Despite Anta's recent efforts in the ESG field, there is still a large room for improvement
The 2nd United Nations Sustainable Development Goals (SDGs) Summit was held in September 17, 2023, at the United Nations Headquarters in New York. This summit represents the highest-level United Nations event in the field of sustainable development. As a prominent representative of China's sporting goods industry, Anta Sports (2020:HK) has pledged its commitment to the "Business in Action - Consensus on Sustainable Industrial Development" initiative, and its related practices have also been recognized as exemplary cases within this initiative.
Founded in 1991, Anta Sports is a renowned global sporting goods company with a diversified brand portfolio, including Anta, FILA, DESCENTE and KOLON SPORT. The company has consistently published its ESG report for eight consecutive years since 2015, showcasing its dedication to sustainable practices.
Wu Yonghua, Executive Director and Co-CEO of Anta Sports, attended the Official Theme Side Event with the theme of “Industrial Sustainable Innovation 2023”. Mr. Wu shared Anta's strategies, achievements and insights on ESG practices, and as the representative of the participating enterprises, he also engaged in discussions and exchanged views with UN Under-Secretary-General Mr. Li Junhua.
The first batch of Chinese enterprises to sign the initiative pledged to take practical actions to promote high-quality development in support of the UN's 2030 Agenda for Sustainable Development, and committed to the 10 principles of sustainable development. These principles include incorporating sustainable development goals into business strategies, daily operations and organizational culture; encouraging the development, upgrading and promoting environmental-friendly technologies and innovations; reducing greenhouse gas emissions and significantly increasing the use of renewable energy; enhancing the full lifecycle management of chemicals and waste; and eliminating inequality within their organizations to promote inclusive development, among others.
The initiative is supported by the Sustainable China Industry Development Action, which invites outstanding Chinese enterprises with industry representation to join the initiative. It aligns with the United Nations' 2030 Agenda for Sustainable Development and demonstrates the firm commitment of the Chinese business entities in taking on international responsibilities.
Wu Yonghua pointed out that sustainable development strategy is one of Anta's core strategies. The company has set clear strategic goals of achieving carbon neutrality by 2050, with sustainable development practices centering on 3 cores and 1 high standard. Specifically speaking, the "3 cores" refers to developing innovative green and low-carbon products, building a green supply chain, and promoting biodiversity conservation, and fulfilling social responsibilities. The "1 high standard" involves joining the United Nations Global Compact and other international sustainable development organizations to promote sustainability with the highest standards.
According to Wu Yonghua, Anta Sports has established a comprehensive ESG strategy implementation system. The company’s Board of Directors has formed a Sustainability Development Committee, creating a closed-loop of ESG practice management. From 2015 to 2022, while achieving a nearly 400% increase in revenue, Anta reduced greenhouse gas emission intensity (per million yuan of revenue) by more than 40%, and decreased water consumption by 22%.
On the production side, the company's self-owned factories have completely phased out the use of coal and are transitioning to cleaner energy at full speed. According to the S&P Global Corporate Sustainability Assessment, Anta ranked ahead of 87% of its global peers among some 160 global textile, apparel and luxury brand companies.
Three major initiatives to create a green supply chain
While reducing its own carbon footprint, Anta is also upgrading its green supply chain management system. The company collaborates with core suppliers to manage carbon emissions, promote clean energy applications and renewable energy layouts. By raising admission standards, conducting responsibility audits, and empowering suppliers, Anta is working on building an environmentally friendly, healthy, safe and efficient supply chain symbiosis platform .
Since 2022, Anta Sports has organized more than 60 ESG-related training sessions and seminars, empowering over 90% of its suppliers to improve their social responsibility and environmental data management capabilities. In addition, 50% of the company's strategic suppliers have installed photovoltaic clean energy. Anta's goal is to achieve a leading global standard in supply chain sustainability management by 2030, with core suppliers reducing water consumption by 2.5% and carbon emissions by 5.5% annually.
However, according to the latest ESG rating report released by MSCI, Anta's ESG rating has been downgraded to B grade this year, which is at the "laggard" level. Despite Anta's recent efforts in the ESG field, there is still a large room for improvement, particularly in five key areas such as corporate governance, supply chain labor standards, product carbon footprint, raw material procurement, and chemical safety.