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Going Green? Knowing Your Supply Chains is Half the Battle

Supply chain, know thyself. That was the key message that Linda Greer, senior scientist at the National Resource Defense Council and head of the nonprofit’s Clean by Design sustainable-textiles program, delivered to brands and retailers at the Copenhagen Fashion Summit this past May.

If apparel companies want to whittle their water consumption, energy expenditure or use of chemicals, they must first figure out where and how their products are being manufactured, Greer said.

You can’t really be disruptive, you can’t really be innovative and you can’t really do what needs to be done until you take this very first important step of actually knowing where stuff is made and then benchmarking the environmental performance of those facilities,” she said.

Greer, whose program will be working with the Sustainable Apparel Coalition to bring it to scale, served up an analogy.

“Let’s pretend we were running a school system that was failing,” she said. “We hired a very exciting new superintendent who has a very innovative plan for improving how to teach children math. We’re all excited to bring him on. He comes in and he doesn’t have a list of the schools in his school district.”

Burberry is one firm that has found success with Clean by Design’s signature 10 best practices for improving textile-mill efficiency—”low-hanging fruits” that NRDC says typically cost little up front yet provide a return on investment in under a year.

After a 2012 environmental assessment indicated half its impact occurred in the raw-materials and processing stages, the British luxury house deployed Clean by Design’s guidelines in 28 Italian facilities that processed approximately 43 percent of its product.

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The company sussed out more than 230 individual opportunities for saving either water or energy, according to Pamela Batty, vice president of corporate responsibility at Burberry.

“Italy, which as we know, is not a developing country; it is a country with a mature and sophisticated textile industry,” Batty said. “But we still managed to see energy savings of up to 14 percent and water savings of 11 percent.”

For Batty, Clean by Design offers quick and easy wins that complement Burberry’s larger, overarching commitment: to “drive positive change” in 100 percent of its offerings by 2022.

“There are lots of things that are going to make up that 100 percent, including more sustainable raw materials, but this program is going to be really central to us achieving our ambitions,” she added.

Kering, which pioneered the Environmental Profit & Loss Account, a form of “natural capital accounting” that places a monetary value on the impact of a company’s supply-chain operations, also believes in immersing onself in the nitty gritty of manufacturing.

It’s a great exercise because we have a really clear view of where and how our activities create impacts such as water pollution, greenhouse-gas emissions, land use and waste,” said Géraldine Vallejo, sustainability program director at the fashion conglomerate. “And based on these results we’re able to take action.”

Kering could trace only 10 percent of its impact to its own operations. An overwhelming 90 percent related to its brands’ manifold supply chains.

“So if you only focus on your own operation, you’re missing the point,” Vallejo said, before noting Kering’s own ambition to reduce its Environmental Profit & Loss footprint by 40 percent relative to business growth.

“So 40 percent is enormous,” she said. “We know today that we can reduce by 20 percent by implementing best practices and existing technology, but the additional 20 percent will require breakthrough innovations like circularity, like decoupling from nature.”

Vallejo likewise praised Clean by Design’s best practices for affording Kering its short-term victories, which she hailed as wins for both the company and its suppliers. Kering’s efforts were so successful, in fact, that the conglomerate has moved the program upstream from its Tier 2 manufacturers to Tier 3 and Tier 4 suppliers, including wool scouring and silk reeling.

And it all began with finding an objective and hitting the mark.

“It was important for us to set a target as a group so that, internally, people were much more ready to take action,” Vallejo said.

Ebru Ozkucuk Guler, senior corporate social responsibility executive at ISKO, one of the world’s leading denim producers, stressed that equal partnership is important in the supply chain, so that “it’s not just one part that always demands everything from the rest.”

At ISKO, Guler worked to obtain life-cycle assessments for all of the company’s denim items. She also helped produce an Environmental Product Declaration—a document that details independently verified, transparent information about the environmental impact of ISKO’s products—that the firm will publish this November. It’ll be a first of its kind for denim.

“If you’re doing something good in the long-term with responsibility, in innovation, then you have to share with others,” Guler said.

As the co-owner of a small-and-medium-sized enterprise (SME), Nicolaj Reffstrup, CEO of Ganni, a Copenhagen-based apparel label, has a slightly different perspective on the situation.

“We’re experts in design and sales and marketing, in sourcing, but we do not possess the skills nor the capacity to create the innovative solutions for our supply chain, which we hardly control,” Reffstrup said.

SMES, particularly those in the entry-price segment, generally lag behind in sustainability, according to the 2018 “Pulse of the Fashion Industry” report, which precedes the Copenhagen Fashion Summit every year. Indeed, they represent a “blind spot” in addressing sustainability, the report’s authors said, perhaps a result of their lack of leverage and uncertainty about how to tackle complex issues in their supply chains.

Since 2016, Ganni has been mapping its carbon footprint through an external auditor, in part to uncover how much carbon it generates but also to offset its footprint, which it does by purchasing carbon credits.  

“I know it’s far from ideal, but it’s a start,” Reffstrup said. “It turns an abstract challenge into something that’s measurable and tangible, which is what it’s all about when you’re an SME.”

As for what comes next, Reffstrup’s cri de coeur is one that many SMEs in the sustainability sector can empathize with today.

“As an SME I can only change my supply chain profoundly if someone bigger than me will help create that innovation and make it available to me. Or if we pool resources with other SMEs to gain leverage towards our supply chain,” he said.

Reffstrup says he believes that SMEs are willing to dole out the cash and promote sustainable innovations in their supply chains if given the opportunity.

“But we kind of need them to be productized or turnkey-ish because creating that change from scratch is a tough one,” he added.