Decathlon Climate Report TCFD-2020

Climate-related risk report 2020
TOWARDS AN ALIGNMENT WITH THE TASK FORCE ON CLIMATE-

RELATED FINANCIAL DISCLOSURES RECOMMENDATIONS
1. SUMMARY
At Decathlon, our first priority is to reduce our emissions and
contribute to carbon neutrality. However, we are aware that climate
change will have an impact on our activities and we are therefore
developing a climate-related risks and opportunities strategy.
Involving external experts, internal project referents along with the
specific climate adaptation team, Decathlon carried out an iterative
process to identify and map climate-related risks and opportunities
over the 2030-2035 time horizon under RCP 8.5 climate change
scenario.
The assessment carried out in 2020 allowed us to identify 16

risks and opportunities linked to climate change. Among those,
three risks and one opportunity were prioritized and analyzed in
detail. These analyses enabled us to develop strategies to reduce
the vulnerability of Decathlon’s activities, and contribute to GHG
reduction at the same time.
Climate-related risk report 2020 TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES

WATER STRESS RISK TEMPERATURE RISING RISK
Climate change is highly likely to affect water supplies worldwide, Climate change means temperature increases and tougher extreme
due to changes in weather patterns. This will affect the whole textile conditions such as heat and cold waves. This will impact Decathlon
supply chain (which represented 32% of Decathlon sales in 2020), energy consumption, through changes in heating and air conditioning
from natural fibers production to fabric processing, highly dependent needs in our sites.
on water quality and availability.
The calculation of the risk takes the cooling degree days (CDD) as
The risk is quantified based on the 2030 RCP 8.5 scenario (no GHG an indicator for the increase in energy consumption. Decathlon sites
emission reduction, which leads to an increment between 2.6ºC and (warehouses and stores) and production supplier sites are classified
4.8ºC in the world average temperature in 2100), compared with the based on this indicator in the 2035 scenario RCP 8.5 exposure,
worldwide current water stress situation. The Decathlon production from low (<50ºC.days) to extremely high (>500ºC.days) exposures.
sites are categorized based on the percentage of this difference, from In addition, a heat wave increasing projections has been taken into
low (<10%) to extremely high (>60%) exposure. A future cost analysis account, dividing the exposure of the sites between low (less than 2
was conducted, resulting in an annual overcost of 4.3 million euros/ days with t>35ºC) and extremely high (> 20 days). The additional cost
year due to increases in production costs (estimation made for 2021). for Decathlon stores activities due to the increase in air conditioning
consumption, to maintain a comfort condition for workers and/or
customers, could increase to 12 million euros/year by 2035.
To reduce its vulnerability, Decathlon launched in 2021 different projects
linked to water management (raw water consumption and wastewater
treatment) to increase control over water scarcity in its supply chain. A best practices guide in terms of building insulation is under
Decathlon also carries out regular environmental audits at suppliers development to reduce air-conditioning needs for Decathlon sites.
consuming a lot of water through their industrial process and, twice a For the stores equipped with air conditioning, white roofs are being
year, the mentioned suppliers have to send their water consumption experimented in Decathlon Spain’stores. They can drive a substantial
monitored data. These suppliers also have to start building a water decrease in electricity consumption. In addition, since 2016 energy
management strategy. By 2026, each factory should have designed and consumption per square meter is monitored (quarterly) for every
implemented a roadmap to monitor and reduce water consumption. Decathlon site, and also piloted (yearly), as an indicator for energy 3
efficiency (kWh/m2).
Climate-related risks and opportunities report 2020 TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES
POLYESTER PRICE RISK RENEWABLE ENERGY OPPORTUNITY
New regulations related to climate change policies regarding fossil The climate change international strategies and the related efforts
fuels use are coming, affecting the price of virgin polyester. In in the development of new energy production technologies make
addition, the market changes in the use of plastic bottles will also switching to renewable energy economically attractive, especially
affect the price of recycled polyester. All this market volatility will through PPAs (Power Purchase Agreement) or on-site generation.
mean a risk for Decathlon’s polyester supply chain.
Switching to self generation in European stores could reduce the

With the projected scenario (IEA SDS), the increase in carbon pricing annual electricity expenses by 10.5 to 12.4 million euros by 2030.
in a 1.5°C world (68 to 188 euros/T eq CO2
to render recycled polyester competitive. We remain nevertheless
committed to developing recycled polyester in order to reduce our In line with its RE100 commitment, Decathlon is studying different
GHG emissions. However, despite switching 100% to sustainable scenarios for renewable energy purchasing, aiming to extend the
polyester (recycled polyester and/or dope-dyed), exposure to share of on-site and PPAs into its sourcing mix, taking into account
carbon pricing would rise to 75 million euros in 2030. 2
savings by 2026.
The development of circular economy strategies (renting, second In order to support the achievement of climate exposure-related
hand, reparability and upcycling) is seen as the only way to reduce targets, part of our 2026 Transition Plan, and the completion of
this vulnerability. Decathlon implemented the “Sustainable Sales” underlying actions, Decathlon has assessed the related quantitative
concept and its piloting, which takes into account the sales of these
new strategic actions. The target is to reach 5% of sales by 2022
thanks to these solutions. actions. Beyond 2026, Decathlon has also committed to contribute
to global carbon neutrality by 2030.
During 2021, Decathlon will continue developing and implementing
strategies to reduce the vulnerability of its activities to these 3 main
risks, while leveraging the renewable energy opportunity. Meanwhile,
risks and opportunities will evolve due to external impacts, changes
in world geopolitical conditions and environmental conditions.
An update is planned every year in order to screen possible new
risks and opportunities in addition to those already identified.
Going forward an annual iterative process will aim at designing
and implementing action plans to face the prioritized risks and
opportunities by the different Decathlon concerned internal players.
Climate-related risk report 2020
TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES
1. INTRODUCTION
2. REPORT
2.1 GOVERNANCE
2.2 RISK MANAGEMENT. RESULTS OF THE PILOTS PROJECTS:
2.3.1 WATER STRESS RISK

2.3.2 TEMPERATURE RISING RISK
2.3.3 POLYESTER PRICE RISK
2.3.4 RENEWABLE ENERGY OPPORTUNITY
2.3 STRATEGY
2.4. METRICS AND TARGETS
3. TCFD COMPLIANCE 6
1. INTRODUCTION
This report presents an overview of Decathlon climate-related risks and
opportunities assessment, conducted under the guiding principles of the
Taskforce on Climate-related Financial Disclosures (TCFD).
Through this first “TCFD report” effort, Decathlon aims at providing transparency
in terms of climate-related disclosure for all stakeholders. The advancements
in the availability and quality of related information will be tracked through the
future updates of that report which are expected to be disclosed on an annual
basis. Identified areas of progress already include geographical scope coverage
(first assessment focused on Europe and Asia), time horizon (expanding forecast
beyond 2035), climate change scenarios (in addition to the RCP8.5), subsequent
impact assessment and related mitigation action plans.
Decathlon climate adaptation strategy is addressed from a holistic perspective.
Climate change is highly connected with the global patterns of inequality as the
most vulnerable are often disproportionately impacted by the costs of addressing
climate change. Additionally, since every new strategy has the potentiality of
environmental transformations, adaptation practices could involve an increase
in pressures to the ecosystems, both locally and globally. For that reason, our
strategies designed to adapt our business to climate-related risks will take into
account their social and environmental consequences.
Climate-related risk report 2020 TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES

2. REPORT Committee”).
2.1 GOVERNANCE internally named “Circle of Contributors”. This committee is made up of key
BOARD-LEVEL OVERSIGHT OF CLIMATE-RELATED ISSUES Sustainable Development Leaders (for example: Climate Strategy Manager,
Ecodesign Manager, Sustainability Communication Manager etc.) and internal
Decathlon’s Transition Committee was created at the request of Decathlon Board Operational Leaders (for example Decathlon India Manager, Forclaz Brand
Chairman, to support and monitor the subject of Sustainable Development with Manager, Vietnam Production Manager etc.). The committee’s role is to fuel
due attention.This Board Committee is headed by the Board Chairman and is made Decathlon’s sustainable development roadmap, with practical contributions
and family shareholders, as well as independent experts. Thanks to its unbiased production, transport, retail, IT/Data, etc.), that are connected to their networks.
viewpoint, it can observe, evaluate and question the long-term strategies put in In this way, strategies are discussed, developed and owned by the different BUs/
place to ensure the long-term resilience of Decathlon. functions, taking into account the constraints and opportunities encountered in
including securing the robustness of sustainability indicators and ensuring that - Decide on strategies as representatives of the different sectors of the company.
the transition trajectory complemented the economic trajectory to guarantee
the sustainability of key business decisions. The Transition Committee reports
annually to Decathlon’s Board of Directors and exchanges information with the - Support their peers in implementing actions.
- Monitor and alert in the event of deviations.
systematically discussed and analysed during the annual session with the Board.
Climate-related issues are always part of the agenda. For example in 2020 the
committee validated the deployment of a new climate management system Decisions made by this committee are then validated by the Transition Committee.
for the Business Units’ managers: scorecards to manage the performance of
the climate objectives by Business Unit, to highlight where the performance is
achieved or not, and to animate and accompany the managers to achieve their
objectives. of more than 40 people. The CSR Department is connected to an international
network of Sustainability Leaders (around 100 people). It is composed of Process
MANAGEMENT’S ROLE IN ASSESSING AND MANAGING CLIMATE-RELATED RISKS AND Change, CSR reporting, Ecodesign, Human Rights Responsibility in production
OPPORTUNITIES . etc.). These managers are helped by project leaders. The role of the CSR
Department is to:
8
- Enlighten Decathlon’s managers and employees about sustainable development stakes
and challenge Decathlon’s activities and orientations accordingly.
- Propose targets, trajectories and roadmaps, built in cooperation with internal and external
stakeholders.
- Connect and bring people together by sharing our common sustainability purpose and
actions.
- Empower and involve teammates, making them autonomous, by providing purpose,
creating tools, methods, training and coaching.
- Manage (assess, report, forecast) and share KPIs to improve sustainability performance.
The responsibilities for climate-related issues have been assigned to the Chief
Sustainability Officer as she is the cornerstone between the Board, the Group
Executives and the Business Units management. She has a key role in ensuring
alignment between:
- The Group strategy on Sustainable Development and Climate, validated at Board level.
- The execution of that climate strategy through trajectories and KPIs validated by the Group
Executive Committee.
- The ownership and embodiment of climate trajectories within Business Units through the
Sustainable Development Committee.
2.2 RISK MANAGEMENT
A materiality assessment is done on a regular basis by the CSR team. This In 2020, 16 climate-related risks and opportunities were identified for Decathlon
exercise allows the mapping of stakeholders expectations and the identification activities. In this first exercise, the subsequent short-listing process was based
of strategic issues or risks of business importance. Our materiality assessment, on:
which we refreshed in 2018, has consistently shown that climate change is a i) Risk assessment results.
material issue for our business and stakeholders.
ii) Decathlon’s existing capability to deal with some of the identified risks.
The main extra-financial risks are also identified and updated during the annual iii) Internal data availability in order to be able to conduct pilot risk mitigation projects.
review of Decathlon’s global risks by the internal Audit and Risk Management
Team, for submission and validation by the Board Audit Committee. Climate
change is identified as a risk in the global risk mapping done by the internal Audit Three main risks and one opportunity were consequently focused upon following
Team annually. the mapping phase: water stress at production sites, temperature increase at
In that context, Decathlon developed in 2019 a specific iterative process to identify Decathlon sites (stores, warehouses, and partner production sites) and polyester
and map climate-related risks and opportunities. The methodology includes a price volatility as risks; and renewable energy procurement as an opportunity.
benchmark conducted by an external expert, and subsequent working groups In terms of risk management, the groups involved in each of the risks and
with stakeholders and internal experts to enrich the results of the benchmark. opportunities identified, together with the Climate Strategy Team, define the
Once the risks and opportunities have been identified by the benchmark and the roadmap to reduce the vulnerability of Decathlon activities, with corresponding
successive working groups, a final overarching working group is conducted in metrics and targets, and contribute to GHG reduction at the same time. Regular
order to prioritise the main risks and opportunities. meetings are developed for the tracking of the strategies, managed together by
the risk owners and the Climate Strategy Team.
The risks and opportunities mapping is based on a qualitative positioning
following the benchmark’s results, external climate risk experts and Decathlon’s
experts’ opinions. The classification is made relying on a probability criterion
with 4 categories, from Rare (less than 10% chance that this risk occurs within
the coming year), to Imminent (more than 90% chance that this risk occurs in the
coming year) and on a potential impact criteria pertaining to Decathlon financial
results, also with 4 categories, from Minor (<2% net result) to Extreme (>20% net
result).
In the last step, there is an identification of the priority risks and opportunities,
based on their impact and probability. The end of the process implies a definition
of the owner of each identified risk or opportunity. Each risk and opportunity will
be managed by a Decathlon expert on the topic and a group of referent people 10
inside the company.
IDENTIFIED RISKS AND OPPORTUNITIES
LAND USE AND PRODUCT USE
DESIGN PRODUCTION SITES LOGISTICS RETAIL OPERATIONS
RAW MATERIALS AND MARKETING
#3 Water stress on #5 Operations and

suppliers. Increased logistics disruption
competition for water caused by extreme #7 Increased
events #6 Increase in air seasonality of sales
PHYSICAL #1 Cotton availability resource & chemical conditioning costs
RISKS and price volatility product management #16 Decreased due to the increase #9 Adapt products to
#4 Supply chain productivity and in temperature reflect evolving climate
interruption due arduousness of work conditions
to extreme events due to the increase
in temperature
#8 Reduced purchasing
#2 Polyester
power caused by
#11 Legislation price volatility
TRANSITION #12 Uncertainty over regulations extreme events
related to product #10 Uncertainty on
RISKS on energy & GHG emissions #13 Decrease in
labelling regulation related to
commercial appeal
& brand value
#14 Ecodesign: #15 Increased return

TRANSITION increased demand of investment on
OPPORTUNITIES for more sustainable renewable & energy
products
Physical risks: physical risks arise from the increased frequency and severity of climate and weather related events that damage property and disrupt trade.
Transition risks: transitioning to a lower carbon economy may entail extensive policy, legal, technology, and market changes to address adaptation requirements related
to climate change.
Transition Opportunities: 11
adoption of low emission energy sources, the development of new products and services, access to new markets, and building resilience along the supply chain.
RISKS AND OPPORTUNITIES MAPPING
4
EXTREME
Black Swan
3 #11 Legislation related

#15 Opportunity
to product labelling
MAJOR for renewable energy
#2 Polyester price volatility
IMPACT
#5 Operation interruption
2 #9 Adapt products to reflect caused by extreme events #13 Decrease in brand value
#1 Cotton price volatility
MODERATE evolving climate conditions #10 Uncertainty on regulation #14 Ecodesign
related to synthetic fibers
#7 Increased
#6 Increase
seasonality of sales
1 #8 Reduced purchasing power in air conditioning costs
#4 Extreme events on suppliers #12 Regulation
MINOR caused by extreme events
on GHG emissions
#16 Decreased productivity
due to heat stress
#3 Water stress on suppliers
1 RARE 2 OCCASIONAL 3 FREQUENT 4 IMMINENT
PROBABILITY 12
2.3 STRATEGY 2.3.1 WATER STRESS RISK
To assess the risk of water stress for Decathlon suppliers, World Resource
and in the worst climate change IPCC scenario (RCP8.5) for physical risks, and Institute’s Aqueduct tool (WRI AqueductTM platform) was used to track the baseline
International Energy Agency (IEA) Stated Policy Scenario (SPS) and Sustainable water stress variable. It measures total annual water withdrawals (municipal,
Development Scenario (SDS) for transition risk and opportunity. We are industrial, and agricultural) expressed as a percentage of the total annual available
developing here the 3 short-listed risks from the risk mapping exercises, as well blue water. Higher values indicate more competition among users.
adaptation strategy that will involve our whole supply chain activities.
compared with the current water stress. The production sites are categorized
based on the % of this difference, and categorized following the future exposure
to water stress (WRI AqueductTM platform results) from low (<10%) to extremely
high (>60%).
mandatory (e.g. current South India regulations). For Decathlon, it could mean an
increase in purchasing costs.
The strategy designed to reduce Decathlon activities vulnerability implies that:
- Decathlon has started the tracking of water use (raw water consumption and wastewater
treatment) to control water scarcity in its supply chain.
- Once a year, partner suppliers have to report monitorized data about consumption,
and demonstrate they have a reduction strategy for water usage. From 2021 onward
Decathlon has introduced new questions about water consumption in the environmental
assessment grid for suppliers (e.g. the suppliers should have at least 20% of its industrial
water recycled and reused to obtain a B rating1 on environmental compliance).
- In 2021 Decathlon will also evaluate the impact of its partner production sites in
biodiversity.
1
To guarantee compliance with commitments made together around the world through our Code of Conduct, we carry out regular
audits on our suppliers. During the course of these, we look into the employees’ working conditions: health & safety, as well as
respect for human rights are assessed. These audits also focus on environmental issues, by analysing what is implemented to
reduce and prevent the environmental impact on communities in the areas surrounding the factories (water and air pollution, and 13
soil contamination). Depending on the information collected throughout the audit, a rating ranging from A to E is assigned to a
CURRENT WATER STRESS RISK
12 SUPPLIERS AT EXTREMELY HIGH EXPOSURE
Current exposure of water stress risk of Decathlon suppliers sites. Risk calculated following the baseline water stress variable from WRI AqueductTM platform.
12 suppliers are considered in an “Extremely high” exposure situation.
LOW: <10%
MEDIUM-LOW: 10-20%
MEDIUM-HIGH: 20-40%
HIGH: 40-60%
EXTREMELY HIGH: >60%
14
FUTURE WATER STRESS RISK
2030 water stress risk of Decathlon suppliers sites. Risk calculated according to RCP 8.5 scenario following the baseline water stress variable from WRI AqueductTM platform.
14 suppliers are considered in an “Extremely high” exposure situation.
LOW: <10% New suppliers

MEDIUM-LOW: 10-20% with an
MEDIUM-HIGH: 20-40% extremely
high exposure
HIGH: 40-60%
EXTREMELY HIGH: >60%
15
2.3.2 TEMPERATURE RISING RISK > with a SBTi-compatible CO2 reduction trajectory.
> with an energy efficiency action plan.
The calculation of the risk is based on the cooling degree days indicator (mean
temperature increase). Decathlon stores and production suppliers sites are > with 100% renewable energy procurement.
classified based on this indicator in the RCP 8.5 scenario exposure, from low
(<50ºC.days) to extremely high (>500ºC.days). In addition, heat waves projections
have been taken into account (for Decathlon warehouses and production sites) In December 2020, 21% of the suppliers by purchase value defined their SBT targets.
as an indicator of extreme temperature increase, and the exposure of the sites The target is to achieve 80% by the end of 2021 and 90% by 2022. End of 2020, 14.5% of
the electricity (from the suppliers representing 90% of the total sales) was coming from
has been segmented between low (less than 2 days with t>35ºC) and extremely
renewable sources (EAC, PPA, self-generated).
high (> 20 days).
26ºC is considered as the threshold for human well-being inside a building, so
the study fixed this value as a reference point to calculate the air conditioning
needs.
The financial impact was calculated only for European and Chinese stores,
based on the increase in air conditioning consumption. The results showed that
the additional cost for Decathlon related stores could reach 12 million euros/
per year by 2035.
In order to mitigate the risk and reduce the impact of temperature increasing,
the defined strategy includes:
- By the end of 2021 Decathlon will have a best practices guide about building
insulation and energy efficiency for stores and warehouses. In particular, Decathlon
has already deployed LEDs in 80% of its international stores and a BEM (building
energy management) system in all its French and Spanish sites (this system allows
us to regulate the heating and air-conditioning systems in order to save energy).
- Since 2021, every Decathlon site must measure their energy consumption per square
meter as an energy efficiency indicator (kWh/m2).
- A target for this KPI is under development, and it will be applied to each Decathlon site
and at a country level.
- Regarding the suppliers’ sites, the 2026 target is the following: 90% of Decathlon’s
purchasing value are produced from suppliers:
16
> autonomously measuring their GHG emissions.
TEMPERATURE RISING RISK FOR SUPPLIER’S SITES
Increase in mean temperature by 2035 for Decathlon suppliers sites.
This risk is calculated based on the IPCC RCP 8.5 exposure scenario for Cooling Degree Days (>26ºC).
COOLING DEGREE DAYS (CDD) PER YEAR
LOW: CDD < 50°C days

MEDIUM-LOW: 50 < CDD < 150°C days
MEDIUM-HIGH: 150 < CDD < 250°C days
HIGH: 250 < CDD < 500°C days
EXTREMELY HIGH: CDD > 500°C days
17
TEMPERATURE RISING RISK FOR STORES
95 STORES AT EXTREMELY HIGH EXPOSURE
Increase of mean temperature by 2035 for our Decathlon stores.
This risk is calculated based on the IPCC RCP 8.5 exposure scenario for Cooling Degree Days (>26ºC).
COOLING DEGREE DAYS (CDD) PER YEAR
LOW: CDD < 50°C days

MEDIUM-LOW: 50 < CDD < 150°C days
MEDIUM-HIGH: 150 < CDD < 250°C days
HIGH: 250 < CDD < 500°C days
EXTREMELY HIGH: CDD > 500°C days
18
TEMPERATURE RISING RISK FOR WAREHOUSES 2.3.3 POLYESTER PRICE RISK
New regulations related to climate change policies regarding fossil fuels use are
4 WAREHOUSES AT EXTREMELY HIGH EXPOSURE coming, affecting the price of virgin polyester (PET). Crude oil price is one of the
Increase of extreme temperature (heat waves) by 2035 for Decathlon warehouses.
main drivers of virgin PET price and, in 2019, variation in crude oil price of 1USD
This risk is calculated based on the IPCC RCP 8.5 scenario for a number of days above 35ºC.
translated on average into 26USD/ ton increase the virgin PET price. Although
recycled polyester (RPET) price is not correlated to crude oil price (since it
depends on cost/availability of material for recycling, the productive capacity
and the economically competitive recycling industry), the market changes in the
use of plastic bottles will also affect the price of RPET. All this market volatility will
mean a risk for Decathlon’s polyester supply chain. This risk has been calculated
based on the future GHG emission regulations, petrol use and market changes
(following IEA Sustainable Development Scenario (SDS), 2019).
With the projected scenario (IEA SDS), the increase in carbon pricing in
a 1.5°C world (68 to 188 euros/ T eq CO2) would not be sufficient to render
RPET competitive. We remain nevertheless committed to developing recycled
polyester in order to reduce our GHG emissions. However, despite switching
100% to sustainable polyester (recycled polyester and/or dope-dyed), exposure
to carbon pricing would rise to 75 million euros in 2030.
FOCUS CHINA
NUMBER (NB) OF DAYS

ABOVE 35°C PER YEAR
LOW: NB < 2 days

MEDIUM-LOW: 2 < NB < 5 days
MEDIUM-HIGH: 5 < NB < 10 days
HIGH: 10 < NB < 20 days
EXTREMELY HIGH: NB > 2 days
19
WORLWIDE CARBON TAXES
ESTABLISHED EMISSIONS TRADING SCHEME ESTABLISHED CARBON TAX Prices given in USD/tCO2e
Data source: I4CE - Institute for Climate Economics with data from ICAP, World Bank, government officials and public information, May 2020.
AMERICAS
30 28
23 23 23 23 23 23 23 6 8
15 15 17 15 15 17 3 5 5 10
Canada British Alberta Northwest Saskatchwan Ontario Quebec Newfoundland Prince Nova Scotia New California RG GI Massachusetts Mexico Columbia Chile Argentina
federal Columbia Territories and Labrador Edwards Brunswick
mechanism Islands
123
EUROPE 58
84 98 98
49
28 30 28 28 28 28 26 28 28 28 28 26 28 28 28 28 28 28 28
23 19
2 10 <1 <1 13
Island Ireland United Denmark Norway Sweden Finland Portugal France Estonia Latvia Poland Ukraine Slovenia Liechtenstein Switzerland
Kingdom
ASIA AFRICA OCEANIA

31
3 4 6 6 6
1 12 2 1 2 2 3 4 8 17
Kazakhstan Beijing Chongqing Fujian Guangdong Hubei Shanghai Shenzhen Tianjin South Korea Japan Saitama Tokyo Singapore South Africa New
(China) (China) (China) (China) (China) (China) (China) (China) Zealand
20
The strategies developed to reduce the vulnerability of raw materials accessibility > Rental
are: Decathlon’s strategy is to increase the percentage of sales related to rental
- Decathlon production follows a KPI for CO2 emissions: kgCO2 activity. In 2020, 23 brands proposed their products on a short or long term rental.
which drives production towards raw materials and manufacturing processes with lower In 2022, we estimate an investment of approximately 200 million euros to develop our
carbon footprint. digital infrastructure in key territories to accelerate and facilitate customers’ access to
buying second hand and reused products.,
- As part of its ecodesign2 strategy, aiming at offering 100% ecodesigned products by
2026 (5.9% in 2020), Decathlon commits to use 100% sustainable polyester by 2026
(recycled, dope dyed or biton) and 100% sustainable cotton from 2020 onward (recycled
better cotton initiative or organic cotton). Decathlon launched a call for projects in
Decathlon decided to invest the sum of 3 million euros to support these projects.
Based on our macro estimations and taking into account the future market prices of
component materials and internal growth simulations, we estimate an investment of
approximately 1billion euros by 2026, including the development of human competence in
ecodesign, increased cost of sustainable raw materials and development of recyclability
in our supply chains.
- The development of new business models contributing to Decathlon’s “Sustainable

Sales”, based on the principles of circular economy: rental, second life and repair. The
2022 sustainable sales target is 5% of decathlon global sales. In 2020, the Sustainable
Sales represented 1.4% of the total sales.
> Repair
Decathlon is increasing the number of products that are repairable and offering
appropriate repair services. By 2026, the objective is to have 30% of Decathlon products
proposes all the types of backpack buckles for sale and tutorials to repair.
> Second life
Decathlon is aware of the increased demand for second life products. Since 1986
Decathlon has organised “Trocathlon” events to allow customers to sell their second
hand products. In 2020, 14 countries have developed a permanent second-hand market
in stores or online. The objective is that 100% of countries offer second-hand products
by 2026. 2
At Decathlon, an ecodesigned product must demonstrate a reduction of minimum 10% on the product life cycle analysis (LCA) impact for at least 2 indi-
the LCA impact of our ecodesigned products focusing on four dimensions: Climate Change, Respiratory Effects, Resource Depletion, Water Eutrophisation. 21
2.3.4 RENEWABLE ENERGY OPPORTUNITY
The levelized cost of energy (LCOE) in 2030 has been estimated based on
projected trends from the 2019 IEA World Economic Outlook scenarios, Stated
Policy Scenario (SPS) and Sustainable Development Scenario (SDS). In addition,
two scenarios for Decathlon renewable energy purchasing have been analyzed,
taking into account installation size, labor cost and cost of labor-intensive activities,
renewable energy resources and capital costs. For the trajectory analysis, variation
in the cost of labor (CAPEX and OPEX) and cost of capital (WACC), and regional solar
resources evolution (global horizontal irradiation and capacity factor) have been taken
into consideration. This analysis concluded that switching to self generation in European
stores could reduce the annual electricity expenses by 10.5 to 12.4 million euros if
Decathlon were to take advantage of the full potential.
- On the other hand, PPA agreements scenario would enable to increase RE electricity
consumption to 100%, helping Decathlon reach its RE100 3 commitment. For example,
advantages of the deployment of a PPA, is the long term commitment (more than
10 years) which secures long-term price stability and the positive opportunity
At the end of 2020, 59% of consumed electricity of Decathlon stores and

warehouses came from renewable sources (electricity purchase and production).
purchase but Decathlon wants to accelerate on-site renewable production and

PPAs. Four scenarios of renewable energy purchasing have been developed and
CO2 savings. The decision will be linked to our RE100 commitment.
3
RE100 is a global initiative created by The Climate Group and launched at the UN Climate Summit in New York in 2014. The initiative aims to engage,
support and promote companies that have committed to using 100% renewable energy (including biomass, geothermal, solar, wind and tidal). Decathlon
commitment is to be 100% renewable in 2026 in electricity consumption.
22
WORLDWIDE RENEWABLE ENERGY SOURCES
Eurasia
86.9 GW
Europe
441.0 GW
North America
294.2 GW
Middle East
16.2 GW
Asia
Central America
SOURCE OF RENEWABLE ENERGY & the Caribbean 728.8 GW
10.9 GW Africa
34.0 GW
South America
179.2 GW
Oceania
HYDRO WIND SOLAR BIO
24.0 GW
Data source IRENA 2016
23
2.4 METRICS AND TARGETS
From 2016, (baseline year) Decathlon has been calculating its GHG emissions, As part of the development of the strategy, Decathlon is defining its targets
as per the GHG protocol guidelines, and covering the three scopes. Its total linked to climate-related risks and opportunities strategies.
value footprint is estimated at 9,823,015 T eq CO2 More information about our latest climate change figures can be found in our
- Scope 1: 26,453 T eq CO2 2020 DPEF report.
- Scope 2: 139,944 T eq CO2
- Scope 3: 9,656,618 T eq CO2
Also, in 2019, Decathlon secured the validation from SBTi on the following
targets:
- Reduce by 75% its CO2 emissions associated with Scopes 1 and 2 (in Tonnes CO2)
- Getting its main suppliers to set their own science-based targets by 2024.
These targets have been supplemented by a group-wide intensity target to

reduce CO2 emissions per product sold (tonnes CO2/product) by 40% between
2016 and 2026 for all its activities (Scopes 1, 2 and 3).
In 2021, Decathlon submitted an updated intensity target (in tonnes CO2/euro
of gross profit) covering scopes 1, 2 and 3 to the SBT initiative in order to secure
alignment with the +1.5°C scenario.
In order to support the achievement of those targets as part of our 2026 Transition
Plan, and the completion of underlying action plans, we have assessed the
related quantitative financial impacts on an annual basis for the 2021-2026
period, and designed the internal financial mechanisms to finance the intended
actions.
Beyond 2026, Decathlon has also committed to contribute to global carbon
neutrality by 2030.
24
3. TCFD COMPLIANCE
GOVERNANCE
Disclose the organization’s Describe the board’s oversight of climate-related risks and opportunities. TCFD. Section 2.1 Governance
CDP. Section C2
governance around climate-related
risks and opportunities.
Describe management’s role in assessing and managing climate-related risks TCFD. Section 2.1 Governance
and opportunities. CDP. Section C2
STRATEGY
Disclose the actual and potential Describe the climate related risks and opportunities the organization has TCFD. Section 2.3 Strategy. In this first analysis and report we only have
identified over the short, medium, and long term. focused on the medium term (2030 and 2035).
impacts of climate-related risks and
opportunities on the Describe the impact of climate-related risks and opportunities on the TCFD. Section 2.3 Strategy
organization’s businesses, organization’s businesses, strategy, and financial planning. CDP. Section C3
strategy, and financial
planning where such information is Describe the resilience of the organization’s strategy, taking into consideration TCFD. Section 2.3 Strategy. Since we are in the first steps of our climate
different climate-related scenarios, including a 2°C or lower scenario adaptation strategy, we have focused on the high emission scenario (RCP8.5,
material. +4.5ºC)
RISK MANAGEMENT
Disclose how the organization Describe the organization’s processes for identifying and assessing TCFD. Section 2.2 Risk Management
climate-related risks. CDP. Section C2
identifies, assesses, and manages
climate-related risks. Describe the organization’s processes for managing climate-related risks. TCFD. Section 2.2 Risk Management
CDP. Section C2
Describe how processes for identifying, assessing, and managing TCFD. Section 2.2 Risk Management
climate-related risks are integrated into the organization’s overall risk DPEF. Creating Sustainable Value section.Identification of Extra-Financial
management. Risks.
METRICS AND TARGETS

Disclose the metrics and targets Disclose the metrics used by the organization to assess climate-related risks TCFD. Section 2.4 Metrics and Targets
and opportunities in line with its strategy and risk management process. CDP. Section C4
used to assess and manage relevant
climate-related risks and opportuni- Disclose scope 1, scope 2, and, if appropriate, scope 3 greenhouse gas (GHG) TCFD. Section 2.4 Metrics and Targets
ties where such information is mate- emissions, and the related risks. CDP. Section C4
rial. DPEF.Indicators and Methodology section.
Describe the targets used by the organization to manage climate-related risks TCFD. Section 2.4 Metrics and Targets
and opportunities and performance against targets. *Our climate-related risks and opportunities targets are being developed 25
SELECTED CLIMATE CHANGE SCENARIOS IEA SDS
Sustainable Development Scenario (SDS), works backwards by choosing a set of objectives an
RCP 8.5: describing the rapid structural changes in the energy system required for their achievement.
This scenario describes how would the world energy system have to look like if it were on a
Representative Concentration Pathways (RCPs). Scenarios that include time series of emissions pathway aligned with the Paris Agreement while also achieving energy access to all and reduced
and concentrations of the full suite of greenhouse gases (GHGs) and aerosols and chemically air pollution, which results from the combustion of fossil fuels. Coal experiences the most severe
active gases, as well as land use/land cover. The word representative signifies that each RCP fall of all fossil fuels in this scenario and oil also takes a heavy hit, losing the dominant position
provides only one of many possible scenarios that would lead to the specific radiative forcing it still enjoys nowadays against both renewables and natural gas by 2040. Natural gas is the only
characteristics. The term pathway emphasises that not only the long-term concentration levels fossil fuel not suffering from a heavy fall in demand in this scenario. Renewables experience the
are of interest, but also the trajectory taken over time to reach that outcome. strongest growth of all, making them the largest source of primary energy demand by that time
for ahead of both natural gas and oil, which take the second and the third place, respectively.
RCPs usually refer to the portion of the concentration pathway extending up to 2100, for
which Integrated Assessment Models produced corresponding emission scenarios. Extended Primary energy demand does not rise in the “Sustainable Development Scenario” thanks to
Concentration Pathways (ECPs) describe extensions of the RCPs from 2100 to 2500 that were improving energy efficiency and thanks to a shift of power generation away from combustion,
calculated using simple rules generated by stakeholder consultations, and do not represent fully which reduces losses from waste heat. Accordingly, energy-related CO2 emissions fall sharply
consistent scenarios. from 33.2 Gt in 2018 to 25.2 Gt in 2030, reaching 15.8 Gt in 2040. Such emission pathway gives
50% change of achieving the Paris Agreement by limiting global average temperature rise to 2
degrees by the end of the century.
RCP8.5 One high pathway for which radiative forcing reaches greater than 8.5 W m-2 by 2100 and
continues to rise for some amount of time (the corresponding ECP assuming constant emissions
after 2100 and constant concentrations after 2250)
.
IEA SPS
Stated Policy Scenario (SPS) shows how the world would look like if current policy intentions
and announced targets were implemented. In such state of the world, the growth in oil demand
flattens out in the 2030s, coal use falls and electrification causes rapid transformation of a
part of the energy system. Renewables and natural gas grow fast, the demand for nuclear
also increases, but only marginally. As such, nuclear remains far behind both fossil fuels and
renewables. The share of fossil fuels falls from 81% in 2018 to 77% in 2030 further down to
74% in 2040 and the primary energy demand growth slows down to 1% annual average growth
to 2040. Consequently, the growth of energy-related GHG emissions slows down and eventually
reverses into a decline, which results only in a marginal emission increase: from 33.2 Gt in 2018
to 37.4 Gt in 2030, followed by a decrease to 35.6 Gt in 2040. However, this trajectory is still far 26
from being compatible with the Paris Agreement.
CLIMATE-RELATED RISK REPORT 2020
TOWARDS AN ALIGNMENT WITH THE TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES RECOMMENDATIONS

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Climate-related risk report 2020

TOWARDS AN ALIGNMENT WITH THE TASK FORCE ON CLIMATE-

The assessment carried out in 2020 allowed us to identify 16

Climate-related risk report 2020 TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES

Switching to self generation in European stores could reduce the

2.2 RISK MANAGEMENT. RESULTS OF THE PILOTS PROJECTS:

2.3.1 WATER STRESS RISK

2.4. METRICS AND TARGETS

Climate-related risk report 2020 TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES

#3 Water stress on #5 Operations and

#14 Ecodesign: #15 Increased return

3 #11 Legislation related

1 RARE 2 OCCASIONAL 3 FREQUENT 4 IMMINENT

LOW: <10% New suppliers

COOLING DEGREE DAYS (CDD) PER YEAR

LOW: CDD < 50°C days

COOLING DEGREE DAYS (CDD) PER YEAR

LOW: CDD < 50°C days

NUMBER (NB) OF DAYS

LOW: NB < 2 days

ASIA AFRICA OCEANIA

- The development of new business models contributing to Decathlon’s “Sustainable

At the end of 2020, 59% of consumed electricity of Decathlon stores and

purchase but Decathlon wants to accelerate on-site renewable production and

CO2 savings. The decision will be linked to our RE100 commitment.

Data source IRENA 2016

These targets have been supplemented by a group-wide intensity target to

METRICS AND TARGETS

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