO2e by 50% by 2030.
  • Reduce aggregate water footprint of new products by 30% by 2030.
  • Increase ‘More Responsibly Sourced’ Cotton to 80% by FY24 and 100% by FY25.
  • Increase ‘More Responsibly Sourced’ Timber to 50% by FY25.
Short-term Goals:
  • Increase NPS year-on-year.
  • Increase % of own brand products with take-back service to 50% by FY24.
  • Reduce Scope 1 CO2e/£ Group revenue by 24% by FY24.
  • Reduce virgin plastic packaging by 24% by FY24.
  • Increase % of role-model leaders from ethnically diverse backgrounds to 8% by FY26.

Environmental Challenges

  • Increased total absolute carbon emissions across all scopes against FY19 baseline.
  • Supply chain disruptions (implied by challenges in sourcing responsibly and ethical audits).
  • Theft and unacceptable behaviour towards colleagues.
  • Pace of change in national infrastructure, legislation, and taxation.
  • Industry challenges such as theft and unacceptable behaviour towards colleagues.
Mitigation Strategies
  • Taking more action in areas of control within the supply chain (design, UK manufacturing, trusted suppliers).
  • Switching to lower-impact materials, introducing more efficient fuel and vehicles.
  • Helping suppliers improve ethical and environmental standards.
  • Engaging customers on sustainability progress and introducing more sustainable products.
  • Advocacy with organisations such as the British Retail Consortium, Textiles 2030, Better Cotton, the Aldersgate Group and the Sustainable Logistics Forum.

Supply Chain Management

Supplier Audits: Increased number of unannounced ethical audits; 91% of Tier 1 audits low- to medium-risk.

Responsible Procurement
  • Ethical Code of Conduct for Suppliers and Partners
  • Responsible Cotton Policy
  • Responsible Timber Policy
  • Better Manufacturing program

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI, TCFD, SBTi, Textiles 2030

Third-party Assurance: Ernst & Young LLP (limited assurance on four metrics)

Sustainable Products & Innovation

  • Conscious Choice range; Remade range; products with recycled materials; products with reduced plastic packaging.

Reporting Period: 2024

Environmental Metrics

Total Carbon Emissions:1,344,633 tCO2e
Scope 1 Emissions:5,139 tCO2e
Scope 2 Emissions:0 tCO2e (market-based)
Scope 3 Emissions:1,344,633 tCO2e
Renewable Energy Share:100%
Total Energy Consumption:41,383 MWh
Water Consumption:195.0m M3
Carbon Intensity:3 tCO2e/£1m Group revenue (FY24)

ESG Focus Areas

  • Climate Change
  • Community Engagement
  • Employee Well-being
  • Responsible Sourcing
  • Circular Economy

Environmental Achievements

  • Reduced overall Scope 1 carbon emissions by 27% from our FY19 baseline despite strong sales growth of 53% over the same period.
  • Increased the number of own-brand products in our Conscious Choice range to c.26% from c.15% last year.
  • Launched the Higg Facility Environmental Module (‘FEM’) for our Tier 1 suppliers as part of our Better Manufacturing programme. At the end of FY24, over 80% of our Tier 1 suppliers completed and disclosed data to the Higg FEM.

Social Achievements

  • Doubled the number of gifts donated to over 125,000 during our ‘Delivering Joy’ campaign in December 2023
  • Launched new partnership with Age UK, committing to raise £2m over the next three years
  • Expanded our Home to Home scheme, where customers can donate pre-loved and good quality homewares such as crockery and glasses in our stores, to 39 stores, with support from Age UK.
  • Colleague retention increased to 89% from 87% in FY23.
  • Launched our ‘Reach’ development programme for colleagues from underrepresented ethnic groups, providing skills training, connection and career advancement opportunities.

Governance Achievements

  • Board changes with the addition of two new Non-Executive Directors and the departure of others.
  • Continued focus on succession planning for Board and Executive Team roles.
  • Improved processes for ESG reporting and assurance.

Climate Goals & Targets

Long-term Goals:
  • Reach net-zero greenhouse gas emissions across the value chain by FY40 from a FY19 base year.
Medium-term Goals:
  • Achieve 10% market share.
  • Reduce aggregate water footprint in own brand textile products by 30% by 2030
  • 100% of own-brand cotton more responsibly sourced by 2025
  • 50% more responsibly sourced timber by FY25
  • 30% less virgin packaging in own-brand range by 2025
Short-term Goals:
  • Reduce absolute Scope 1 and 2 GHG emissions by 50% by FY30 from a FY19 base year.
  • Reduce absolute Scope 3 GHG emissions by 50% by FY30 from a FY19 base year.

Environmental Challenges

  • Challenging consumer environment due to inflationary pressures and economic uncertainty.
  • Disruption to major shipping routes causing delays and additional freight surcharges.
  • Ongoing geopolitical pressure and tensions around key trade routes impacting supply chain resilience.
  • Elevated wage inflation.
Mitigation Strategies
  • Maintaining pricing discipline and closely managing input costs.
  • Working closely with freight providers to manage the impact of surcharges and minimise availability issues.
  • Proactive approach to supply chain management, including scenario planning and diversification of carrier network.
  • Productivity improvements across the Group to offset cost increases.
  • Investment in technology and automation to mitigate wage inflation.

Supply Chain Management

Supplier Audits: Over 80% of Tier 1 suppliers completed Higg FEM in FY24

Responsible Procurement
  • Ethical Code of Conduct for Suppliers and Partners
  • Responsible sourcing policies for cotton and timber
  • Better Manufacturing programme

Climate-Related Risks & Opportunities

Physical Risks
  • Impact on availability of raw materials due to extreme weather events.
Transition Risks
  • Carbon taxes
  • Extended Producer Responsibility fees
Opportunities
  • Increased market share by demonstrating leadership in sustainability.

Reporting Standards

Frameworks Used: TCFD, GRI, SBTi

Third-party Assurance: PwC

Sustainable Products & Innovation

  • Conscious Choice range
  • Full Circle sofas
  • Aurora lighting range