Executive Summary
Since the Industrial Revolution, GHG emissions have contributed to atmospheric warming that has lifted global temperatures by around 1.1 degrees, with significant regional variations. The warming has precipitated more frequent and severe risks, including flooding, fires, droughts and storms, leading to socioeconomic impacts on, e.g. liveability and workability, food systems and natural capital. With temperatures set to continue their upward trajectory, it is likely these adverse impacts will become more severe over the coming years.
This research shows that the global fashion industry produced around 2.1 billion tonnes of GHG emissions in 2018, equalling 4% of the global total. This is equivalent to the combined annual GHG emissions of France, Germany and the United Kingdom. Around 70% of the fashion industry’s emissions came from upstream activities such as materials production, preparation and processing. The remaining 30% were associated with downstream retail operations, the use-phase and end-of-use activities.
Adding to the challenge of reducing its GHG footprint is the expectation that the fashion industry will continue to grow as a result of shifting population and consumption patterns. If no further action is taken over the next decade beyond measures already in place, the industry’s GHG emissions will likely rise to around 2.7 billion tonnes a year by 2030, reflecting an annual volume growth rate of 2.7%.
This research analyses two scenarios for the industry’s abatement efforts:
- Current pace trajectory.
If the industry continues to embrace current decarbonisation initiatives at the current pace, emissions will be capped at around 2.1 billion tonnes a year by 2030, around the same as they are now. This would leave levels at nearly double the maximum required to stay on the 1.5-degree pathway. - Accelerated abatement.
To align with the 1.5-degree pathway over the next 10 years,
the fashion industry should intensify its efforts. In practice, that means embracing accelerated abatement, which is estimated to reduce annual emissions to around 1.1 billion tonnes, around half of today’s figure. The immediate focus of accelerated abatement should be upstream operations, where around 60% of emissions savings are possible, in particular from increased use of renewable energy, through collaborative efforts supported by brands and retailers. Actions relating to brands’ own operations have the potential to deliver around 20% of the reduction, with the remainder coming from changes in consumer behaviour. By 2030, these efforts will need to have created a significantly reformed fashion landscape, in which, for example, one out of five garments are traded through a circular business model.
The good news for the fashion industry is that many of the required actions can be delivered at
a moderate cost. Around 90% of the accelerated abatement can be delivered below a cost of around USD50 per tonne of GHG emissions. Around 55% of the actions required will lead to net cost savings on an industrywide basis. The remaining actions will require incentivisation in the form of consumer demand or regulations to deliver abatement. Additionally, around 60% of the abatement will require upfront capital, where brands and retailers will need to support and collaborate with value chain players to invest for the long-term benefit of society and the environment.
The scale of change required implies a need for bold commitments. Stakeholders throughout the value chain should be willing to make bold commitments, followed by equally bold actions, transparency, collaboration and joint investment. Brands and suppliers need to step up engagement with policy makers, support the roll out of renewable energy and drive end-of-use collections for recycling.
Beyond 2030, the challenge becomes even greater. To stay on the 1.5-degree pathway, the industry needs to go beyond this vision of accelerated abatement to fundamentally redefine business models and current imperatives of economic growth and rising consumerism. For a prosperous future and an habitable earth, the industry’s ingenuity and creative spirit will be required to decouple value creation from volume growth and to move from commitments to actions.
Data & Impact Partner
