LOS ANGELES – Whenever I scan the fashion and sustainability headlines, my optimism that the industry is on a path toward real change fades a little more. The current narrative conflates the idea that sustainability will come from increased transparency or technological innovation, a narrative that ultimately distracts the media, consumers, investors and policymakers from fashion’s real problem: the prevailing business model.
The topics that create the best headlines don’t address the roots of fashion’s outsized environmental impact: the overproduction of low-quality, polyester garments made in far flung locations by low-wage workers – if they are paid at all – in order to offer low prices to consumers and hit quarterly growth targets for shareholders.
The hope that organisations striving to disrupt the industry’s status quo will ever garner the media attention and investor dollars required to spur actual change diminishes with every story on the latest recycling or innovative material technology.
In Thinking Fast and Slow, Daniel Kahneman notes: “People tend to assess the relative importance of issues by the ease in which they are retrieved from memory … this is largely determined by the extent of coverage in the media … what the media choose to report corresponds to their view of what is currently on the public’s mind.”
In fashion, the media reports on various tech innovations because it believes that’s what the public wants. This ultimately creates a smokescreen helping brands avoid substantive change. Buzzwords like: recycle, resale, regenerative agriculture, circular, organic, etc mask the lack of progress.
Real change will be expensive and likely create short-term losses. When BP announced it would be accelerating the transition to renewables, the company conceded it wouldn’t make money for years on the projects, it outlined a roadmap for the transition, committed to cutting oil production — and most importantly communicated how this transition would be funded.
By contrast, I can’t recall a single sustainability initiative in fashion that provided a detailed financial breakdown of what their sustainability goals would cost, or even one that made the financial press apart from last year’s Patagonia news.
Any initiative that would result in a fundamental change to fashion’s business model would capture the attention of the financial press, analysts and investors. The apparel industry relies largely on using the lowest cost manufacturers and materials across a complex supply chain where one garment can cross the globe many times before it reaches the end consumer. Substantive change will require a transition away from the volume led growth strategy that’s dominated since trade barriers fell in the early 90s.
Fashion’s sustainability narrative would be well served by incorporating the idea of materiality. Materiality, that is, in the legal or financial accounting sense.
The concept of materiality in accounting refers to the impact a particular financial figure has on a company’s accounts, and whether its omission or a mistake in its calculation has a material impact on the outcome of the financial statements. These things are always relative.
So, for example, the US$250m climate fund raised by The Apparel Impact Institute amounts to just 1.5 basis points (less than two tenths of one per cent of the US$1.7 trillion-dollar industry). The fund’s goal to raise US$2bn amounts to just 0.12 per cent of the industry’s estimated annual revenues. Context matters yet it’s rarely presented in press coverage.
The allure of turning mushrooms or pineapples into materials is easier to communicate than why or how better quality clothing could create a more sustainable industry. The 2023 news cycle started with a series of articles on vegan designer Stella McCartney’s more sustainable materials, investments in recycling technology, and highlighted her fully circular parka. That’s it. A parka at a high-fashion, not an outdoor brand. The other innovation mentioned was a hoodie in her partnership with Adidas, but only 50 were made. 50!
Stella McCartney’s annual revenues are estimated to be upwards of US$270m. However technologically interesting and innovative these materials might be, they don’t amount to a rounding error on the bottom line and are far from scalable (not to mention untested in their durability). Yet her various initiatives are covered exhaustively by the fashion media and held up as a leader in sustainability. If assessed with respect to their materiality to the bottom-line or potential for scalability, the initiatives wouldn’t be newsworthy.
H&M is currently being sued for deceptive advertising where the plaintiffs highlight the insignificant amount of recycled materials relative to the total collection compared to its marketing emphasis on these products.
Materiality matters. Coverage that perpetuates the idea that preferred materials or recycling as a solution to fashion’s environmental impact ignores the data and trends that facilitated the current crisis and distracts consumers, investors and policymakers.
Even if textile recycling was close to scalable (it’s not) recycling still relies on consumers getting their textile waste to the right facilities. For perspective, in the US only 5-6 per cent of the plastic bottles produced are recycled even though over 60 per cent of municipalities have curbside recycling and 94 per cent of the population has access to recycling facilities. If we haven’t achieved a critical mass for something as simple as plastic bottles, does it make sense for the fashion industry to continue to pin its sustainability hopes on recycling our clothing which is far more complex and costly?
The technological pipedream of preferred materials, recycling and promises of circularity create a smokescreen to distract consumers, investors, policymakers, and the media from the lack of progress or even attention to the factors that will actually lower emissions.
The Sustainable Apparel Coalition’s (SAC) latest decarbonization plan is a buzzword heavy initiative seemingly designed along these lines.
The SAC is the main organisation leading a coalition of the largest brands to help guide them toward more sustainable practices. It is the same organisation that promotes polyester — a fossil fuel derived material primarily made in countries with the dirtiest energy grids and geographically far from the end consumer. Yet polyester ranked as the least environmentally impactful textile. The decarbonization plan will also use the SAC’s Higg suite of tools to guide brands — tools banned in Norway and whose methodology is under investigation by several European regulators.
The SAC noted: “Left unchecked, emissions will keep growing, well off pace to deliver the 45 per cent absolute reduction needed by 2030 to limit global warming to 1.5°C.”
A 45 per cent reduction requires radical changes to how fashion operates. There is nothing radical or even substantive in this decarbonization plan. A substantive plan would have had an impact on the stock prices for the member companies. The plan didn’t mention any financials or how it would be funded. This announcement didn’t even make it to the financial press.
Even if you ignore the lack of financial or funding disclosures (the fatal flaw in my view) this plan still left me with more questions than hope. The SAC noted the following as being the six most impactful areas:
- – Maximising material efficiency: reducing the amount of fibre and materials that go to waste through design, material usage, and manufacturing methodology
- – Scaling sustainable materials and practices: increasing the use of more sustainable materials and practices
- – Accelerating the development of innovative materials: increasing investment in next-generation materials, including textile recycling and bio-based materials
- – Proliferating energy efficiency: making energy efficiency a priority across all manufacturing facilities
- – Eliminating coal in manufacturing: replacing coal with renewable energy in all manufacturing facilities
- – Shifting to 100 per cent renewable electricity: deploying renewable energy solutions
All the buzzwords are there. But the degree of decarbonization is in the details, which the plan lacks. Below is a sample of the questions that came to mind when I read this:
- – Regarding scaling “sustainable materials” — will this mean scaling more polyester since it’s the fibre the Higg MSI tools suggests is the most “sustainable” or least impactful?
- – How durable are these new “more sustainable,” bio-based materials?
- – What qualifies as “all manufacturing facilities?” Does this only apply to the factories that member companies own? Most apparel firms don’t own any of their suppliers or manufacturers, so who exactly is included?
- – What percentage of the supply chain will these initiatives cover or apply to? Do these initiatives apply across all Tiers/Scopes?
- – How are they eliminating coal in manufacturing when most apparel production occurs in developing countries with the dirtiest grids that lack the funds or motivation to transition to renewables? Are they going to be investing in the entire energy infrastructure in the countries where most apparel production occurs? Are they going to create special renewable power sources that only supply power to their suppliers (which again they don’t own)?
- – Are they dedicating funds to help China, Bangladesh, or Vietnam (three of the largest apparel manufacturing hubs) transition to more renewable energy?
- – How does the focus on preferred materials help when fashion’s supply chain remains so geographically spread out?
- – How do any of these measures address the overproduction of cheap, disposable clothing?
- – How will any of this be funded?
The SAC notes that it, “will identify the biggest opportunities for impact and help accelerate the large-scale change needed to drive emissions reduction across the industry at scale.”
Using historical trends and how the industry has changed over the last 30 years as a guide, the biggest opportunities for impact on the production side would come from reducing the amount of polyester used, the total volume of production and the miles each garment travels for production.
As the founder of a brand who tries to operate in a more responsible and sustainable manner, I lose hope for the future of a more sustainable fashion industry and the ability for brands like mine to survive and thrive whenever I read the ongoing and extensive press coverage of these buzzword-filled initiatives.
As a former Wall Street professional who has spent the last eight years working in financial policy, I cringe at the lack of critical coverage.
As the world’s fourth largest sector by some estimates, fashion is not frivolous. But when it comes to its sustainability narrative, it’s treated as such. Media coverage ultimately helps inform consumers, investors and policymaker attitudes about what is and is not “sustainable.” Look at where investor dollars are going: innovative materials, digital goods, resale or tech solutions to make shopping easier for consumers.
Most agree that legislation will be required to help right the ecological wrongs the industry imposes. Policy measures will always lag the market, though. In the absence of policy, we cannot overlook how the media’s coverage of the industry’s sustainability initiatives shapes stakeholder attitudes. The more the media covers the idea of preferred materials as a solution to fashion’s environmental footprint, the more consumers, investors and policymakers will think that’s enough — only it’s not even close.