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Too many “truisms” about the #fashionindustry are hazy.

 

Published April 2 2024


See the following excerpts and notes from a McKinsey & Company study just released entitled “How Fashion Can Afford and Accelerate Decarbonization.” The report contains a number of worn “truisms” about fashion which I find suspect (see which and why). ✓ = true. 𐄂 = not so much.✓"The fashion industry is far from #sustainable.” “Only 37% (of brands surveyed) are on track to reach their 2030 #decarbonization goals."𐄂 “The global fashion industry is estimated to emit 3% to 8% of global greenhouse gas emissions.” Boston Consulting Group (BCG) pegs the number at 8.1% of global emissions. According to Lutz Walter, textile innovation expert, the number is far closer to 2% of global GhG. The Apparel Impact Institute calculates that fashion #emissions are 1.8% of global emissions.✓”Pressure for change is increasing. It comes from regulators who are taking action now (and planning more to come)....” See the NY Fashion Act.𐄂 .”... from consumers with elevated expectations and for young employees for whom sustainability is non negotiable. Unsurprisingly, investors are demanding it.” Consumers? SHEIN has grown by 15X over the past 5 years selling $12 jeans and $8 dresses; Employees? I see no evidence that fast fashion companies are having a hard time hiring; Investors: ExxonMobil is trading near an all time high and the S&P Global Clean Energy Index is down more than 50% from Jan 2021.“✓”it is increasingly evident that fashion consumers care about sustainability"𐄂 “Our recent survey….shows that, in general, about 1/2 of those surveyed are willing to spend more on sustainable products.” According to brand consultant and professor Mark Ritson, surveys like this are unreliable…this is “partly because they will give you a false answer to impress you; partly because it depends on the other tradeoffs that they might have to make; partly because by question 42 you might as well be asking them in Klingon. But mostly because they simply don’t know the degree to which it influences them.”The report contains an excellent assessment of 30 fashion brands progress (or not) vs. their own stated decarbonization targets (see the graphic below) and why most companies fall behind their own goals (see the report for the reasons why). Note that the brands are disguised so that you cannot see which brands are on path and which are not, unfortunately.Looking at 30 fashion brands ….almost 2/3 of brands are not on pace to deliver their own decarbonization targets. 40% of the brands have increased their emissions intensity since setting their targets.For a great example of what is possible, see PUMA Group.

 


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