Weaving a Better Future: Rebuilding a More Sustainable Fashion Industry After COVID-19
The study “Weaving a better future: Rebuilding a more sustainable fashion industry after Covid-19,” published by researchers of the Boston Consulting Group (BCG), the Sustainable Apparel Coalition (SAC) and technology company Higg Co, known for their Higg Index for consumer goods industries, sets out to prove how crucial it is for fashion brands, retailers and other industry stakeholders to continue following sustainability goals during the coronavirus crisis and beyond.
The COVID-19 pandemic and the resulting societal and economic shutdowns required to contain it present the apparel, footwear, and textile industries with unprecedented challenges. But while this crisis strains their commitment to sustainability, it simultaneously demands that companies accelerate their progress on sustainable initiatives in order to be competitive in the market that will emerge after the pandemic.
This crisis is delivering a shock to the global economy and to the broader fashion industry: retail businesses are temporarily closed, brands are adjusting to declining customer spending, and workers in countries like India, Bangladesh, and China are furloughed because of reduced or cancelled orders. And an impending economic crisis is expected to wipe out more than 30% of the fashion industry’s business in 2020 alone.
According to a recent survey of Sustainable Apparel Coalition members, 1/3 of decision makers within fashion brands, retailers, and manufacturers felt very unprepared for the COVID-19 crisis.2 Concerns that were once dominant within the industry – from sustainable materials sourcing to carbon reduction to workers’ rights – have been relegated to secondary considerations while businesses scramble to manage short-term economic distress.
However, surveys with key stakeholders, study of prior global crises, and analysis of economic trends and consumer sentiment make it clear that fashion risks irrecoverable self-inflicted wounds if it abandons sustainability and value chain partnerships in the face of COVID-19. While sustainability is in danger in some areas of the industry, companies that embrace it will be among the leaders of a resurgent fashion industry on the other side of the pandemic.
Today, business decision makers and sustainability professionals need practical and actionable guidance to avoid backsliding on progress and to actively prepare for a changing industry:
• Protect critical assets to survive the economic crisis: Fashion companies must safeguard workers, employees, capital, value chain partnerships, channels, and the trust and support of their customers. This moment is an opportunity to remove unnecessary complexity and costs, in order to prepare for reinvestment.
• Solve immediate inventory challenges in partnership with suppliers: Leaders will recognize the importance of open dialogue and constructive partnership across the value chain in order to find shared solutions for protecting worker livelihood and sustaining trust. Cancellation of completed orders will be a measure of last resort, while cancellation without consultation or collaboration will be an unacceptable practice.
• Integrate sustainability throughout business recovery strategies: Sustainability will be an imperative for strong companies after the crisis. Leaders will make sustainability central to post-pandemic decision- making, while laggards will view sustainability as an effort to resume once convenient.
• Accelerate transparency while increasing sustainability ambitions: Companies must take advantage of digitalization, innovative business models, and end-to-end solutions – with transparency playing a central role – in order to assess and demonstrate positive environmental and social impact to stakeholders.
The companies that succeed in maintaining their sustainability programs and commitments as they manage the crisis will gain a durable business advantage once it ends, and rebuild a more sustainable fashion industry after COVID-19.