H&M Group, the Swedish fast fashion giant operating across more than 4,250 stores in roughly 80 markets, published its Annual and Sustainability Report 2024 in March 2025, covering fiscal year December 2023 to November 2024. The report reflects H&M’s positioning as the top-ranked fast fashion retailer on Stand.earth’s 2025 Fossil-Free Fashion Scorecard, earning a B+ grade for the second consecutive year. Its core 2030 goals target a 56% reduction in absolute Scope 1, 2, and 3 emissions against a 2019 baseline and 100% recycled or sustainably sourced materials across all commercial products.

Source

https://hmgroup.com/investors/annual-and-sustainability-report/
https://hmgroup.com/wp-content/uploads/2025/03/HM-Group-Sustainability-progress-report-2024.pdf

Sustainability Strategy and Goals

H&M’s sustainability framework aligns with Science Based Targets initiative (SBTi) validated pathways and the UN Sustainable Development Goals. The company pursues a twin-track strategy: decarbonizing its own operations and supply chain on one track, and transitioning to 100% circular materials on the other. Net zero is targeted by 2040, requiring a 90% absolute reduction in Scope 1, 2, and 3 emissions from the 2019 baseline, with permanent carbon removals balancing any residuals.

Net Zero and Carbon Emissions

H&M achieved a 41% reduction in Scope 1 and 2 emissions by 2024 against its 2019 baseline, driven largely by renewable electricity procurement. Scope 3 emissions fell 23.7% against the same baseline, though they rose 3% compared to 2023 due to increased material weight and airfreight volumes climbing to just under 3% of total transports following shipping route disruptions. The company targets a 56% absolute reduction across all scopes by 2030 and 90% by 2040.

• Scope 1 and 2 reduction in 2024: 41% vs 2019 baseline​
• Scope 3 reduction in 2024: 23.7% vs 2019 baseline, but up 3% vs 2023 due to airfreight and material weight increases​
• Coal boiler use among Tier 1 and 2 garment suppliers fell from 118 factories in 2022 to 27 factories in 2024, with full phase-out targeted by 2026​
• H&M targets net zero by 2040 through 90% absolute emissions reductions and permanent carbon removals for residuals​

Water Stewardship

H&M targets a 30% absolute reduction in freshwater consumption across Tier 1 and 2 production factories by 2030 against a 2022 baseline, with a 10% interim milestone by 2025. The company achieved a 9.5% freshwater reduction in 2024, placing it on course to hit the 2025 milestone ahead of schedule. Water recycling in the supply chain reached 19.6% in 2024, up from 12.2% in 2022.

• Freshwater consumption in supply chain: down 9.5% vs 2022 baseline​
• Water recycling rate: 19.6% in 2024, up from 12.2% in 2022​
• H&M deployed waterless dyeing technology at two suppliers: Arvind in India and Chorka Textiles in Bangladesh​
• Quantis partnership established a water stewardship framework and supplier self-assessment tool covering water-stressed regions including Bangladesh, India, China, Turkey, Indonesia, Vietnam, and Pakistan​

Regenerative Agriculture

H&M’s regenerative agriculture engagement is indirect, channeled through sustainable materials sourcing and lower-impact fiber transitions. The company does not publish a standalone regenerative agriculture target. Its fiber strategy focuses on certified organic cotton, Better Cotton, and recycled cotton as primary levers for reducing land and agricultural water impact.​

Deforestation and Biodiversity

H&M has not published a standalone biodiversity or deforestation commitment equivalent to its climate or water targets. The company’s materials transition work, including eliminating conventional viscose from risk-supply regions and shifting to ECOVERO branded viscose from sustainably managed forests, carries indirect deforestation co-benefits. This remains an area where formal, measurable targets are absent.​

Packaging and Circular Economy

H&M achieved a 54% reduction in plastic packaging against a 2018 baseline by 2024, more than double its 25% reduction target for 2025, which it met one full year ahead of schedule. For commercial products, 89% of all materials used in 2024 were recycled or sustainably sourced, up from 83% in 2023, with recycled materials alone reaching 29.5%, effectively meeting the 30% target for 2025 one year early. The company targets 100% recycled or sustainably sourced materials and 50% recycled materials by 2030.

• Plastic packaging reduction: 54% vs 2018 baseline, surpassing 25% target ahead of schedule​
• Recycled or sustainably sourced materials in products: 89% in 2024, up from 83% in 2023​
• Recycled materials share alone: 29.5% in 2024, vs 30% target set for 2025​
• Recover multi-year supply agreement signed in 2025 to deliver mechanically recycled cotton (RCotton) at commercial scale across Europe, Asia, and the Americas​

Human Rights and Responsible Sourcing

H&M’s Code of Conduct, first launched in 1997, governs supplier compliance with international labour standards. In 2024, over 450 Tier 1 factories enrolled in the Wage Management System programme, covering 44% of Tier 1 suppliers. The company heard from over 164,000 workers, representing more than 1 million people in supplier factories, through its worker voice survey, finding that over 95% of respondents knew how to file a grievance and more than 50% of grievances were resolved within 24 hours.

• Wage Management System coverage: 450+ Tier 1 factories, 44% of Tier 1 suppliers in 2024​
• Worker voice survey responses: 164,000+ workers across 750+ supplier factories​
• Living wage gap: H&M committed to living wages in its supply chain in 2013 but has not yet published a verified living wage attainment rate for its full supplier base​
• Coal phase-out: On-site coal boilers in Tier 1 and 2 factories dropped from 118 in 2022 to 27 in 2024​

Nutrition and Health

As a fashion retailer, H&M does not operate in the food or nutrition sector. Its most relevant human health contributions come through reducing chemical use in textile processing, its Wastewater Zero Ambition program to prevent hazardous chemical discharge into waterways, and its supplier water governance work in water-stressed regions.​

Community and Social Impact

H&M’s worker voice program reached more than 1 million supply chain workers across 750 supplier factories in 2024. The company works with trade unions and NGOs on grievance mechanisms and living wage advocacy across production countries including Bangladesh, India, and Cambodia. Waterless dyeing and reduced freshwater interventions also carry direct community co-benefits in regions where garment production competes with local water access.

Governance and Transparency

H&M publishes its sustainability targets and progress publicly on its website in near real-time and discloses through CDP, the Global Reporting Initiative (GRI), and its Annual and Sustainability Report. Stand.earth’s 2025 scorecard rated H&M first among 42 fashion companies on fossil fuel phase-out transparency and climate action, ahead of Inditex, Puma, and Nike. The company voluntarily extended the scope of its coal phase-out commitment to include Tier 3 suppliers in 2024.

Technology and Innovation

H&M’s Circular Innovation Lab and H&M Group Ventures fund and scale next-generation fiber and materials technologies. The Recover partnership brings mechanically recycled cotton (RCotton) to commercial scale, using a process that shortens and re-spins discarded cotton textiles into new fiber blends with lower energy and water use than virgin cotton production. For water efficiency, H&M invested in waterless dyeing technology at Arvind in India and Chorka Textiles in Bangladesh.

Global Partnerships and Advocacy

H&M is a signatory of The Fashion Pact and a Global Deal partner for living wage advocacy. Its Quantis-developed water stewardship framework, including supplier self-assessment tools, is planned for public release to drive collective action across the textile industry. H&M also collaborated with Stand.earth, CDP, and WBCSD on transparency programs and wastewater commitments.

Source

https://hmgroup.com/sustainability/leading-the-change/goals-and-ambitions/
https://hmgroup.com/sustainability/circularity-and-climate/climate/
https://hmgroup.com/sustainability/circularity-and-climate/water/
https://www.thefashionpact.org/member-case-study-hm-group/
https://sustainabilitymag.com/articles/sustainability-circularity-social-responsibility-at-h-m
https://apparelresources.com/business-news/sustainability/hm-unveils-reveals-numbers-support-sustainability-goals-new-report/

Progress vs. Target Tracker

Commitment	Target	Current Status	Assessment
56% absolute reduction in Scope 1, 2, and 3 vs 2019	2030	Scope 1+2 down 41%; Scope 3 down 23.7% vs 2019 baseline ​	On Track
Net zero (90% absolute reduction all scopes)	2040	On course if current Scope 1+2 trajectory continues ​	On Track
100% recycled or sustainably sourced materials	2030	89% achieved in 2024, up from 83% in 2023 ​	On Track
30% recycled materials in products	2025	29.5% achieved in 2024, one year ahead of target ​	On Track (Near-Achieved)
50% recycled materials in products	2030	29.5% in 2024; requires 20.5pp gain in six years ​	At Risk
25% plastic packaging reduction vs 2018	2025	54% reduction achieved, surpassing target ahead of schedule ​	Achieved
10% freshwater reduction in Tier 1 and 2 factories vs 2022	2025	9.5% reduction achieved in 2024 ​	On Track (Near-Achieved)
30% freshwater reduction vs 2022	2030	9.5% achieved; 20.5pp remaining ​	At Risk
100% coal phase-out at Tier 1 and 2 supplier factories	2026	Down to 27 factories from 118 in 2022 ​	On Track
Living wage for supply chain workers	No formal date published	Wage Management System covers 44% of Tier 1 factories; no verified attainment rate ​	At Risk

Source

https://hmgroup.com/sustainability/leading-the-change/goals-and-ambitions/
https://hmgroup.com/wp-content/uploads/2025/03/HM-Group-Sustainability-progress-report-2024.pdf
https://hmgroup.com/wp-content/uploads/2025/03/PR-HM-Group-Annual-and-Sustainability-Report-2024.pdf

Key Sustainability Innovations and Technologies

H&M’s most significant circular materials innovation in 2025 is the multi-year commercial partnership with Recover for mechanically recycled cotton (RCotton). The process re-spins discarded cotton textiles into new fiber at industrial scale with lower water and energy inputs than virgin cotton, and Recover’s traceable supply chains meet the verification standards H&M requires for its SBTi-aligned materials targets. This transition from pilot to full commercial deployment marks the first time a major fast fashion retailer has anchored volume recycled cotton supply agreements to a binding 2030 circularity goal.​

On water technology, H&M invested in waterless dyeing systems at two key supplier factories, with Arvind in India and Chorka Textiles in Bangladesh serving as anchor deployments for broader supply chain rollout. The Quantis-developed water stewardship framework adds a data layer by equipping suppliers with a self-assessment tool that maps water impacts at the basin level across seven high-risk countries. This moves H&M from a facility-level water metric to a watershed-level governance model.

For supply chain coal phase-out, H&M is not deploying a single technology but rather a structured supplier engagement program. The result is visible: on-site coal boilers at Tier 1 and 2 factories dropped from 118 in 2022 to 27 in 2024, and H&M voluntarily extended coal tracking to Tier 3 suppliers in 2025. The Circular Innovation Lab and H&M Group Ventures remain the primary capital vehicles for funding next-generation materials across fiber recycling, bio-based inputs, and low-impact dye systems.

• Recover RCotton partnership: commercial-scale mechanically recycled cotton across Europe, Asia, and the Americas, aligned with the 2030 materials target​
• Waterless dyeing: deployed at Arvind (India) and Chorka Textiles (Bangladesh), reducing water and energy per unit of fabric​
• Quantis water stewardship framework: basin-level self-assessment tools across Bangladesh, India, China, Turkey, Indonesia, Vietnam, and Pakistan​
• Coal boiler phase-out: 118 factories in 2022, 46 in 2023, 27 in 2024, zero targeted by 2026​
• Circular Innovation Lab and H&M Group Ventures: primary funding vehicle for fiber recycling, bio-based materials, and circular design systems​

Source

https://esgnews.com/hm-recover-sign-multi-year-partnership-to-scale-recycled-cotton-supply/
https://quantis.com/case-studies/h-and-m-water-stewardship-framework/
https://wbcsdpublications.org/case-study-h-m-group-wastewater-zero-ambition/
https://hmgroup.com/sustainability/circularity-and-climate/water/

Measurable Impacts

H&M’s headline sustainability numbers for fiscal 2024 show consistent progress across most environmental metrics. Scope 1 and 2 emissions fell 41% from the 2019 baseline, driven by renewable electricity procurement across stores, offices, and distribution centres. Scope 3 emissions fell 23.7% from the 2019 baseline, though rose 3% year-on-year, a setback tied to airfreight growth and a shift toward heavier material categories. Plastic packaging reductions reached 54% from a 2018 baseline, compared to 47% in 2023, reflecting continued supplier and logistics packaging optimization.

Materials circularity data moved sharply. The recycled or sustainably sourced materials share increased from 83% in 2023 to 89% in 2024, with recycled materials alone climbing from approximately 26% to 29.5% in the same period. Freshwater consumption in Tier 1 and 2 factories fell 9.5% vs the 2022 baseline, with water recycling rates rising from 12.2% in 2022 to 19.6% in 2024.

• Scope 1 and 2 emissions: 41% below 2019 baseline in 2024 vs approximately 24% below in 2023​
• Scope 3 emissions: 23.7% below 2019 baseline in 2024; up 3% vs 2023​
• Plastic packaging: 54% reduction vs 2018 baseline in 2024, up from 47% in 2023​
• Recycled or sustainably sourced materials: 89% in 2024, up from 83% in 2023​
• Water recycling in supply chain: 19.6% in 2024, up from 12.2% in 2022​
• Coal boilers at supplier factories: 27 in 2024, down from 46 in 2023 and 118 in 2022​

Source

https://hmgroup.com/investors/annual-and-sustainability-report/
https://hmgroup.com/sustainability/circularity-and-climate/climate/
https://www.thefashionpact.org/member-case-study-hm-group/
https://sustainabilityonline.net/news/fashion-retailer-hm-makes-progress-against-sustainability-goals/

Challenges and Areas for Improvement

Scope 3 emissions are H&M’s most exposed gap. Although they are 23.7% below the 2019 baseline, the 3% rise year-on-year in 2024 signals that the downward trajectory is not yet stable. The two triggers, increased airfreight and heavier material categories, both reflect operational decisions within H&M’s control. A 56% absolute reduction by 2030 requires an additional 32 percentage points of Scope 3 cuts in six years from a position that moved in the wrong direction in 2024.​

The living wage commitment remains the most structurally unresolved issue in H&M’s social sustainability record. H&M committed to a living wage across its supply chain in 2013, but as of 2024 the Wage Management System covers only 44% of Tier 1 suppliers, with no published target date for full attainment and no disclosed verified living wage rate. Given the company’s reliance on over 1 million garment workers across Asia and its public ESG profile, the absence of a binding, time-stamped living wage target creates credibility risk.

The 50% recycled materials target by 2030 also faces a structural supply constraint. At 29.5% in 2024, reaching 50% requires more than doubling the recycled content share in six years while maintaining quality and volume standards across hundreds of material categories. The Recover partnership adds supply capacity for cotton, but recycled polyester, nylon, and technical materials require separate infrastructure investments not yet publicly committed to at the same scale.​

• Scope 3 up 3% year-on-year in 2024, despite a 23.7% reduction vs 2019 baseline; 32pp of further cuts needed by 2030​
• Living wage: Wage Management System covers only 44% of Tier 1 suppliers; no verified attainment rate published; commitment dates to 2013​
• Recycled materials at 29.5% in 2024 vs 50% target for 2030; 20.5pp gap with no disclosed procurement plan beyond cotton​
• Freshwater reduction at 9.5% vs 30% target for 2030; trajectory suggests the 2025 milestone is near but the 2030 target requires a structural supply chain shift​
• No standalone biodiversity or deforestation target despite sourcing from forest-risk fiber regions​

Source

https://hmgroup.com/sustainability/circularity-and-climate/climate/
https://flagship-report.theglobaldeal.com/case-study/promoting-living-wages-in-hm-group
https://www2.hm.com/en_in/sustainability-hm/social-impact/working-conditions.html

Future Plans and Long-Term Goals

By 2026, H&M expects to eliminate all on-site coal boilers from its Tier 1, 2, and 3 supplier base, completing the most visible supply chain energy transition in fast fashion. By 2030, the company targets 100% recycled or sustainably sourced materials, 50% recycled content specifically, a 56% absolute Scope 1, 2, and 3 reduction from 2019, a 30% absolute freshwater cut in production factories, and 100% recycled or sustainably sourced packaging materials. These 2030 commitments are all SBTi-aligned and publicly tracked on a quarterly basis through H&M’s sustainability goals page.

By 2040, H&M targets net zero through a 90% absolute reduction in all scope emissions from the 2019 baseline, with permanent carbon removal neutralizing remaining residuals. The company’s circular materials roadmap, backed by Circular Innovation Lab investments and external partnerships such as the Recover deal, is the primary vehicle for reaching both the 2030 materials targets and the long-term emissions reduction curve. H&M’s 2030 water target will require a step-change in supplier basin-level water management, and the Quantis framework provides the governance infrastructure for that shift.

Source

https://hmgroup.com/sustainability/leading-the-change/goals-and-ambitions/
https://esgnews.com/hm-recover-sign-multi-year-partnership-to-scale-recycled-cotton-supply/
https://quantis.com/case-studies/h-and-m-water-stewardship-framework/

Comparisons to Industry Competitors

H&M leads the fast fashion sector on Stand.earth’s 2025 Fossil-Free Fashion Scorecard with a B+ grade, ahead of Inditex (Zara’s parent), which moved from 20th to 9th place in 2025, and well ahead of SHEIN, which held an F grade. Inditex targets a 95% cut in Scope 1 and 2 emissions by 2030 and a 51% Scope 3 reduction, with 100% lower-impact textile fibers also targeted by 2030 and a net zero goal of 2040, matching H&M’s timeline. Both companies outperform SHEIN, which does not publish a verifiable SBTi-aligned net zero target or supply chain emissions data.

Apple and Google’s circular economy programs are not directly comparable given their different industries, but within the apparel sector H&M’s 89% sustainably sourced materials rate in 2024 is the most advanced publicly disclosed metric among global volume fashion retailers. Inditex’s Fibers Plan commits to 100% lower-impact sources by 2030, with a biodiversity and ecosystems policy also linked to executive pay, an accountability mechanism H&M does not yet match.

Fast Fashion ESG Metrics (Latest Available Data)

Metric	H&M Group	Inditex (Zara)	SHEIN
Scope 1+2 reduction vs baseline	41% below 2019 baseline ​	20% reduction target set for 2027 vs 2018 baseline ​	Not publicly disclosed ​
Scope 3 reduction vs baseline	23.7% below 2019 baseline ​	51% cut targeted by 2030 vs 2018 baseline ​	Not publicly disclosed ​
Renewable energy match	Not disclosed as a percentage	Progressing toward 95% Scope 1+2 renewable target by 2030 ​	Not disclosed ​
Recycled/sustainable materials in products	89% in 2024, up from 83% in 2023 ​	100% lower-impact fibers targeted by 2030 ​	No published target ​
Net zero target	2040 ​	2040 ​	None published ​
Stand.earth Fossil-Free Fashion Grade (2025)	B+ (Ranked 1st of 42) ​	Ranked 9th (improved from 20th in 2024) ​	F grade ​
Living wage commitment	2013 commitment; 44% Tier 1 coverage in 2024, no attainment rate ​	ESG targets linked to executive pay ​	Not disclosed ​

Source

https://www.bloomberg.com/news/articles/2025-06-03/h-m-outperforms-zara-and-shein-on-green-report-card-for-fashion
https://apparelresources.com/business-news/sustainability/stand-earth-report-hm-outperforms-zara-shein-climate-action/
https://www.cattolicainvestmentclub.it/wp-content/uploads/2025/04/Inditex_Report_CIC.pdf
https://hmgroup.com/sustainability/leading-the-change/goals-and-ambitions/

What to Watch: 12 to 18 Month Indicators

Scope 3 Direction in Fiscal 2025 Report

H&M’s Scope 3 emissions rose 3% in 2024 compared to 2023, the first year-on-year increase after several years of decline, and the company cited airfreight and material weight as causes. The fiscal 2025 report, due in early 2026, will reveal whether this is a one-year anomaly or the beginning of a structural reversal. A second consecutive year of Scope 3 growth would put the 56% reduction target by 2030 seriously out of reach, given that 32 additional percentage points of reductions are still required.​

Coal Phase-Out Completion at Tier 1, 2, and 3 Factories by End of 2026

With 27 factories still operating coal boilers at the end of 2024 and the full phase-out deadline set for 2026, the next 18 months represent the final execution window for H&M’s most specific, time-bound supply chain decarbonization commitment. The expansion of scope to Tier 3 factories in 2025 raises the total number of factories under scrutiny. A public progress update by mid-2026 will confirm whether coal has been fully eliminated or whether the deadline slides.​

Living Wage Target Formalization

H&M’s 2013 living wage commitment remains without a verified completion date or published attainment rate as of 2024. With the EU Corporate Sustainability Due Diligence Directive (CS3D) requiring large companies to address living wages in supply chains under legal obligation from 2026, H&M faces regulatory pressure to formalize what has been a voluntary commitment for over a decade. Any announcement of a binding, time-stamped living wage target or third-party attainment audit in 2025 or 2026 would represent a material step-change in H&M’s social sustainability profile.

Source

https://hmgroup.com/sustainability/circularity-and-climate/climate/
https://hmgroup.com/wp-content/uploads/2025/03/PR-HM-Group-Annual-and-Sustainability-Report-2024.pdf
https://flagship-report.theglobaldeal.com/case-study/promoting-living-wages-in-hm-group
https://hmgroup.com/sustainability/fair-and-equal/human-rights/

H&M’s 2024 sustainability data shows a company that has closed the gap with its near-term 2025 targets faster than expected. Delivering 41% Scope 1 and 2 reductions, 89% sustainably sourced materials, and 54% plastic packaging cuts all ahead of target year reflects a program with genuine operational depth, not just aspirational framing. The coal boiler data is particularly credible: a four-year trajectory from 118 factories to 27, with a clear 2026 deadline and voluntary expansion to Tier 3, is verifiable and moving in the right direction.

The structural risks sit in three places. Scope 3 emissions are 32 percentage points from the 2030 target while moving year-on-year in the wrong direction. The living wage commitment is a decade old without binding resolution, creating escalating regulatory and reputational exposure as CS3D takes effect. And the 50% recycled materials target for 2030 lacks a disclosed procurement plan beyond cotton, leaving polyester, nylon, and technical materials without a credible supply pathway.

Three strategic takeaways for practitioners benchmarking or replicating this approach:

1. Coal phase-out is a replicable model. H&M’s structured supplier engagement, combined with mandatory disclosure of boiler counts by tier and a hard 2026 deadline, produced a 77% reduction in coal-using factories in two years. Practitioners in other textile or manufacturing supply chains can apply this precise mechanic: set a factory-level count baseline, report it annually, and extend scope by supplier tier each year.
2. Early target-setting with public quarterly tracking drives faster-than-expected delivery. H&M hit its 2025 recycled materials and plastic packaging targets one year early precisely because they were quantified, published, and tracked at the SKU and supplier level. Sustainability strategists who internalize targets into procurement contracts, not just annual reports, consistently outperform those who keep targets at the corporate communication level.​
3. Water stewardship at basin level, rather than at facility level, is the emerging standard. H&M’s Quantis partnership and its plan to make the supplier water stewardship framework publicly available represents a shift from internal operational metrics to shared watershed governance. For any brand sourcing from water-stressed regions, the ability to map and demonstrate basin-level impact will become a disclosure requirement, not a differentiator, within the next three years.​

Source

https://hmgroup.com/investors/annual-and-sustainability-report/
https://hmgroup.com/wp-content/uploads/2025/03/HM-Group-Sustainability-progress-report-2024.pdf
https://quantis.com/case-studies/h-and-m-water-stewardship-framework/
https://hmgroup.com/sustainability/fair-and-equal/human-rights/