LONDON — Is it time to stop bashing fashion, and its relationship with the environment?
Paul Polman certainly thinks so.
The former Unilever chief executive officer, cofounder of the green business consultancy Imagine, and co-chair of The Fashion Pact steering committee, believes the industry has made strides in the fields of sustainability and environmental preservation in the past 12 months, spurred on by COVID-19.
It certainly wasn’t the year anyone had hoped for — and for many it has been the stuff of nightmares — but Polman said adversity only fired up luxury, fast fashion, textile, retail and other brand ceo’s to strike faster — and with more conviction.
In an interview on Day One of the Copenhagen Fashion Summit — during which he served on a panel with other signatories of the agreement — Polman said that over the past 12 months The Fashion Pact’s membership doubled to more than 60 in spite of many organizations being in a temporary state of shock, and disarray, due to the onset of the pandemic.
Those 60-plus signatories represent more than 200 brands and about one-third of the fashion world, a group he believes could soon be dictating the legislation on fashion to governments worldwide.
“This collective way of working gives governments more confidence to make changes,” he said as The Fashion Pact released its first progress report, a year after the industry lobby was launched.
Fashion, he said, “was one of the industries hardest-hit by COVID. And although it’s early days, what I think is encouraging is that we are now seeing more companies stepping up, wanting to work on climate and biodiversity targets, on [eliminating] plastics. The industry has very good players who want to work together, to make commitments and to ensure that they build back a better situation than where we came from.”
In addition to setting seven targets aimed at addressing climate change, biodiversity and the future of the oceans, signatories of The Fashion Pact have taken action as individuals. Chanel, Burberry, Salvatore Ferragamo, Moncler and Prada are among the luxury giants that have raised money in the public — or the private — markets in a bid to reach their sustainability targets more quickly, and with public accountability.
Polman said even before COVID-19 struck, environmental and social, “ESG investing,” was already on an upward trajectory.
He said for investors, ESG investing often promises higher returns, while “from a company’s point of view financing comes at a lower cost, and is less risky because it goes into projects that save the future. Companies that are making commitments around ESG are actually able to attract quite a lot of financing. By contrast, companies that are ‘told’ to change — such as some of the fossil fuel industries — have a hard time attracting financing.”
Polman added that even accounting frameworks are changing to include the impact of environmental policies: He argued that while Kering Group’s Environmental Profit and Loss accounts were admirable, the future will likely see all fashion and luxury companies having to account for their environmental impact on balance sheets and in annual reports.
Polman noted that the World Economic Forum has already asked a group of firms to work toward broadening the accounting framework to measure the social, environmental and government-related aspects of doing business, not just the financials.
In a unique year for business, Polman said it was the speed of change and the cooperation within The Fashion Pact’s companies that has made him the most proud.
He said fashion, as an industry, “has historically never come together to do things collectively. It has not taken responsibility for its value chain. Now, at the ceo level, these companies have collectively committed to move higher — and that’s interesting.
“I also believe that these ceo’s will drive themselves to show more courageous leadership by working together. I’m proud of the dynamics that have been created. We now have an industry that has a better understanding of its impact on the environment, and which takes full responsibility for that impact. These companies are putting the interests of the industry ahead of their own.”
There is still much to be done, and Polman said The Fashion Pact ceo’s will soon have to address the hot-button issue of overconsumption.
“Going back to buying more is not the solution; I think many of these ceo’s understand that, but they can’t end that issue individually. Collectively, they can move quite quickly. Technology will help, and I think you’ll see targets on renewable energies, plastic and biodiversity [being achieved] faster.”
He also argued that the collective efforts of brands in The Fashion Pact will be able to drive production costs down and make way for more investment in future-focused projects and technologies.
He pointed out that 40 to 45 percent of all energy consumed by The Fashion Pact’s members comes from renewable sources. “That’s cheaper than fuel in many parts of the world. If you get rid of unnecessary plastic that’s a saving, too. There are areas that give you savings. There are areas within sustainable sourcing, in biodiversity that don’t necessarily come at a higher cost. Often, they come at a lower one.”
Over the next 12 months, he added, companies will continue to carry the COVID-19 burden, but they’ll have to push ahead with their green agendas, regardless of that challenge.
“I’ve always said that COVID-19 is here to stay. I don’t think we’ll get out of COVID-19 in the near future, so every business will have to take this into account in the next few years. We only know a few things for sure: That technology is accelerating, so what would have taken five years now takes six months. That means companies that are able to react quickly to online are doing well. You’ve also seen an accelerated framework from the environmental, social and government sides. China is making a net-zero carbon commitment by 2060, which will also pull us forward.”
Polman is also hoping that in this COVID-19 era, governments “continue to spend, not pull back and ensure that their spending fuels job creation. Green [power], restoring our biodiversity and our natural capital are all better job creators than anything else. This recovery needs to be a green recovery,” he said.