Some of the biggest names in footwear are undermining global climate goals by not tackling the tropical deforestation in their supply chains head on, a new report says.
Much of their risks revolve around leather, a byproduct of cattle ranching, which is itself a leading driver of logging and natural vegetation clearance in countries such as Brazil, according to Global Canopy, whose annual Forest 500 index tracks the deforestation policies and performance of 500 influential companies and financial institutions.
Of the leather-sourcing businesses the environmental nonprofit examined, less than one-third (28 percent) published a deforestation commitment, which it referred to as the “most basic step to address deforestation risks.” Leather-using companies were also less likely to report on their progress in eliminating deforestation than those that sourced other forest-risk commodities, such as palm oil, soy, beef, or pulp and paper.
The lowest-scoring brands in the index include Asics, Teva and Uggs parent Deckers, H&M, Jimmy Choo owner Capri Holdings, Prada, Skechers, Steve Madden, Li-Ning, Nike, Wolverine and Zara owner Inditex. Also included is Pou Chen, a Taiwan-based manufacturing giant that makes shoes for the likes of Adidas, Nike and Puma.
H&M said the report spotlights the industry-wide challenges and importance of halting illegal deforestation to reduce carbon emissions and reverse biodiversity loss.
”H&M Group acknowledges these challenges and address them in our material ethic policy and biodiversity ambition,” a spokesperson told Sourcing Journal, noting that the retailer is engaging in the Taskforce on Nature-Related Financial Disclosures, whose work is highlighted in the report, to drive progres. “We will continue working to improve our commitments, policies and the implementation of those as well as how we publicly disclose our actions and progress in this area.”
Prada declined to provide statements, while the other companies did not respond to requests for comment.
One problem is that most companies do not view deforestation as a risk, Global Canopy wrote in the report. In the eight years since it first published the Forest 500, the nonprofit found a “shocking lack of progress” despite an urgency to act amid the escalating climate crisis.
“The commitments made at COP26 in 2021 saw nature, forests and people more firmly embedded in the climate agenda than ever before,” it said. “Action is needed from companies and financial institutions, as well as from governments, to keep global temperature rise below 1.5 degrees Celsius.”
But failing to commit to deforestation or ensuring that their pledges are implemented also leaves companies ill-equipped for due-diligence requirements coming down the legislative pipeline, Global Canopy noted. In November, the European Commission proposed a law preventing the import of deforestation-linked commodities such as leather by requiring companies to prove that their supply chains are not contributing to forest degradation. The following month, the United Kingdom opened a consultation for an Environmental Act that would make it illegal for large businesses to use forest-risk commodities, which will likely include leather, on land illegally occupied or used.
“There is little doubt that the regulatory mood is shifting—and companies and financial institutions can get ahead of this by taking steps now to address their risks,” it added. “Companies and financial institutions should show ambition, and seek to go beyond what legislation will require to remove deforestation from their activities and products. Customers and consumers expect nothing less.”
The fashion industry isn’t without tools at its disposal. A first-of-a-kind mapping project being conducted by the Leather Working Group, in collaboration with the National Wildlife Federation, World Wildlife Fund and the Gibbs Land Use and Environment Lab at the University of Wisconsin-Madison, for instance, seeks to shed light on frequently obfuscated operations. Transparency platforms such as Sourcemap say they’re able to use software to help businesses visualize deforestation hot spots and measure manage risk.
But untangling supply chains takes considerable time and effort. Meanwhile, last month’s study by sustainability watchdogs Stand.earth and Slow Factory drew connections between more than 100 brands, including Adidas, Gap, H&M, LVMH Moët Hennessy, Prada, Ralph Lauren, Timberland owner VF Corp., Ugg and Zara, with manufacturers and tanneries with known links to cattle raised on recently logged Amazon land.
Though 30 percent of the brands researchers surveyed had some kind of deforestation policy in place, there is “clearly a disconnection between words and changes on the ground,” Greg Higgs, director of research and investigations at Stand.earth and one of the authors of the report, told Sourcing Journal.
Leather isn’t fashion’s only conduit to deforestation, either. An October report by Royal Holloway, University of London, tied brands such as C&A, Gap, H&M and Levi Strauss to illegal logging in Cambodia because their suppliers in the Southeast Asian nation were burning forest wood to stoke their boilers either exclusively or in combination with other fuels such as incinerated garment waste.
“Even following the national crackdown on forest wood usage, the practice has continued largely unabated, with wood now delivered at night rather than during the day, as previously,” the report said. “According to local informants, some larger factories use hundreds of tons of forest wood each day in order to meet their energy needs.”