Fashion Industry has Failed to Tackle Climate Change, says Scorecard

As a multi-trillion dollar industry whose greenhouse gas emissions are expected to drastically increase in the coming decades, fashion companies are not doing enough to move from climate commitments to actions at the scale desperately needed, says a new report.

In the wake of a global pandemic and a devastating new IPCC report that reinforced a growing consumer demand for corporations to act on the climate crisis and protect public health, Stand.earth’s annual Fossil-Free Fashion Scorecard shows how fashion companies are failing in their efforts to tackle climate change. Read the report here.

“The runway is getting shorter for companies to move from commitments to actions, and take the steps necessary to drastically reduce their greenhouse gas emissions in the next decade. If fashion companies truly care about solving the climate crisis, they need to phase out coal power from their supply chains and say goodbye to fossil fuel fabrics like polyester,” said Muhannad Malas, Senior Climate Campaigner at Stand.earth.

The scorecard assesses 47 fashion companies on the steps being taken to eliminate fossil fuels from manufacturing, materials, and shipping processes. The results show that sportswear brands are leading the race, with Mammut (B-) ranking highest overall, followed by Nike (C+), and a tie between Asics (C), PUMA (C), Levi’s (C), and VF Corp (C). By contrast, popular yoga brand Lululemon (D-) flunked the scorecard for taking no meaningful action to get rid of coal and deploy renewable energy in its manufacturing.

“Lululemon’s continued dependence on fossil fuels poses a significant investor and brand risk, and is inconsistent with its values. As a rapidly growing healthy lifestyle brand, Lululemon has a critical opportunity to rise to the top and become a climate leader by committing to ditch coal and invest in a rapid transition to renewable energy,” said Malas.

Other sportswear brands that received poor grades include Columbia (D-), Gap (Athleta) (D), New Balance (D), and Under Armour (F). In fast fashion, the world’s biggest brand Zara (D) ranked poorly for its increasing dependence on cheap, fossil fuel fabrics like polyester and for demonstrating little progress in decarbonizing its manufacturing.

KEY FINDINGS:

The scorecard measures the performance of global fashion companies across five areas: climate commitments and transparency; renewable and energy-efficient manufacturing; renewable energy advocacy; low-carbon materials; and greener shipping. Among the top 10 performing companies across all areas, none scored higher than a B-. Eight are sportswear companies — Mammut, Asics, Nike, PUMA, VF Corp, adidas, Arc’teryx, and Patagonia — with Levi’s and H&M also included in the top 10. Other key findings by area:

Climate commitments: Companies are not setting strong enough climate targets, putting the industry on a trajectory far surpassing the 1.5C pathway recommended by the U.N. Paris Agreement. Only three companies assessed — Asics, Mammut, and REI — have committed to slashing absolute emissions across the supply chain by 55% or greater by 2030 (the goal recommended by the U.N.).

Renewables in manufacturing: The industry continues to rely heavily on coal to power its manufacturing processes, contributing to rising climate emissions and air pollution in countries like Vietnam and Bangladesh. Few companies reported meaningful steps toward financial incentives or direct investments for suppliers to purchase renewable energy, but seven companies assessed — Mammut, Nike, Asics, Levi’s, adidas, Esprit, and PUMA — ranked highly in this section for setting renewable energy targets in their supply chains or working with manufacturing partners to phase out coal-fired boilers. A broad range of companies loudly tout efforts to deploy renewable energy in their headquarters and stores, but these decarbonization efforts only account for a small percentage of their climate pollution.

Renewables advocacy: Companies are not doing enough to seek better access to renewables from governments in countries where factories are located. Despite this lack of progress, advocacy opposing new investment in coal-fired electricity was an important bright spot, with several companies signing on to letters to Cambodia cautioning against plans to increase coal-fired power and to Vietnam seeking a pilot program for purchasing renewables. Notably, H&M, Levi’s, and VF Corp signed both letters, contributing to their high ranking in this section.

Low-carbon materials: Many companies have recently announced “sustainable material” commitments to phase out virgin polyester or other fossil fuel fabrics such as nylon, but are doubling down on fibers recycled from plastic waste, which prevents them from fulfilling any promises of circularity as these fibers are ultimately destined for the landfill. Several sportswear and fast fashion companies assessed — including Lululemon, Under Armour, Zara, and Uniqlo — will face major challenges in transitioning to low-carbon materials since fossil fuel-derived fabrics like polyester make up a large proportion of their materials mix.

Greener shipping: The fashion industry is one of the largest customers of ocean and air shipping, which contributes to significant air pollution worldwide. With the industry’s shipping needs expected to increase dramatically in the coming decades, it’s imperative for companies to advocate for zero-emissions vessels and infrastructure. Fewer than half, only 20 companies assessed — including Adidas, Mammut, Nike, and PUMA — included shipping in their supply chain emissions reduction targets. Swiss outdoor gear brand Mammut set a new precedent in the sector by being the only company to commit to switching to zero-emission shipping vessels by 2030.