SUSTAINABILITY GOALS

Sustainability Goals

OUR JOURNEY SO FAR

12 Gallons

The average amount of
water saved per pair of
jeans, compared to past
denim production.

100%

of eligible denim factories
now recycle their water.

62%

of our cotton comes
from more sustainable
sources.

23%

of the energy used for our
operations came from
renewable sources.

WATER LEADERSHIP

Reduce water use in our jeans production by 30%

Any water leaving our factories does not pollute the environment

Increase the amount of water being recycled by our laundries to 50%

Sustainable Denim Washing
Garment finishing and washing is the last step in the manufacturing process to give our jeans the final look our customers love. We are working with key laundries to implement new technologies and equipment that dramatically decrease the overall water needs for this type of processing.

Our laundries have installed new washing machines that use a fraction of the water used by conventional washers, as well as others technologies such as lasers and ozone. Many of our laundries are using Jeanologia’s environmental impact monitoring (EIM) software as an initial step towards measuring and building more sustainable processes. The EIM software assesses the environmental impact of the garment finishing process in four areas: water consumption, energy consumption, chemical use, and worker health.

AEO’s Water Leadership Program
Apparel production involves a large quantity of water and needs to be treated properly. In 2013, we launched the AEO Wastewater Management Standard to provide factories with guidance on how to properly manage water and make sure that water is safe before it is discharged.

In 2017 we launched the Water Leadership Program with our denim factories. This program sets expectations for our factories on wastewater, water reduction, water recycling and chemical management. Each year, our expectation increase as we work with our factories toward meeting our overall water goals. Factories that meet our requirements receive higher scores on our vendor scorecard and are prioritized for receiving business.

Through this program, we have decreased the water used per jean by 36%, and ensured all active denim laundries with onsite wastewater treatment are using recycled water back to production processes, with an average water-recycling rate of 44%. With these efforts, our factories have saved over one billion gallons of fresh water a year. From 2018, we have expanded the program to cover strategic denim and woven mills.

Chemical Management
AEO is committed to reducing the use and impact of harmful substances in our global supply chain. As part of that commitment, we maintain a Product Restricted Substance List (RSL), which is a dynamic document that is updated semi-annually based on changes in global legislation and corporate requirements.

Our suppliers are required to follow our RSL as part of their Master Purchase Agreement, and we validate compliance with regular audits. We work closely with a third party accredited lab for expert regulatory advice and updates. We also monitor high-risk chemicals of concern in the industry with our third party accredited lab, industry groups such as AAFA, AFIRM Group, and RILA, and monitor Prop 65 notices in CA. We recently made the decision to ban the use of Poly- and Perfluorinated Alkyl Substances (PFAS) in our products due to the overwhelming concern for issues found in the use of this chemical in all aspects of the supply chain. PFAS are a group of chemicals that create a waterproof coating on apparel. These chemicals are known to persist in the environment, causing ecological damage and are toxic to human health. PFAS was added to our RSL as “prohibited” in early 2022, and AEO is committed to eliminating all PFAS from our products by 2024.

Cascale

In 2016, we joined Cascale, joining a common industry approach for environmental assessments at factories. We are using Cascale’s Higg Index suite of tools to help us measure the environmental impacts of factory operations at almost 400 factories, laundries, mills and trims suppliers.

We specifically use the water and carbon data to measure our progress to our overall goals. In 2022, AEO collected Facility Environmental Modules (FEM) self-assessments from all eligible Tier 1 factories, mills and subcontracts, and verified submissions from 80% of Tier 1 strategic apparel factories, 87% of subcontracted wet process factories, and 91% of strategic mills and trims suppliers. We plan to continue this collection rate and increase the percentage of verified scores.

CLIMATE

Secure renewable energy for 100% of electrical power demand for owned and operated facilities by 2030

Reduce carbon emissions 40% by 2030 and 60% by 2040 in AEO’s manufacturing

Reach net-zero emissions by no later than 2050

Phase out coal-fired boilers in our supply chain by 2030; No new factories with coal-fired boilers after 2025

AEO Climate Policy and Greenhouse Gas Emissions Reduction Strategy
AEO recognizes the scientific-consensus that climate change is real and significantly impacts our world. AEO is committed to reducing our impact on the environment, preserving natural resources, and promoting the well-being of our communities.

In 2012, we initiated our Greenhouse Gas (GHG) Inventory Program to reduce our GHG emissions. We set a goal to reduce by 20% and are proud to report that between 2013 – 2017, AEO decreased its CO₂ emissions intensity by 32% in AEO offices, distribution centers, data centers, and retail stores in the US and Canada.

In 2019, we unveiled our new greenhouse gas emissions goals in line with climate science. These goals were framed by a number of commitments we made:

We joined RE100, making a commitment to achieve carbon neutrality across all of AEO s owned and operated facilities and employee business travel by 2030 by sourcing 100% renewable energy.

We also joined the United Nations Framework Convention on Climate Change’s (UNFCCC) Fashion Industry Charter for Climate Action, a coalition of fashion stakeholders committed to holistic climate action. The Charter set a vision to achieve net-zero emissions by 2050.

Lastly, we committed to and set a science-based target. In order for a target to be science-based, emissions must be limited to keep global warming below 2°C, in line with the Paris Agreement. AEO’s target was approved by the Science Based Targets Initiative (SBTi) at the most ambitious level, limiting emissions to keep warming in line with a 1.5°C scenario.

In 2022, we committed to set a target to reach net-zero emissions by no later than 2050. We plan to submit this target to the SBTi for approval.

We had our 2021 Scope 1&2 GHG footprint independently verified by a third party at the limited assurance level. Please refer to the GHG Inventory Results below for full details.

View our full Climate Policy
View the GHG Inventory Results
View our CDP Climate Response: 2021, 2022, 2023

LEED Certified Facilities
LEED (Leadership in Energy and Environmental Design) is a green building rating system that provides a framework for healthy, highly efficient, and cost-saving green buildings. AEO LEED Facilities:

Hazelton Distribution Center – LEED Silver
Mexico Corporate Office – LEED Platinum

Renewable Energy
AEO’s commitment to the RE100 initiative has increased the amount of renewable energy we source. We recognize the following renewable energy sources, as defined by the RE100 Technical Criteria: wind, solar, geothermal, sustainably sourced biomass and sustainable hydropower. We began sourcing renewable energy for our offices, distribution centers and stores in Pennsylvania and Ohio at the end of 2018 and expanded to cover New York, Texas, Connecticut, and Illinois at the end of 2020.

In 2021, we expanded coverage to include our facilities in Massachusetts, Maryland and New Jersey. This means that 26% of our energy came from renewable sources through our local utility suppliers in 2021.

We are investigating how to further expand our renewable energy sourcing to onsite production, where feasible, as well as making larger investments in renewable energy projects to cover our footprint in states where we do not currently have the ability to source renewable energy. We continue to look for opportunities to source renewable energy for more of our facilities and expect to see this percentage increase year over year.

Smarter Energy Systems
New stores are being built with an Energy Management System (EMS) that allow us to make sure lights and heating/cooling systems are turned off when no one is in the store. It also allows us to identify and diagnose energy anomalies, such as a bad compressor or other equipment failure.

Energy Savings with LED Lights
Since 2014, we’ve changed the lighting in our stores to LED, resulting in savings 3,050 tons of carbon dioxide. This is equivalent to removing 582 cars from the road. We also replaced and installed LED lighting on our Pittsburgh campus, which reduced our energy usage by 40% and will finish installing energy saving LED lighting in our distribution centers by the end of 2022.

Product Manufacturing

We started the journey to meet our ambitious 40% emissions reduction target for manufacturing by collecting metrics on supplier energy performance via Cascale’s Higg Facility Environmental Module (FEM). This tools helps us measure the environmental impacts of factory operations at over 300 factories, mills and laundries.

We are currently collaborating with the Apparel Impact Institute (AII) to pilot improvement programs at fabric mills as a way to help our manufacturing partners improve the efficiency of their operations and reduce their environmental impact, including GHG emissions. In 2020, we started a pilot with seven facilities with the AII Clean by Design program. Facilities completed 63 improvement actions, and together saved 215,000 m³ of water and 1,782,370 kWh of electricity per year.

Additionally in 2020, the AII Carbon Leadership Program helped five fabric mills in a pilot project to identify 71 improvement actions and set an average GHG reduction target of 22% by 2025 and 26% by 2030. We plan to expand engagement with our strategic suppliers through this industry collective program from 2022 onward to drive emissions reductions in manufacturing facilities, aligned with our science-based target.

Taking these learnings, in 2021 we launched the AEO Carbon Leadership (CLP) Program for our strategic factories that represent approximately 80% of our procurement volume. The CLP program encourages suppliers to develop their own GHG inventory, commit to reduction targets and long-term climate-mitigation plans. This includes energy efficiency improvement, renewable energy use and phasing out coal powered processes and equipment. Factories that meet our requirements receive higher scores on our vendor scorecard and are prioritized for receiving business. Based on 2021 data collected from our strategic factories covering 80% of business, 11% of their total energy consumption is from renewable energy, which includes solar, biomass, etc. The renewable energy comes from the following countries: Vietnam 64%, Cambodia 16%, China 9%, India 5%, and Others 6%.

Acknowledging the contributions to carbon emissions coming from coal use, in 2022 we committed to not accept any new factories into the AEO supply chain with coal-fired boilers after 2025. We are working with our existing factory base to phase out coal-fired boilers entirely by 2030. Based on 2021 data collected from our strategic factories covering 80% of business, around 9% of our products are produced from suppliers using coal-fired boilers. These suppliers are located in Vietnam, Indonesia and Pakistan.

SUSTAINABLE MATERIALS

All cotton used in products will be 100% more sustainably sourced

Ensure that 100% of viscose is from non-endangered forests and increase sourcing of sustainably produced viscose fibers

Use 50% more sustainable polyester

Material Footprint and Progress to Goals
Three types of fibers make up the vast majority of our overall material footprint so we have focused our efforts to transition to more sustainable materials on these fibers.

Together cotton, polyester and man-made cellulosics (MMCFs) make up 80% by weight of the materials we use to make our products. Cotton alone represents 61% of our total material usage.

AEO has a goal to source 100% more sustainable cotton – which includes recycled, organic and sustainably sourced cotton through Better Cotton – by 2023. In 2022, we sourced 65% of cotton from more sustainable sources, up from 59% in 2021 and 37% in 2020. We have also made great progress in our viscose sourcing, with 90% coming from Canopy Green Shirt designated fiber suppliers. Additionally, we are tracking toward our goal of sourcing 50% recycled polyester, reaching 27% in 2022, up from 16% in 2021 and 11% in 2020.
View our Material Mix

Cotton
One of the programs that makes up a large percentage of our sustainable cotton is the Better Cotton Initiative. In 2015, we joined Better Cotton, a non-profit organization whose mission is to help cotton communities survive and thrive, while protecting and restoring the environment.

Better Cotton is sourced via a chain of custody model called mass balance. This means that Better Cotton is not physically traceable to end products, however, Better Cotton Farmers benefit from the demand for Better Cotton in equivalent volumes to those we ‘source.’

Recycled Polyester
Post-consumer plastic bottles can be turned into polyester fibers preventing the need to use virgin resources and also keeping bottles out of landfills or the ocean.

We work with Unifi, Inc. and several of our key mills to help us manufacture fabrics containing recycled or waste synthetic raw materials using their recycled fiber called REPREVE®.

Additionally, AEO works with the First Mile initiative. First Mile material is recycled polyester made out of responsibly collected bottles from Haiti, Honduras, and Taiwan. Brands that utilize First Mile material in their products support income generation for people around the world while keeping plastic waste out of landfills and out of our oceans.

Man-made Cellulosic Fibers
Man-made cellulosics are a type of regenerated fiber made primarily from the dissolved pulp (“cellulose”) of trees, such as viscose/rayon, lyocell, and modal.

Unfortunately, the trees used to create these fibers can come from Ancient and Endangered Forests.

The world’s Ancient and Endangered forests are irreplaceable. For this reason, AEO is working with the CanopyStyle initiative to eliminate the use of these fiber sources from our clothing-and expand our innovative solutions for our viscose and rayon. The details are contained in our pledge.

Jeans Redesign Program
American Eagle developed a limited denim collection using guidelines as a part of the Ellen MacArthur Foundation’s Jeans Redesign project. The AE x Jeans Redesign collection uses guidelines developed by the Foundation’s Make Fashion Circular

team alongside over 80 denim experts and adheres to the principles of a circular economy where clothes are made with limited impact, are recyclable and are long-lasting to be kept in use.

Using the Ellen MacArthur Foundation’s guidelines, the innovative design process meets the following requirements:

Durability: Designed to last, withstanding home laundering and featuring wash and care instructions on each piece.

Recyclability: Made of 100% organic cotton with easy-to-remove hardware, making the jeans easily recyclable.
Material Health: Produced without the use of harmful chemicals and processes, making the styles better for the environment.

Traceability: Every garment in the AE x The Jeans Redesign collection will be easily identifiable for ease of apparel recycling.

Textile Exchange
Textile Exchange (TE) is a global nonprofit that creates leaders in the preferred fiber and materials industry. They develop, manage and promote a suite of leading industry standards, as well as collect and publish critical industry data and insights that enable brands and retailers to measure, manage and track their use of preferred fiber and materials.

We joined TE in 2019 as a partner level member and leverage their tools, resources, and certifications to help shape and guide our sustainable material strategy.

WASTE REDUCTION

Recycle apparel waste (used or unsold clothes, etc.)

Convert all labels to sustainably
sourced materials

Reduce plastic packaging or move to alternatives with less impact

Apparel Recycling
According to the U.S. Environmental Protection Agency, 32 billion pounds of clothing, shoes, and other textiles end up in landfills in the U.S. each year. We aim to be part of the movement towards a circular economy where pre-loved apparel and footwear can be reused or re-manufactured into new products.

In our stores we have two initiatives for garment collection and recycling. Aerie has engaged with the NGO “Free the Girls” to start a bra give-back program in all stores. Free the Girls turns new or gently used bras into economic opportunity and a path to freedom for sex trafficking survivors.

In April 2019 we started a partnership with the Cotton Inc. program “Blue Jeans Go Green” to collect jeans in our AE stores. Jeans collected through this program are turned into home insulation.

At our corporate offices and distribution centers, we partner with I:CO (I:Collect) to implement a closed-loop recycling program to collect used clothing and shoes. AEO associates can recycle their unwanted clothing, shoes, and textiles on each campus through I:CO. Additionally, in our New York Design Office, any fabric scraps or samples are processed together with the organization Fabscrap to make sure they are properly recycled. Recycled items through these programs are transformed into new products like insulation and even new fabric.

In 2020 we began a partnership with Give Back Box to allow all of our customers to easily donate their gently used clothing, shoes, and accessories using any box they have at home since in store collections programs were paused. Customers print out a free shipping label, fill up any box they have with the items they want to donate and Give Back Box ensures their donations go to local charities.

Plastic Packaging
We often receive feedback from our customers on this issue and we want you to know that we hear you! We also want to see how we can impact plastic use in this way.

We are currently addressing plastic use in our supply chain by assessing possibilities for converting to recycled plastic or finding opportunities to reduce or eliminate plastic use. We have succeeded in beginning to convert to recycled plastic bags for our clothing by requiring our vendors to source recycled plastic bags and have implemented a number of initiatives to reduce the amount of plastic we use by decreasing what is used for shipping, and reducing the amount of plastic used in our mailers.

Starting in 2018 we made the move to use shopping bags with a higher percentage of recycled content. It may seem like a small step, but this simple switch has already yielded a sizeable impact by saving 4.3 million square meters of plastic every year.

Sustainably Sourced Labels
We are well on our way to making sure that all labels on AEO products are made using sustainably sourcing raw materials. Aerie and American Eagle labels have already been converted to recycled polyester. We continue to look for opportunities to further reduce the amount of labels and marketing items on our garments.

For the remaining hangtags and other marketing items on our garments we are working to make sure they are made using the most sustainable materials possible.

Recycling
Every year through our Clean and Green initiative, we tackle paper recycling on a huge scale across our corporate and distribution locations. We encourage AEO associates to clean-up documents, files, and records.

In 2018, the Clean and Green campaign deleted 55 terabytes of electronic storage and recycled 8 tons of physical files. The paper recycled saved 136 trees, 3,040 gallons of oil and 56,000 gallons of water.

We also work to reduce our footprint through cardboard recycling and reuse by reusing or purchasing used boxes that would otherwise have gone to a landfill.