Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance

Environmental Achievements

• 55 stores received EPA GreenChill certifications for refrigeration management
• 69% total landfill diversion rate
• 51,000 MT CO2e averted through food recovery programs
• 87% food waste recovery rate
• 32 million pounds of food donated
• 100% reusable bags at checkout by end of 2023
• 2.5 million meat trays transitioned from polystyrene to widely recyclable #1 PET trays
• 800,000 pounds of plastic bags and film recycled
• $3.2 billion in sales of products with a social or environmental attribute
• 26% of total sales from organic products
• 21% increase in plant-based alternatives sales

Social Achievements

• 1,600 jobs created through new store openings
• 77% of promotions company-wide were female and/or racially/ethnically diverse team members
• 24% of team members promoted
• 64% of store manager positions filled with internal candidates
• 11,280 hours of culture reinforcement content delivered
• $3.2 million invested in school garden and nutrition education programs
• 400 educators united for the first-ever nationwide school garden education summit
• 4,000 volunteer service hours delivered, including Sprouts’ Annual Day of Service
• $200 million in sales of products from minority- and women-owned suppliers
• $145 million in sales from over 200 local produce suppliers
• 100% of seafood meets our responsible seafood sourcing policy

Governance Achievements

• Completed human rights risk assessment
• ESG risks incorporated into ERM strategy
• Expanded internal human rights training
• Ethics hotline for anonymous reporting of concerns
• No material data or cybersecurity breaches
• Board oversight of risk management and cybersecurity by Risk Committee
• 88% of Board members are independent
• 38% of Board members are female or racially/ethnically diverse
• Dedicated Board and executive oversight of ESG

Climate Goals & Targets

Environmental Challenges

• Climate change impacts (Scope 3 emissions)
• Waste management
• Supply chain sustainability

Mitigation Strategies

• Reduced store size by 23%
• Investment in energy efficiency technologies
• Investigation of renewable energy sourcing
• Comprehensive Scope 3 emissions inventory
• Partnership with HowGood for product sustainability data
• EPA SmartWay partnership
• Store growth plan within 250 miles of DCs
• Food donation programs
• Material recovery initiatives
• Sustainable sourcing practices
• Supplier engagement on water risk

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Sustainable sourcing standards (organic, non-GMO, plant-based, etc.)
• Supplier Code of Conduct
• Commitment to Human Rights
• Responsible Seafood Policy
• Palm Oil Policy (100% RSPO certified or equivalent by end of 2022)

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: SASB

Certifications: EPA GreenChill

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Goal 2: Zero Hunger
• Goal 10: Reduced Inequalities
• Goal 3: Good Health and Well-being
• Goal 12: Responsible Consumption and Production
• Goal 4: Quality Education
• Goal 13: Climate Action
• Goal 6: Clean Water and Sanitation
• Goal 14: Life Below Water
• Goal 8: Decent Work and Economic Growth
• Goal 15: Life On Land

Sprouts' ESG efforts align with these SDGs through various initiatives described in the report.

Sustainable Products & Innovation

• Rescued Organics program
• Plant-based alternatives
• Responsibly sourced seafood
• Sprouts Brand products with sustainable packaging

Awards & Recognition

• AAA rating from MSCI
• Global 100 most sustainable corporation by Corporate Knights

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance

Environmental Achievements

• 87% of food waste generated was diverted from the waste stream
• 100% of eggs sold were from cage-free or better facilities
• 61% of all pork sold in Sprouts' meat department was raised in group-housed or better housing systems

Social Achievements

• Zero work stoppages
• $3.3 billion in revenue from products labeled and marketed to promote health and nutrition attributes
• $3,250,330,954 in revenue from third-party certified to an environmental and/or social standard

Governance Achievements

• Zero data security breaches
• IT systems audited annually by a 3rd party
• Training on data security for all employees completed upon hiring and then annually thereafter

Climate Goals & Targets

Environmental Challenges

• Not disclosed

Mitigation Strategies

• Not disclosed

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Sprouts conducts a variety of supply chain audits annually for supplier social and environmental animal welfare performance.

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: SASB

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Food Quality & Safety
• Healthy Food & Transparency
• Ethics & Integrity
• Board Composition & Independence
• Data Privacy & Security
• Board Oversight of ESG
• Sustainable & Responsible Sourcing
• Team Member Engagement & Retention
• Team Member Recruitment, Training, & Development
• Diversity, Equity, & Inclusion
• Community Engagement
• Waste Management
• Climate Change & GHG Emissions
• Energy Management & Usage
• Water Management

Environmental Achievements

• 70% landfill diversion rate
• 70M pounds of food recovered
• 419,000 glass milk bottles returned for reuse
• 8.2M meat trays transitioned from polystyrene to recyclable PET
• 100% of eggs packaged in recyclable fiberboard or plastic containers
• 1.4M pounds of soft-plastic bags and film recycled
• 130M reduction in single-use plastic bags

Social Achievements

• Created 3,000 new jobs
• 75% of promotions were from female and/or racially/ethnically diverse team members
• $15.8M invested to develop internal store leadership
• 815,000 total hours of in-store training delivered
• 50 Sprouts scholarships awarded to team members and their families
• 36% reduction in worker injuries since 2019
• $20M awarded to nonprofit partners since 2015
• 3M students participated in school garden programs
• 478K Grab & Give bags donated by customers
• 37M pounds of food donated (equivalent of 29M meals)

Governance Achievements

• Engaged with shareholders holding approximately 25% of outstanding shares to discuss ESG matters
• Completed first human rights risk assessment and engaged suppliers from countries with less robust oversight
• Implemented 350+ team member suggestions leading to positive outcomes

Climate Goals & Targets

Environmental Challenges

• Waste generation inherent in food retail operations
• Climate change and GHG emissions from operations and supply chain
• Water scarcity in certain supply chain regions
• Maintaining food safety standards across the supply chain
• Cybersecurity threats
• Data security risks

Mitigation Strategies

• Commitment to becoming a “Zero Waste” company by 2030 (90% waste diversion)
• 25% emissions intensity reduction target per sq. ft. by 2033
• Engaging with key suppliers to mitigate water risk through efficient irrigation, CEA, drought-tolerant varieties, and alternative growing regions
• Robust food safety program including training, inspections, and supplier audits
• Comprehensive cybersecurity program including technology investments, training, and third-party expertise
• Regular review and updates to Privacy Policy to ensure compliance with state privacy laws

Supply Chain Management

Supplier Audits: 120 supplier food safety audits completed; several supplier social audits conducted in 2023

Responsible Procurement

• Organic sourcing
• Regenerative agriculture sourcing
• Local sourcing
• Plant-based product sourcing
• Higher-welfare animal product sourcing (chicken, eggs, pork, beef)
• Responsibly sourced seafood
• Fair Trade products
• B Corp Certified supplier partnerships
• Diverse supplier partnerships

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: SASB

UN Sustainable Development Goals

• Goal 2: Zero Hunger
• Goal 3: Good Health and Well-being
• Goal 4: Quality Education
• Goal 6: Clean Water and Sanitation
• Goal 13: Climate Action
• Goal 14: Life Below Water
• Goal 15: Life On Land
• Goal 8: Decent Work and Economic Growth
• Goal 10: Reduced Inequalities
• Goal 12: Responsible Consumption and Production

Alignment described in detail on page 51 of the report.

Sustainable Products & Innovation

• Sprouts Brand products with sustainable and ethical sourcing; organic, regenerative, non-GMO, plant-based products; Fair Trade products; B Corp Certified products