As the titans of politics and industry converge on the World Economic Forum in the Swiss Alps resort of Davos, the leaders of some of the world’s biggest fashion companies are championing the need to make sustainability not “just a trend” but a business imperative.
With its patron, Mary, Crown Princess of Denmark in the audience, the Global Fashion Agenda (GFA) announced at Davos House on Wednesday the second edition of its CEO Agenda, a series of guidelines developed in collaboration with Asos, Bestseller, H&M, Kering, Li & Fung, Nike, PVH Corp., the Sustainable Apparel Coalition and Target to pin down the eight sustainability priorities every fashion CEO needs to address, including climate change, which has been upgraded to a “core priority.”
“Climate change is an unprecedented threat to people and the planet. We only have 11 years to rectify the catastrophic impact we’ve had on our planet or we’ll miss the objective of the Paris Agreement to keep global warming below 1.5 degree Celsius,” said Eva Kruse, CEO and president of GFA, which organizes the Copenhagen Fashion Summit every summer. “We know that change is not easy, but overall progress is too slow, and we simply can’t afford to lose another year. The fashion industry is one of the world’s largest and most powerful industries. Therefore, we need to take leadership to secure the future of our industry—and our planet.”
Textile production accounts for 1.2 billion metric tons of greenhouse-gas emissions s every year, according to new research from the United Nations Framework Convention on Climate Change. While sustainability has “risen on the corporate agenda,” Kruse said, half of the industry has yet to take action on sustainability.
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Sustainability isn’t just about do-gooding for do-gooding’s sake, she added. With mounting disruptions from extreme weather, growing water scarcity and evolving consumer sentiment rattling the very foundations of how business operates, fashion companies must take action if they want to future-proof their market shares.
Indeed, GFA’s 2018 “Pulse of the Fashion Industry” report, which the organization co-authored with the Boston Consulting Group, affirmed that companies that pivot toward toward ethical practices that benefit both people and planet—by using lower-impact fibers, say, or improving chemical management–can can boost their Earnings Before Interest and Taxes by 1 percent to 2 percent.
Besides combating climate change by curtailing greenhouse-gas emissions, the CEO Agenda lists includes among its core priorities for immediate implementation the need to bolster supply-chain transparency by tracing Tier 1 and Tier 2 manufacturers; implementing water, energy and chemicals efficiency programs in processing stages; and ensuring respectful and secure work environments.
“The fashion industry is going through a transformation that poses many challenges we as an industry need to collaborate on,” said Karl Johan Persson, CEO of H&M. “The transition towards a circular and climate positive business model is key, as is ensuring that the jobs created along our value chains are fair and equal.”
The four “transformational priorities for fundamental change” involve replacing conventional fibers with better-for-the-planet ones, accelerating a circular fashion system, promoting better wage systems and embracing the fourth industrial revolution.
Fulfilling these eight priorities won’t be easy, GFA noted. It will require “top-level engagement” from fashion CEOs who can lead the transformation of not only their own organizations but also the entire industry.
“We believe in holding ourselves accountable to the highest standards, setting ambitious Corporate Responsibility goals that drive fashion forward—for good,” said Emanuel Chirico, chairman and CEO, PVH Corp., which declared its status as a GFA Strategic Partner last week. “CEO Agenda 2019 encourages leaders across the industry to do the same. The issues our industry faces are complex and global, they require collaboration, and no single organization can solve these challenges alone.”
Or as François-Henri Pinault, chairman and CEO of Kering, recently named the world’s second most sustainable company, put it: “A modern corporation has to have a dimension of purpose or it won’t last.”