Fashion brands are talking about sustainability. A lot. In the last 5 years, references to sustainability in the annual reports of 15 of the world’s largest fashion companies have more than doubled. The market is demanding that the industry change, and the industry is responding by talking about sustainability and setting new targets. But how will companies rise to the challenge of actually meeting those targets?
For a long time, the discourse about sustainability in the industry has mostly revolved around materials. High profile initiatives focused on using recycled materials or shifting from conventional to organic cotton have tended to dominate. There are good reasons for this: fossil fuels used in material production are a major contributor to climate change, and within the realm of actions brands can take to address their footprint, it’s relatively easy to shift to producing materials from certified sources.
But materials are just one piece of a big pie, and it’s time to expand the conversation to include other industry practices standing in the way of sustainability, including waste. That’s why it’s notable to see waste as one of six pillars in the Business of Fashion’s inaugural Sustainability Index. But it’s less encouraging to see that no major company included in the index scores higher than a 37 out of 100 on the waste metric, and that it’s the metric with the lowest average score across all companies (just 24 out of 100).
Fashion waste is an enormous problem for the environment. According to the Index, roughly 40 million tonnes of textile waste is sent to landfill or incinerated, and even before Covid-19, overproduction was so prolific that just 60 percent of garments were sold at full price. The index’s waste metric includes three sub-components, and one of them - waste-free production - has an average score of just 19 out of 100 across brands, one of the lowest average scores in the entire index.
Given the direness of the waste problem and the enormous scope for improvement, the solutions will require creativity and decisive action. Many brands will have to rethink core components of their business models. Already, some luxury brands are beginning to tentatively embrace second-hand business models - something that until recently was unthinkable. Circularity is getting more attention too, as brands begin to think through how they can deal with post-consumer waste.
But perhaps the simplest and most immediate opportunity to reduce waste lies in getting better at predicting demand. Brands that are serious about reducing waste as a way to help achieve sustainability targets cannot hope to be successful unless they change the way they predict demand and adjust their production levels and buy depths accordingly. Incorporating consumer insights into the demand planning process will be critical. Fortunately, it’s easier than ever before for fashion brands and retailers to access predictive analytics in the form of consumer insights. The industry must transition from producing first and hoping for high sell-through, to using consumer input to understand what will sell before production even begins.
Consumers are growing increasingly savvy about sustainability, and they’re also getting more serious about holding brands accountable. Tackling waste presents a unique opportunity for brands to show they’re serious about meeting targets to make the industry more sustainable.
