Editor’s note: The Global Fashion Agenda is spearheading the fashion industry’s journey toward a more sustainable future and is behind the Copenhagen Fashion Summit and the annual Pulse of the Fashion Industry report in collaboration with the Boston Consulting Group. Here, the nine Strategic Partners of the Global Fashion Agenda — Asos, Bestseller, H&M group, Kering, Li & Fung, Nike, PVH Corp., the Sustainable Apparel Coalition and Target Corp. — have authored a “call for joint action” to make sustainability a default setting across the fashion apparel industry.
How do we secure a future-proof business model for the fashion industry?
As one of the largest and most creative industries, fashion has the power to play a vital role in securing a prosperous and sustainable future. Today, planetary resources like water, oil and land are limited. Climate change presents unprecedented challenges for our planet and everyone who lives on it. People rightly request safer and improved working conditions. A growing share of consumers demands more sustainable products. Shareholders seek to protect the long-term viability of their businesses and investments. These challenges present both a need for driving change at scale and an opportunity for long-term value creation. Investments in people and the planet are indispensable to readying the fashion industry for a prosperous future. In short, sustainability is no longer just a trend. It’s a business imperative.
As Strategic Partners of Global Fashion Agenda — a leadership forum on fashion sustainability — we have codeveloped a publication called the CEO Agenda defining the top eight sustainability priorities for fashion industry executives to take action on.
We come from various segments of the industry and have different business models. And because we represent the luxury, athletic, e-commerce, high street, premium and sourcing markets, we also face different challenges on the sustainability journey. By co-publishing this Agenda, we do not claim to be perfect nor do we believe that we have found all the solutions. Yet we fully understand how vital and equally difficult these challenges are to solve, even for some of the largest companies in our industry. That’s why we acknowledge the need for a collaborative industry effort and realize that we will not be able to solve these issues alone.
We call upon all the fashion industry’s decision-makers to take leadership by working pre-competitively to future-proof our industry and our planet.
While many ceo’s are already stepping up their work to address these shifts, half of the industry has yet to take action on sustainability. Meanwhile, many frontrunners have reached a technological ceiling on scalable solutions. The complexity of creating a business model that meets the triple bottom line calls for guidance. While changing established practices alongside the scale of negative impacts can be overwhelming, ceo’s and their businesses must act now.
What does a sustainable fashion industry look like and how do we get there?
Our industry has come far, but currently change is not going far or fast enough to accommodate the increasing demand for finite natural resources or to solve myriad pressing social issues facing the industry. If this argument is not enough reason to take action, the following argument speaks for itself: Improving a fashion brand’s environmental and social performance is a positive business case. Calculations from the Pulse of the Fashion Industry 2018 show that investments in sustainability boost profitability and that not taking any action will reduce EBIT margins. Sustainability thus makes rational business sense and secures investments in lasting business models.
The fashion industry’s success, our success, in growing profitability over the next decade depends on top management making the decision now to make sustainability a strategic priority. We need to prioritize joining forces in collaborative efforts and investing in technologies and innovations to overcome these environmental and social challenges. What the industry needs now is, first and foremost, a conscious decision by industry leaders to prioritize a long-term view beyond the pressure of quarterly earnings. A demand businesses increasingly see from investors.
The CEO Agenda presents priorities intended to give guidance on the most important levers for executives to focus on. It outlines core priorities that can be implemented with existing solutions, such as supply chain traceability, combatting climate change, increasing efficiency and creating safe and secure work environments for everyone along the supply chain. The Agenda also highlights transformational issues that will, in the future, disrupt the way business is done as we know it, including developing more sustainable materials, minimizing waste through circular business models, improving wage systems along the supply chain and preparing for the fourth industrial revolution. Based on the knowledge and experience we collectively bring to the group, we believe that addressing these issues will move us in the right direction.
Tackling and finding solutions for each of these priorities is crucial, but they also exemplify just how complex sustainability is. The truth is that there is no one-size-fits-all when it comes to transforming our industry to a more sustainable one. Everyone has a different starting point and we acknowledge that no one can do it all at once — or alone.
The need exists for alignment, for finding common ground and for exerting a collaborative effort to drive action now. A joint industry focus is vital if we are to make sustainability the new normal in the fashion industry.
We hope the CEO Agenda will serve as a tool for taking action and a catalyst for collaboration, for a world beyond next season.