Brands in the fashion industry fail to carry through on their commitments to environmental sustainability.
In an effort to address the environmental impact of the fashion industry, leading brands are implementing various strategies to finance the decarbonization of their supply chains, particularly in countries like Bangladesh, India, and Cambodia.
One of the key approaches is through industry-wide collaboration, such as the Fashion Industry Charter for Climate Action. This UN-backed initiative, joined by brands like Adidas, Burberry, Hugo Boss, and Gap Inc., aims to collectively address the climate impact of the entire fashion value chain. The Charter promotes decarbonization of production, sustainable material selection, low-carbon transport, consumer engagement, and collaboration with financiers and policymakers to catalyse scalable solutions[1].
Brands are also working closely with their suppliers to decarbonize. Companies like Columbia Sportswear are collaborating with key suppliers on programs like Clean by Design to help reduce emissions, although broader transparency and renewable energy commitments remain limited[5]. This collaboration often involves funding feasibility studies and providing technical and financial support to suppliers to transition to cleaner energy and sustainable practices.
Investment in electrification and low-carbon technologies is another significant strategy. Brands such as H&M are shifting from fossil gas and biomass fuels towards electrification of their supply chains, prioritizing low-temperature, electrified technologies for energy-intensive processes like dyeing, washing, and drying fabrics[2].
Fashion companies are also exploring circular business models and resale platforms as a means of decarbonization. Developing brand-owned resale channels and integrating resale into core business models can generate new revenue streams that help finance sustainable operations and reduce emissions by displacing new production[3].
Transparent data systems and certification are being utilised to attract climate financing. Service providers like FORLIANCE help brands implement transparent data systems and certifications that document decarbonization progress in textile value chains, potentially unlocking access to green financing, carbon credits, or impact investments needed for scaling decarbonization[4].
However, progress has been slow in reducing emissions in major textile-producing countries like Bangladesh, India, and Cambodia. The investment gap for Bangladeshi fashion suppliers to cut emissions by half by 2030 is estimated at US$4.8 billion[6]. Many suppliers balk at the high capital investment needed to replace gas-based boilers with more energy-efficient technologies[7].
Despite these challenges, many companies in the fashion industry have promised to reach net zero emissions by 2050 or sooner. Brands need to accept that there will be a cost to climate transition, according to Kim Hellström, senior sustainability manager at H&M[8]. If brands put budgets behind their goals, it would establish better partnerships with suppliers, said Kristina Elinder Liljas, senior director of sustainable finance and engagement at AII[9].
It's crucial to note that while many brands are making efforts, a large number still lack visible efforts to finance their climate plans and support suppliers to decarbonize[10]. This story was published with permission from Thomson Reuters Foundation, focusing on humanitarian news, climate change, resilience, women's rights, trafficking, and property rights.
Sources: [1] https://www.businessoffashion.com/articles/sustainability/the-fashion-industry-charter-for-climate-action-launches-at-cop26 [2] https://www.mckinsey.com/industries/apparel/our-insights/the-fashion-industry-decarbonization-agenda [3] https://www.mckinsey.com/industries/apparel/our-insights/the-fashion-industry-decarbonization-agenda [4] https://www.forliance.com/ [5] https://www.mckinsey.com/industries/apparel/our-insights/the-fashion-industry-decarbonization-agenda [6] https://www.stand.earth/wp-content/uploads/2022/02/Brand-Emissions-Report-2022.pdf [7] https://www.stand.earth/wp-content/uploads/2022/02/Brand-Emissions-Report-2022.pdf [8] https://www.stand.earth/wp-content/uploads/2022/02/Brand-Emissions-Report-2022.pdf [9] https://www.stand.earth/wp-content/uploads/2022/02/Brand-Emissions-Report-2022.pdf [10] https://www.stand.earth/wp-content/uploads/2022/02/Brand-Emissions-Report-2022.pdf
- Leading fashion brands, such as Adidas, Burberry, and Gap Inc., are collaborating through the Fashion Industry Charter for Climate Action to address climate change, prioritizing decarbonization, sustainable material selection, and low-carbon transport.
- Companies like Columbia Sportswear are partnering with suppliers on programs like Clean by Design to reduce emissions, although many struggles with limited transparency and renewable energy commitments persist.
- H&M is transitioning from fossil fuel and biomass fuels towards electrification of its supply chains, with a focus on low-temperature, electrified technologies for energy-intensive processes.
- Fashion companies are adopting circular business models and resale platforms to decarbonize, generating new revenue streams for sustainable operations and reducing emissions by displacing new production.
- Transparent data systems and certifications, like those provided by FORLIANCE, help brands document decarbonization progress in textile value chains, potentially unlocking access to green financing, carbon credits, or impact investments.
- Despite challenges in major textile-producing countries like Bangladesh, India, and Cambodia, many fashion companies have promised to reach net zero emissions by 2050 or sooner, understanding that climate transition will have costs but could establish better partnerships with suppliers.
- However, a large number of brands still lack visible efforts to finance their climate plans and support suppliers to decarbonize, as evident in the Brand Emissions Report 2022.
- This discussion on the decarbonization of the fashion industry, its reliance on science, corporate responsibility, and the role of finance in promoting sustainability, falls under the broader context of climate change, environmental science, and lifestyle changes, including fashion and beauty.
