These Shoes Are Shifting the Economics of Deforestation in the Amazon Rain Forest

VEJA is launching a running shoe, the brand's first athletic shoe and, according to the company, the first of its kind at all.
October 6, 2019, 12:30 PM UTC
Racing to save the Amazon, Veja launches an eco-friendly running shoe.
Veja

Outside of his home in the far eastern Brazilian state of Acre, Julio Barbosa de Aquino takes a hooked knife known as a cabrita and slowly carves a shallow groove in the trunk of a seringueira tree. The long, diagonal cut completed, he removes the knife and makes another parallel cut just below the first, and then another, and another, scoring a section of the trunk about 18 inches tall and a foot wide.

Cut too deep, Barbosa says, and the tree will give too much of the milky white substance that is now beginning to seep into those first cuts and downward into a small plastic collection bucket below. Overharvesting exhausts wild rubber trees like this one, making them unproductive and eventually unhealthy. But when trees are managed correctly, seringueiros—or rubber tappers—like Barbosa can extract from them over and again, as the scars running up and down all sides of this 80-year-old tree attest. At the Chico Mendes Extractive Reserve, the white rubber trickling into the collection vessel is not only 100% sustainable but also quite lucrative, thanks to a unique partnership with Parisian sneaker brand (and casual-fashion darling) Veja.

Launched in 2005 by two friends who simply wanted to produce a more ethical, sustainable sneaker, Veja did a tidy 34 million euros (roughly $37 million USD) in sales globally last year, retailing in 45 countries. The company’s minimalist aesthetic and unambiguous message of environmental responsibility and ethical production have resonated with a growing number of consumers including the likes of Meghan Markle, Katie Holmes, and Emma Watson, helping drive average annual growth to an enviable 60% over the past four years. Its latest offering, the world’s first performance shoe made from 53% bio-based materials, has redefined the art of the possible in sustainable athletic shoe design. (By comparison, your average pair of trainers is constructed almost entirely from petroleum-based synthetic rubbers and plastics.)

Veja cofounders Sébastian Kopp and François-Ghislain Morillion.
Veja

But as hectares upon hectares of the Brazilian Amazon continue to burn in one of the worst single-season losses of rain forest in memory, Veja’s most significant social and environmental impacts very well may be dribbling down this tree trunk near Barbosa’s home in Acre. By creating both a demand for wild rubber and a mechanism for rubber tappers to make a decent living from it, Veja is not just proving that it’s possible for sneaker manufacturers to green up their supply chains. It’s also creating a market-based, economic incentive for keeping the rain forest and its wild seringueira trees in place.

“We don’t like to say ‘Veja is saving the rain forest,’” Veja cofounder Sébastian Kopp says. Rather, the company is “finding a productive model benefiting profit and preservation at the same time.” In this remote corner of Acre, Kopp and cofounder François-Ghislain Morillion may have found exactly that.

Fair Trade, Fair Business

Chico Mendes Extractive Reserve is named for a rubber tapper turned activist, union leader, and environmentalist who in the 1980s led a local movement to protect the rain forest and the livelihood of Acre State’s rubber tappers. At the time, cattle ranchers had turned to sometimes violent means to appropriate and clear Amazonian land for grazing. While leaving his house one evening in 1988, Mendes was shot and killed by one such rancher.

His death galvanized the movement and forced the Brazilian government to take action, though 30 years on, the situation in Acre and other Amazonian states has seemingly come full circle. The fires burning across the Amazon this summer were largely the result of land clearance by farmers and ranchers. Far-right Brazilian President Jair Bolsonaro has pulled back enforcement measures put in place by previous governments to curb deforestation. One of the world’s most significant carbon sinks is shrinking at an accelerating pace, and the Amazon’s rubber tappers are once again organizing to defend their livelihoods with little help from the Brazilian state.

Rubber tappers at the Chico Mendes Extractive Reserve.
Veja

Veja began working with the rubber tappers in Acre via Bia Saldanha, an activist and friend of Chico Mendes who since 2007 has engineered and helped maintain the company’s supply chain, working directly with the rubber tapping communities in Acre straight through to Veja’s production facility near Porto Alegre in southeastern Brazil. With help on the ground from Saldanha, Kopp and Morillon have managed to keep Veja extremely close to its supply chain. Both Kopp and Morillon make regular trips to Brazil, spending time with individual rubber tappers and cotton farmers and hashing out the fair trade agreements central to Veja’s vision.

The company negotiates what it deems fair prices directly with the producers and fixes them from the outset, insulating producers from market fluctuations. In doing so, Veja regularly pays well more than market prices for organic cotton and wild rubber, sometimes as much as double. In exchange, Veja receives a steady supply of organic cotton and its pick of the best wild rubber coming out of the eight rubber tapping associations with which it does business. The agreements also secure its supply of sustainable wild rubber by creating an economic model that makes rubber tapping financially viable and the rain forest a profitable asset. Veja isn’t fighting deforestation, Kopp says, so much as creating value in keeping the forest as is.

The shoes are manufactured in Brazil. Most of the materials comes from sustainable sources, including rubber farms in the Amazon and cotton farms in northern Brazil, with which Veja actively works on a fair-trade basis.
Veja

“Fair trade, as we see it, is not a hippy vision, it’s not a utopian vision,” he says. Ethical considerations aside, it’s simply good business. Veja can’t deliver on its core value proposition to consumers—a more sustainable shoe—without a steady flow of organic textiles, wild rubber, and recycled plastics, he says. If securing Veja’s supply of sustainable rubber happens to keep Brazil’s seringueiros in the rubber tapping business when they could just as easily clear the forest for cattle ranching, so much the better.

Racing for the Future

While Veja’s remarkable growth serves as a strong argument for the company’s feel-good, fair-trade, sustainable-at-all-costs model, scalability remains a critical challenge. So, too, does technology. The Condor, Veja’s new athletic performance shoe, took four years of development and remains only 53% bio-based (though a fully bio-based performance shoe is both the ultimate goal for Veja and within reach, Morillion says). While the upper mesh material is made from recycled plastic bottles, the interior lining also from recycled plastic and organic cotton, and the signature “V” logo patch from castor oil, the sole remains 39% petroleum-based synthetic rubber (the remainder: 30% wild rubber and 31% rice husk).

That’s both a huge step forward compared with the 99% petroleum-based trainers that dominate the market and indicative of the challenges faced by fashion brands, particularly those athletic apparel giants that churn out millions of pairs of sneakers annually. Whether or not a fully post-petroleum athletic shoe is possible remains an open question, says Céline Semaan, CEO of the Slow Factory, a consultancy and R&D lab that specializes in sustainable solutions for fashion brands. But if the industry wants to find out, it can’t necessarily rely on larger corporate brands to do so. “Most brands, unlike Veja, don’t have a good understanding or good control over their supply chains,” Semaan says. “The reason we are not seeing innovations at scale coming from these larger corporations is that their systems are designed to continue as usual.”

Available for men and women, the Veja Condor retails for $160 in the United States.
Veja

There’s nothing usual about Veja’s system, however. Bootstrapped entirely by Kopp and Morillion, the company has no outside investors to whom they must answer. The company manages its supply chains meticulously, keeping them as short as possible. The brand’s website enumerates all the ways in which the company is not living up to its own principles of sustainability and transparency. (The eyelets contain metal Veja didn’t source itself; its e-commerce operation relies on banks with branches in tax havens.) Its shoes cost five times more to produce than the average “big-brand” running shoe. It has never bought an advertisement, does zero marketing, and uses the dollars saved to invest in R&D and offset its higher production costs.

All of this helps keep rubber tappers like Barbosa in business and countless acres of Amazonian rain forest in place. To make a dent in the current (accelerating) rate of deforestation, however, this system would have to scale dramatically, and applying Veja’s model to a production enterprise the size of Nike or Adidas would prove a massive logistical challenge.

Fast shoes, but not fast fashion.
Veja

But the conversation around footwear brands like Veja, Allbirds, and Everlane—brands embracing sustainable production methods to gain both mind share and market share—is forcing larger shoe and sportswear brands to come to grips with a changing consumer culture. Brands like Adidas and Reebok have recently released shoes made from recycled plastic or designed with recyclability in mind, a nod to changing consumer values if not yet a wholesale acquiescence to them.

“Veja has done this amazing job of values matching and showing the mainstream actually cares about climate change,” says Lucy Shea, group CEO at Futerra, an international strategy and creative agency focused on sustainability. “You now have consumers with a much clearer stated preference for products and services that are going to do good for the planet while doing good for them. Hence the growth of the Vejas, the Everlanes, the Reformations. The big guys are worried about their lunch getting eaten, so they’re throwing out the life rafts to see if they can actually prove the business case for this.”

If Veja’s recent growth is any indication, there’s indeed a business case to be made despite a steep uphill technological and logistical climb. “We have a lot of limits, a lot of problems, a lot of things to improve on,” Kopp says. “But if there is a problem with scaling, I would say this is a good problem to have.”

More must-read stories from Fortune:

Cannabis dos and don’ts from an etiquette expert
—Tips and treats for stress-free travel with pets
—What happens to the clothes you forget to pick up from the dry cleaner?
Rent the Runway will stop taking new customers temporarily amid operations chaos
—Why this New York City museum is in an elevator shaft
Follow Fortune on Flipboard to stay up-to-date on the latest news and analysis.