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Big fashion companies lag behind on green targets

Commodities1 hour ago (Mar 22, 2021 03:10PM ET)

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(C) Reuters. FILE PHOTO: People stand next to fashion boutique in a shopping district in Tokyo

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By Victoria Waldersee and Silvia Aloisi

(Reuters) – The 15 largest listed fashion companies are lagging behind when it comes to meeting the social and environmental targets of the Paris climate agreement and UN Sustainable Development Goals, a new report by the Business of Fashion said on Monday.

The Business of Fashion, an online publication about the fashion industry, analysed in its report publicly disclosed information from the five biggest companies by revenue in three categories – luxury, sportswear, and high street fashion, including Kering (PA:PRTP), Adidas (OTC:ADDYY), H&M and others.

The fashion industry is under increasing pressure from consumers and governments to clean up its act. Statistics cited by the World Economic Forum show that the industry is responsible for at least 4% of global greenhouse gas emissions.

The Business of Fashion’s report scored companies out of 100 in their progress towards meeting sixteen targets which would align their performance with the UN Sustainable Development Goals and Paris Agreement on emissions, waste, workers’ rights, water, and materials.

It also ranked the companies on transparency, or how much information about a company’s practices was currently available.

Kering ranked top with 49 points and Under Armour (NYSE:UA) ranked lowest at 9 points. The average score for the companies was 36 points.

The report found the companies were more likely to disclose information on targets than concrete actions towards fulfilling them.

“Opaque working practices and fuzzy definitions of what constitutes ‘good’ progress complicate matters further, creating a woolly picture of where the industry is at and what steps are required for it to clean up its act,” the report said.

Kering and Nike (NYSE:NKE) performed best on transparency, while PVH Corp (NYSE:PVH), Levi Strauss (NYSE:LEVI), and VF Corp (NYSE:VFC) ranked highest on their efforts to reduce emissions.

Under Armour scored lowest on all rankings except workers’ rights, where LVMH ranked one point lower.

Scores for Hermes, LVMH and Richemont averaged lower than high street fashion companies H&M, Inditex (MC:ITX), Gap and Levi Strauss across the six categories – emissions, waste, workers’ rights, materials and transparency.

On average overall, the companies performed worst on waste and workers’ rights. Uniqlo owner Fast Retailing, Under Armour and Richemont reported the lowest average score across the six targets.

Kering sustainability chief Marie-Claire Daveu said the company was proud of the recognition given by Business of Fashion. Asked about the fact that the report highlighted all companies were falling short of targets, she recognised that sustainability was a “long, never-ending journey.”

Adidas said it was working closely with its partners to achieve climate neutrality in its operations by 2025 and throughout its supply chains by 2050.

Other companies cited did not immediately respond to a request for comment.

A panel of twelve sustainability experts advised on the methodology for the Business of Fashion’s report.

Big fashion companies lag behind on green targets

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