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Best Way to Slash Scope 3 Emissions? New Climate Report Weighs In

A new climate change study from the Climate Board and Textile Exchange highlights critical findings and successful practices in the fashion industry to address climate change.

Working with 40 leading, global retailers, brands, and suppliers, the “Friction Points in Fashion and Textiles: Removing Barriers and Accelerating Climate Action” study dives into the climate reduction activities of some of the world’s most advanced fashion retailers and suppliers.

“The study is filled with timely recommendations for fashion and textile companies worldwide to accelerate their journey to net-zero,” La Rhea Pepper, CEO at Textile Exchange, said. “Taking us beyond ‘analysis paralysis,’ it gives context and best practices to create clear actions.”

What’s more, the report “pinpoints the barriers retailers, brands and suppliers face, and highlights sustainability practices that move the needle,” Ken Bruder, co-founder and head of research at the Climate Board, said. “The industry is still nascent and most companies are just beginning to look at the more difficult [carbon] reductions in Scope 3.”

Key findings in the study include that more than 90 percent of emissions from fashion and textiles comes from indirect (Scope 3) sources and that fiber and materials offer the biggest lever to reduce Scope 3 emissions. In addition, the study concluded that the industry is not on track to achieve Scope 3 emissions goals, with early evidence indicating that as many as two-thirds of brands and retailers that have announced Scope 3 targets are not on track to achieve absolute Scope 3 emission reductions.

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The study also found that announcing bold climate goals does not correlate with actual carbon reductions. While companies are under pressure from stakeholders to commit publicly to aggressive climate goals, the data does not demonstrate a strong correlation to GHG reductions, according to the study.

Also, nuanced fiber strategies do correlate with improved carbon reductions and those that incorporate a more sophisticated definition of sustainability linked to greenhouse gas (GHG) emissions achieve better results. The study noted that companies are experimenting with a wide range of methods to reduce fiber and material-related emissions, acting as a broad, multi-faceted climate solutions laboratory.

While the focus of this study was fiber and materials for Scope 1, 2 and 3, the Climate Board also took a snapshot of practices that complement, extend and accelerate climate impact.

For one, field, farm and forest interventions “jump the long and complex queue of intermediate suppliers,” adding another critical lever in the push to move Scope 3 emissions. What’s more, financial market innovations should focus on extending impact beyond the supply chain to mobilize capital and accelerate change. Plus, the study noted that new business models serve as emerging experiments to advance sustainability and circularity in fashion and textiles.

The Climate Board accelerates business action on climate change by empowering corporate executives with practical, cost-effective solutions to climate and sustainability challenges. The organization leverages the experience and insights of industry practitioners, then adds research and analytical expertise to provide implementable best practices, decision-support tools, and actionable data.

Separately on Wednesday, Textile Exchange and TextileGenesis announced the pilot release of Textile Exchange’s Electronic Trackit, or “eTrackit,” program–a digital system for granular traceability using innovative technologies applied to Textile Exchange Standards.

The pioneering system creates detailed material accounting of certified materials at the article level across the supply chain, enabling peer-to-peer validation and leveraging third-party certification bodies in the transaction verification process. The pilot program will be released in November at Textile Exchange’s annual global conference in Dublin, and the first phase will focus on the Global Recycled Standard (GRS) and the Recycled Claim Standard(RCS).

“In an industry’s first, supply chain transactions along with a product level chain of custody will be verified digitally on the platform,” Claire Bergkamp, chief operating office of Textile Exchange, said. “Our aim is that this technology accelerates positive impacts throughout the supply chain while also providing brands with the verified data they need to confidently make product claims.”

Seven global brands, including Bestseller, H&M Group, Inditex, Tentree and VF Corp., will pilot this traceability system for GRS and RCS certified materials across their supply chains. Participating certification bodies include Control Union, USB Certification, IDFL, Intertek and Bureau Veritas.

After these pilots, scaling programs will be designed to facilitate a rollout on a commercial level. The traceability system will be further expanded to cover the animal fiber standards, followed by the Organic Cotton Standard in 2022.

“With increasing consumer demand and compliance risks, CEOs and boards of the majority of top 100 fashion brands have committed to using sustainable fibers over the next five years, with transparency and traceability being a core part of business priorities,” Amit Gautam, CEO of TextileGenesis, said. “Sustainability and traceability have become deeply interconnected, and it’s great to see Textile Exchange paving the way for the entire fashion industry to follow. Our supply chain traceability platform creates robust and scalable material accounting at the product-article and lot-level for Textile Exchange’s fiber standards using our Fibercoins traceability technology.”

Textile Exchange is a global nonprofit that develops, manages and promotes a suite of industry standards, and collects and publishes vital industry data and insights that enable brands and retailers to measure, manage, and track their use of preferred fiber and materials.