A 2013 file picture shows a woman shopping at H&M on Thanksgiving Day in New York. Photo: Reuters
As recently as 2018, H&M didn’t list sustainably-minded shopping as a risk at all. But the past few years have seen tough feedback for fashion companies that push the limits on how quickly they can churn out clothing and accessories, alongside demands for more transparency. That leaves retailers whose business model relies on fast fashion to size up the threat against it in their annual reports, sustainability reports and climate disclosures, where little consensus exists.
One estimate suggests clothing production doubled between 2000 and 2015, a period during which the Ellen MacArthur Foundation estimates a 36% decline in the number of times an item was worn before being thrown out. They are also setting science-based targets for cutting emissions, ramping up reliance on clean energy, cutting use of plastic packaging and water, finding ways to more responsibly source raw materials, using more recycled textiles, and launching resale programmes.
"There’s a lot of talk about these younger people wanting to shop more sustainably but when you look at the shopping patterns, there’s absolutely no evidence of this,” she says.A Chinese e-commerce giant that took fast fashion to a new level, Shein’s ascent is one of the biggest arguments against the idea that the model is suffering.
Kassatly says Shein’s popularity with the Gen-Z shoppers may have to do with their believing the company is in fact acting sustainably –"like, Shein has a sustainability report,” she says. After endorsing the Financial Stability Board’s Task Force on Climate-Related Financial Disclosures in August 2018, H&M conducted a detailed financial risk analysis the following year, where it first identified shifting consumer preferences as both a business risk and an opportunity.
H&M also estimated the possible financial upside of catering to evolving climate-driven tastes: increased sales of SEK 2.6 to 8 billion, or US$248mil to US$764mil .H&M spokesman Inigo Saenz Maestre emphasises that those numbers are hypotheticals"to explain different scenarios” and"not [an] actual prognosis we are working with”.
Inditex also identifies a"minor” reputational risk stemming from customers engaging in climate activism and souring on companies with carbon-intensive businesses.