Woolworths Group has chosen to create a Sustainability Linked Bond Framework in order to align its sustainability plan with its long term financing strategy.
Woolworths Group cares deeply about its impact on people and the planet, and we want to go further than just minimising harm – we want to create good. This will be done through ongoing improvement of how Woolworths Group conducts its own business, including how it engages its people and the communities in which it operates.
The documents relevant to our Sustainability Linked Bond Framework are set out as below:
Basis of preparation
As per the terms of the Sustainability Linked Bonds and the Sustainability Linked Bond Framework, Woolworths Group is required to report progress on an annual basis, expressed as a percentage, in reducing scope 1 and 2 emissions, in line with a 1.5 degrees Paris Agreement pathway, as verified by the SBTi.
Woolworths Group uses an operational control approach to measuring emissions, where we have the primary authority to introduce and implement operating policies. Woolworths Group reports in compliance with the NGER Measurement Determination, NZ Ministry for the Environment - 2022 Emissions Measurement Guide, and NGA emission factors.
Material scope 1 emissions sources include fugitive synthetic refrigerants, transport fuel for company-owned or company-controlled fleet cars and home delivery trucks, and natural gas.
Scope 2 emissions are those associated with purchased electricity use across all stores, distribution centres and offices and make up the largest part of our operational footprint. Woolworths Group’s scope 2 emissions reporting is location-based.
Baseline and restatements
The baseline year used to create the SBTi approved decarbonisation trajectory was F15 and this is the relevant baseline year for the purposes of calculating the percentage reduction in emissions for the Sustainability Linked Bonds.
The current F15 baseline as verified by the SBTi:
Includes emissions relating to Endeavour Group, which was separated from Woolworths Group at the start of F22
Excludes emissions relating to Quantium and PFD Food Services, which were acquired in F21 and F22, respectively.
Thus, to provide a more meaningful representation of the reduction in emissions, an adjusted scope 1 and 2 emissions baseline has been provided that reflects the organisational structure as at end F22. This is the reporting approach we have used for all F22 reporting, accessible here:
SBTi requires organisations to regularly review their progress and baselines. Woolworths Groups’ baseline changed materially following the demerger of Endeavour Group and the acquisitions of PFD Foods and Quantium. Therefore, Woolworths Group is in the process of submitting emission targets for re-validation. The revised baseline and proposed targets are currently with SBTi. Once the new targets are validated these will be shared publicly and will be used for the purposes of reporting the progress on Woolworths Group’s reduction in scope 1 and 2 emissions.
Reporting against both approaches is shown in the following table.
Performance against SBTi
Scope 1 and 2 emissions – as verified by SBTi (tCO2e)1
Scope 1 and 2 emissions – adjusted (tCO2e)2
F15 - baseline
Woolworths Group’s scope 1 and 2 emissions as verified by the SBTi. For 2015 (baseline) year, includes emissions relating to Endeavour Group. For 2022 year, excludes emissions relating to Endeavour Group and includes emissions relating to Quantium and PFD Food Services
Woolworths Group’s scope 1 and 2 emissions adjusted for Woolworths Group’s material demergers and acquisitions since SBTi verification. Emissions relating to Endeavour Group have been excluded and emissions relating to Quantium and PFD Food Services have been included in 2015 (baseline) year
Woolworths Groups’ target reduction in scope 1 and 2 emissions were validated by the Science Based Targets initiative (SBTi) in 2020. SBTi is an independent global body formed by the United Nations Global Compact, CDP, the World Resources Institute, and the World Wildlife Fund for Nature. The SBTi assesses and approves companies’ targets through a scientific lens, ensuring alignment with the Paris Agreement goal of limiting climate change to an increase of 1.5 degrees above pre‑industrial levels.
To align to the goal to keep warming to 1.5 degrees, Woolworths Groups current target is to reduce scope 1 and 2 emissions by 63% from a 2015 baseline, by 2030.
As of June 2022, Woolworths has reduced its scope 1 and 2 emissions by 31% since 2015.