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1 July 2019

Fashion and luxury retail 2019 – 5 of 5 Insights

Sustainable luxury: can fashion be 'fixed'?

Ethical and sustainable fashion is increasingly on the industry's agenda and 2019 appears to be a year of significant awakening for many luxury players.

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Anjali Chandarana

Senior Associate

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Securing a sustainable future across all aspects of our lives, not just fashion, is a defining challenge of our time. Do you know exactly where your textiles are sourced? Do you have a detailed understanding of the working conditions of your garment factories? Do you care enough for the answers for them to influence your shopping habits?

What is sustainable fashion?

Despite the growing interest in sustainability issues within the fashion industry and among its customers, there is no common definition of what sustainable fashion actually means. Generally, sustainable fashion can be described as a movement aimed at creating flourishing ecosystems and environmentally responsible communities, including by changing the way products are produced and used, reducing waste and harm to the environment, and clamping down on poor labour conditions.

Sustainability is significant for the fashion industry because it is among the leading global polluters and because its customers are increasingly demanding greater environmental responsibility. Globalisation has made it possible to produce clothing at lower prices, both in response to and as a driver of constantly changing trends, leading to increased disposal of products by consumers – so called 'fast fashion'.

The sustainable fashion movement aims to end the 'throwaway' society and encourage consumers to favour durable and environmentally friendly products. Is sustainability the answer to 'fixing' the current state of fashion?

Walking the walk

World-renowned fashion designers and celebrities are already raising awareness of environmental issues and some of the less desirable realities of parts of the industry, including exploitative labour, waste and animal cruelty in additional to environmental damage. Sustainability consultancy Eco-Age's 'Green Carpet Challenge' is one of many well-established ethical initiatives that serves to put sustainability in the spotlight, specifically on red carpets across the globe.

Its founder and creative director, Livia Firth, walked the walk recently to highlight sustainability issues by wearing a custom floral caftan, 'upcycled' with Swarovski crystal stones designed by Richard Quinn at this year's Met Gala in what was almost certainly the most sustainable look of the evening.

'Fast fashion': no longer the future?

According to the Environmental Audit Committee's landmark 'Sustainability of the Fashion Industry' report, we buy more clothes per person in the UK than any other country in Europe. Many of these are fast fashion garments made from non-recyclable single fibre materials which generate excessive waste.

The recent growth in this market is particularly driven by the success of low-value end online retailers such as Boohoo and Misguided. These online fashion companies increasingly secure relationships with 'influencers' – consumers now only have to tap on Instagram photos to be told the price of products worn and get an online link to purchase vastly increasing time to market (see our article for more on influencers).

The industry's current fast fashion business model is, however, unsustainable, especially with rapidly growing levels of consumption across the globe and growing demand in developing countries. Creating a circular fashion system is becoming the new goal: this means the entire lifecycle of a product must be considered at the design and sourcing stage. This poses a problem for brands and designers as they grapple with the tension between consumer demands for novelty and sustainability.

Sustainability: challenges and solutions

Tackling textiles

Gaining a full picture of the impact of different fibres used in clothing production is important so that businesses, consumers and policymakers can decide on the most effective solutions for the industry.

Textile production is a significant contributor to climate change. The environmental impact of our clothes is mainly determined during the design and production phase. The growing of fibres consumes large quantities of water. Adding rips and tears to jeans by chemical application, for example, is also linked to high rates of water use.

The natural versus synthetic fibre debate is ongoing and there are ethical and environmental problems associated with both. The use of land, water, animals and chemicals are required to produce natural fibres like cotton, wool and leather.

Cotton is the most widely used natural fibre in the world, but a move from conventional to organic cotton could help reduce the negative impact to the industry. Gap recently announced that its brands are committed to sourcing 100% sustainable cotton within the next six years.

Synthetic fibres, on the other hand, enhance the problem of ocean microfiber pollution and polyester, for example, requires an energy intensive production process.

While increasing use of natural fibres may seem like the most obvious option, animal welfare is of increasing concern to consumers - the UK has banned the manufacturing of fur and may go on to ban the sale of fur. Prada is the latest fashion house to go fur-free. A number of other luxury retailers have been fur-free since 2017, including Burberry, Versace, Gucci, Chanel and Farfetch.

So are recycled fibres the answer? Natural Fiber Welding is an example of a start-up that has found a way of producing sustainable yarns and fabrics by using a closed-loop system that 'upcycles' materials that are today considered waste.

Rothy's is another example of a company that uses recycled materials to create stylish, comfortable, sustainable shoes. Developing the technology to recycle fibres across the industry is perhaps the biggest challenge the industry will need to overcome in order to move to true circularity.

Fighting fashion waste

Our consumption of disposable fashion goods is causing a global waste problem. The industry is responding by developing innovative business models to give clothing a longer shelf life, including repairing garments to reduce their environmental footprint, reusing second-hand clothes and 'up-cycling' old or damaged goods.

Thrift+ is an example of a startup which aims to make it easy for consumers to donate second-hand clothes to their favourite charity – Thrift+ sells consumers' clothes online and gives 33% of the revenue back to them.

There has also been a recent behavioural shift towards the 'access economy' - innovative models that rely on sharing or renting rather than ownership are emerging, for example, peer-to-peer vintage sales on sites like Depop. Brands are not currently legally required to take responsibility for end of life recovery of their products. However, numerous companies, including Zara and H&M have introduced voluntary in-store recycling initiatives to tackle the 'throwaway' culture.

The hidden cost of fashion

Many leading Western luxury fashion retailers source their clothes from countries with low environmental governance. While some production has been re-shored to factories closer to home, most brands still source materials from disjointed supply chains in Asia.

Poor pay and conditions are not unusual lower down global clothing supply chains – workers can be subjected to forced overtime, as well as cramped and unhygienic surroundings, and use of child labour is a problem.

Eco-Age has argued that retailers impose "unrealistic requirements on suppliers that compete to offer the lowest prices and shortest lead times, often resulting in corner cutting, impacting both worker welfare and the environment."

Primark's business model is perhaps the anomaly in fast fashion; reducing advertising relative to its competitors, thereby enabling it to pay its workers decent wages while also charging low prices to consumers.

Focusing on transparency and traceability is vital for businesses seeking to control conditions in their supply chains and tech innovation can play a major role.

To the Market is an example of a startup which partners with existing artisan groups employing vulnerable communities and connects them to global consumers in order to help them grow their businesses. Digital technology, for example, blockchain, can be used to record all aspects of the supply chain including materials used in products.

The future of sustainable fashion

Fashtech

Using innovative tech in the fashion industry is fundamental to enabling ethical change in the fashion market. Fashtech startup innovators are continuing to develop circular business models, taking into account consumer desirability and emerging technologies.

However, the technology does not yet exist to completely recycle clothing, especially if the material is badly ripped or stained. Increased investment into these types of businesses and open discussions regarding re-aligning business models and production processes can help find solutions to improving sustainability in the industry (see our article for more).

New rules

Regulation has a part to play in sustainable fashion. The UK's Modern Slavery Act 2015 (MSA) requires certain companies to produce a statement setting out the steps they have taken to ensure modern slavery is not taking place in their business. It is a first step to increasing transparency in supply chains, although it has its limitations (see our article for more).

Fashion Revolution recently called for the government to pass mandatory supply chain due diligence laws and pointed to regulatory examples in Switzerland and France. Even a simple legal requirement on brands to declare the source of raw materials used in their clothing would lead to a shift in attitudes.

In February 2019, the UK Parliament's Environmental Audit Committee published a report on the future of fashion sustainability, suggesting broad-ranging systemic change and a series of world-leading policy recommendations including:

  • Reforms to taxation to shift the balance of incentives in favour of reuse, repair and recycling to support responsible fashion companies.
  • Mandatory environmental targets for fashion retailers with a turnover above £36 million.
  • A penalty for fashion firms which fail to report and comply with the MSA.

In its formal response to the report, the government rejected the series of recommendations, explaining that plans to address fast fashion are in the pipeline for the future and "the industry has the primary role to play in achieving change, helped by consumer behaviour and underpinned by support, where appropriate, from government".

The response cites the government's continued support for the Sustainable Clothing Action Plan (SCAP), a voluntary agreement co-ordinated by WRAP which sets targets for the industry to reduce carbon emissions, water and waste.

However, currently only 11 fashion retailers are signatories to SCAP so unless the government's push to encourage the wider industry to take part is effective, action to tackle fast fashion in the near future is unclear and out of step with public sentiment.

Key luxury players

Brands and designers are already taking a lead on sustainable fashion. These fashtech innovators are often faced with increased competition from businesses that aim to maximise profits regardless of the ethical costs. At present, no brand can label itself as fully sustainable, but there are a number of luxury players leading the movement, including:

  • Stella McCartney, a leading brand pushing the agenda for sustainable fashion. The brand uses a breakthrough decision-making tool 'Environmental Profit and Loss' to measure and understand its impact on the environment that goes far beyond traditional reporting.
  • French luxury conglomerate LVMH which has announced a partnership with Unesco's 'Man and Biosphere' intergovernmental scientific program, aiming to preserve biodiversity around the globe by supporting innovative approaches towards economic development.
  • Luxury fashion retail platform Farfetch which has recently launched two key initiatives as part of its sustainability strategy, 'Positively Farfetch': it will pilot 'Second Life' – a handbag resale service which allows customers to resell their unwanted designer handbags through its sister site, and it has teamed up with Good On You (a mobile app with a brand-rating system for people, planet and animals) so consumers can discover the most eco-conscious fashion brands from around the world.

Consumer demands?

Is there a place for sustainable consumption in the mainstream fashion marketplace? There is no doubt that Millennials and Generation Z are increasingly interested in sustainability but the desire for new clothes may be impossible to change.

It's all very well aiming to design and produce clothing for longevity and reduced environmental impact, but perhaps the real challenge is how to reduce consumer demand for cheap on-trend garments.

It may be more effective for disruptors in the industry to focus on emerging technologies to design recyclable products, rather than wasting efforts on attempting to appeal to consumers' supposed ethical concerns.

Dedicated followers of fashion

It is true that fast fashion has allowed consumers across the economic spectrum to experience the pleasure of style and the latest trends at a low cost. However, key industry players, fashtech innovators, governments and conscious consumers can drive the end of the 'throwaway' society and 'fix' fashion.

Sustainable consumption demands cultural change from consumers and businesses alike on a global level due to the complexities involved across different markets. Making fashion truly sustainable will require everyone to walk the walk, not just talk the talk.

If you have any questions on this article please contact us.

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