Executive summary

In the wake of a global pandemic that reinforced growing public demand for strong action to curb the climate crisis and protect public health, fashion brands are at a critical crossroads. As people around the world call for a just and green economic recovery, the fashion industry, which is responsible for 5 to 8% of all global greenhouse gas (GHG) emissions, must quickly ramp up its efforts to eliminate fossil fuels across supply chains in order to halve its emissions by 2030 in line with the Paris Accord.[1]

The fashion industry continues to rely heavily on coal to power the manufacturing of its products, contributing to rising climate emissions and deadly air pollution in countries, such as Vietnam and Bangladesh, where its supply chain is concentrated. Fashion brands are also driving demand for fracked fibers such as polyester, which are derived from fossil fuel feedstocks, and whose production is associated with significantly greater emissions compared to plant-based fabrics such as cotton.

Over the last few years, many fashion brands have pledged to take steps to cut the climate emissions generated from their supply chains by signing the Fashion Industry Charter for Climate Action, which commits brands to 30% emission reduction across entire value chains.[2] But as the runway to 2030 gets shorter, fashion brands must move rapidly from climate commitments to actions geared to phase out fossil fuels in order to halve their greenhouse gas emissions in this decade in line with limiting global warming to 1.5℃.

Climate science has made it abundantly clear that the fashion industry’s business-as-usual reliance on fossil fuels to manufacture and ship its garments is not consistent with a climate-safe future. Continued reluctance by fashion brands to decarbonize their manufacturing processes also poses significant reputational and investor risk, with both consumers and shareholders increasingly demanding corporate action to cut down emissions in line with the Paris Accord.[3]

Stand.earth’s Fossil-Free Fashion Scorecard benchmarks 47 leading fashion and apparel companies on their efforts to eliminate fossil fuels in the manufacturing, raw materials and shipping of their goods. The Scorecard builds on Stand.earth’s Filthy Fashion Climate Scorecard published in 2019 by analyzing not only their climate commitments but also their efforts to increase renewable energy and energy efficiency in manufacturing, shift to low-carbon materials, and reduce climate pollution from shipping.

Major findings

The 2020 United Nations Environment Program Emissions Gap Report demonstrates that the world must cut emissions by 55% in order to limit global warming to below 1.5℃. Of the 47 companies evaluated in the Scorecard, only Asics, Mammut and REI Co-op have set commitments to slash their GHG emissions across the value chain (i.e. scopes 1, 2 and 3) by at least half by 2030 - 63%, 55% and 55%, respectively. With the exception of Burberry (46%), Allbirds (42%), American Eagle Outfitters (40%), H&M (41%) and Levi’s (40%), all other companies have either set supply chain emission reduction targets 30% or lower or committed to intensity-based targets that fall short of achieving the necessary 2030 reductions.

Despite their supply chain being responsible for 90% of GHG emissions, companies continue to focus much of their efforts on decarbonizing their own operations, which typically represent 10% or less of emissions. More than three-quarters of the companies evaluated in the Scorecard (35 of 47) received a failing “F” grade on their efforts to drive energy efficiency and a transition to renewable energy in their supply chain. Of the 47 brands in the scorecard, only six have reported the deployment of renewable energy in their supply chain.The highest grade in this area was achieved by Asics, Levi’s, Mammut, Nike, and PUMA, each receiving a grade of “C.” These companies have taken important steps to invest in improving energy efficiency in their Tier 1 and Tier 2 of the supply chain, and providing financial incentives to help procure or deploy renewable energy at their supply chain manufacturing facilities.

Several fashion companies have centered their climate strategy on becoming “carbon neutral” or “climate positive”. But in many cases, these increasingly popular buzzwords provide a false impression about companies’ decarbonization efforts. For example, Gap has set a target to become “carbon neutral” by 2050; however, the company’s absolute emissions reduction target of 30% by 2030 for its supply chain remains far below the trajectory it needs to set. Gap has also not set a renewable energy target for its manufacturing, which suggests that the company will likely rely on carbon offsets and unbundled renewable energy credits to claim credit toward achieving its climate goals. Another brand that exemplifies this troubling trend is Ralph Lauren, which has committed to a “net zero” target by 2040 by largely relying on “carbon credits” and “nature-based carbon removal” but has not set a renewable energy target for its manufacturing. Pentland, the parent company of Speedo, has a long-term goal of becoming carbon neutral but no commitments to drive renewable energy in its supply chain. For climate neutrality or positivity goals to be meaningful brands must also commit to halving their emissions throughout the value chain and move away from fossil fuels to renewable energy to power manufacturing. Mammut's new net zero strategy, which promises to reduce absolute emissions 55% and switch to 100% renewable energy in the supply chain, provides a strong model for other brands to follow.

Among the top ten performing companies across all impact areas, eight are companies that own popular sportswear and outdoor brands. The Swiss outdoor brand Mammut leads the pack with a “B-” overall grade, followed by Nike (C+), Asics (C), PUMA (C), VF Corp. (C), adidas (C-), Arc’teryx (C-) and Patagonia (C-). Notably, the healthy lifestyle brand Lululemon, known for its popular yoga pants and athleisure wear, was among the worst performing sportswear brands, receiving a “D-” for demonstrating little progress in switching from coal to renewable energy in its supply chain and failure to take steps to reduce its reliance on fracked fabrics and other fossil fuel derived materials. Under Armour, the fourth biggest sportswear brand in the world, received a failing “F” grade, reflecting weak commitments to tackle climate change and troubling lack of transparency in disclosing its GHG emissions and energy use in its supply chain.

Replacing coal-fired boilers presents a big opportunity for fashion brands to substantially cut their GHG emissions, yet only six companies reported recent progress in eliminating or addressing coal boilers. Asics is the only company to report that it has eliminated onsite coal burning at all of its Tier 1 supplier facilities.[5] Nike also reported its partner factories implemented more than 40 boiler electrification projects over the last six years.[6] Adidas, Esprit and PUMA indicated that they are working with supply chain partners to replace coal-fired boilers, and Mammut made a commitment to phase out coal by 2030.

While one-third of the companies evaluated in the Scorecard (14 of 47) require their supply chain partners to provide them with data on their emissions and energy use, this data is not shared publicly, making it difficult for consumers and investors to hold companies accountable for their supply chain climate footprint. Though some brands like Nike and VF Corp. stand out in their reporting of energy demand and renewable energy use by some suppliers, brands across the sector need to become more transparent in regularly reporting supplier emissions and energy use, including renewable energy.

Materials derived from fossil fuels such as fracked polyester continue to fuel the fast fashion business model and increase the climate footprint of brands known for their sportswear. The world’s biggest fast fashion company Inditex (parent company of Zara) has committed to phase out virgin polyester from its material mix by 2030, but the company is doubling down on the use of the fossil fuel fabrics by sourcing fibers recycled from plastic waste generated by other sectors, such as single-use plastic water bottles. The fast-growing athleisure and yoga brand Lululemon has also committed to increase its polyester recycled content to 75%, but its continued reliance on plastic fabrics will undermine its efforts to achieve circularity and tackle its climate emissions, microplastic pollution, and textile waste, as apparel made from plastic waste are conventionally destined to be landfilled or incinerated.

Brands must focus their efforts on transitioning away from fossil fuel fabrics and investing in closed-loop recycling solutions that ensure their products get recycled to create new goods. The popular outdoor brand Icebreaker, a subsidiary of VF Corp., has demonstrated unique leadership in this area by committing to phasing out all fossil fuel derived fabrics from its products, including both virgin and recycled polyester, by 2023. Mammut has also successfully closed the recycling loop for its climbing ropes, one of the most important and energy-intensive products in its product line.

Shipping is often responsible for 10% of fashion brands’ GHG emissions--potentially more than that from scope 1 and 2 activities. As major clients of shipping companies, fashion brands have a unique opportunity to catalyze the rapid decarbonization of the shipping industry, yet only 18 (38%) of the brands evaluated in the Scorecard included shipping in their supply chain emissions reduction target. Mammut exemplified leadership in the area of shipping by being the first major retail brand to commit to shipping its products on zero-emission vessels (ZEV) by 2030.

Impact areas

As outlined in Stand.earth’s Roadmap to Fossil Free Fashion,[4] which identified five critical focus areas and corresponding metrics to assess the ambition and response of global fashion brands to the climate emergency, the 2021 Scorecard measures the performance of global brands across the following impact areas and 2030 benchmarks:

By committing to rebuild their business model around a rapid decrease in fossil fuel use this decade, global brands can transform the fashion industry from being one of the largest climate polluters on the planet to becoming a critical catalyst for a much broader decarbonization of the global economy.

  1. Quantis and ClimateWorks Foundation. (2018). Measuring Fashion: Insights from the Environmental Impact of the Global Apparel and Footwear Industries study. Available at: https://quantis-intl.com/report/measuring-fashion-report/
  2. UNFCC. (n.d.). Participants in the Fashion Industry Charter for Climate Action. https://unfccc.int/climate-action/sectoral-engagement/global-climate-action-in-fashion/fashion-industry-charter-for-climate-action/participants-in-the-fashion-industry-charter-for-climate-action#eq-1
  3. SGB Media. (2020, November 12). Cowen Survey: Sustainability Increasingly Important for Younger Consumers. Available at: https://sgbonline.com/cowen-survey-sustainability-increasingly-important-for-younger-consumers/
  4. Stand.earth. (2020, August). Roadmap to Fossil Free Fashion. Available at: https://www.stand.earth/publication/fashion-roadmap
  5. Asics. (2021) Sustainability Report 2020. Available at: https://assets.asics.com/page_types/4764/files/Asics_sustainability%20Report%202020_online_original-5_original.pdf?1625462760&_ga=2.100673730.2120659369.1626047346-767159206.1626047346
  6. Nike. (n.d.) Carbon and Energy. Available at: https://purpose.nike.com/carbon-energy