The fashion industry’s quest to deliver on its sustainability ambitions
This story is part of The Path to Zero, a series of special reports on how business can lead the fight against climate change. This quarter’s stories go in-depth on sustainability in supply chains.
In November 2019, Kanye West took the stage at the Fast Company Innovation Festival to present the latest style of shoes from his Yeezy brand. The sneakers were made of algae and, West said, represented the next stage in his fashion company’s aspirations: sustainability. The rapper announced Yeezy would be moving its headquarters to a 4,000-acre ranch in Wyoming, so that it “could see every element” of its production process. “Within the next two years, our goal is to bring manufacturing back to America,” he told the audience. “We’re going to be farming and going seed to sole.”
Two years on, it’s not quite clear what the plans for the farm and prototype factory are.
Yeezy is by no means the only brand to make big promises of embracing a more sustainable stance and then failing to show concrete evidence of how exactly it’s honoring them.
But in the wake of the pandemic, things might be taking a turn. For the first time in decades, the global fashion industry is undergoing its most profound moment of reckoning, and some of its players are attempting a systemic transformation in the way it operates.
Pursuit of profits, as well as climate change, is fueling this shift.
The sector’s contributing role to the climate crisis is now well-documented—fashion is the third most polluting industry after construction and food, according to a report by the World Economic Forum, producing an estimated 20% of global wastewater and 10% of global carbon emissions—more than all international flights and maritime shipping combined.
A 2017 study by the Ellen MacArthur Foundation (EMF), a charity that promotes the sector’s circular economy (where products and materials are kept in use for as long as possible, including through reusing and recycling, and where natural systems are regenerated), found that clothing production worldwide roughly doubled from 2000 to 2015, resulting in about 92 million tons of textile waste a year. It also reported that the textiles industry relies on some 98 million tons of nonrenewable resources annually, from oil to produce synthetic fibers to fertilizers to grow cotton to the chemicals that go into dyes. Last year, additional alarming research showed that the fibers in our clothes could be poisoning our waterways and food chain on a massive scale.
The industry’s track record on labor rights has increasingly faced similar scrutiny. Stories of migrant laborers as victims of wage theft and exploitation have become all too familiar in our news cycle, as have records of grim working conditions in the developing world.
The COVID-19 health crisis has further exposed these inequalities, as factories ground to a halt, brands refused to pay their suppliers, and garment workers went unpaid. But it also heightened consumer awareness, as campaigns like #PayUp and #WhoMadeMyFabric gained fresh momentum.
The pandemic has also hit the companies’ revenues, with the industry experiencing its deepest recession in decades owing to a decline in shopping and increasing overstock. H&M Group saw sales plummet 50% in 2020 compared with a year ago. According to the BoF (Business of Fashion)–McKinsey State of Fashion 2021 report, global fashion sales in 2021 could drop below 2019 levels by as much as 15%.
Against these headwinds, the sector has been looking at new ways to compete and shift toward a more sustainable, demand-focused business model.
The supply chain—the industry’s biggest culprit—is where most efforts have been directed.
“For many, that was the most obvious place to start,” says Laura Balmond, head of Make Fashion Circular at EMF. “If you look at the materials, equipment, and techniques textile and footwear companies use, a lot of them almost date back to the Industrial Revolution. The whole structure has been due for a change.”
To deliver on their sustainability goals, a growing number of brands have sought out collaborations with technology startups and experimental suppliers that are looking to replace the supply chain’s most unsustainable practices and materials with alternatives that can reduce nonrenewable resource inputs and the negative impacts of the industry. These companies are creating new bio-based materials like fabric made from coffee grounds, wool fiber alternatives, and mushroom leather, but are also updating the supply chain with pioneering digital tools.
“Collaborations with innovators have essentially become the way forward in fashion’s supply chain,” Balmond says. “Emerging labels are making them an integral part of their operations, while some of the bigger brands have been heavily investing in them. And I think we’re only getting started.”
Liesl Truscott, director of European and materials strategy at Textile Exchange, a nonprofit advocating the expansion of responsible supply networks across the global textile value chain, agrees.
“The message that the system needs to change is sinking in,” she says. “The companies we connect with have already shown a willingness to be held accountable and improve by sharing their data, processes, and impacts for our Material Change Index (MCI), which tracks their progress toward more sustainable materials sourcing. But in general, I do see more players making circularity strides, and embracing new technologies to do so.”
While once only a handful of brands and designers—Patagonia, People Tree, Stella McCartney—championed sustainability in their production, the number of environmentally conscious companies has skyrocketed over the past decade. Tools like the Fashion Transparency Index and the Higg Index, which measure brands on their supply chain traceability and public disclosure of policy, governance, and commitments, have shone a spotlight on who’s doing what in the industry, inspiring some players to share more information with their customers, launch new initiatives, and set new targets to improve their “green” credentials—and, in turn, guarantee likability and profitability.
In 2018, Swedish retail giant H&M, which has long claimed to be moving toward more sustainable practices, invested in Colorifix, a British biotech company developing an alternative method of textile dyeing. Not long after, H&M began piloting this technology within its supply chain.
The startup replicates in a lab setting the DNA information that codes for color in an organism. Colorifix CEO Orr Yarkoni says the process uses no toxic chemicals, reduces water consumption by up to 40 liters per kilogram of fabric, and cuts carbon emissions by 65% compared with common dyeing. As it’s carried out at lower temperatures, it also lessens energy use by up to 70%.
“We use biology rather than chemistry not just to make our dyes but also to transfer them onto materials, which is a true game-changer in terms of increasing environmental savings,” Yarkoni adds. “I think bioengineering is potentially the future of fashion.”
This past March, H&M launched Colorifix’s dyes worldwide with its capsule collection.
That of course isn’t going to fix the brand’s fast-fashion model—in fact, any new collection only creates higher amounts of cheap, disposable clothing, as many environmental activists have pointed out when accusing the company of greenwashing. But it’s a small step toward driving change within the sector. “With our size and our resources, we can be part of making [new technologies] more scalable,” CEO Helena Helmersson told British Vogue in an interview last year.
Other environmental fashion startups have also seen growing interest, raising significant funds in the past year.
California-based MycoWorks, which has developed and patented a technology called Fine Mycelium to create leatherlike, lab-grown premium materials, raised $45 million in funding in November 2020 from celebrities such as Natalie Portman and John Legend, venture capitalists, and “several major fashion brands,” according to a company statement. In March, luxury French label Hermès partnered with the startup to introduce Sylvania, a new biotech fabric it will use in some of its bags.
Back in Europe, Swedish startup Material Exchange was named innovation partner of the United States Fashion Industry Association (USFIA) this past spring. Founded in 2017, the company works on software and 3D tools to digitize sourcing and standardize material data (essentially creating a digital language to describe and “feel” materials) with the aim of eliminating physical sampling and material waste—a crucial step in decarbonizing the supply chain. It also launched the Open Marketplace, to help brands and suppliers connect digitally.
“We’re hitting critical mass,” says Stacy Flynn, cofounder of Seattle-based textile innovation company Evrnu. “Our emails blow up every week with new clients contacting us, from brands and retailers to designers. A lot of industry professionals are genuinely asking, ‘How do we shift things for the better?’”
Flynn’s company might offer a solution. Launched in 2014, the startup has developed a new technology, NuCycl, which breaks down the molecular components of discarded cotton and builds them back up into new fibers that are stronger and use 98% less water than virgin cotton. Among its partners are Levi’s, Target, Adidas, and Stella McCartney.
“We essentially want to do away with landfills and incinerators,” explains Flynn. “The goal is to put out products that can come back into the system and find a second, third, fourth life. It’s the only way to really achieve tangible impact reduction and create a fully circular fashion cycle.”
Italian denim supplier Candiani Denim also saw demand soar during the pandemic, after some of its partners—names like Stella McCartney and Kings of Indigo—began adopting its latest material technology, Coreva. The fabric uses a plant-based yarn obtained from natural rubber to replace synthetic, petrol-based yarns, and it’s the world’s first biodegradable and compostable stretch material.
“We released Coreva to the wider market in March, and requests went through the roof,” says Simon Giuliani, Candiani’s global marketing director. “We’re a small company, but we’re now having to work on making Coreva available on an industrial scale, to meet demand from luxury names, big brands, historical denim makers. It’s pretty remarkable.”
Still the fashion sector as a whole is a long way from fully disrupting the supply chain.
“The brands we work with are committed to being environmentally responsible, but the industry is still rife with greenwashing and maximizing profit,” Giuliani says. “Technologies like ours might be better for the environment, but they can’t be price-competitive compared to the cheap labor the sector has relied on for so long. Until the focus shifts—until big brands stop churning out collections every other month and being so sales-driven—there are still limitations to really closing the loop.”
While the pandemic has made some players step away from fashion’s standardized calendar, the sector’s quarterly cycle (and inherent huge volume of clothes that result from it) has yet to be fully upended—as do its unethical practices. Similarly, regulatory bodies continue to do too little to ensure the industry scales up its circularity.
“We have to [help build better] social protection systems…in countries where there’s a lot of production,” H&M CEO Helena Helmersson told BoF in October 2020. She also noted the increasing need for “more collective, industrywide agreements between employers, workers, unions, and governments, as there are in some parts of the world.”
The majority of the textile sector is still discarding as much as 12% of fibers on its factory floor and recycling less than 1% of its products. Garment production volumes are projected to grow 2.7% annually between now and 2030, McKinsey analysis showed.
A recent study by the Royal Society for Arts, Manufactures, and Commerce (RSA) in the U.K. revealed that approximately half the clothes sold by large online fast-fashion brands like Boohoo and Asos are made entirely from virgin plastic materials such as polyester, acrylic, and nylon.
Ultimately, it might be up to consumers to force the industry to address its shortcomings.
“People hold the biggest power,” Giuliani notes. “Once we start demanding true accountability from the brands we buy from, that’s when we’ll see change. Those in the industry that are able to back up their commitments in a concrete way will be the ones that’ll still be around 10 years down the line.”
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