Endeavour Group Limited
GovernanceGovernance
Governance body oversight and management's role
The Board, supported by the Audit, Risk and Compliance Committee (ARC), has overall responsibility for oversight of climate-related risks and opportunities (p. 31). The ARC monitors the Risk and Compliance Management Framework (RCMF) and receives management reports at least twice a year (p. 32).
Board (p. 32). Board Charter responsibilities include oversight and approval of the Sustainability Strategy and its climate-related policies, risks, commitments and targets. It is informed through ARC-endorsed management reports at least twice per year and approves and oversees the RCMF. It does not currently consider climate-related trade-offs in major transactions. It oversees target setting by approving the Sustainability Strategy and monitors progress at least twice per year. Climate-related metrics are not incorporated into remuneration frameworks or policies. A skills matrix is published annually (Corporate Governance Statement).
Management (pp. 31, 33). The Board delegates to the Executive Leadership Team (ELT), led by the CEO, which holds dedicated ESG meetings at least three times a year and uses the RCMF as its primary control. The Chief Corporate Affairs and Sustainability Officer leads the Sustainability team, the Chief Legal Officer manages the RCMF day to day and the Chief Financial Officer leads financial quantification. Business units hold operational responsibility, supported by a cross-functional Climate Working Group (p. 33).
StrategyStrategy
Climate-related risks and opportunities
Three climate-related risks that could reasonably be expected to affect business performance are identified (p. 34).
| Risk | Type | Description | Time horizon (bar) |
|---|---|---|---|
| Climate hazards disrupting sites and operations (p. 35) | Physical | Combined effects of acute and chronic hazards on operational sites (hotels, retail stores, distribution centers, support offices, wineries, vineyards, bottling facilities) in Australia and New Zealand | Short, medium and long |
| Energy market volatility and policy uncertainty (p. 36) | Transition | Increasing electricity price volatility at all sites in Australia and New Zealand, from renewable droughts, heat-driven demand peaks and major thermal outages | Short and medium |
| Introduction of a carbon tax (p. 38) | Transition | Increased direct operating costs from a potential Australian carbon tax, and increased indirect cost pass-throughs from domestic and international suppliers under local and/or global carbon taxes | Medium and long |
No climate-related opportunities were identified that could reasonably be expected to affect performance in the current period (p. 34).
Time horizons (p. 34). Short term 1–3 years, medium term >3–10 years, long term >10 years. The short term is aligned with the typical three-year strategic and financial planning cycle; the Group does not typically engage in long-term horizon planning, citing constraints in financial forecasting over extended periods.
Business model and value chain
Physical hazards (p. 35). The network of sites is spread across Australia and New Zealand in regions with varying climate exposure. A gradual increase in the frequency and severity of acute hazards (bushfire, cyclone, flood, hail, storm) and chronic shifts such as higher mean temperatures is expected to affect property, inventory and equipment and increase pressure on cooling and refrigeration. Over the medium and long term this is anticipated to mean a moderate uplift in repairs, maintenance, energy and insurance costs, with potential occasional limited revenue impacts where extended site closures arise. The greatest aggregate exposure is across the store and hotel network. Distribution centers remain operationally important, but no individual sites were identified as disproportionately exposed relative to broader operations.
Energy market volatility (p. 36). Electricity is a significant input across retail, hotel, distribution, production and corporate operations, so exposure is broadly distributed, not concentrated in any business activity or location. Wholesale volatility has the potential to influence procurement costs over the short and medium term; exposure to spot price volatility is expected to progressively reduce.
Carbon tax (p. 38). Exposure arises through direct emissions and supplier cost pass-throughs across operations and is not concentrated in a particular site or business activity.
Strategy and decision-making
Strategy and targets (p. 34). The strategy is structured around reducing emissions, physical risk preparedness, and establishing effective data and reporting capabilities, with two targets: net zero Scope 2 market-based emissions by 2030 and net zero Scope 1 and Scope 2 emissions by 2050.
Mitigation and adaptation (pp. 35, 37–38). Physical: site design to building codes, fire extinguishers, hose reels or sprinkler systems, backup generators at some sites, and insurance. Energy: progressing the target of sourcing 100% renewable electricity by 2030, a phased approach to long-term Power Purchase Agreements, on-site solar, and energy efficiency projects such as refrigeration upgrades. Carbon tax: a progressive refrigerant upgrade plan to lower Global Warming Potential alternatives, and progress on the Scope 2 target.
Resourcing (p. 34). Through existing operational and capital planning processes, with investment decisions incorporated into the broader business planning and capital allocation framework. Transition risk activities are primarily resourced through the energy optimization strategy; physical risk adaptation through existing property, supply chain and risk management functions.
Transition plan (pp. 43, 49). The Group states it is not disclosing a formal climate transition plan for the year ended 28 June 2026 (p. 43) and is developing one to formalize these projects and inform a Group-wide gross emission reduction pathway (p. 49).
Financial position, financial performance and cash flows
Anticipated effects are assessed over the short, medium and long term, on a residual basis after existing mitigation and adaptation (p. 39).
| Risk | Current (F26) | Anticipated |
|---|---|---|
| Physical hazards (pp. 35–36) | No material financial effects; no material asset damage, business interruption or insurance claims | Acute perils (flood, bushfire, cyclone, storm, hail) not anticipated to be material; a moderate uplift in repairs, maintenance, energy and insurance costs anticipated over the medium and long term (p. 35) |
| Energy market volatility (p. 37) | No material financial effects. Climate-related drivers of price volatility are not separately identifiable from other market factors; total year-on-year movement in electricity spend not material | Not expected to be material, including if 100% of electricity costs were exposed to volatility (sensitivity analysis) and for the cost of moving to 100% renewable energy |
| Carbon tax (pp. 38–39) | No direct carbon pricing tax applied to Scope 1 or Scope 2 emissions | Direct exposure under an assumed carbon price trajectory not anticipated to be material (indicative assessment). Supplier cost pass-through cannot be reliably estimated because of high measurement uncertainty; any material exposure would be expected to increase inventory carrying values and cost of goods sold |
No climate-related risks are expected to result in a significant risk of material adjustment in the 2027 financial year (p. 39).
Climate resilience and scenario analysis
Scenarios (p. 40). Low emissions: IPCC SSP1-1.9 and NGFS Net Zero 2050, used to assess a 1.5°C-aligned pathway. High emissions: IPCC SSP3-7.0, supplemented by SSP5-8.5 assumptions where required, and the NGFS 'Current Policies' scenario. Chosen to capture a plausible range of physical and transition outcomes. Time horizons: short term 2030, medium term 2040, long term 2050. As this is the first year, the analysis is primarily qualitative, supported by quantitative analysis where sufficient data is available. Assumptions on policies, macro-economic trends, national and regional variables, energy usage and mix, technology and physical weather events are set out in tables per scenario (pp. 40–41).
Resilience (pp. 42–43). Existing site-level controls, insurance, geographic diversity and the renewable electricity transition are described as absorbing or reducing exposure in both scenarios. A carbon tax under the low emissions scenario 'may result in a material financial effect' in the short and medium term, with timing, design and magnitude uncertain. Under the high emissions scenario physical risk becomes the dominant long-term exposure.
Uncertainty (p. 41). Physical climate risks; government policy and macroeconomic trends; energy price volatility and carbon pricing; insurance availability, affordability and terms.
Capacity to adapt (p. 43). Supported by the existing climate change strategy, governance processes and operational structure.
Risk ManagementRisk Management
Processes for identifying, assessing and managing climate-related risks
Identification (p. 44). Identified through internal and external inputs: prior climate risk and materiality assessment work, risk workshops, specialists' review, regulatory developments and market trends. A Group-wide climate risk assessment from the F23 year continues to inform identification; an F26 review reassessed risks and opportunities using the selected time horizons. Scenario analysis is not currently a direct input into identifying risks but informs understanding of the climate risk profile.
Assessment (p. 44). Under the RCMF, with climate risks in the Sustainability and ESG Risk Category. The methodology considers likelihood and consequence, with quantitative thresholds (e.g. impact to profitability) and qualitative ones (reputational, customer, team and safety impacts). Risks were evaluated under AASB S2 using the Group's materiality judgment criteria.
Monitoring and prioritization (p. 45). Business unit risk registers are reviewed with the Risk function at least twice per year. Ratings are assessed against risk appetite to prioritize and escalate risks; the enterprise-level risk register is reviewed by the ELT and ARC biannually, with climate risks incorporated alongside other risks.
Opportunities and changes (p. 45). Opportunities are considered through broader strategic planning and governance processes; none were identified as material for disclosure. No material changes were made to the methods used.
Metrics & TargetsMetrics and Targets
Climate-related metrics
Scope 1 and 2 GHG emissions (p. 46). Total absolute gross GHG emissions in F26 were 331,989 tonnes of carbon dioxide equivalent (tCO2e):
| Scope | Sources | tCO2e |
|---|---|---|
| Scope 1 (direct) | Primarily refrigerant gases, natural gas and fuel use | 61,035 |
| Scope 2 (indirect), location-based | Primarily purchased electricity across more than 2,000 sites | 270,954 |
Figures are for Endeavour Group and its consolidated subsidiaries; the Group does not have joint ventures. Scope 3 is not disclosed: the Group elected the transition relief in AASB S2 Appendix C4(b) for F26 (p. 46).
Measurement (pp. 46–47). Under the National Greenhouse and Energy Reporting Act 2007 (NGER Act) and the GHG Protocol: A Corporate Accounting and Reporting Standard (2004), using the operational control approach. Where primary activity data is unavailable, proxy data per brand and per State is used. Scope 2 follows NGER (Measurement) Determination Method 1A (Location Based Method). No material changes to methodologies; no material contractual instruments affect Scope 2 (p. 47).
Other metrics (pp. 48–49). No sites, operations or activities were identified as materially more vulnerable to physical or transition risks (p. 48). No internal carbon price is applied. Climate-related metrics are not incorporated into ELT or senior leadership remuneration (p. 49).
Climate-related targets
Two absolute targets (pp. 48–49), measured in tCO2e, both with base year F26 and no interim targets:
| Net zero Scope 2 market-based emissions by 2030 | Net zero Scope 1 and Scope 2 emissions by 2050 | |
|---|---|---|
| Objective | Reduce the largest source of emissions (Scope 2) and mitigate transition risk, primarily through renewable electricity | Reduce direct (Scope 1) and indirect (Scope 2 market-based) emissions and mitigate transition risk |
| Entities covered | Sites under operational control where the Group can procure its own electricity | All sites under operational control |
| Gases | CO2, CH4, N2O | CO2, CH4, N2O and listed HFCs |
| Alignment | Australia's emission reduction target of 62–70% on 2005 levels by 2035 | Australia's Net Zero by 2050 Plan, part of its Nationally Determined Contributions under the Paris Agreement |
Setting and review (p. 48). Set as part of the Sustainability Strategy, informed by a materiality assessment; the methodology was not informed by a third party. The Strategy was formally reviewed by management and the Board in the period, with no target revisions since it was set.
Progress (p. 49). Measured against the reported emissions inventory and reported to the ELT and Board at least twice a year; the Group states it remained on track.
Carbon credits (p. 49). Residual emissions are expected to be offset with carbon credits; quantity and type are not yet determined, and credits are not currently used.