Target pledges to reach net-zero and become a ‘circular’ business by 2040

Target's share price increased after the company unveiled the new commitments late on Tuesday (22 June)

On the climate front, the business had already set science-based targets to reduce emissions in line with the Paris Agreement’s 2C trajectory. These targets entailed reducing absolute emissions across all scopes by 30% by 2030 against a 2017 baseline. The retailer then joined the Business Ambition for 1.5C initiative, signalling a desire to strengthen these ambitions, given that alignment with 1.5C requires a halving of emissions by 2030 and reaching net-zero by 2050 at the latest.

Under the updated sustainability strategy, Target is striving to halve emissions from Scope 1 (direct) and Scope 2 (power-related) sources by 2030 against a 2017 baseline. There are new commitments to reach 60% of operational electricity consumption with renewables by 2025, growing to 100% by 2030. Electricity will come from a mix of onsite generation, power purchase agreements (PPAs) and renewable tariffs. Target’s current electricity consumption mix is around 50% renewable.

Target’s updated commitment for Scope 3 (indirect) emissions is a 30% reduction, also between 2017 and 2030. Purchased goods and services will be covered in this accounting; this is the business’s biggest source of Scope 3 emissions.

Material focus

The new sustainability vision, called ‘Target Forward’, also includes commitments to reach zero-waste-to-landfill status and to ensure that all own-brand products and packaging are “designed for a circular future”.

Under this latter pledge, there are plans to stop using materials that are not classed as recycled, sustainably sourced or regenerative and to ensure that products are either recyclable or “easily repaired”. Product durability will also be improved.

Target’s interim goal for this 2040 pledge is to ensure that at least two owned brands meet these circularity principles for all products by 2025. The business has trained some 2,000 staff on circular design principles, according to its most recent Corporate Responsibility Report, with the help of a new web-based training and resource hub.

There is also a new 2025 commitment to reduce the total amount of virgin plastic in own-brand packaging by 20%, through a mix of removing and reducing the weight of packaging components and sourcing recycled content. As You Sow and Green Century Capital Management had filed a shareholder proposal in May, calling on Target to strengthen its plans to reduce plastic, following successful engagement at firms including Keurig Dr Pepper, Walmart, PepsiCo and Mondelez.

While welcoming the new target and calling it “significant”, As You Sow’s senior vice president Conrad MacKerron said the organisation “would like to see Target build toward absolute cuts in plastic use across all its private brands in the future.”

Commenting on ‘Target Forward’ in its entirety, which also details new plans to “accelerate opportunity and equity” by improving community work, diversity and inclusion, the firm’s chairman and chief executive Brian Cornell said: “As a company and a member of the global community, it’s imperative for the health of both our business and our planet that we embrace new ways to move forward.

“We know sustainability is tied to business resiliency and growth, and that our size and scale can drive change that is good for all. Target Forward influences every corner of our business, deepens our collaboration with our partners and builds on our past efforts to ensure a better future for generations to come.”

Sarah George

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