Transformers Foundation Report Questions Fairness, Feasibility of Science-Based Targets

The weather is no longer just a conversation starter. Climate is the conversation and a new report from The Transformers Foundation raises concerns about the fashion industry’s roadmap for achieving critical decarbonization and related climate goals.

Titled “Towards a Collective Approach: Rethinking Fashion’s Doomed Climate Strategy,” the report underscores the disconnect between Science Based Targets Initiative’s (SBTi) Science-Based Targets (SBTs) and feasibility.

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SBTi, which provides auditing and guidance on how to achieve carbon reduction goals, bases its framework on the Paris climate agreement edict that global warming must be limited to 1.5 degrees Celsius or less in order to curb negative impacts to the global ecology. Levi’s, Interloop and Everlane are among the companies that have set SBTs.

The report, written by Kim van der Weerd, Elizabeth Cline and Brooke Roberts-Islam, highlights the taxing responsibility that many brands place on their supply chain to finance renewable energy sources, lower-emission textiles innovation and other solutions to help meet their goals.

“This not only goes against industry platitudes and established international frameworks, including the Paris Agreement, about a need for equitable and just transition, but it also ensures GHG emissions mitigation will stall,” the report stated.

In a statement to Rivet, SBTi said it welcomes and values feedback from climate experts, civil society and other stakeholders, including in the Transformers Foundation report.

“Accuracy in the corporate climate ecosystem is vital to ensure widespread understanding and enable credible science-based action. We therefore want to make it clear that the SBTi’s criteria and requirements apply equally to all companies and financial institutions, without differentiating between suppliers and clients (or contractors). The initiative does, however, have a target validation route for small and medium-sized enterprises (SMEs) to make it easier for smaller, more resource-constrained organizations to set science-based targets,” SBTi stated.

SBTi added that emissions in a company’s supply chain are on average 11 times higher than those from operations, and that it has a supplier engagement guidance to support businesses to address supply chain emissions in a “more structured manner.”

The report argues that SBTs have “institutionalized the logic that the work of decarbonizing fashion is the supply chain’s responsibility.” Transformers found that “who pays” for decarbonization is rarely discussed between brands and suppliers—that it is implied that manufacturers will absorb costs while brands operate business as usual. Several suppliers who contributed to the report expressed frustration that brands and retailers are neither willing to share costs to decarbonize nor pay a higher price for products with lower GHG.

The report points out that three key pieces of legislation—EU Directive on Corporate Sustainability Due Diligence, EU Corporate Sustainability Reporting Directive and The New York Fashion Sustainability and Social Accountability Act—use SBTs as a tool to reduce emissions or to demonstrate climate change action, compounding pressure on the supply chain. Additionally, they all fail to ensure that the “responsibility of financing decarbonization is collective and equitable relative to the margins of each step in the chain.”

Without support from brands or governments, suppliers look else wear for funding to finance decarbonization projects. However, the amount of capital available to the denim supply chain is insufficient, not to mention the projects can be a hard sell.

Decarbonization efforts don’t generate immediate returns, and in some cases, there’s no financial gain to speak of. In the report, Transformers urges the apparel industry “to stop perpetuating the idea that reducing GHG emissions always, or even often, leads to cost savings and returns” and to develop realistic strategies to support projects without a return on investment.

One way to do this is to allow suppliers to lead decarbonization conversations. According to the report, it’s “time to let go of the belief that brands and retailers must be the ones to direct change through a directive, top-down approach” and to pivot from an “I” to a “we” mindset. Suppliers also need localized decarbonization roadmaps that factor in the accessibility of renewable energy sources and the availability of expertise in their region. SBTs are not one-size-fits-all.

“While such a collective plan may seem daunting, we think it’s the key to unlocking and unleashing climate action,” the report concludes. “We also predict that the demands of climate action (and new laws mandating evidence of mitigation) will not only open the door for such a pivot but make it necessary to move away from the individual company-level approach.”