Kering: Environmental Profit and Loss (EP&L) accounting

Kering is a pioneer in Natural Capital assessment having created Environmental Profit and Loss (EP&L) accounting to measure, monetize and manage our environmental impacts in our own operations and across the entire supply chain. 

The EP&L analysis reveals the true impacts resulting from Kering’s business activities and helps us find effective solutions to mitigate our footprint.  In turn, this allows us to better address climate change and develop more resilient business models, as well as providing transparency to our stakeholders along the way.

Aligned with our open-sourcing philosophy, Kering’s EP&L methodology contributed to the Natural Capital Protocol development. Making it open-source aims to help advance the inclusion and adoption of Natural Capital accounting into mainstream decision-making and corporate reporting.

Kering also developed an easy to use tool, the "My EP&L" App, to assist the fashion community in understanding how design decisions influence the extent of environmental impacts such as material choices, sourcing regions, etc. 

Natural Capital Protocol used
  • Yes
Impact drivers assessed
  • Fresh water ecosystem use e.g. wetlands, ponds, rivers
  • GHG emissions e.g. volume of CO2, CH4, N2O, SF6, HFCs and PFCs etc.
  • Impact on biodiversity e.g. impact on species, ecosystems, habitats or genetic diversity
  • Marine ecosystem use e.g. area of aquaculture by type
  • Non-GHG air pollutants e.g. PM2.5, PM10, VOCs, NO, NO2, SO2, CO, etc.
  • Other resource use e.g. volume of minerals extracted, volume of wild fish caught by species
  • Soil pollutants e.g. volume of waste matter discharges and retained in soil over a given period
  • Solid waste e.g. volume of waste by classification, materials constituents or disposal method
  • Terrestrial ecosystem use e.g. area of agriculture by type, area of forest plantation by type
  • Water pollutants e.g. volume discharged to receiving water body
  • Water use e.g. volume of ground- or surface water consumed
Organizational Focus
  • Corporate
  • Project
  • Product
Valuation Type
  • Quantitative
  • Monetary
  • Value to business
  • Value to society
Geographical Scope
Dependencies assessed
  • Biodiversity
  • Energy e.g. solar, wind, hydro, geothermal, biofuel, fossil fuel
  • Knowledge e.g. information from nature such as biomimicry
  • Materials e.g. wood fiber, genetic resources, metals, minerals, plant and animal materials
  • Regulation of biological environment e.g. pollination, crop pest control
  • Regulation of physical environment e.g. flood attenuation, water quality regulation
  • Regulation of waste and emissions e.g. waste assimilation, noise and dust regulation
  • Water e.g. fresh or sea water
  • Well-being and spiritual/ethical values e.g. employee satisfaction and stress release, sacred sites and indigenous traditions
Value Chain Boundary
  • Direct operations
  • Upstream
  • Downstream

Key findings

Kering publishes our Group EP&L on an annual basis. The EP&L is used as a day-to-day decision-making tool and is fully embedded into the business.

Among the lessons learned and key findings, Kering’s EP&L revealed that 93% of our impacts lie in the supply chain and, in particular, from the production and processing of raw materials which together represent 72% of the total. Our own operations represent only 7% of the impacts.  Accordingly, Kering shifted focus to finding innovative solutions and leveraging changes across the supply chain, as well as avoiding high impact sources due to an increased transparency via the EP&L. Kering is currently expanding our natural capital accounting work to assess biodiversity and also linking natural capital accounting to Planetary Boundaries.