Domino’s for Good > Our Environment - Science based targets & carbon footprint
SCIENCE BASED TARGETS & CARBON FOOTPRINT
Today’s companies are increasingly expected to play a leading role in tackling climate change. Domino’s is committed to being part of the industry-wide transition to a low-carbon economy. In 2021, we committed to science-based targets to achieve net-zero emissions across our value chain by 2050.
What are Science Based Targets?
The Science Based Targets initiative is a not-for-profit initiative led by the United Nations Global Compact, the World Wildlife Fund, the World Resources Institute and CDP. The SBTi helps companies set and validate emissions-reduction targets that are consistent with climate science and aim to limit global temperature increase to 1.5 degrees Celsius above pre-industrial levels.
Measuring our carbon footprint
In FY23, we completed our second global footprint measurement using FY21 as the baseline. The footprint is calculated according to the Greenhouse Gas (GHG) Protocol and includes our impact on climate, water, land use and biodiversity. We conducted the same measurement for our corporate footprint in FY22 and our baseline year FY21. Compared to FY22, we have increased our absolute GHG emissions by 5%, due to an increase in the number of orders and the growth of our business in terms of stores, including the addition of Malaysia, Singapore and Cambodia. As we announced our intention to exit the Danish market only at the end of our financial year, we have fully included Denmark in our corporate footprint calculations.
Baseline corporate footprint results
As this is our third year in which we are calculating our corporate footprint, we are still finding gaps in our data gathering process. We understand that it usually takes a few years to get to an accurate and complete collection of actual footprint data. With our combined learning from the past two years, we know how to close our current gaps and we can build on the overall data quality and completeness that we already have in place. The increase in our absolute footprint is driven by the number of pizzas sold. FY22 showed an increase of 6% compared to FY21, and FY23 showed a 5% increase compared to FY22. Looking at our Scopes 1, 2 and 3 in FY23, we can also see that the percentages of each scope are consistent with previous years, with Scope 3 being the dominant scope, accounting for 96% of our footprint in FY23. The main hotspots in all impact categories are: • Purchased goods: production of commodity and non-commodity ingredients (dairy, meat, flour, etc.), packaging materials (corrugated cardboard, plastic food film, etc.). • Utilities: purchased energy (electricity, natural gas, water). • Logistics: inbound transport (to distribution centres), outbound transport (to restaurants), delivery to customers.
Carbon footprint
The main contributors to our carbon footprint are purchased goods (51%), utilities (29%) and logistics (14%). Our purchased goods account for 51% of our total footprint. The main drivers are dairy (cheese) at 15% and meat (beef, pork and chicken) at 21%. Other foods account for 11%. Food therefore accounts for 47% of our total footprint. As mentioned above, we currently see a distinct correlation between our growth in pizzas sold and our growth in carbon footprint. As we intend to grow our business every year, we need to avoid increasing our footprint accordingly. As part of our approved SBTi targets, we have set goals to reduce our GHG emissions per unit of product sold by 65% by 2030 and to be net zero by 2050. We intend to make fundamental changes within Domino's and across our value chain to achieve our goals. As food is our largest contributor at 47%, it is a category that requires significant change. This is why we have developed the Domino’s Dairy Initiative, which is explained in more detail in the ‘responsible sourcing’ section in the ‘Our Food’ chapter. Utilities is also a very important category, accounting for 29% of our footprint. Within the utilities, we have the ability and responsibility to not only improve our efficiency (using less electricity/water/gas per pizza sold), but also to improve the sustainable character of our use (e.g. using more ‘green’ electricity). This is part of the work of our Centre of Expertise on sustainable stores and operations. Logistics changes in our logistics footprint (14%) are the most visible changes we are making. We are electrifying our fleet. Both in our distribution (supplying our stores from our warehouses with the first electric trucks we invested in this year) and in the delivery (bringing our delicious food from store to customer). As these are very capital-intensive investments, a full replacement of our current combustion engines will not happen overnight. In APAC, we are converting all our stores to in-store doughmaking. This means that we no longer have to transport water from our commissaries to the stores. In Japan alone, this is saving 14 ton of water transport per week by end of FY23. As we have only converted 20% of our stores to in-store dough-making, this saving will increase. Not having to transport the water is saving carbon kilometers as well.
Climate roadmap and science-based targets
The Science Based Targets initiative is a not-for-profit initiative led by the United Nations Global Compact, the World Wildlife Fund, the World Resources Institute and CDP. The SBTi helps companies set and validate emissions-reduction targets that are consistent with climate science and aim to limit global temperature increase to 1.5 degrees Celsius above pre-industrial levels.
Domino’s Pizza Enterprises Ltd was selected as one of the first 10 companies in the world to have their Forest, Land and Agriculture (FLAG) targets validated. The SBTi has reviewed Domino’s targets and confirmed that our pathway to reaching them meets internationally recognised scientific standards.
Domino’s reviewed its emissions, and those in its supply chain, before planning a roadmap to reduce our carbon footprint. We found that nearly 40% of emissions came from dairy and other animal-based proteins, with the majority derived from cheese production.
To reach our ambitious goal, Domino’s is working with business partners to find ways to reduce dairy emissions without compromising on customers’ taste preferences. The Domino’s Dairy Initiative aims to reduce the environmental impact of our dairy use in an ethical and sustainable way.
Our corporate footprint baseline measurement identified three main impact areas where we can directly influence and achieve the most significant reductions in our emissions. Within our climate roadmap, we have included targets and actions for the following three impact areas:
Sustainable stores and operations
Responsible sourcing
Sustainable product innovation
For each impact area, we have identified the main actions and a phased implementation across our markets. Domino’s Global Centres of Expertise are dedicated to identifying sustainable innovations that can be implemented across our markets to reduce our environmental impact, and ensuring these solutions are viable options for our franchise partners.
Emissions reduction targets validated by the Science Based Targets initiative
Our first priority is to reduce carbon emissions for Scopes 1, 2 and 3, the three categories of greenhouse gas (GHG) emissions as defined by the GHG protocol.
In November 2021, we announced our commitment to achieving our science-based targets at our Annual General Meeting and submitted our targets to the SBTi in June 2022. Midway through the process, the SBTi invited us to be one of the first 10 companies worldwide to participate in the FLAG pilot. In June 2023, our science-based targets, including FLAG, were officially approved by the SBTi, making Domino’s one of the first companies to have specific FLAG-approved targets.
Overall net-zero target
DPE is committed to achieving net zero greenhouse gas (GHG) emissions across our value chain by FY50. Near-term 2030 targets As part of our journey to achieving net-zero emissions, we have set interim carbon reduction targets for FY31 from our FY21 baseline. These include:
Reducing our absolute Scopes 1 and 2 GHG emissions by 46.2% by FY31 from our FY21 baseline.*
Reducing our Scope 3 GHG emissions by 65% per pizza sold within the same time frame.
*The target boundary includes land-related emissions and removals from bioenergy feedstocks.
FLAG
DPE is committed to reducing its absolute Scope 3 FLAG GHG emissions by 33.3% by FY31 from our FY21 baseline.*
We also commit to zero deforestation across our primary deforestation-linked commodities with a target date of 31 December 2025.
*The target includes FLAG emissions and removals.
We have consolidated our short-term greenhouse gas reduction targets into a comprehensive goal of a 65% reduction in greenhouse gas emissions per unit of product sold by FY31, compared to our FY21 baseline. Further details of our short-term targets and key impact areas can be found in the accompanying visual representation to the right.
Long-term targets
DPE commits to reducing its absolute Scopes 1, 2 and 3 GHG emissions by 90% by FY50 from our FY21 baseline.*
*The target boundary includes land-related emissions and removals from bioenergy feedstocks.
FLAG
We also commit to reducing our Scope 3 FLAG GHG emissions by 80% by FY50 from our FY21 baseline.*
*The target includes FLAG emissions and removals.
Our overall long-term target is to achieve net zero by 2050.
WASTE REDUCTION
We are always looking for opportunities to reduce our energy consumption and choose equipment and appliances based on energy efficiency. This also includes our local stores looking for energy efficiencies with a number of initiatives.
