February saw two significant developments within the fashion industry: As fashionistas around the world waved adieu to fashion legend and Chanel’s creative director Karl Lagerfeld with their perfectly manicured hands, the UK government’s Environmental Audit Committee (EAC) was submitting the final paper in its investigation into the sustainability of the fashion industry.
While the haute couture of Chanel and the apparel churned out by online retailers like Boohoo and Missguided may be at opposite ends of the style spectrum, both sit in a sector that demands a new economic model, the EAC said. As its paper Fixing fashion: clothing consumption and sustainability puts it: “Business-as-usual no longer works. The way we make, use and throwaway our clothes is unsustainable.”
According to Newton global income investment leader Nick Clay, the government’s proposal of a penny charge per garment to clothing manufacturers could raise £35m to invest in better clothing collection and sorting in the UK. This could help address at least some of the issues raised in the EAC’s report, given that the majority of fabric currently ends up in landfill, says Clay.
The EAC sets out five ways in which the fashion industry is damaging the environment:
- Forced labour and other illegal labour practices;
- Synthetic fibres shedding plastic particles;
- Excessive water use in the production of garments;
- Growing consumption and demand for newer, faster fashion; and
- Large scale clothes wastage.
The committee also suggests five possible solutions, or ways the government can help, namely:
- To ensure the rights of workers in the UK and abroad;
- To combat the pollution caused by synthetic fibres;
- To reduce the excessive consumption of water;
- To reduce the wastage caused by the industry; and
- To reduce the rate of fashion consumption.
While admittedly from a pretty low base, Newton says one retailer that stands out for making active progress on sustainability is Hennes & Mauritz. The Swedish clothing company, whose suite of nine brands includes H&M, & Other Stories and COS, used 96% renewable electricity across its operations in 2017, while 59% of the cotton it used was sustainably sourced, with a goal of 100% by next year.1
Further, the company runs a recycling scheme that encourages customers to donate unwanted clothing – of any brand – in exchange for a £5 H&M gift voucher. In 2017, the firm claims to have collected more than 17,771 tonnes of textiles – equating to 89 million T-shirts – through the initiative.2
Lottie Meggit, responsible investment analyst at Newton, says the issue is not just limited to fast fashion, but the entire fashion industry. She expects changes in perception and behaviour around the issue to follow the same path as our collective awakening to the probem of global plastic pollution.
Need for scale
She says recycling schemes like that run by H&M, are starting to become more commonplace but the issue is often that demand for repurposed clothing isn’t there yet, meaning most companies still lack the incentive to run them and achieve economies of scale.
For Clay, while the initial cost to businesses of improving sustainability may be high, these costs are necessary, because in the longer term, either market forces or regulation will ultimately force the decision anyway.
“Either customers will vote with their pockets, or rules will be imposed on the industry and that means those who have already made their investment will be the ones who most benefit further down the line,” he says. “The likes of Boohoo and Amazon (named among the worst offenders in the EAC report), will be slower to react because they are so focused on making and distributing products as cheaply as possible, so any short-term cost increases are a major headwind for their model.”
But consumers bear some of the responsibility too, concludes Clay: “We can focus on the companies all we like, but equally, if the consumer is perfectly happy to wear something for one week, they are supporting that disposable attitude.”
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