New Stand.earth analysis shows major fashion brands' supply chain emissions on the rise

Tuesday November 02, 2021

As world gathers for COP26, research reveals fashion industry failing to meet the 1.5C pathway outlined in the UN Paris Agreement

SAN FRANCISCO — As global business, political, and environmental leaders take the stage at the UN’s annual climate change conference, COP26, happening November 1-12 in Glasgow, Scotland, a new analysis by Stand.earth shows that several major fashion companies are failing in their efforts to reduce supply chain emissions at the levels needed to meet the 1.5C pathway outlined in the UN Paris Agreement.

The analysis of supply chain emissions builds upon the findings in Stand.earth’s Fossil Free Fashion Scorecardreleased in August 2021, which benchmarked 47 top fashion companies on their efforts to tackle climate change. Today’s analysis examined 9 of those companies, selecting companies that are part of the UN Fashion Industry Charter for Climate Action, disclosed supply chain emissions for two years prior, and reported an annual revenue of at least $4 billion USD: American Eagle Outfitters, Fast Retailing (UNIQLO), Gap, H&M, Inditex, Kering (Gucci), Levi’s, Lululemon, and Nike. 

Fashion companies signed on to the UN Fashion Charter, which was first announced in 2018 at COP24, have committed to reduce climate emissions by at least 30% by 2030. These emissions reductions include companies’ manufacturing facilities and supply chains, where an estimated 90% of the fashion industry’s emissions lie.

“Our new analysis found that fashion companies have made little to no progress in eliminating coal and other fossil fuels from their supply chains. In fact, emissions grew substantially for some companies, and others were more dependent on coal-powered manufacturing facilities than when they first signed the UN fashion charter,” said Muhannad Malas, Senior Climate Campaigner at Stand.earth. “These are troubling findings, especially since the vast majority of the sector’s emissions are hidden in complex supply chains. This should be a wake up call to some of the world’s biggest fashion brands that if they want to meet the UN’s 1.5C emissions reduction target, they must do a lot more to decarbonize their supply chains.”

The analysis found that:

  • All 9 companies are projected to fail to reduce their supply chain emissions in line with the 1.5C pathway, if their emissions continue to increase at the rate of growth demonstrated before the COVID-19 pandemic. 
  • The supply chain emissions of 8 of the 9 companies increased in 2019, the year after they committed to reduce their emissions as per the UN Fashion Charter. In some cases, emissions grew substantially. 
  • Fast Retailing (UNIQLO), Gap, Kering, and Levi’s all demonstrated double digit increases in supply chain emissions in 2019. Nike’s supply chain emissions in its 2020 fiscal year (which only cover the first five months of 2020) also grew by double digits.
  • Despite the global economic recession caused by COVID-19, popular athleisure brand Lululemon and fast fashion giant H&M reported an increase in supply chain emissions in 2020. Lululemon’s climate pollution rose by 12.7% from 2019 to 2020, and H&M also reported a slight increase in supply chain emissions (1.7%).

“Fashion companies have for too long focused on cutting energy use in their own stores, implementing greenwashing practices like recycling polyester from single-use plastics, and making misleading ‘net zero’ promises. But the consistent increase in climate emissions by these brands makes clear that these solutions are far from enough to tackle the pollution they generate,” said Malas. “As the runway to 2030 gets shorter, fashion brands must move from words to action to rapidly decarbonize their supply chains by phasing out fossil fuels as a source of energy, fabric, and shipping fuel.”

The analysis combined actual and projected supply chain emissions to paint a picture of fashion companies’ post-COVID 19 pandemic growth. Actual supply chain emissions were obtained from data reported by companies in their sustainability or annual reports, or in their responses to the CDP (formerly the Carbon Disclosure Project). Projected emissions were calculated using the last year-to-year percent change in emissions (i.e. growth rate) reported by companies before the COVID-19 pandemic. (The only exception was Lululemon, whose growth rate was calculated using 2019 and 2020 data.) See full methodology here.

Stand.earth is calling for the fashion industry to reduce its emissions by eliminating its reliance on coal to power its manufacturing processes; engage with governments in supply chain countries to gain better access to renewables; reduce fossil fuel-derived fabrics like polyester; and advocate for zero-emissions shipping and infrastructure. 

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Media contacts:

In North America: Virginia Cleaveland, U.S. Media Director, Stand.earth, +1 510 858 9902, media@stand.earth

At COP26: Muhannad Malas, Senior Climate Campaigner, Stand.earth, +1 604 757 7246 (What’s App and Signal), muhannad@stand.earth