The fashion industry is increasing its efforts to tackle environmental, social and governance (ESG) issues. Leaders are supporting the scaling of new solutions in product development, sourcing, logistics and fulfillment, leveraging advances in data technology for ESG reporting, traceability, supplier engagement, and more. Coalitions are forming across the sector to promote progress towards a more sustainable fashion industry.
As social and environmental issues threaten to compromise fashion’s current operating models, urgent actions are needed to deliver profitability and sustainability in tandem.
Our 2023 Scaling ESG Solutions in Fashion playbook identifies 12 key action areas for transformation across the industry, considering the innovation, technology, finance and policy needed to make meaningful change from 2023 onwards.
ESG practices not only support reversing the climate crisis, but also drive revenue growth, supply chain resilience, product innovation, brand differentiation, and exceptional customer experience – putting people and purpose at the center.
"Let’s start using sustainability to scale the solutions that are possible right now – and next – to help redesign fashion’s purpose-driven future."
— James Fallon, Editorial Director, Women’s Wear Daily
We unlock 12 key action areas for transformation across the environment, industry transparency and social impact.
Carbon and Net Zero
Collaborating on solutions to achieve net zero and carbon reduction via facility improvement, virtual power purchase agreements, eliminating coal in manufacturing, and shifting to renewable electricity.
Scaling the availability and pathways for preferred fiber and material usage, supporting regenerative agriculture and biodiversity – providing an accelerated solution to reducing greenhouse gas emissions.
Water and Chemicals
Sustainable chemical and water management, including eliminating hazardous chemicals from the global value chain, conserving resources and protecting people and planet.
Circularity, Waste and Redefining Growth
Scaling innovations in fiber-to-fiber recycling, turning textile waste into new fibers and/or other textile products. Advancing circular business models, and alternative value creation.
Plastics and Packaging
Retail & brand consortium to identify ways to streamline plastics & packaging requirements to drive efficiencies, alternatives, and potential regional recycling collaborations.
Traceability and Transparency
Increasing visibility, data-led stakeholder communications, improved decision-making, quality control, and risk reduction via supply chain mapping, traceability & transparency.
Consumer Engagement and Labeling
Agreeing on requirements that define preferred / sustainable products – and the required framework of standards, certification, and verification to create consistency.
Worker and Human Rights
Acceleration of labor rights, increased supply chain transparency and human rights due diligence by working with existing NGOs and amplifying global efforts.
Empowerment, Education and Digital Wages
Engaging with initiatives ranging from secondary education to board room practices that further opportunities for individuals from more diverse racial, gender, cultural, and socioeconomic backgrounds.
Justice, Equity, Diversity and Inclusion
Partnership across the apparel industry to build resilient communities by scaling and accelerating a global educational agenda of women’s empowerment and gender equity in supply chain opportunities.
Aligning with suppliers on Science Based Targets (SBTs) and ESG goals, while considering new approaches to dynamic planning that allow for more agile production and local sourcing of materials.
Transportation and Logistics
Optimizing logistics using AI-based software and utilizing electric and alternative fuel-powered trucking and last mile delivery to reduce carbon emissions while providing long-term cost savings.
What's next for ESG in fashion
This 2023 Scaling ESG Solutions in Fashion playbook builds on the 2022 edition and unlocks specific actions for retail leaders to take now – as well as what they should focus on next. To bring these key levers to life, enablers in the form of finance, data, innovation and regulation are needed across the board to drive this industry collaboration.
Let’s envision resilient businesses that deliver a responsible retail industry and a healthier world. A world where fashion retailers drive a circular economy, support regenerative agriculture, source materials from preferred and low climate impact sources, operate with no waste, secure electricity from renewable energy sources, and ultimately respect its people.