H&M Group will spend millions of dollars a year to decarbonize its supply chain.
The Swedish fashion retailer, which has pledged to reduce its Scope 1, 2 and 3 emissions by 56 percent by 2030 from a 2019 baseline, revealed at the United Nations climate talks in Egypt last week that it’ll be funneling an annual 3 billion Swedish kroner ($282 million) to efforts such as phasing out coal and increasing its share of better-for-the-planet materials.
“Instead of measuring the success of these initiatives by financial gain, we measure effective emission reductions,” said Leyla Ertur, the & Other Stories and Cos owner’s head of sustainability. “To turn our company growth, profit and greenhouse gas reduction into equal [key performance indicators] is a very ambitious decision that underlines the importance and value of our sustainability work for our business.”
The fast-fashion purveyor is no stranger to shelling out for the environment. H&M contributed $10 million to the $250 million Apparel Impact Institute-led Fashion Climate Fund when it was announced in June. The goal of the grantmaking vehicle is the mobilize the funds necessary to narrow the $1 trillion investment shortfall needed to halve the industry’s carbon emissions by 2030 and zero them out by 2050.
H&M, for its part, has promised to reach net zero by 2040.
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The Renewcell investor, in partnership with management consultancy Guidehouse, has also developed a sustainable supplier facility that will allow other brands and investors to co-invest in carbon-reduction projects that need funds and adequate technology implementation support to get off the ground. This scheme, it said, will offer further alternatives to support manufacturers in their “decarbonization journey.”
Other initiatives by the world’s second-largest apparel company after Inditex include an internal carbon price tool that promotes the purchase of low-carbon materials and the selection of low-emission production units by its buying, design and merchandising teams; a multi-year carbon removal agreement with Climeworks that will nix 10,000 tons of CO₂; and a shared commitment with Gucci owner Kering, Stella McCartney and others to snap up more than half a million metric tons of “low-carbon, low-footprint” alternative fibers for fashion textiles and paper packaging.
But H&M has far to go before it nips its footprint in the bud, environmental activists say.
According to recent number-crunching by Stand.earth, the lawsuit-hit retailer will not only fail to halve its emissions by 2030, but its carbon contribution will also balloon by more than 67 percent by the end of the decade.
While H&M has committed to phase out onsite coal by 2025 and transition its supply chain to 100 percent renewable electricity by 2030, the company still needs to provide transparency about its progress to ensure accountability, the nonprofit said.
“If climate action is a catwalk, most…brands are still looking for the dressing room,” Rachel Kitchin, Stand.earth’s corporate climate campaigner, said last month of bold-face names like H&M, Kering, Levi Strauss, Lululemon and Nike. “The data is clear, the leading fashion brands need to step up and do more to lower their carbon emissions.”
In its 2022 accountability report, published last week, fashion advocacy group Remake said that H&M did not provide enough information in the past year about its decarbonization initiatives to score points, though it did receive kudos for publishing its full emissions and making progress on its updated science-based emissions targets.
Other brands whose carbon-reduction efforts did not contribute to their overall score, which Remake uses to measure a company’s actions toward social and environmental justice goals, versus lip service, included Abercrombie & Fitch, Burberry, Nike, Primark, Shein and Under Armour.
Overall, H&M emerged fifth among the world’s top clothing makers with a score of 32 out of a possible 150 points for its work in traceability, wages, commercial practice, raw materials, environmental justice and governance, though this was “predominantly due to the shortcomings in sustainability progress seen among its fellow fashion giants, rather than it being an indicator of significant improvement,” it said. The highest scorers were Burberry and Everlane, which each received 38 points. The worst were Edinburgh Woollen Mill and Ross, which earned 0 points a piece.