Fashion brands are failing to act on decarbonisation

Sign up to receive the Vogue Business newsletter for the latest luxury news and insights, plus exclusive membership discounts. To become a Vogue Business Member and receive the Sustainability Edit newsletter, click here. After seven years of tracking the fashion industry’s progress on transparency and sustainability, Fashion Revolution is changing tack. In place of its annual Fashion Transparency Index, the campaigning non-profit just published its first What Fuels Fashion report, focusing on decarbonisation and energy-related data, which Fashion Revolution says are the most urgent facets of brands’ sustainability strategies. Intended to sharpen the focus on fashion’s sluggish progress towards climate goals, the report’s findings are a wake-up call to brands that they have not been doing nearly enough to reduce fossil fuel use and carbon emissions along their supply chains, or to transition to renewable and more sustainable alternatives without leaving workers or suppliers behind. “We have known about the climate crisis and its potential impacts for decades. This is the defining crisis of our time and it has been a preventable disaster,” says Fashion Revolution’s policy and research manager Liv Simpliciano. “The science is crystal clear: globally, we need to halve emissions by 2030 to mitigate the worst impacts of the climate crisis and keep global warming below 1.5 degrees above pre-industrial level. The fashion industry is projected to blow past this threshold by half. Fashion brands are prioritising their bottom line over our collective lifeline.” Since 2017, Fashion Revolution has been ranking the world’s largest fashion brands in its annual Fashion Transparency Index, based on the quality and quantity of information they publicly disclose about their supply chains and impacts. The archive shows just how slow fashion has been on transparency and sustainability more broadly. The average brand score — representing brands’ overall performance across all transparency indicators — increased just 6 per cent in seven years, reaching 26 per cent in 2023. Only two brands ever achieved a score of 80 per cent or higher (Italian mass-market label OVS and Kering-owned Gucci did so last year). This latest report — which ranks 250 brands with an annual turnover of $400 million or more — hones in on decarbonisation, diving deep on the problem as well as laying out potential solutions. It analyses not just whether brands have targets in place, but how viable those targets are in the context of a just transition. “When you look at how decarbonisation targets are set, it’s mostly top-down, which puts outsized pressure on the supply chain and the most vulnerable people,” explains Simpliciano. “We wanted to ensure the worker voice was part of how decarbonisation targets are set, so the just transition section looks for transparency on how brands have consulted with suppliers to co-create their climate strategies and targets, and to understand how they’re implementing them in context.” The report’s 70-plus indicators include: accountability, decarbonisation, energy procurement, financing decarbonisation, just transition and advocacy. A total of 117 have set what Fashion Revolution deems “credible” decarbonisation goals (meaning they cover Scopes 1 through 3), but only four — Asics, H&M, Marks & Spencer and Patagonia — have targets that are ambitious enough. Only 105 disclose their progress, however, and — most concerning — 42 reported an increase in their Scope 3 emissions against their baseline year. The results Spanning fast fashion, mid-market and luxury, 32 major brands came out with zero points, including BCBG Max Azria, DKNY, Fabletics, Fashion Nova, Longchamp, Max Mara, Reebok, Revolve, Savage x Fenty, Tom Ford and Tory Burch. Even the highest-scoring brands fell short. Puma scraped into the top spot with 75 per cent, followed closely by Gucci with 74 per cent. Fast fashion retailer H&M came in third place with 61 per cent. Fashion Revolution says that fashion brands are not only falling short on investing in a just transition away from fossil fuels, they are shirking responsibility onto already cash-strapped suppliers — who are now tasked with “fixing a problem they didn’t create”, the report says. Fashion’s reliance on fossil fuels has been a point of contention for years, reflecting a broader debate on the world stage about how to decarbonise and meet the goals of the Paris Climate Agreement. Also among the key findings: 89 per cent of brands failed to disclose how many clothes they make annually, and 94 per cent failed to share how much they are investing in supply chain decarbonisation. Only 14 per cent of brands included have a public coal phase-out target. And just three per cent of brands included in the ranking disclose efforts to financially support workers affected by the climate crisis. As always, the new report comes with a disclaimer, says policy and campaigns manager Ciara Barry. “Disclosing factory lists doesn’t mean your supply chains are sustainable, and disclosing your decarbonisation targets doesn’t mean you’re making sufficient progress. But transparency is key for accountability. Transparency allows us to scrutinise progress and drive for improvements.” Next steps This year’s report also comes with a call to action: Fashion Revolution wants brands to commit to “put their money where their emissions are”, investing 2 per cent of their annual revenue into clean, renewable energy, and upskilling and supporting workers. “This is based on the polluter pays principle, whereby those who pollute and profit the most should pay the most towards the transition,” explains Simpliciano, pointing to research by the Apparel Impact Institute which suggests fashion would need to unlock $1 trillion in financing by 2050 to sufficiently decarbonise. Crucially, What Fuels Fashion offers a tangible roadmap to a just transition, something which has been sorely lacking in the fashion space. Brands could make significant headway in this direction by addressing the report’s indicators, Fashion Revolution argues, with living wages for workers, investments or co-financing schemes for suppliers, and longer-term supply chain relationships that allow for more equitable power dynamics and better purchasing practices as foundational principles. Fashion Revolution is well aware that the industry rarely acts of its own accord. That’s why the report also includes recommendations for policymakers. On top of the existing push for sustainable fashion legislation, the non-profit says it would like to see policymakers expand mandatory disclosures in line with the report’s indicators, increase government funding and support for the transition to renewable energy, strengthen enforcement and sanctions for non-compliance, create incentives to distribute financial risk across supply chains more equitably, and push brands towards fairer purchasing practices. “We don’t need loads more standards which are just about reporting,” says Barry. “Of course transparency is a good first step, but we need policymakers to demand meaningful action beyond mandatory disclosures. Otherwise, you could do nothing and say that, and technically be compliant with the law.” Comments, questions or feedback? Email us at feedback@voguebusiness.com.

Make better business decisions

More sustainability stories from Vogue Business

Make better business decisions