H&M: Making Fashion Sustainable and Sustainability Fashionable
Can H&M, one of the world’s largest fast-fashion retailers, successfully make fast-fashion and ethics synonymous?
The fast-fashion industry, characterized by garments worn less than five times and kept for 35 days, produced 400% more carbon emissions per item per year in comparison to garments worn 50 times and kept for a full year [1]. As one of the world’s largest fast-fashion retailers, H&M is aiming to reinvent the fast-fashion industry by making sustainable fashion choices available, attractive, and affordable for the masses [2].
The apparel industry accounts for 10% of the total global carbon impact and is the second largest industrial polluter, second only to the oil industry [2]. In addition, 20% of industrial freshwater pollution comes from textile treatment and dyeing, and nearly a quarter of all chemicals produced in the world are used in textiles [1]. These are just the ecological and economic impacts of the apparel industry; the social impacts are far more complex. At the same time, consumers are becoming more mindful about what they wear, where it came from, how it was produced and by whom. This demand for transparency from consumers coupled with the adverse effects of climate change on profitability has forced companies, like H&M, to implement sustainability standards into their businesses.
H&M’s Conscious Collection
H&M is one of the largest go-to affordable, fast-fashion retailers, second only to Inditex, owner of Zara [3]. H&M sells more than 600 garments of clothing every year and annual sales have reached $24B as of 2015 [4][5]. H&M has taken impressive but much needed action to address their role as a major contributor to climate change. In 1997, they launched a comprehensive sustainability program to address these issues and since then, they’ve published 14 annual sustainability reports, built out a staff of 200 dedicated sustainability employees, and introduced a distinct clothing line made out of sustainable raw materials called the “Conscious Collection” [2].
As of 2015, they’ve produced some impressive sustainable figures [2]:
- 20% of raw materials were sourced sustainably
- 78% of total electricity use comes from renewable sources
- 31% of total cotton used certified as organic cotton, Better Cotton (BCI), or recycled cotton
- 56% reduction in total CO2e emissions compared with 2014
- 12,341 tons of clothing were collected for reuse and recycling
H&M’s Sustainability Strategy
One of the major complications with H&M’s sustainability program is that H&M estimates that only 10% of the carbon footprint stems from their own operations, leaving nearly 90% of the climate impact attributable to their partners [2]. A critical aspect of their value chain within their control is how they source raw materials. Cotton is the primary raw material used in production at H&M [6]. As a crop, cotton is more resilient to the impacts of climate change however, cotton farming is one of the most water intensive processes in the supply chain process. To address this issue, H&M has increased their use of sustainable cotton, specifically organic cotton which has 46% less carbon impact than conventional cotton [2]. Additionally, organic cotton requires less fertilizer and pesticides which improves H&M’s overall profitability [7]. According to the Textile Exchange’s Organic Cotton Market Report, H&M was the #2 user of organic cotton by volume in the world in 2015 and H&M has set an ambitious goal of using 100% sustainable cotton by 2020 [8].
In addition to sourcing sustainable resources at the front end of the product life cycle, H&M has taken steps to control waste at the back end of the cotton life cycle as well [See Figure 1]. The U.S. EPA estimates that textile waste occupies nearly 5% of all landfill space in the U.S. when nearly 95% of this could be recycled or reused [2]. In 2013, H&M introduced their garment collecting initiative – collecting over 22,000 tons of old garments for reuse and recycling since launch, enough fabric for nearly 100 million t-shirts [2]. Yet, in order to achieve this completely closed loop cycle for textile fibers on such a massive scale, H&M will need to invest heavily in people and new technologies over the coming years. This doesn’t come without potential risks to H&M’s business and value proposition, including increased costs, compromised quality, and higher prices for the end consumer.
![Figure 1: The Primary Life Cycle Stages of Cotton [9]](https://d3.harvard.edu/platform-rctom/wp-content/uploads/sites/4/2016/11/cotton.png)
H&M is a textiles business and so long as they make apparel, they will remain heavily dependent on raw materials to produce their product. The cotton commodity market naturally fluctuates based on supply and demand, and these price fluctuations are either absorbed by the consumer or by the company [8]. In the future, H&M may face pricing challenges as they aim to price within the customer’s means while also staying true to their ethical commitments throughout the supply chain. The element of fairness, both within their supply chain and to their customers, is key in order for H&M to achieve long-term success.
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- http://www.forbes.com/sites/jamesconca/2015/12/03/making-climate-change-fashionable-the-garment-industry-takes-on-global-warming/#6ba24d36778a
- http://sustainability.hm.com/#impact
- https://www.theguardian.com/sustainable-business/h-and-m-sustainability-report
- http://about.hm.com/en/media/news/244704.html
- http://about.hm.com/content/dam/hmgroup/groupsite/documents/masterlanguage/Annual%20Report/Annual%20Report%202015.pdf
- http://about.hm.com/en/sustainability/sustainable-fashion/materials/cotton.html
- https://www.ota.com/sites/default/files/indexed_files/Organic-Cotton-Facts.pdf
- http://textileexchange.org/wp-content/uploads/2016/07/2016-TE-Organic-Cotton-Market-Report.pdf
- http://msl.mit.edu/publications/SustainableApparelMaterials.pdf
Jenna, this was a great piece and thank you for bringing this important issue to the table. I was encouraged to see H&M – as a retail giant – work towards making both its operations and products more sustainable.
But like you, I am still struggling with the irony of H&M’s efforts. By definition, the fast-fashion business model encourages low quality garments, quick replacement cycles, and ultimately, a lot waste. I also question the efficacy and motivations behind some of their initiatives – for example, the recycling program. In absence of a 100% closed-looped system to re-use and recycle old garments, I think H&M’s recycling program is only making the problem worse. The program encourages the customer to return items at the store, receive a voucher, purchase a new item (not made of 100% recycled items) using the voucher, and ultimately contribute more waste! Encouraging returns could also increase the number of trips a customer makes to H&M, and thus increase car utilization and carbon emissions.
The recycling concept is great in theory, but as you suggested, the technology is far from commercially scaleable. Furthermore, “there is closed-loop technology for pure cotton that could take a garment, break it down and reweave—but once cotton is dyed, treated or blended with other materials, the process no longer works. Treated cotton, linen, silk and wool can be mechanically chopped up for recycling, but they yield a low-quality, short fiber that must be mixed with virgin fiber for clothing.” [1] Closed-looped technology for synthetic materials are “even further away from commercial feasibility.” [1].
There are also challenges from the customer perspective. To make this model truly work, more customers must be engaged in re-using and recycling. According to the EPA, 84% of unwanted garments end up in the landfill or incinerator [1]. Changing this percentage requires a huge shift in consumer behavior and preferences!
Ultimately, no matter how much H&M preaches that they are moving towards sustainability, I have my doubts. There is a permanent and undeniable tension between the fast-fashion business model itself and creating a sustainable planet. It promotes a lifestyle where we are constantly searching for newness. Even if we cracked the closed-loop recycling model for clothing, does this promote a wasteful lifestyle in other areas of our life like food and transportation? Should we, as environmentally-conscious consumers, promote more “closet-sharing” business models vs. “fast-fashion”? Wouldn’t this allow us to try new styles and pieces, without increasing our carbon footprint? Or if H&M truly cares about sustainability – should they shit its business model to produce higher quality garments that can last longer?
In fact, I really admire what Patagonia is doing in this space. Similar to H&M, they are encouraging a closed-loop recycling program [2]. However, unlike H&M, they are also promoting the notion that “as individual consumers, the single best thing we can do for our planet is to keep our stuff in use longer.” They subsequently provide an “easy-to-follow repair guide” on its website (http://www.patagonia.com/worn-wear-repairs/) [3]. While this may not increase customer purchases for Patagonia, they are doing their part in creating a more sustainable world. I would argue that this is an even better business model – as an environmentally-conscious consumer, I trust that they truly have the planet in mind first.
As a final note, HBS’s Retail & Luxury Goods Club has a panel on Sustainability for its conference in January that could be interesting for H&M to take some ideas from.
[1] Jared Miller, “Fast Fashion is Creating an Environmental Crisis,” Newsweek, September 1, 2016, http://www.newsweek.com/2016/09/09/old-clothes-fashion-waste-crisis-494824.html
[2] “Reuse and Recycle.” Patagonia. http://www.patagonia.com/reuse-recycle.html
[3] “If It’s Broke, Fix it!” Patagonia. http://www.patagonia.com/worn-wear-repairs/
I can see both sides of the conversation that Jenna and Jessie are putting forward. I’ve only recently begun to think about how shopping at places like IKEA and H&M are impacting the environment, and it is becoming clear that the impact is large.
I think recycling is H&M’s best bet for continued sustainability, but as Jessie mentioned, it is going to be very difficult to follow through on, especially given the quality of the clothing. There really isn’t an easy way to reuse this type of clothing – you can’t donate it to a second hand store (due to tears, etc. caused by the low quality) and you can’t resell it (due to the trend-based setup of the clothing line). Enforcing a recycling culture is likely out of line with the behavior and expectation of the H&M consumer. The exact opposite is true for Patagonia, which is likely why they have seen so much success. Their marketing message, product, and sustainability views are all aligned in this instance.
Jenna and Jessie, you both illustrated the inherent tension between recycling efforts and providing fast fashion for H&M very clearly. And I agree – the recycling program to reduce the water waste and other pollution resulting from textile production is a bit flawed and cannot achieve a closed loop system status without a large influx of capital. Within the clothing production cycle, there are two levers that we can pull to reduce environmental impact. One is (as you both mentioned) through recycling at the end of the cycle, the other is to reduce production in general at the beginning of the process. Because of the current fast fashion trend, the second option will unlikely gain any traction with clothing companies. Patagonia’s encouragement of customers to repair items can be effective, but will be limited to clothing companies whose products are meant to last (i.e. down winter jacket from Patagonia vs. a summer top from H&M).
Recently, I’ve been closely tracking a few clothing subscription companies like Le Tote, Gwynnie Bee, and Rent the Runway. They provide monthly (or as requested) boxes of lightly used, fashionable clothing catered to the taste of the customer for a flat fee. Once the clothes have been worn, the customers send it back, the company will clean, iron, and fold the pieces, and send them off to the next customer. This model mimics the fast fashion concept by providing new styles on a monthly (or even faster) basis while limiting the clothing production at the beginning of the cycle. Like the recycling program, this is in no means a perfect solution (people may not want to wear second hand clothes, customers may not like all the pieces they received, etc.), but I think it can be a very effective way to maintain the fast fashion trend while reduction environmental impact.
Furthermore, what struck me as potentially more environmentally damaging is the additional transportation and distribution networks required to run a fast fashion business. Companies like Zara and H&M can get clothes from design to store in less than a month[1]. Customers are also no longer purchasing items on a twice a year cycle. As a result, the increased frequency with which H&M must distribute new products to its stores via ship, freight, or truck will add significantly more CO2 and burn more fossil fuels than before. Other than using more fuel efficient vehicles, I do not have an easy solution to this problem and would be interested to hear other peoples’ thoughts.
[1] Zarroli, Jim. “In Trendy World of Fast Fashion, Styles Aren’t Made to Last.” http://www.npr.org/2013/03/11/174013774/in-trendy-world-of-fast-fashion-styles-arent-made-to-last. Published Mar 2013, Accessed Nov 2016.
Nancy – thanks for the great feedback on Patagonia’s model. I completely agree with you that it is easier for Patagonia to promote this due to their “meant to last products.” That said, I do hope that consumer preferences shift away from fast-fashion and start moving towards “meant to last products.” I liked your subscription model idea. Although I am a bit worried that they may be contributing to our carbon footprint more so than helping. Rent the Runway packages often comes in large packages that are shipped from one side of the country to the other. The consistent additional transportation and air freight that the Rent the Runway subscription model requires may negate the positive impacts of re-using garments. I’d love to hear other’s thoughts on this trade-off.
Nancy, I love this idea of capturing sustainability through a subscription model! However, after looking into a bit, I’m not so convinced it would be effective because of additional costs the model would incur. For example, I’m worried about the potentially high transportation cost associated with the subscription model, as well as energy emissions that result from increased transportation. These services also likely utilize high degrees of dry cleaning, which (unless they are committed to using one of the “greener” and more expensive options) we know contributes to environmental damage. H&M estimates that 30% of a garment’s climate footprint occurs post-purchase due to care and disposal [1]. If H&M were to scale the subscription model, it could be adding serious negative impact on climate change through the use of chemicals, production of toxic waste, and energy expended during the process. Moreover, think about all the packing (I’m imagining rooms and rooms of cardboard boxes…) that would be required for this model! If we were to scale this, how would be deal with making sure these materials are recycled properly?
That being said, I still like this model because I think it is innovative and has a lot of potential for success in sustainability if we introduced it with several modifications to the subscription businesses that are currently out there. I’m thinking:
1. Set up local distribution centers to minimize transport
2. Use recyclable packaging wherever possible
3. Invest in cleaning technologies which aren’t environmentally damaging
4. Educate customers on sustainability, especially in garment care
New startup idea, perhaps? Who wants to take FIELD 3? 🙂
[1] http://eleanorsnare.com/is-subscription-clothing-a-sustainable-alternative-to-shopping/
Agree with both you and Jessie that there definitely are tradeoffs in pursuing a subscription model that will have a huge impact on the environment. To get to the bottom of it, we’ll likely have to resort to environmental experts and some intense Excel modeling. That said, I do really like your idea. I think modification #3 will be the lowest hanging fruit, since not all garments will have to be dry-cleaned. There is so much technology that goes into fabric design that allows most pieces of clothing to be machine washable.
For H&M, I absolutely agree that adopting a subscription model will be difficult, simply because there will be so much additional merchandising, customer relations, and curating of outfits that would need to happen.
Jenna – thanks for sparking off this interesting debate on the feasibility of sustainable initiatives in the fast fashion industry. I agree with both Jessie and Nancy that there is a fundamental friction between sustainability and the very value proposition of fast fashion. The ideal solution in the long term would be a switch in consumer preferences towards longer-lasting, higher frequency-of-use apparel, which would address this issue at its root.
Having said that, I still believe that there is a lot that fast-fashion retailers can do to make their value chain more aligned with long-term environmental sustainability. When we talk about reducing production or eliminating waste at the beginning of the production cycle it is not only limited to reducing the number and frequency of SKUs produced (which is integral to the customer value proposition). H&M’s use of organic cotton is an example of improving sustainability at the earlier stages off the supply chain. Inditex (Zara) also recently launched a campaign called “Join Life” which includes products exclusively manufactured from organic cotton, recycled wool and Tencel (a wood cellulose sourced from certified socially and environmentally responsible forests). An interesting point in the above post is that 90% of H&M’s climate change impact is attributable to its partners. Inditex, in order to ensure greater control over its production eco-system, only sources those products for its “Join Life” campaign which have been manufactured using Inditex’s “Green to Wear” technologies (Eg: Water recycling) and in factories with a Grade A or B in environmental sustainability. Moreover, they have doubled down on creating “eco-efficient” stores which focus on reducing electricity consumption and reusing packaging supplies. While I agree that there is a need for the fast-fashion model to evolve to match sustainability targets, there is still plenty that players can do within the constraints of the current business model.
Jenna – great post and a very fashionable topic! I am personally becoming more and more skeptical of the real intention behind selling sustainability within fashion. Is it just PR, sustainability or both? H&M sustainable lane is sold under H&M “collection”, i.e. off the runway high quality products. TopShop is doing the exact same thing. The more I see it, the more I view it as yet another marketing tool. An ability to charge premium prices for products that arguably positively affect the planet and then mark them as off the runway. What if it is a marketing tool that allows high street retailers to brake into higher margin high fashion products?
Building on Jessie’s point of Patagonia, another interesting brand is The Reformation. They are fairly new (only a few years old) company headquartered in LA. They sell products that are more fashion forward than Patagonia but their differentiated selling point is using materials and production processes that supposedly reduce the use of natural resource and CO2 production as compared to other brands. Every garment they sell comes with a description on how much water/CO2/energy was saved (vs. standard production) during production, as measured by an internally developed scale. They also pride themselves on refreshing, redesigning and reselling vintage clothing as a secondary line. The company is growing at double digits and is very popular with stores across the country. I guess my question to you girls is – are people truly buying into the sustainability story or is it just en vouge to buy sustainable clothing these days?
Very interesting article and discussion about a very important topic, thank you Jenna!
Most points have been made and I think what is so great about this article is that it really makes you think and start to feel more conscious about where you shop and what impact your purchasing behaviors are having on the environment. I think it’s similar to seeing a video about terrible conditions for the animals we eat such as chickens or cows, and then starting to eat only organic or free range/grass fed products. Similarly, if we saw a lot of the working conditions, air and water pollution, and waste coming from these clothing factories we may just be horrified enough to not purchase.
A lot of eco-conscious fashion brands have already been mentioned but I thought I would bring one new one up that was specifically founded based on the fact that there is just so much waste of raw materials.
It is called Tonle: zero waste fashion, founded by Rachel Faller, and all of their products are made from factory scraps, and they use patterns that use 100% of the material leaving no scraps.
https://tonle.com/
Jenna – excellent post!
I think you call out some great points that affect both the broader fast-fashion industry and H&M in particular. I did not appreciate the enormity of the emissions that are contributed by the likes of fast-fashion providers versus traditional fashion retailers – 400% more per item seems incredibly high. While it appears that H&M is making strides towards becoming more sustainable in their manufacturing process, I do believe that they will not be able to fully realize changes until the consumer in this market accepts the pass through of a higher price in order to wear sustainable goods. As your article points out, we are already seeing some of this in the current market environment, however, my belief is that for it really resonate with H&M and their competitors.