The report includes information about the company's EP&L (Environmental Profit and Loss), a measurement model of the natural capital meant to offer precise information about a company's impact on the entire lifecycle of its products and its whole value chain by examining its GHG emissions and impact levels on earth, water and air.
It has examined its EP&L values for the past two years together with Sustainalize, a new generation of sustainability specialists from the Netherlands.
Scotch & Soda's sales for the year rose to €342.5 million, registering a 23% increase over the previous year, accompanied by a 34% growth in volume of materials produced.
With its EP&L rating as the centerpiece of its sustainability strategy, Scotch & Soda considers the environmental impact of its direct and indirect business activities, from raw material production to the end of a product's life cycle, translated into a monetary value. On this basis, the company assumes responsibility for a total environmental impact of €47.1 million, which represents an increase of 36% compared to the previous year.
The EP&L assessment shows that the majority of Scotch & Soda's environmental impact is caused by the selection of materials used in the collections, and occurs in the raw material production phase, mainly through greenhouse gas emissions, air pollution and water consumption.
By looking at EP&L's material intensity metric, it shows an increase of only one percent of impact per kilogram of material produced, compared to an overall absolute EP&L increase of +36%. In terms of reduction in water consumption - a key element of the company's strategy - the report shows that on average 1.4 cubic meters are required to produce 1 kilogram of material, a reduction of 5.0%, which represents a 5% reduction compared to last year's water footprint.
These steps demonstrate that Scotch & Soda's current material sourcing strategy, which continues to expand the use of organic, recycled or renewable materials, is setting measurable goals, to decouple the company's growth from its corresponding environmental impact.
Frederick Lukoff, CEO of Scotch & Soda, commented: "Sustainability has become an essential part of Scotch & Soda's strategy recently, inspired by the values of the free spirit of Amsterdam. One of our top priorities as a team is to run our business with greater sensitivity to the people and the planet by making more responsible choices that reduce our environmental footprint."
"I am pleased that this year we are seeing the first positive results of our strategy. Although we still have a long way to go, we can now measure our impact and establish a clear roadmap for the years ahead. We look forward to continuing this positive trend and further decoupling impact from sales in the future," he added.
Following the achievement of these results, in early 2023, Scotch&Soda will unveil its Long-Term Strategy that will set out a roadmap that reflects the company's greatest ambitions, as well as a set of comprehensive goals in different areas that it aims to achieve by 2030.
Jelle de Jong, Scotch & Soda's director of sustainability, explained: "We have introduced the EP&L as a core part of our sustainability strategy to gain a 360-degree understanding of our environmental footprint across the entire value chain, from cradle to grave. These insights help us, highlight maximum impact in the areas that need it most, and enable us to set measurable and time-bound targets."
And she continued: "This approach goes hand in hand with our work to ensure full traceability of products through to raw material production, and gives us the opportunity to address social and environmental challenges that meet the needs of a particular site."
Highlights of the 2021/2022 impact report referred, for instance, to the company's impact in terms of Planet impact.
Scotch & Soda increased its production of responsible garments by 80% over the previous previous year, representing 46% of total production volume.
It has also increased its share of responsible cotton alternatives to 51% of its total cotton consumption, up from 33% in the previous reporting year, and it increased its share of recycled polyester to 45% of total polyester consumption, compared to 26% last year.
As part of the company's material sourcing and design strategy, natural, renewable fibers over synthetic fibers, as evidenced by the increasing use of forest use of forest fibers, have replaced products previously made from polyester.
Synthetic fibers such as polyester are made from non-renewable resources and carry a higher risk of micro-pollution of water during the use phase. In early 2022, Scotch & Soda began using three new, promising, next generation fibers: Mycelium (from mushrooms grown in fields in Vietnam), Pyratex Element 1, obtained from Himalayan nettle, and Pyratex Element 2, another fiber obtained from banana agricultural waste.
In the next reporting year, Scotch & Soda will increase the volume of compostable Tipa poly bags to at least 2.5 million units, which will support the brand's goal of switching from conventional plastic away from conventional plastic poly bags by 2025.
Through design thinking and cross-industry collaboration, the brand has launched several projects on the cyclical running economy. For instance, it is following the principles of reuse with its Eternal Blauw collection, repair with its Blauw Repair Service and recycling as a founding member of the Denim Deal.
In this reporting year, Scotch & Soda has pledged to recycle, as part of its partnership with Trees for All to plant 178,948 trees, of which 127,614 have already been planted, both in the Netherlands as well as in other countries such as Spain, Vietnam, Uganda, Madagascar, Bolivia and Mexico.
Among various other initiatives, in 2022, Scotch & Soda also launched its Scotch & Soda x Plastic Whale boat "The Free Spirit of Amsterdam," which collected 1,250 plastic bottles in one year.