The infrastructure, and what it took to build

 

The headline credentials are well-known: CDP Triple A in 2024 for the second consecutive year, a club of eight companies globally to score top marks across climate, forests, and water; MSCI top-rated for four years; Sustainalytics low-risk classification at 10.7 as of July 2025; twelve consecutive years on the Dow Jones Sustainability Indices.

What sits underneath is more interesting. The Environmental Profit & Loss account, pioneered at Puma in 2011 under Kering's predecessor PPR and rolled across the group thereafter, assigns monetary value to environmental externalities (carbon, water consumption, land-use change, air pollution, waste) at every tier of the supply chain. The methodology has been open-sourced and used as a UK government case study, and remains the most developed parallel accounting system in fashion. Kering's science-based targets, validated by SBTi in 2024, commit the group to a 54.6 percent reduction in absolute Scope 1, 2, and 3 emissions by 2033 against a 2022 baseline, with 90 percent reduction by 2050. The 2033 pathway is unusually early for a company of this scale and supply chain length.

The EP&L is the part of Kering's architecture other sectors should be paying attention to, more than the climate targets themselves. Putting a euro figure on environmental damage forces every sourcing decision and material substitution into the same financial language as cost of goods. If carbon pricing eventually becomes a serious regulatory instrument, companies that have built this kind of internal accounting will have a decade of head-start data. Most have not even begun.

 

What the 2025 roadmap actually delivered

 

The 2017 to 2025 programme was built around three pillars: Care, Collaborate, Create. Most targets landed close to plan, some came in ahead, a handful fell short.

The cleaner wins are operational. Against its 2017 to 2025 targets, Kering ended the period with:

• Renewable electricity: 100 percent across direct operations, achieved in 2021 and held since
• Total renewable energy: around 96 percent across all sources
• GHG emissions (Scopes 1, 2, 3): down 12 percent in absolute terms in 2024 versus the prior year, per the group's CDP submission
• Scope 3 emissions specifically: down roughly 16 percent year-on-year
• Water withdrawals (direct operations): down 7 percent
• Raw material traceability: 97 percent across key materials, 98 percent for leather (original target was 100 percent)
• Regenerative agriculture: 1.1 million hectares enrolled by end of 2024 across 13 projects in eight countries through the Kering-led Regenerative Fund for Nature, exceeding the original million-hectare 2025 target

The number that does the most work in this picture is the absolute reduction. Fashion's climate progress has long been measured against revenue, which lets a growing business show declining intensity while emitting more in absolute terms. Kering's pivot to absolute targets in 2024 was an acknowledgement that the trick was wearing thin. Disentangling how much of the 2024 progress comes from operational improvements and how much from the business contracting will keep investors and regulators arguing for the next two years.

 

Financials

 

The other half of the picture is harder. The 2024 numbers laid it out plainly:

• Group revenue 2024: €17.2 billion, down 12 percent year-on-year
• Gucci revenue 2024: €7.7 billion, down 23 percent (the brand's weakest year since the depths of the pandemic, and roughly 60 percent of group operating profit historically)
• Operating margin: 27 percent in 2022, down to 11 percent in 2025
• Net debt: €200 million in 2021, climbing to roughly €10.5 billion by end of 2024 after a heavy spend on Creed, Maui Jim, property, and a 30 percent stake in Valentino
• Share price: down roughly 60 percent over two years
• Q1 2026: group revenue declined 6.4 percent to €3.57 billion, with Gucci down 14.3 percent

By comparison, Hermès reported a 1.4 percent decline in Q1 2026 and LVMH's fashion and leather goods division was off 9 percent. Kering is the worst-performing of Europe's three major luxury houses, and has been for two years, and the gap looks structural rather than cyclical. Sitting alongside these numbers is a leadership reset that has touched almost every level of the group. New chief executives have been installed at Gucci, Saint Laurent, and Balenciaga inside eighteen months. Demna Gvasalia was appointed Gucci's creative director in mid-2025, months after Sabato De Sarno's unexpected departure. De Meo himself only stepped into the group CEO role in September 2025, with Pinault moving back to a chairman-only position after twenty years. None of this is the context in which corporate sustainability programmes typically thrive.

 

Decoupling growth from emission

 

Marie-Claire Daveu, Kering's chief sustainability and institutional affairs officer since 2012, has outlasted almost every senior figure in the group except Pinault himself. When the new absolute 2035 emissions target was announced in 2024, she was unusually direct about the strategic logic underneath.

"It's very ambitious, because we are also a company and we want to continue our growth," she told the Business of Fashion. "So beyond this kind of target is a decorrelation between the growth of the business and degrowth of greenhouse gases. The idea is to really to prioritise value over volume. We are speaking about quality and exclusivity, and for me, that's really how the business will bring solutions to decrease greenhouse gases."

That argument, made eighteen months ago, now reads as the connective tissue between Kering's sustainability identity and de Meo's recovery plan. ReconKering rests on a structural shift toward higher prices, fewer SKUs, tighter wholesale distribution, and a sharper focus on full-price retail. Gucci alone is reducing its product range by 20 percent under Francesca Bellettini, and the group is closing 100 stores this year on the way to 250 over four years. Fewer items produced and shipped, sold at higher margins through fewer channels, is precisely the volume-to-value pivot Daveu has been articulating since well before financial pressure made it commercially urgent.

Compare with LVMH, which is hitting its 2026 emissions targets while continuing to grow revenue. Both groups arrive at lower absolute emissions, but only one is doing it through deliberate downsizing of the business model. If Kering's recovery works on the terms de Meo set out in Florence, it becomes the more instructive case for any consumer business asking whether decoupling growth from emissions is achievable. If it does not work, the same data becomes a warning about whether ESG leadership can survive a downturn the company partly walked into.

 

What ReconKering does with sustainability

 

The structural choice de Meo made on April 16 was to embed sustainability as one of five group-wide capability hubs alongside Industry, Client, Technology, and Support Functions. Sustainability decisions are now consolidated at group level rather than running through each Maison separately, with the explicit purpose of binding environmental performance into capital allocation and operational decisions. It is more centralised than Kering had before, and bears de Meo's industrial fingerprints from his Renault years.

Read one way, this strengthens the sustainability position. Consolidation usually means accountability gets clearer and budgets become easier to track, and the fact that sustainability is one of the five hubs rather than a function buried elsewhere signals where it sits in the new architecture. The reasons for caution sit in culture rather than structure. De Meo is not a fashion executive and not, by reputation, a values-driven leader. His turnaround at Renault was an industrial exercise in supply chain efficiency and operational discipline, and sustainability under his stewardship is more likely to be defended as a productivity argument than a moral one. That can be how climate action becomes durable inside a large corporate structure, or how the harder commitments, the ones requiring cost without immediate return, get quietly deprioritised when the supply chain function is being asked to take a billion euros of inventory off the books in twelve months. Which version prevails will be visible in the 2025 sustainability statement, due in March, and in capital expenditure disclosures from the structural reset phase ending late 2026.

 

The supplier problem nobody has solved

 

Roughly 90 percent of fashion sector emissions sit in Scope 3, and Kering's profile is no exception. The 16 percent year-on-year reduction reported for 2024 looks impressive at first glance and gets more complicated on inspection. Some of it reflects supplier-level progress, including the Apparel Impact Institute's Clean by Design programme, which has cut participating suppliers' energy consumption by 13 percent on average. Some of it reflects reduced production volumes during the sales downturn. Holding the trajectory steady while the business returns to growth is the harder part, and one neither Kering nor any of its peers has shown they can do.

Kering's supplier engagement runs through the Kering Standards, the Kering for Nature Fund, the Materials Innovation Lab, and the Fashion Pact, the cross-industry initiative co-founded at the G7 in 2019. Compared with LVMH's LIFE 360 Business Partners programme, launched in late 2023, Kering's supplier-facing programmes are smaller in volume but more rigorous in methodology. Neither group has cracked Scope 3 at the level the 2033 net-zero pathway requires, and neither has a credible answer for what happens when supplier capacity for low-carbon raw materials runs into hard physical limits, which it will, and likely before 2030.

 

What a working recovery would prove

 

Most sustainability case studies are written about companies in good financial health, and most are therefore not particularly illuminating. The instructive test is what a sustainability programme looks like under pressure, and whether the commitments hold or quietly soften.

If de Meo executes ReconKering on the terms he set out in Florence, and if Daveu's framework holds through the leadership transition, Kering becomes the most informative ESG case in luxury, and probably in consumer goods more broadly. It would demonstrate that climate commitments can survive a downturn the company is in the middle of working through, and that sustainability budgets do not have to be the first item cut when revenue contracts. The companies that prove sustainability survives financial distress are the ones whose ESG ratings will eventually carry weight in the market. The ones that walk back are the ones whose commitments were always negotiable. Kering is, at this moment, the most public test in luxury for which category most corporate sustainability actually belongs in. The verdict will arrive faster than most observers expect.

 

Sources: Kering 2024 Universal Registration Document (March 2025); Kering Capital Markets Day, Florence (April 16, 2026), reported in WWD, Drapers, and Ecotextile News; Kering Q1 2026 revenue announcement (April 2026); Kering 2024 Annual Results press release (February 2025); Marie-Claire Daveu interview, Business of Fashion (July 2024); CDP A List 2024, ESG Today and Fashion United; Regenerative Fund for Nature 2024 Annual Report (August 2025); Stand.earth Fossil-Free Fashion Scorecard for Kering. Comparator data on LVMH from group's official LIFE 360 disclosures.