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Scotch & Soda Impact Report: Environmental Damage Rises 36 Percent

Due to its growth and some reworking of the numbers, Amsterdam-based apparel brand Scotch & Soda took an environmental step backward according to its just released fiscal year 2021-2022 Impact Report.

The company, which unlike many others measures its environmental impact through an environmental profit and loss (EP&L) system that puts a monetary value on the effect, said that it caused environmental damage of 47.1 million euros ($48.68 million), a 36 percent increase compared with last year.

It vowed to make improvements. “With these findings in mind, presented in this report, we are currently working on an extensive reduction strategy that will be shared over the course of 2023,” it said.

“This increase is due to our growing business, resulting in a 34 percent growth in produced textile volumes and an increase of other activities (such as distribution, store openings and user impact) that correlate with these higher volumes,” the report explained. “With more goods being produced and more stores being opened, the impact of a business increases significantly. Additionally, as explained in the methodology, we have expanded the scope of our assessment to include licensee products and replaced average market data with enriched actual data, which has led to an increased total impact.”

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The biggest contributor to this harm took place in Tier 4 of the value chain, the farming of raw materials crops and animals, which accounts for 56 percent of the total damage. Tier 2, the production of fabrics from yarns, was the second biggest violator, accounting for 11 percent of the problem.

The study also measured and included the end user’s effects, which accounted for 7 percent of the total and due mostly to home laundering and heat drying.

Of the six environmental impact categories (greenhouse gases, water use, water use, land use, land pollution and air pollution) studied, Scotch & Soda produced the most air pollution (29 percent of the total effect). Its water use and greenhouse gas emissions each accounted for 24 percent of the total pollution.  

The company also saw a 1 percent increase compared to last year in the environmental impact per 1 kilogram of produced textile. “Despite the absolute EP&L growth of 36 percent, the material intensity metric proves that the product and material strategy that we currently have in place is not following the same growth trend as the total EP&L impact,” the report said.

Scotch & Soda’s water intensity metric, which measures the water footprint per kilogram of material, fell 5 percent to 1.44 cubic meters. “We aim for these intensity numbers to further decrease over time, by extending and scaling up our current material sourcing strategy, showing proof of decoupling financial and business growth from environmental degradation,” the report said.

Regarding specific materials, the company revealed that cotton is its most used fiber (56 percent) and that its goal is to replace 100 percent of its conventional cotton with organic, recycled, in-conversion or regenerative agriculture cotton fibers by 2025. It also plans to increase its use of recycled polyester, wool and nylon and source 100 percent of its wood pulp-based fibers from a Canopy Hot Button producer with a “green shirt” ranking by 2022, to be used in the collections by 2025.

It has also set goals and made advancement in its denim pieces. Throughout 2021-2022 it developed 70,000 denim back patches with a mycel leather alternative made from mushrooms. “For our denim pieces, we want to avoid the high-chemical and heavily impactful treatments. Our denim designers and producing partners will achieve the worn denim look we all love, while making use of less impactful techniques and innovative technologies–such as ozone and laser–or pre-working on the fabric characters so that it requires less intense processing steps,” the report added.

It also said that based on the Environmental Impact Measuring (EIM) scores developed by Jeanologia that measure environmental impact of garment finishing based on four different categories–water and energy needs, chemical impact and impact on workers’ health–62 percent of Scotch & Soda’s denim was finished with a medium-impact treatment with 28 percent with a low-impact one. The remaining 10 percent is unknown as the mills need Jeanologia tools and scorecards to measure their processes and not all of them have adopted them.

The brand has also achieved the goals of the Denim Deal coalition, which it joined in 2020, and which committed it to having at least 5 percent post-consumer cotton into its total denim fabric volume. It had 6 percent in 2020 and 9 percent in 2021. It also pledged to create 160,000 jeans with at least 20 percent post-consumer recycled cotton, to contribute to the collective target of 3 million pairs of jeans by the end of 2023. It achieved that goal at the end of 2021.

Under its creative lab called Eternal Blauw the company created 100 denim pieces made from materials repurposed from cancelled styles and is setting up a pilot to turn used Scotch & Soda and other Dutch jeans into new denim pieces. In addition, its new free denim repair service at its Amsterdam store has attracted nearly 100 customers since April and it is looking to expanding it to other cities.

Scotch & Soda has also vowed to make its packaging more eco-friendly, increase supply-chain transparency across all four of its defined tiers and to provide a safe and happy workplace, among other goals.

“This reporting year we have continued to build and reinforce our foundation whilst approaching sustainability in a holistic way,” the report concluded. “We have been measuring our impact through a natural capital measurement model, the Environmental Profit & Loss, from which objectives for the coming years will be set. We recognize that social inclusion in this measurement model is essential to approaching sustainability from a truly holistic perspective and will be seeking advice from industry experts to learn, develop and keep moving forward.”