Scope 3 Greenhouse Gas (GHG) Emissions Methodology

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A.1 Methodological Framework

The Company’s Scope 3 greenhouse gas (GHG) inventory was prepared in accordance with the GHG Protocol Corporate Value Chain (Scope 3) Accounting and Reporting Standard. Scope 3 emissions include indirect emissions that occur across the Company’s value chain but are not included in Scope 1 (direct emissions) or Scope 2 (purchased electricity).

Given the Company’s brand‑led, asset‑light business model and outsourced manufacturing structure, Scope 3 emissions represent the majority of total greenhouse gas emissions, consistent with apparel and accessories industry norms.

The Company prioritizes conservative assumptions and avoids overstating emissions reductions when primary supplier data is unavailable.

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A.2 Organizational and Operational Boundaries

The Scope 3 inventory includes emissions associated with activities occurring during the reporting year that are attributable to the Company’s value chain, including:

• Outsourced product manufacturing
• Raw material extraction and processing
• Upstream transportation and distribution
• Corporate operations not directly owned or controlled by the Company

The Company does not own or operate manufacturing facilities. Production is carried out by third‑party suppliers located in India, China, Vietnam, and the United States. The Company operates a single corporate headquarters in the United States and distributes products in approximately 10 countries.

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A.3 Scope 3 Categories Included

The following Scope 3 categories were identified as material and included in the inventory:

Category 1: Purchased Goods and Services

Includes emissions associated with:

• Raw material production (cotton, recycled polyester, and other materials)
• Fabric and component manufacturing
• Cut, sew, assembly, and finishing at third‑party factories

Category 1 represents the largest share of total Scope 3 emissions, consistent with apparel lifecycle assessments.

Category 4: Upstream Transportation and Distribution

Includes emissions from:

• Ocean freight (approximately 80% of inbound freight)
• Inland trucking and last‑mile transportation

Air freight was assumed to be negligible during the reporting year.

Category 5: Waste Generated in Operations

Includes emissions from office waste disposal, estimated using industry‑average emission factors.

Category 6: Business Travel

Includes emissions from employee business travel, estimated using distance‑based emission factors where detailed activity data was unavailable.

Category 7: Employee Commuting

Includes emissions associated with employee commuting, estimated using employee headcount and regional average commuting data.

Other Scope 3 categories were evaluated and excluded where deemed immaterial or where reliable data was unavailable.

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A.4 Product Volume, Materials, and Trims

 

Material composition (weighted average across production):

• 50% cotton
  • Of which approximately 20% is certified organic cotton
• 40% recycled polyester
• 10% other materials

All materials used in production are 100% REACH‑compliant, ensuring conformity with European chemical safety requirements. REACH compliance was treated as a regulatory and risk‑management measure and was not used to adjust greenhouse gas emission calculations.

Approximately 50% of products incorporate bluesign®‑certified buckles. While this certification demonstrates strong environmental and chemical management practices, no direct emissions reduction was applied due to limited product‑specific carbon intensity data for trims.

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A.5 Supplier Energy and Renewable Electricity

Approximately 60% of total production volume was manufactured at a supplier facility operating primarily on solar‑generated electricity.

To reflect this:

• Manufacturing electricity emissions for this portion of production were adjusted to account for substantially lower grid electricity emissions.
• Thermal energy use (e.g., steam or process heat) was conservatively assumed to remain unchanged unless supplier‑specific data was available.

Manufacturing energy (electricity and thermal) was conservatively estimated to represent approximately 20–30% of total product‑level emissions, consistent with apparel lifecycle analysis literature.

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A.6 Sustainable Material Adjustments

Recycled Polyester

Recycled polyester was modeled as having approximately 50% lower greenhouse gas emissions than virgin polyester, based on industry‑accepted lifecycle assessments. This adjustment was applied only to the polyester portion of materials and only to the portion of production verified to include recycled polyester.

Organic Cotton

Certified organic cotton, representing approximately 20% of total production volume, was conservatively modeled as achieving a 20–30% reduction in emissions relative to conventional cotton. This reflects lower synthetic fertilizer use and reduced field‑level emissions.

No emissions reductions were applied to conventional cotton or other materials beyond verified sustainability attributes.

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A.7 Packaging and Printed Materials

The Company eliminated the use of single‑use plastic poly bags for product shipping across 100% of production. Emissions associated with poly bag material production were therefore excluded from the Scope 3 inventory.

All product hangtags are produced using:

• 100% FSC‑certified paper
• Vegetable‑based printing inks

Reductions associated with FSC‑certified paper sourcing were conservatively included. Vegetable‑based inks were acknowledged as an environmental best practice but were not materially adjusted due to their relatively minor greenhouse gas contribution.

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A.8 Corporate Operations and Work‑From‑Home Policy

The Company operates under a work‑from‑home policy, significantly reducing emissions associated with:

• Employee commuting
• Office energy consumption

Corporate electricity consumption is minimal and was estimated based on a small office footprint located in Seattle, Washington, using regionally appropriate grid emission factors.

No Company‑owned vehicles are operated.

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A.9 Emission Factors and Data Sources

Emissions calculations were based on:

• Industry‑average lifecycle emission factors for textiles and apparel
• Material‑specific emission intensities aligned with commonly used apparel LCA datasets
• Mode‑specific freight emission factors for ocean and truck transport
• Regional electricity grid emission factors where applicable

Supplier‑specific renewable electricity data was incorporated where available. In the absence of primary data, secondary data and conservative assumptions were applied in line with GHG Protocol guidance.

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A.10 Conservatism, Data Quality, and Uncertainty

The Scope 3 inventory incorporates a combination of:

• Estimated activity data (production volumes, material mixes)
• Secondary emission factors
• Limited supplier‑specific information

Reported Scope 3 emissions are therefore subject to an estimated uncertainty range of ±20–30%, which is consistent with first‑cycle apparel and accessories inventories.

The Company applies a conservative methodology and avoids applying emissions reductions for certifications or practices primarily addressing chemical safety, regulatory compliance, or governance unless supported by quantitative carbon intensity data.

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A.11 Exclusions and Limitations

The following limitations apply:

• Supplier thermal energy data was not available for all facilities
• Product end‑of‑life emissions were excluded due to customer behavior uncertainty
• No market‑based carbon credits or offsets were used to reduce reported emissions

All reductions reflect structural supply‑chain characteristics, not offsetting mechanisms.

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A.12 Future Improvements

The Company intends to enhance data quality and Scope 3 accuracy by:

• Expanding supplier‑specific energy and emissions reporting
• Increasing traceability of recycled and certified materials
• Refining product‑level emission factors by category
• Evaluating additional renewable energy adoption across suppliers