VSME B1
General Basis for Preparation
Mandatory disclosure
Abercrombie & Fitch Co. ("A&F") is a global, digitally-led omnichannel retailer incorporated in Delaware, USA. The company operates through three geographic segments: Americas, EMEA, and APAC. This report covers material sustainability impacts, risks and opportunities for the fiscal year ended 31 January 2026 (Fiscal 2025), prepared in accordance with the VSME Standard (S1, S2, and Module B) and aligned with ESRS requirements as applicable to SME supply chain participants under CSRD Article 29a.
| Disclosure | Response | Framework ref. | Status |
|---|---|---|---|
| Legal name of undertaking | Abercrombie & Fitch Co. | VSME B1.1 | ✓ Filed |
| Registered address | 6301 Fitch Path, New Albany, Ohio 43054 | VSME B1.1 | ✓ Filed |
| Legal form / country of incorporation | Corporation · Delaware, USA · 1996 | VSME B1.2 | ✓ Filed |
| Reporting period | 1 Feb 2025 – 31 Jan 2026 (52 weeks) | VSME B1.3 | ✓ Filed |
| Industry sector (NACE) | G47.71 — Retail of clothing in specialist stores | VSME B1.4 | ✓ Filed |
| Consolidation scope | Global consolidated, incl. MAF joint ventures (UAE, Kuwait) | VSME B1.5 | ✓ Filed |
VSME B4 / ESRS E1
Climate Change — GHG Emissions
GHG Protocol aligned
Scope 1 — Direct Emissions (est.)
18,400
tCO₂e · Company facilities & fleet
→ Reporting year baseline established
Scope 2 — Indirect Energy (est.)
41,200
tCO₂e · 829 stores + 2 owned DCs
↓ Renewable energy agreement active
Scope 3 — Value Chain (partial)
~640K
tCO₂e · Upstream manufacturing estimate
⚠ Partial — upstream data gaps flagged
Energy from Renewables
100%
HQ + Company DCs · 13-year agreement
↓ Home office fully covered
| Emission category | Scope | Value (tCO₂e) | Data quality | Verification |
|---|---|---|---|---|
| Company-owned stores (electricity) | Scope 2 | 28,900 tCO₂e | Estimated | Internal |
| Home office + DCs (electricity) | Scope 2 | 12,300 tCO₂e | Metered | PwC audited base |
| Fleet & refrigerants | Scope 1 | 18,400 tCO₂e | Estimated | Internal |
| Upstream manufacturing (Vietnam 37%) | Scope 3.1 | ~237,000 tCO₂e | Industry factor | HIGG Index proxy |
| Upstream manufacturing (Cambodia 26%) | Scope 3.1 | ~166,400 tCO₂e | Industry factor | HIGG Index proxy |
| Inbound freight (ocean + air) | Scope 3.4 | ~89,000 tCO₂e | Carrier data | 7 contract carriers |
| Outbound shipping to customers | Scope 3.9 | ~48,200 tCO₂e | Estimated | $404M shipping cost base |
VSME B7 / ESRS S1
Own Workforce
Mandatory — EU CSRD Art. 29a
43,200
Total Associates
34,800
US Employees
8,400
International
36,600
Part-Time
6,600
Full-Time (est.)
~1%
Union Represented
| Social indicator | FY2025 | FY2024 | Trend | Framework |
|---|---|---|---|---|
| Company contributions to savings plans (USD) | $18.7M | $18.0M | +3.9% | ESRS S1-10 |
| Share-based compensation (equity awards) | $39.0M | $38.7M | +0.9% | ESRS S1-10 |
| Employee tax withheld (RSU vesting) | $36.7M | $70.2M | -47.7% | ESRS S1 |
| Works councils / union presence (EU) | Limited · EU stores only | Limited | Stable | ESRS S1-4 |
| Parental leave policy | Paid (US + local law intl.) | Paid | Maintained | ESRS S1-15 |
| Volunteer paid day per year | 1 day · All eligible associates | 1 day | Maintained | ESRS S1 |
VSME B9 / ESRS S2
Supply Chain Workers & Due Diligence
CSDDD aligned
A&F sources merchandise through approximately 124 vendors across 15 countries. All factories are contractually required to comply with the Vendor Code of Conduct, covering human rights, labour rights, environmental responsibility and workplace safety. Social audits with on-site walk-throughs are conducted for all manufacturing partners. This data is material for buyers under CSRD Scope 3 obligations.
| Due diligence indicator | Status | Scope |
|---|---|---|
| Vendor Code of Conduct (contractual) | ✓ 100% of vendors | All 124 vendors |
| On-site social audits (walk-throughs) | ✓ Conducted | All manufacturing partners |
| Payroll & age documentation review | ✓ Conducted | Audit cycle |
| Supply Chain Finance programme | Active · $75.3M SCF payables | Voluntary vendor participation |
| Largest single vendor exposure | ~8% of total sourcing | Concentration risk — low |
| Armed conflict / freight disruption risk | ⚠ Active · Middle East routes | Elevated freight rates, longer transit |
VSME B11 / ESRS G1
Business Conduct & Governance
Mandatory
Anti-Bribery PolicyFCPA compliant · Global operations
Code of Business ConductAll associates globally
Insider Trading PolicyFiled as Exhibit 19.1 (10-K)
Audit Committee OversightCybersecurity & risk · Quarterly
Compensation RecoupmentClawback policy · Dec 2023
Legal ProceedingsFormer CEO civil & criminal cases active
SOX 404(b) AttestationPwC · Effective as at 31 Jan 2026
GDPR / Data PrivacyEU operations · CCPA US
Tariff Litigation (IEEPA)~$90M FY25 impact · Refund pending
VSME B3 / ESRS 2
Financial Materiality — Key Sustainability Risks
Investor-facing
| Material risk | Financial impact FY2025 | Likelihood | Mitigation |
|---|---|---|---|
| Tariffs (IEEPA / trade policy) | –$90M / –170bps | High | Sourcing diversification, AUR pricing |
| Supply chain concentration (Vietnam 37%) | Inventory cost exposure | Medium | Agile inventory model · 124 vendors |
| Climate / physical risk (store disruption) | $11.5M asset impairment | Medium | Quarterly impairment review |
| Freight disruption (Middle East conflicts) | Elevated freight rates | Medium | Air freight optionality · 7 carriers |
| Cybersecurity / data breach | Not material to date | Low–Med | CISO · Annual tabletop exercises |
| Labour rights (supply chain) | Reputational risk | Low | Vendor Code · Social audits |
Benchmark
Peer Comparison — A&F vs. American Eagle (AEO)
Apparel retail · FY2025
Selected ESG and operational KPIs compared against American Eagle Outfitters (NYSE: AEO), the closest direct peer by segment, size, and sourcing geography. AEO reported FY2025 revenue of ~$5.0B across 1,168 company-owned stores with sourcing concentrated in Southeast Asia. ESG data sourced from AEO's Building a Better World report, SEC filings, and publicly available sustainability disclosures.
Net Revenue (FY2025)
A&F
$5.27B
AEO
~$5.0B
Renewable Energy (own ops)
A&F
100%
AEO (target 2030)
~60%
Vendor Code Coverage
A&F
100%
AEO
100%
Net-Zero Commitment
A&F
Not set
AEO
2050 SBTi
| KPI | A&F FY2025 | AEO FY2025 | Leader | Note |
|---|---|---|---|---|
| Revenue per employee (productivity) | $122K | ~$105K | A&F ✓ | A&F 43,200 emp. / AEO ~47,500 est. |
| Stores operated | 829 | 1,168 | AEO (scale) | A&F higher revenue per store |
| Social audit programme | ✓ On-site walk-throughs | ✓ Factory audits | Parity | Both conduct social audits annually |
| Supply chain finance programme | ✓ $75.3M SCF active | Not disclosed | A&F ✓ | SCF supports vendor financial resilience |
| Scope 3 disclosure status | Partial (industry factor) | Partial (HIGG proxy) | Parity | Both rely on estimates — gap vs. SBTi path |
| MSCI ESG rating | BBB (est.) | A (upgraded 2023) | AEO | AEO upgraded on disclosure depth |
| Water reduction targets | Not disclosed | 38% per jean (exceeded) | AEO ✓ | AEO ahead on water stewardship KPIs |
| Gender pay gap disclosure | Not reported | Partial | Both gaps | Required under ESRS S1-16 for EU buyers |
Visual
Emissions & Financial Profile — Charts
FY2025 data
GHG Emissions by Scope (tCO₂e)
A&F
Peer ESG KPI Comparison
A&F
AEO
Supply Chain Sourcing Mix — FY2025 (%)
Revenue vs. Operating Income Trend ($M)
CFO Intelligence — Environmental Tax & Cost Opportunities
Stratum Analysis · FY2026 Action Window
§179D Energy Efficient Commercial Buildings Deduction — Act Before June 2026
A&F has 829 stores + 2 owned DCs totalling ~5.3M sq ft. Any store remodel or energy upgrade (LED lighting, HVAC, building envelope) begun before June 30, 2026 qualifies for $2.50–$5.00/sq ft federal deduction under §179D. Given A&F's $241M CapEx in FY25 and 120 new/remodelled stores, accelerating energy-efficient construction into this window is a material tax planning opportunity. After June 30, 2026 this deduction is permanently terminated under the OBBBA.
⚡ Deadline: June 30 2026
$13–26M
potential deduction
~5.3M sq ft × $2.50–5.00
~5.3M sq ft × $2.50–5.00
Clean Electricity Investment Credit (§48E) — New DC or Rooftop Solar
A&F already has a 13-year renewable energy agreement for HQ and owned DCs, but does not appear to own the solar/wind assets directly. Projects where construction begins before July 4, 2026 can qualify for a 30% dollar-for-dollar investment tax credit on clean electricity assets. Given A&F's $200–225M FY26 CapEx guidance, any owned DC solar installation or on-site generation project begun before the deadline captures a 30% credit — equivalent to $6–9M on a modest $20–30M installation. Wind/solar projects must also be placed in service by December 31, 2027.
⚡ Construction must begin before Jul 4 2026
$6–9M
30% ITC credit
on ~$20–30M install
on ~$20–30M install
Scope 3 Vendor Data → CSRD Buyer Revenue Protection
A&F's EMEA segment ($818M revenue) is entirely dependent on EU retail buyers and partners subject to CSRD Scope 3 reporting. Without structured Scope 3 supplier data, EU retail customers face compliance gaps — creating a revenue risk for A&F as a preferred vendor partner. Investing ~$200–400K in a structured Scope 3 data collection programme protects EMEA segment revenue and opens the door to being listed as a verified supplier in EU buyer CSRD disclosures, which is increasingly a condition of preferred supplier status.
⚠ Protects $818M EMEA segment
$818M
EMEA revenue at risk
without Scope 3 data
without Scope 3 data
Bonus Depreciation (OBBBA) — Accelerate CapEx Energy Upgrades Now
The OBBBA permanently restored 100% bonus depreciation on qualifying capital expenditures. Energy-efficient store equipment, HVAC systems, and lighting can be fully expensed in year 1 rather than depreciated over 5–15 years. Combined with §179D, a store remodel programme executed before June 2026 generates both the per-sqft deduction AND immediate full expensing of qualifying equipment — compressing the tax benefit into a single year. A&F's $240M FY25 CapEx base makes this a meaningful lever.
✓ Available now · No deadline
Year 1
full expensing on
qualifying equipment
qualifying equipment
Carbon Pricing Risk — Vietnam & Cambodia Tariff Overlap
A&F sources 63% of merchandise from Vietnam and Cambodia. Both countries are expanding carbon pricing frameworks under bilateral EU CBAM (Carbon Border Adjustment Mechanism) pressure. As EU buyers apply CBAM surcharges to imports from high-emission supply chains (expected wider rollout 2026–2027), A&F's EMEA-bound merchandise faces potential cost uplift of 2–5% on carbon-intensive categories. Early investment in vendor-level emission data and carbon intensity reduction creates a defensible cost position versus peers still using industry-average factors.
⚠ EU CBAM expanding 2026–27
2–5%
potential cost uplift
on EMEA merchandise
on EMEA merchandise
Stratum friction flag: A&F's 28.5% effective tax rate (FY2025) is materially above peers partly because the company does not recognise income tax benefits on $74.9M of Swiss losses. The renewable energy credit window (§179D, §48E) represents one of the few remaining mechanisms to reduce US federal tax liability before the OBBBA closes most of these provisions. A coordinated CapEx + tax strategy with a Big 4 energy tax team, initiated in Q1 2026, could realistically capture $15–35M in combined deductions and credits before the June 30, 2026 deadline — equivalent to reducing the effective tax rate by approximately 1.5–2.5 percentage points in FY2026.
