Sustainability Is in Vogue as Fashion Goes Circular

The garment industry is transitioning toward circular sustainability.

When we think of the world’s most polluting industries, the clothes we wear don’t usually come to mind. However, the fashion and garment industry does have an impact, producing 2.1 billion tons of CO2 annually—an incredible 4% of global GHG emissions, making it second only to the oil industry. As nations aim for net zero carbon emissions as soon as possible, garment manufacturing is emerging as a key area of focus.

While global support for sustainability has greatly increased, rapidly changing fashion trends continue to encourage disposability, which fuels overproduction and impacts the environment. As the middle class has expanded in emerging nations, and styles continue to come and go at a frenetic pace, the Ellen Macarthur Foundation’s New Textiles Economy report shows that textile industry production volume has doubled in the last 15 years.

The annual production of garments produced using synthetic dyes and fabrics made from fossil-fuel feedstocks poses a significant global sustainability challenge. Most recently, the rapid pace of fashion, along with widespread supply chain delays, have combined to accelerate clothing obsolescence. McKinsey & Company, in its State of Fashion 2020–Coronavirus Update, forecast that the pandemic may lead to billions of unsold garments in 2021, with significant environmental implications.

Setting greener trends

Enel X is an Italy-based technology solutions leader that provides assessments, products and services, including sustainable energy. It is also one of a growing number of companies, institutions and governments supporting the greening of the fashion industry. SDA Bocconi School of Management, in Milan, has been a leading business school for 50 years, with a mission to contribute to the growth of people, companies and institutions by promoting managerial culture, knowledge and innovation skills. The school recently launched the Monitor for Circular Fashion as part of its Sustainability Lab, powered by Enel X. The initiative’s first report is dedicated to green macro-trends in the Italian fashion industry, and identifies areas needing improvement to make the vaunted “Made in Italy” label more environmentally sustainable.

“The Monitor for Circular Fashion of the SDA Bocconi Sustainability Lab is a multi-stakeholder initiative involving collaboration between technology providers and companies in the fashion pipeline. This makes it easier to face the still open challenges of circularity, confirmed by the research conducted, such as high costs, availability of technology and infrastructure, cultural barriers and regulatory gaps. The opportunities in circularity, especially those related to corporate reputation and end-user loyalty, are fundamental to guiding the decisions of business managers in the circular fashion roadmap,” explains Francesca Romana Rinaldi, Lead Monitor for Circular Fashion at SDA Bocconi School of Management.

“To present the results of the first fashion supply chain circularity report in Italy is a source of great satisfaction because it represents the result of Enel X’s commitment to develop services and solutions in the field of sustainability—essential values of the company’s business strategy,” said Nicola Tagliafierro, Head of Global Sustainability at Enel X, at the report’s results presentation in September 2021. “Thanks to the support of SDA Bocconi, we have laid the foundations for the activation of a virtuous process that wants to involve more and more companies in the supply chain over the years, with the aim of supporting them in the process of decarbonization, electrification and energy transition, capable of reducing up to 60% of the total CO2 emissions produced.”

Circularity goes beyond sustainable manufacturing and recycling to describe durable products that can be reused, repaired or remanufactured—a trend that directly counters disposability in the fashion world. As an additional benefit of the initiative, Enel X’s Circular Economy Report evaluates a company’s level of circularity and suggests a path to follow for decarbonization and enhanced sustainability.

The Monitor for Circular Fashion involves 14 companies from the Italian fashion sector along the entire supply chain, from upstream to downstream, including both ingredient and consumer brands, retailers and service providers, along with a KPI-driven committee of expert circularity consultants.

The project is taking various actions to improve fashion circularity, including measuring companies’ CO2 emissions and environmental footprint and providing concrete opportunities for decarbonization, to make the Italian fashion industry—and the world’s garment manufacturing—more sustainable.

Decarbonizing the energy needed to produce the world’s clothing is a good start to making fashion more sustainable, and Enel X, a business line of Enel Group, the world’s largest private renewables player by installed capacity, is well positioned to facilitate the industry’s transition with data and solutions.

Powering change with renewables

As is the case in other industries, the use of renewable energy in the Italian garment industry needs to be increased; 42% of the total energy used to produce the samples analyzed in the report was certified with a Guarantee of (renewable) Origin. The Monitor for Circular Fashion report also highlights the importance of smart monitoring systems to measure energy efficiency and identify critical areas of action; only 50% of the partner companies’ consumption is currently monitored with a smart system. Finally, electrification and mobility need to be increased; only 13% of the companies analyzed have company spaces for charging electric vehicles. The report notes that investments in charging infrastructure can facilitate the overall energy transition and have a strong impact on decarbonization.

Other countries and organizations are taking steps to increase fashion sustainability. In June, France, another global fashion leader, introduced a ban (to take effect by 2023) on the destruction of unsold garments, with manufacturers and retailers obliged to donate, reuse or recycle—the first such national regulation anywhere. In September, the German government unveiled the Green Button, the world’s first government sustainable textile label. And the EU’s Circular Economy action plan aims to ensure that products can be repaired or recycled, with textiles as a priority.

In early 2019, 10 UN organizations launched the UN Alliance for Sustainable Fashion to align the fashion industry with the UN’s Sustainable Development Goals. “Sustainability encompasses social issues, such as improvements in working conditions and remuneration for workers, as well as environmental ones, including the reduction of the industry’s waste stream, and decreases in water pollution and contributions to greenhouse gas emissions,” notes its mission statement. “Through the Alliance, the UN commits to changing the path of fashion, reducing its negative environmental and social impacts, and turning fashion into a driver of the implementation of the Sustainable Development Goals.”

Consumers are more supportive than ever of sustainable products, including the clothes they wear. Worldwide, 50% of consumers, on average, are adopting more eco-friendly consumption behaviors, and ethics and sustainability are essential elements in purchasing decisions for 24% and 19% of consumers, respectively, according to PwC. McKinsey & Company reports that 57% of consumers are willing to change, even drastically, their lifestyles—and likely their clothing—to be more sustainable, and that 60% of consumers prioritize recycling and choosing products in eco-friendly packaging.

For forward-thinking manufacturers, governments and consumers, sustainable fashion is très chic and a welcome trend that is set to last into a greener future.