Volume 6—Multiline and Specialty Retailers & Distributors

Title: Volume 6—Multiline and Specialty Retailers & Distributors

Category: Part B—Industry-based Guidance for IFRS S2

Source: IFRS Foundation (https://www.ifrs.org)

Navigator: https://www.ifrs.org/issued-standards/ifrs-sustainability-standards-navigator/sustainability-pdf-collection/

Model: https://www.ifrs.org/content/ifrs/home/issued-standards/ifrs-sustainability-standards-navigator/sustainability-pdf-collection/jcr:content/root/responsivegrid_1242322373/standarddocument.model.json

PDF: https://www.ifrs.org/content/dam/ifrs/publications/pdf-standards-issb/english/2023/issued/part-b/ifrs-s2-ibg-volume-6-multiline-and-specialty-retailers-and-distributors-part-b.pdf?bypass=on

Year: 2023

Type: Industry

Industry-based Guidance on implementing

Climate-related Disclosures

Volume 6—Multiline and Specialty Retailers & Distributors

June 2023

IFRS S2

IFRS

® Sustainability Disclosure Standard

International Sustainability Standards Board

This Industry-based Guidance accompanies IFRS S2 Climate related Disclosures (published

June 2023; see separate booklet) and is issued by the International Sustainability

Standards Board (ISSB).

Disclaimer: To the extent permitted by applicable law, the ISSB and the IFRS Foundation

(Foundation) expressly disclaim all liability howsoever arising from this publication or

any translation thereof whether in contract, tort or otherwise to any person in respect of

any claims or losses of any nature including direct, indirect, incidental or consequential

loss, punitive damages, penalties or costs.

Information contained in this publication does not constitute advice and should not be

substituted for the services of an appropriately qualified professional.

Reproduction and use rights are strictly limited to personal non-commercial use, such as

corporate disclosure.

Any other use, such as – but not limited to – reporting software, investment analysis,

data services and product development is not permitted without written consent. Please

contact the Foundation for further details at sustainability_licensing@ifrs.org.

The Foundation has trade marks registered around the world (Marks) including ‘IAS®’,

‘IASB®’, the IASB® logo, ‘IFRIC®’, ‘IFRS®’, the IFRS® logo, ‘IFRS for SMEs®’, the IFRS for SMEs®

logo,

‘International

Accounting

Standards®’,

‘International

Financial

Reporting

Standards®’, the ‘Hexagon Device’, ‘NIIF®’, ‘SIC®’ and SASB®. Further details of the

Foundation’s Marks are available from the Foundation on request.

The Foundation is a not-for-profit corporation under the General Corporation Law of the

State of Delaware, USA and operates in England and Wales as an overseas company

(Company number: FC023235) with its principal office in the Columbus Building, 7

Westferry Circus, Canary Wharf, London, E14 4HD.

IFRS S2 CLIMATE-RELATED DISCLOSURES–JUNE 2023

Introduction

This volume is part of the Industry-based Guidance on Implementing IFRS S2 Climate-related

Disclosures. This guidance suggests possible ways to apply some of the disclosure requirements in

IFRS S2 but does not create additional requirements.

This volume suggests possible ways to identify, measure and disclose information about

climate-related risks and opportunities that are associated with particular business

models, economic activities and other common features that characterise participation in

this industry.

This industry-based guidance has been derived from Sustainability Accounting Standards

Board (SASB) Standards, which are maintained by the International Sustainability

Standards Board (ISSB). The metric codes used in SASB Standards have been included for

ease of reference. For additional context regarding the industry-based guidance contained

in this volume, including structure and terminology, application and illustrative

examples, refer to Section III of the Accompanying Guidance to IFRS S2.

IFRS S2 INDUSTRY-BASED GUIDANCE

Volume 6—Multiline and Specialty Retailers & Distributors

Industry Description

The Multiline and Specialty Retailers & Distributors industry encompasses a variety of

retailing categories such as department stores, mass merchants, home products stores

and warehouse clubs, as well as a smaller segment of distributors like electronics

wholesalers and automotive wholesalers. These entities (except for the distribution

segment) commonly manage global supply chains to anticipate consumer demands, keep

costs low and keep products stocked in their brick-and-mortar storefronts. This is a

highly competitive industry in which each category generally has a small number of

important players characterised by generally low margins. The relatively substitutable

nature of retail makes entities in this industry especially susceptible to reputational risks.

Note: Separate standards exist for the Food Retailers & Distributors (FB-FR), Drug Retailers

(HC-DR), E-Commerce (CG-EC) and Apparel, Accessories & Footwear (CG-AA) industries.

Retail entities involved in food or drug retail, e-commerce, or apparel, accessories and

footwear manufacturing should also consider the disclosure topics and metrics outlined

in these other standards.

Sustainability Disclosure Topics & Metrics

Table 1. Sustainability Disclosure Topics & Metrics

TOPIC

METRIC

CATEGORY

UNIT OF

MEASURE

CODE

Number of: (1) retail locations and (2) distribution centres Quantitative Number CG-MR-000.A Total area of: (1) retail space and (2) distribution centres Quantitative Square metres (m²) CG-MR-000.B Energy Management in Retail & Distribution Topic Summary Entities in this industry require significant amounts of energy for retail facilities and warehouses. An increasing number of greenhouse gas (GHG) emissions regulations and incentives for energy efficiency and renewable energy may result in price increases for conventional electricity sources while making alternative sources more cost-competitive.

Fossil fuel-based energy production and consumption contribute to significant environmental impacts, including climate change and pollution. Energy sourcing decisions can create trade-offs related to energy supply costs and operational reliability.

Overall energy efficiency and access to alternative energy sources are becoming increasingly important for entities to manage. Efficiency in this area can have financial IFRS S2 CLIMATE-RELATED DISCLOSURES–JUNE 2023© IFRS Foundation 3

implications through direct cost savings, which are particularly beneficial in this low-margin industry.

Metrics CG-MR-130a.1. (1) Total energy consumed, (2) percentage grid electricity and

(3) percentage renewable 1 The entity shall disclose (1) the total amount of energy it consumed as an aggregate figure, in gigajoules (GJ).

1.1

The scope of energy consumption includes energy from all sources,

including energy purchased from external sources and energy produced by the entity itself (self-generated). For example, direct fuel usage, purchased electricity, and heating, cooling and steam energy are all included within the scope of energy consumption.

1.2

The scope of energy consumption includes only energy directly consumed by the entity during the reporting period.

1.3

In calculating energy consumption from fuels and biofuels, the entity shall use higher heating values (HHV), also known as gross calorific values (GCV), which are measured directly or taken from the Intergovernmental Panel on Climate Change (IPCC).

2 The entity shall disclose (2) the percentage of energy it consumed that was supplied from grid electricity.

2.1

The percentage shall be calculated as purchased grid electricity consumption divided by total energy consumption.

3 The entity shall disclose (3) the percentage of energy it consumed that was renewable energy.

3.1

Renewable energy is defined as energy from sources that are replenished at a rate greater than or equal to their rate of depletion, such as geothermal, wind, solar, hydro and biomass.

3.2

The percentage shall be calculated as renewable energy consumption divided by total energy consumption.

3.3

The scope of renewable energy includes renewable fuel the entity consumed, renewable energy the entity directly produced and renewable energy the entity purchased, if purchased through a renewable power purchase agreement (PPA) that explicitly includes renewable energy certificates (RECs) or Guarantees of Origin (GOs), a Green‐e Energy Certified utility or supplier programme, or other green power products that explicitly include RECs or GOs, or for which Green‐e Energy Certified RECs are paired with grid electricity.

3.3.1

For any renewable electricity generated on-site, any RECs and GOs shall be retained (not sold) and retired or cancelled on behalf of the entity for the entity to claim them as renewable energy.

3.3.2

For renewable PPAs and green power products, the agreement shall explicitly include and convey that RECs and GOs be retained or replaced and retired or cancelled on behalf of the entity for the entity to claim them as renewable energy.

3.3.3

The renewable portion of the electricity grid mix that is outside of the control or influence of the entity is excluded from the scope of renewable energy.

3.4

For the purposes of this disclosure, the scope of renewable energy from biomass sources is limited to materials certified to a third-party standard (for example, Forest Stewardship Council, Sustainable Forest Initiative,

Programme for the Endorsement of Forest Certification or American Tree Farm System), materials considered eligible sources of supply according to the Green-e Framework for Renewable Energy Certification, Version 1.0 (2017) or Green-e regional standards, or materials eligible for an applicable jurisdictional renewable portfolio standard.

4 The entity shall apply conversion factors consistently for all data reported under this disclosure, such as the use of HHVs for fuel usage (including biofuels) and conversion of kilowatt hours (kWh) to GJ (for energy data including electricity from solar or wind energy).

6© IFRS Foundation Columbus Building 7 Westferry Circus Canary Wharf London E14 4HD, UK Tel+44 (0) 20 7246 6410 Email sustainability_licensing@ifrs.org ifrs.org International Financial Reporting Standards®, IFRS Foundation®,

IFRS®, IAS®, IFRIC®, SIC®, IASB®, ISSBTM, IFRS for SMEs®