ESRS 2 General Disclosures

Upstream impacts on water consumption occur during either agricultural or facilities’ operational processes. For agricultural processes, the impact comes mainly from the use of water for raw material production (e.g., cotton cultivation, cattle farming for leather). For facilities’ operational processes, the impact occurs with the use of water for personal hygiene and sanitation purposes, which could lead, in severe cases, to reduced water availability for local communities.

Upstream impacts on water withdrawal occur mainly during water-intensive production processes, such as dyeing and tanning (mostly present at our Tier 2 suppliers). The combination of location and water-intensive processes could lead, in severe cases, to reduced water availability for local communities.

For adidas, the risk related to water withdrawal could be related to:
– stricter regulation in the sourcing countries, potentially leading to higher operational costs for suppliers;
– business disruption and/or reduced manufacturing capacity at our suppliers, due to the reduced availability and higher cost of water.

Upstream impacts on water discharges occur during production processes. The impact is mainly present during the dyeing and tanning phases as these are chemical and water-intensive processes, which could lead, in severe cases, to pollution of water and damage to living conditions for local communities.

For adidas, the risk related to water discharge could be related to:
– stricter regulation in sourcing countries, potentially leading to higher operating costs for suppliers and/or fines for non-compliance;
– reputational risks, if adidas is linked to claims related to damage of living conditions by local communities due to improper water discharge.