The LEGO Impact: Scaling Production and Sustainability
The LEGO Group's 2025 Annual Results report reveals how the company is navigating the complexities of global supply chain management while pursuing ambitious climate and circularity targets.
With consumer sales growing 16% in 2025, the Danish toy manufacturer delivered more products to children worldwide than ever before, presenting both opportunities and challenges for its procurement and distribution networks.
The company's financial growth has been accompanied by an increased focus on sustainability across its supply chain operations, from raw material sourcing to packaging and logistics.
However, this expansion has also highlighted the intricate balance between scaling production and reducing environmental impact.
The LEGO Group's recent assessment of its supply chain vulnerability reveals significant exposure to climate-related risks. The geographical locations of its manufacturing facilities face high risk of disruption from heatwaves, drought and water scarcity. This evaluation underscores the growing importance of supply chain resilience as weather events caused by climate change become more frequent.
The company set a science-based target in 2020 to reduce its total greenhouse gas emissions by 37% by 2032, compared to its 2019 baseline, as part of its journey towards net zero by 2050. However, the reality of supply chain emissions presents ongoing challenges.
Supply chain emissions increase with growth
The LEGO Group's strong 2025 sales figures contributed to a 12% increase in Scope 3 emissions from purchased goods and services compared to 2024 levels. This category, which encompasses emissions from the supply chain including raw materials and manufacturing components, represents a significant portion of the company's carbon footprint.
Niels B Christiansen, CEO of the LEGO Group, says: "We are very pleased with our record performance in 2025, building on last year's success.
"Our innovative and extensive portfolio, combined with the strength of the LEGO brand and an effective operating model, drove high demand.
"We delivered these results by being both creative in product innovation and efficient in operations, bringing LEGO play experiences to more kids than ever before.
"As we continued to invest in future growth, we brought multi-year strategic investments to life and reached more than half renewable and recycled content in the materials we buy to make LEGO bricks."
This achievement in material sourcing represents a notable milestone in the company's supply chain transformation, with renewable and recycled content now comprising more than 50% of materials procured for brick production.
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Progress towards sustainable material sourcing
The LEGO Group continued to advance its sustainable materials goals throughout 2025, with particular emphasis on circularity within its product and packaging supply chains. The company aims to use packaging made from renewable materials that reduces single-use plastic and is recyclable.
According to the annual results, more than 95% of the LEGO Group's sold packaging by weight is now made from paper, cardboard and other paper-based materials. The company has introduced paper packs inside LEGO boxes, which are made of at least 95% paper and a thin plastic coating to help seal the bags and allow safe transportation of bricks.
These bags have been verified as technically recyclable in LEGO's European Union, US and Canadian markets, demonstrating progress in creating more sustainable packaging solutions across different regulatory environments.
The shift towards sustainable materials extends beyond packaging to the core product itself. The company continues to test and validate alternative materials for LEGO bricks, working with suppliers to develop bio-based and recycled plastic options that meet the brand's rigorous quality and safety standards while reducing reliance on virgin fossil-based plastics.
Operational improvements across the network
Beyond packaging, the LEGO Group is working to reduce emissions across its operational supply chain. In terms of Scope 1 emissions, the company is aiming to eliminate its use of natural gas entirely over the next few years. In 2025, 9% of its total energy consumption came from natural gas, which is mostly used to heat factories.
The company's vehicle fleet, which supports its logistics and distribution networks, is also undergoing transformation. A company car policy introduced in 2024 has led to nearly 50% of its company car fleet becoming electric.
Niels says: "We are deeply committed to having a positive impact on the world and the communities we are part of.
"We do this by aiming to reduce our environmental footprint and improving access to play for kids who need it most, and we will continue to invest significantly to deliver on that ambition."
The company's social responsibility programmes, including innovations like a LEGO MRI scanner used in hospitals, have impacted 11.7 million children in 27 countries, exceeding the company's target of reaching 10.2 million children. Since the programme launched, more than one million children globally have benefited from the project. Healthcare professionals have responded positively to the initiative, with 96% saying that the LEGO set reduced children's anxiety.
