On Tuesday, NYU Stern Center for Sustainable Business announced its open-sourced “Apparel Industry Sustainable Strategies Framework” based on its Return on Sustainability Investment methodology launched with other sectors two years ago. The project was funded by HSBC Bank USA’s foundation.
As part of the framework, the Center for Sustainable Business identified eight key strategies for making the apparel industry more sustainable, uncovering more than 60 best practices to address environmental, social, and governance-related issues.
“Companies need to understand the business case,” said professor Tensie Whelan, founding director of NYU Stern’s Center for Sustainable Business. “The monetization is critical due to COVID-19 because these companies are really struggling.” The framework, through a set of strategies, proves the urgent business case for sustainability in the apparel industry.
Key strategies outlined include: reducing chemical impact, improving water management, improving energy management, investing in the reduction of material waste, implementing sustainable raw material sourcing, investing in circularity and innovation, investing in employee and supplier well-being, and investing in sustainable brand marketing and communications.
The Center for Sustainable Business team approached sustainably minded clothing brands like Reformation, Eileen Fisher and REI early last year.
Reformation helped steer the framework’s initial findings on circularity, having engaged in consultative conversations with NYU’s team on its circular strategy, specifically providing data and insight on its resale partnership with ThredUp and fabric waste solution strategies, like its L.A.-based post-production recycling partner OsomTex.
Regarding the ThredUp insights that informed the framework, Kathleen Talbot, Reformation’s chief sustainability officer and vice president of operations, said: “The main takeaway was customer acquisition — customers would discover [Reformation] on ThredUp and come find us — which was a really incredible and unexpected benefit of the program. The other thing we looked at was potential upsell [through credits]. Both of those takeaways we saw as really encouraging.”
The monetization of Reformation’s case study is still under wraps, but the Center shared others.
Eileen Fisher, for one, shifted its transportation mix away from air transport and toward sea and trucking transports, resulting in $1.6 million in annual cost savings in 2019 as compared to 2015. The brand saw $150,000 in cumulative societal benefit by reducing greenhouse gas emissions during the four-year period. In a separate instance, outdoor brand REI found its positive employee culture equated to millions in net benefits from increased employee productivity and retention in 2018 and 2019.
Despite a growing scene of coalitions and tool sets, Whelan said, “There’s a whole set of issues the industry needs to devote more time and money to,” referencing e-commerce growth as inviting a host of other problems like packaging waste and transportation emissions.
“With our ROSI methodology, we are looking to align and support these other standards,” she continued, adding that her team offers the “credibility and the neutrality — we’re doing this because we’re interested in [apparel’s] forward motion.” When asked about the existing brand tools like Kering’s Environmental Profit & Loss, Whelan was quick to say the tool didn’t address all externalities.
All things considered, Whelan maintains a positive outlook: “For me, it’s exciting to see how we can really get rid of outmoded forms of production and consumption.”