Can Fashion Still Meet Its Climate Promises?

0:07Hello and welcome to The Debrief from the Business of Fashion, where each week we delve into our most popular BOF professional stories with the correspondents who created them. I'm senior correspondent Sheena Butler-Young. And I'm executive editor Brian Baskin. As COP30 plays out on the edge of the Brazilian rainforest, the mood is grim. A decade ago in Paris, governments and companies, including many of the world's biggest fashion brands, pledged to cut emissions as a necessary step to prevent catastrophic climate change. Almost all of them have fallen short, And at some companies, emissions are actually higher today than they were a few years ago.

0:45And that's not even taking into account the rise of Shein, which barely existed in 2015 and is now one of fashion's biggest single sources of emissions. Today we're asking, can fashion still meet its climate promises? And if not, what would it take to get there? Joining us are BOF's Sarah Kent and Shiza Wallid, our sustainability dream team, to help us answer that question. Sarah, Shiza, welcome to The Debrief. Thanks so much for having us, guys. It's lovely to be back here, Sheena and Brian. Thanks. Before we get into it, I wanted to note, Sarah was actually, I believe, our first debrief guest over a year ago.

1:19We were actually talking about this exact topic about warming and the effect it was having on factory workers in South Asia. And I also want to note here, it might be a little while before we hear from Sarah again, because she is soon to welcome a new little emission producer into the world. Is that right? That's not exactly how I'm framing it, but that is true. I am going to be off for a few months from the end of the week. And I hope when I come back and we talk about this next year, there will be more positive things to say. And that's the last positive thing we'll probably say this entire episode, unfortunately.

1:58So as COP30 gets underway, Shiaza, why don't you talk us through where fashion should be on its Paris aligned pathway? Yeah, absolutely. We just did a story this week, kind of wrapping up fashion's trajectory over the last 10 years, where it is right now and where it should have been. When brands came together after the Paris Agreement, there was a lot of discussions and a lot of pledges that were put forth for them to slash emissions. There was targets set. 2030 was the short-term target that was set for them to slash emissions by a certain percentage, especially in their supply chains and not just in their operations.

2:33Right now, 10 years since then, what we found from looking at some of the largest brands in the fashion industry is that while there's been some progress that's been made, especially in brands' own operations, in their supply chain, there's still a massive gap to be filled and for them to reach their 2030 goals in terms of reducing emissions. Let's name some actual names here because, I mean, and I wouldn't even say, you know, these, most of these companies are especially bad actors, but they are the biggest and they're probably representative of what's happening in the industry, right? Yeah, no, absolutely.

3:05We looked at the six of the largest emitters in the fashion industry. So this includes, and this is not an order, but this includes Inditex, Nike, H &M Group, Shein, obviously, LVMH and Adidas. And what we found that most of them are still far away from their 2030 goals when it comes to reducing supply chain emissions, where majority of fashion's emissions lie. And while Adidas, for example, has inched closer to it, it seems like in general there's been a slowdown and a lagging in terms of the pace of emissions that need to be cut by 2030. Now that we're only five years away. I think you're almost understating the problem here.

3:45I mean, it's not that they're, you know, behind on their targets. I mean, I'm looking at Inditex, their baseline emissions in 2019 were 10 million tons of carbon dioxide emitted. 2024, their emissions were 9.9. That doesn't seem like progress to me. LVMH, kind of same story, went from 8 to 7.5. They're supposed to be at 5.4 by 2030. Adidas has made a little more progress, went from 6.6 to 5.2, but they're supposed to get to 3.8. I don't know that there's a roadmap for that. I mean, are there any big companies that can actually say we're on track for 2030? I think what's happening with these brands is very instructive of the fact that there is actually a growth in apparel supply around the world.

4:26All these majority of these brands are kind of still growing their scale in a way. So they're not reducing their emissions. And it's kind of this weird bottleneck situation where they set these targets out, but they're growing in volume. So how do you kind of come to that, I suppose, that ideal situation where you're able to meet your targets and also increase your business at the same time? And I think they don't have that answered. Yeah, it's like the classic adding to subtract scenario that we've been seeing in fashion for a very long time. Sarah, I know you have thoughts. I think you're jumping out of your seat with thoughts.

4:58Well, I would just respond to Brian's very straightforward question with a very blunt answer. No, I would not say any brand has a credible pathway right now to meet their targets for 2030. Even companies that have shown that they're able to reduce their emissions to date, driving down their carbon footprint over the next five years is going to be harder, more complex and more costly than the steps they've taken to date. And really no one company can do that alone. And there's not a clear framework for the industry to work together to shift that narrative or to plug into other industries that is adjacent to like agriculture or national government policies around energy supply and national grids, which is going to be so critical to helping companies reduce their emissions.

5:52Because really what we're talking about is being able to switch what your manufacturers use to fuel their factories to renewable energy as opposed to the coal or gas that they currently run on. To that point, though, I think one of the challenges that I'm having personally is like whether these goals were made with realistic intentions and good intentions or did they know this 10 years ago? Like, is this the result of meaningful attempts or not, is another way of asking that. I think that there is a both-and answer to that. You know, certainly companies set these targets and they did not have clear strategies to deliver on them.

6:37But they were not alone in doing so. Governments set these targets without clear strategies to deliver on them. And there was this sort of moment of exuberance. So everyone was sort of like, we're all going to get together and we're going to do this And we're not going to think about the nuts and bolts of how we do this, because then we wouldn't even agree, we wouldn't even get started. And so, you know, in the 2015 to 2020 period, that target setting by itself was meaningful. And it did start to set up, it started to prompt people to ask these questions, to require companies to be more robust, to set specific frameworks, to think about, okay, you know, when I'm talking about reducing my emissions, so much of those are outside of my control in my supply chain, not in my own operations.

7:23So how am I going to start tackling those? But what hasn't really happened in the intervening years as much as it should have is a conversation around, oh, OK, now that we've unpacked how hard it really is going to be to deliver on these goals, how do we move beyond just that commitment and start taking action? And, you know, that is a very, very broad sweeping statement. Obviously, as we've talked about, some companies are making progress. Some parts of the industry are making progress. You know, I would highlight even the fact, you know, we looked at these six biggest polluters in the industry.

8:00even the fact that they have set specific targets is beyond what many, many other companies in the industry have done. You know, within the industry as a whole, simply having set a target, and this is insane to say in 2025, is still quite progressive. Sounds a lot like diversity, equity and inclusion. A lot of companies that set very ambitious and maybe well-intentioned DEI targets, got to a place where they said, you know, there is some progress to knowing now what we didn't know when we first set out. That actually is progress. Not having any targets, not ever trying, you're never going to do anything.

8:38But I think they got stuck right there. Like, this was, this is, we didn't know how hard it was, and now we do, so never mind. It sounds like sustainability is not saying never mind. The companies that made these pledges are not saying never mind, right? And again, that too is mixed because in the same way in DEI, you've seen some companies step back from commitments. Similarly, some companies have stepped back from climate targets. I do think that there is a difference in the sense that there is still this global commitment, global political agreement to try and cap emissions, to try and tackle the climate crisis that exists, even if it feels very fragile and frail right now.

9:23And that does not exist within the DEI conversation in the same way. Let's talk a bit more about that. But it sounded from what both of you were saying before, that a lot of the ability to fulfill these commitments is out of the hands of the companies that made the commitments. What do you mean by that? And maybe this is a good time also to talk about the different turn the U.S. has taken to COP30 than maybe some other, maybe their past commitments. So majority brands don't own the facilities or the factories where their clothes are made. They're owned by manufacturers and suppliers in different parts of the world, largely in Asia.

10:01And majority of fashion's emissions also comes from these factories, from supply chains. And essentially, it's up to these manufacturers to really invest in technologies and make the shift renewable and also allow these brands to meet their commitments. So it passes on, I suppose. But in many cases, these facilities and these factories are in countries where the policies aren't maybe the most favorable for them to make certain shifts. For example, when we spoke to certain manufacturers in Sri Lanka and Bangladesh, for example, the grid doesn't allow for very easy investments in renewable versus in India, where there are certain pockets and legislation that allow you to make the shift to renewable energy, whether that's through wind or what we saw largely was the shift to biomass, which has become an increasingly kind of stopgap solution for manufacturers to meet certain targets like phasing out coal.

10:57And then what about the U.S.? I mean, it's taken this hard right turn on all things climate change. I mean, does that kind of let fashion off the hook? Does that impede some of these global efforts? What's the Trump factor here? I think as with so much to do with Trump at the moment is it's just an agent of chaos. So you've kind of thrown a hand grenade into the middle of this conversation that was already hugely politically contentious and complex and difficult. And to a degree, you've given some companies an excuse to say, well, we're just going to focus on today's profit. This very complicated issue is not in our core wheelhouse.

11:43It's not what we're meant to do. We're a brand. We make things. We sell things. That's what we're going to do. And that's what we're going to worry about. I think why that is not going to make many of the biggest brands take that view is that the world is much bigger than America, although Trump doesn't necessarily think so. And other countries are still continuing to pursue these goals. You are also seeing the economic shift so that renewable energy in many countries is more economic than building new fossil fuel powered plants. plants. And so that you're seeing a shift happen with or without policy support, it might just take longer.

12:24I think what's kind of interesting about what we're seeing right now is it's a little bit like that psychological experiment where you shut a kid in a room with a piece of chocolate and tell them, you know, you can eat this one piece of chocolate now, or if you wait until I come back, I'll give you two pieces of chocolate. But what we're seeing right now is many, many executives and politicians are kind of eat the chocolate right now, people. Because on climate, if you don't act, you don't have to make these big investments. And, you know, you can keep growing your business and things will trundle along for some time.

12:56But the longer you wait to act, the worse the climate impacts you're going to have to deal with are going to be. And the higher the costs of mitigating them, adapting to them, and trying to continue this business, your business in a climate constrained world is going to be. And I think that's that kind of, we're looking at a lot of short-sighted thinking at the moment. I would just add to that to say, when we spoke to certain manufacturers, this idea of like, what's the impact of Trump on emissions and what's happening right now? A lot of these brands are based in the US. And I think although, as Sarah mentioned, like action in terms of these biggest brands, because they see that the world is much bigger, they know that their supply chain is global.

13:36They'll maybe not act on what's happening, but the signaling and I suppose the communication they have around emissions, around their sustainability ambitions and commitments has maybe taken a bit of a slowdown or like it's been slightly silenced. And I think manufacturers, some of them have felt that as well, even after they've made these huge kind of investments into making their shifts into to phase out coal or to turn to other renewable energy sources. So I think that element of it definitely has a bit of an impact from this past year, especially since this January. I wanted to close the loop on the DEI bit that I mentioned.

14:13I think to a little different than sustainability, I'm not letting companies off the hook because of the political climate. I think language around DEI is politically compromised, but the core values, I don't know that companies have a real reason to say it's outside of our control. That language, I think, does not apply here. I think these are just values that companies should, especially in fashion, which is inherently diverse as an industry, or the consumer at least is, not the top leadership. I don't think it's out of their control.

14:45We'll be back with more of The Debrief right after this.

14:53Can we talk Sheehan? I'm jumping out of my seat to bring up Shein? I think we absolutely should. Here's a fun fact. I was looking up when did Shein rebrand from, it used to be called Shein side. It happened in June, 2015. So six months before the Paris climate agreements. And that's when Shein really burst out of the gate and started to become a thing. Quite, quite interesting timing, I would say, considering what happened next. So the elephant in the room here is that, you know, in the data that we pulled out earlier around how little, let's just say how little progress a lot of those companies that you looked at made.

15:28Shein did not just not make progress. It actually showed signs of regression. Shaisa, talk to us about where Shein landed in the 10 years. I would say that Shein's case is a very instructive one, which kind of shows that growth and emissions, even if you set targets, there's limits to voluntary commitments, which is what majority of these brands have made when the business model is built on speed and volume because Shein's entire supply chain, it's very famously this on-demand supply chain. If there's demand for things, they'll start making these things. And there's a large use of polyester as well in majority of their clothes.

16:04And I think it just shows that voluntary commitments are maybe not enough for fashion brand, especially a brand as big as Shein, to actually tangibly reduce its emissions when its entire business case doesn't stand for that or stand for a sustainable way ahead. I think putting some numbers to this would help. So according to your story, it looks like Sheehan's baseline emissions, so this is 2019, were 18.1 million tons of carbon. This is a little bit of nuance that is worth pointing out. The baseline emissions for all of these companies are set in different years. And one of the things to make, you know, a nuance around the piece with Sheehan is that its baseline year is 2023.

16:48So other companies have had many more years to show progress. This is just one year. It's still a 10 % increase when it's meant to be decreasing that. Looked at another way, went from zero in 2015 or essentially zero to more than Nike and Adidas combined as of last year. And its emissions grew between 2023 and 2024 by more than, again, Nike and Adidas managed to cut their emissions over their entire commitment period. So it's basically almost single-handedly wiping out a big chunk of the fashion industry's progress on emissions. Am I overstating things? I think that's fair. I feel like in Shein's situation, I feel like it's pretty confusing, but also particularly contentious because obviously fast fashion is known for being a high emitter.

17:40it's known for being unsustainable and even still it's on the rise and I think it's interesting because when you see all these other brands make commitments and you have a brand like Shein make a commitment you're kind of wondering how much is it even going to reach when all these other brands which have target setting way earlier and don't have that fast fashion model to the same extent haven't been able to make that same level of progress that they set out to do so I think it brings a lot of questions to mind and makes you wonder like when we've already slowed down for brands which have certain checks and balances in place and their models not based off of fast fashion or on-demand supply?

18:17How is a company that's fully based off of that and growing because of that and not in spite of that going to make any progress at all? But yeah, that's probably my takeaway from it. The fundamental conflict at the heart of the fashion industry's climate commitments, which is you've got a business built on extracting stuff and producing stuff and selling stuff. And that has an impact. And the more stuff to sell, the better the business does, but the worse the environmental impact is. And that is the profitability and sales growth trajectory of businesses are fundamentally at odds with the environmental commitments companies have made.

18:58And at the moment, the political and structural framework in which the industry exists means that there is no cost to destroying the planet or exploiting workers or any of these sort of so-called negative externalities, as we call them, even though they do have a cost, it's not a financial one. And so it doesn't get factored into executive decisions fundamentally when they have to answer to their shareholders. Well, first of all, this is very depressing. Are we really making a case for bringing more people into the world as we talk about this. It's really sad. I'm so sorry. It's so sad. But there is a human element to this is what I want to say, which is that I think both you and Shiza have talked about it.

19:45Like the workforce, fashion's workforce is going to start to see or is already starting to see some of the direct consequences of climate impact, right? So like the heat waves, the factory conditions, all of the major weather events that have happened in the last couple of years, that actually is going to, at some point, have a financial cost for these companies that will feel more direct down the line, no? Yeah, no, absolutely. And I think that's something that we repeatedly heard from every single person that we spoke with for this piece. And also just, now that it's been 10 years, everyone talking about what's been done so far, but how as much as decarbonization is a priority, everybody kind of brought up that at the end of the day, it's largely not just about mitigation, but really about adaptation.

20:27Sarah did a story last year, which you guys were mentioning earlier, which is like how heat stress is affecting workers in South Asia and India in particular. And I think the reality is, you know, very early on in the story, we said that the last 10 years have been the hottest 10 on record. And it doesn't seem like it's going to get any less hotter. And whenever you speak to someone who's physically been to a factory, they'll say that, you know, for a lot of workers, they find that if the factory is well built, if certain manufacturers have made changes, it's cooler and it's nicer to come to work than stay in their own homes because it's so hot in these countries.

21:03And I think that just speaks to the people who are kind of facing the brunt of not making certain progress when it comes to sustainability commitments and reducing emissions, because as much as a brand can delay a bit of what they want to do or a manufacturer can slow something down, for the worker that impact is very, very direct. It's not like a retrofit that doesn't happen in time is increasing the discomfort that workers have to deal with when it comes to heat stress or even when it comes to, I suppose, resiliency building for certain factories when it comes to flooding. And I think there's major health risks as well, which you think about in terms of food.

21:43We had an occasion where I think one of the manufacturers was talking about for a lot of workers, they bring food from home. And when the heat rises, that food rots or doesn't stay well. And that leads to indigestion and all these problems. So it's really cyclical and it all kind of trickles down to a multitude of problems that heat brings. And so it's not just a corporate issue anymore. And I don't think people want to see it as a corporate issue anymore, especially people who have the visuals and recognize the reality of what's happening in these factories and the people who are making clothes at the end of the day.

22:14Yeah. But it is also a corporate issue because people who are suffering from heat stress are not as productive. Yes. The heat doesn't only affect workers. It also affects your machinery. It doesn't work as well. It will slow down productivity. Obviously, floods are disruptive to production as well, to logistics, to supply chains. They shut down highways. And just because we have not yet seen a major disruption to the apparel supply chain from these kind of climate crises yet is more luck than anything else. Are brands aware of that? Is that going to be the motivating factor for them to see this through the corporate lens and actually move on it in real time with more urgency?

23:02I think that broadly speaking, there is an awareness of this risk. But at the moment for many companies, it feels manageable. Many of them rely on risk assessments that they've commissioned consultants to do for them. Those risk assessments suggest that, you know what, your supply chains are flexible enough. You'll be able to manage, you know, if there's disruption in Bangladesh, you'll be able to manage for a period of time by moving production elsewhere. Also, often these disruptions do not last for long enough to really upset global supply chains, which are so agile now. But that doesn't mean that you can't, we will not reach a point where you will have multiple crises in multiple places and you just can't keep shifting things around.

23:55I don't want to leave listeners with the impression that this is hopeless. We're just headed toward a catastrophic future. I mean, the stakes are unimaginably high. There's already damage being done. But there's also some positive developments. You talk about some in your story. You've mentioned today, for example, the rise of renewables, which has blown past anyone's expectations. I was thinking of, you know, H &M, which has made more progress than most, has weaned most of its suppliers off of coal, which I'm not sure anyone thought was possible even a few years ago. There are paths to maybe not hitting those original 2030 targets, but making progress here, right?

24:37It's not totally bleak. Give me some hope. I think that's right. And we're also getting a little bit more into the nitty gritty of it and the complexity. So, Brian, you raise this point about moving away from coal within supply chains. And this is a big impact area for the industry where some of the biggest impact within fashion happens when clothes are washed and dyed because you need a lot of thermal energy, a lot of heat. And in order to generate that, typically factories use coal-fired boilers. And so what H &M and several other large companies have said they will do is no longer use factories that use coal-fired boilers going forward.

25:19And they pressured the factories they work with to move away from coal-fired boilers. And this is the potential to have a huge amount of impact. The complexity comes in where big brands have gone to their suppliers and said, hey, we need you to get out of coal. They've typically not done so with a promise of future orders. So suppliers are taking on a lot of risk by making these changes, assuming that the brand will still be there at the end of these investments. And at the moment, the most economic and speediest way to shift away from coal is to convert your boilers to biomass, which is an imperfect solution because biomass can be, you know, you're burning wood or you're burning agricultural waste.

26:03those are still you're still giving off carbon and pollution when you burn those things and you're not guaranteed to have a sustainable supply chain you know that would could be from a forest that is now being cut down because you want biomass or land that was previously being used to grow crops from fuel is now being used to grow crops to burn for biomass because that market has become bigger and better there's this there's a trade-off here that hasn't necessarily been thought through because we're looking for quick wins. And when you talk to manufacturers, several of them will say if we were given more time and more long-term commitments from our clients, our brand partners, what we would prefer to do is look into electrification of the boilers, which would be take more time and require more investment, but would be a longer-term solution, whereas biomass is just a stopgap.

26:57And so that maybe sounds like I'm now being negative again. Looking for the good news, looking for the good news. I think it's really healthy that we're getting to a point where these kind of technical discussions are actually happening. And we're looking at the nitty gritty realities of what is happening and acknowledging that some of the solutions that are around are not perfect. I do think that's a major step forward that we're getting away from this period of saying these nice platitudes and everyone thinking that's going to fix it and acknowledging that didn't work. And maybe a little bleakness then leads to some actual solutions that don't just involve the marketing department.

27:39So we're going to play lightning round, which is a fun thing we do every now and then on the debrief. So both of you, which metrics should we watch over the next 12 months to know whether the sector that's fashion is finally bending the curve rather than just talking about climate impact and sustainability? I think some of the metrics that we need to look ahead for the next 12 months is some of these biggest brands' coal phase-out targets, which was for 2025. And in 2026, we'll have the data available, which is also the halfway mark to 2030. Not to say all of them, we're going to see a big change, but I think that's something to look forward to as to we can actually see the data for that.

28:18But I also think in terms of innovation or actually installations of certain solutions, whether that's what we've spoken about, greater uptake of renewables. We've also heard increasingly about process innovation to increase efficiency and also heat pumps. I think that'll be something interesting to see over the next 12 months as to how many manufacturers and brands are really pushing ahead with that and how many are still kind of stalled. Sarah, what about you? What's your metric? Look, if you want to see if the industry is banding its curve on emissions, keep an eye on where those emissions numbers are coming in.

28:51You know, more and more companies are having to report them. Kind of frustratingly, they keep changing their methodology. So it's quite hard to compare year on year, but hopefully it means the methodology is getting better. Next year, as I said, is a critical year. This year is halfway to 2030, obviously, but the data for 2025 will only become available in 2026. So really understanding where the industry is at, at the halfway mark, will become clear next year. And that's really when you need to see companies starting to say, OK, well, we're not doing enough or a very tiny handful might be able to say we're happy with where we are.

29:27But the real question is, OK, what are you going to do for the next five years? And I would say my metric is probably Shein's annual sales next year. If those continue to zoom up, I think that'll say a lot about where we are as consumers and as an industry on fighting climate change. Thank you. This was such an interesting conversation. Sobering, but I think there are beacons of optimism in there as well. Shiza, Sarah, thank you so much for joining us. Thank you guys for having us. So much for having us. Please be sure to check out Shiza's article, Can Fashion Still Meet Its Climate Promises, and everything Sarah's ever written on the world of sustainability at businessoffashion.com.

30:01Enjoy your maternity leave, Sarah. These and other stories are available to BOF professional subscribers only, and you can find the links in the episode notes. You've been listening to The Debrief, produced and edited by Olivia Davies and Eric Bria. I'm Sheena Butler-Young. And I'm Brian Baskin. We'll be back next week with a new episode. Thanks so much for joining us and be sure to follow us wherever you get your podcasts.