Under the general trend of global joint response to climate change and complicity for sustainable development, promoting the green and low-carbon transformation of economy and society has become a strategy adopted by major fields. The significance of this green industrial revolution and green development race is comparable to previous industrial revolutions in history. There is no doubt that the leader will lead the way on the world stage for a long time, bringing long-term well-being to humanity. At the same time, green reform is essentially a race to occupy the commanding heights of the economy under the common goal of addressing climate change and seeking sustainable development for mankind.
It is difficult for the lone to rise, but easy for the multiplier.
While other areas see sustainability reform as a fair and fierce competition between companies, for companies and brands in the fashion industry, the key word to achieve the SDGs has never been "competition", but cooperation and win-win. It is precisely because of this that in the past 2022, despite the challenges from the market and supply chain, the pace of sustainable development reform of the global fashion industry has not slowed down at all.
In the post-pandemic era, sustainable development has not only changed the traditional form of fashion, but also subverted the expression of fashion and people's consumption patterns. Powered by technological innovation, encouraged by the capital market, and driven by more new generations, the sustainability issues of the fashion industry are expanding at the margin, and the balance between business and responsibility is gradually becoming clear.
Retired and new. As the fashion industry gradually opens up countless expectations and expectations for 2023, WWD Chinese Edition celebrates an important milestone for the global fashion industry in the next decade with the release of the Fashion Industry Trends and Trends Insight Report • Sustainable Fashion.
The resale business has become a major investment target for the fashion industry in 2022
Although global economic headwinds do inhibit consumers' ability to spend on living to a certain extent, they are also structurally changing consumers' perception of the value and ownership of fashion items.
In the past three years, the decline in consumer confidence caused by the epidemic has made more cost-effective clothing rental and second-hand clothing trading more and more popular among consumers, but this is not exactly equivalent to the "lipstick economy" that emerged during the global Great Depression.
BCG data shows that the global second-hand market was worth $100 billion to $120 billion in 2022. Recycling and resale will be one of the hottest fashion trends of the future.
Hugo Boss、Ganni、Michael Kors Marimekko、Tommy Hilfiger、Selfridges、Neiman Marcus、Steve Madden、Dolce Vita……
According to incomplete statistics, more than a dozen fashion brands and retail companies have released news of opening resale service projects in 2022. This trend not only means that fashion brands and companies are focusing on promoting and realizing the circular economy of fashion, but also that they are no longer resistant to resale and want to take their dominance into their own hands to ensure that they can get their share of this expanding second-hand resale market.
The Marimekko Pre-loved resale project offers more options for sustainable lifestyles
In April 2022, ThredUp, the world's largest fashion resale platform, announced the launch of the monthly Recommerce 100, a monthly resale index that tracks the resales of fashion brands and retailers selling second-hand goods in the U.S. market. James Reinhart, CEO of ThredUp, said: "At the current rate, the number of new resale stores opened in 2022 will be the largest ever. This acceleration is a positive sign, but to have a greater impact on the fashion industry, more meaningful investments by brands and retailers are needed. ”
ThredUp's 2022 Fashion Resale Market and Trend Report shows that second-hand trading is becoming a global phenomenon. The global second-hand clothing market is growing three times faster than the global clothing market, with an estimated growth rate of 24% in 2022 and an estimated 127% growth in size by 2026. Among them, the development of technology and the ease of purchasing goods on online shopping platforms will be the main drivers of the growth of resale transactions, and by 2024, 50% of the revenue of the resale market will come from online platforms. 70% of consumers say buying second-hand fashion is easier and more convenient than it was 5 years ago.
The deep shift in consumption patterns has also attracted the attention of capital. In 2022, "resale" became one of the hottest financing keywords in the sustainable fashion space.
Start-ups that offer recycling and resale technology are also attracting attention
In the past year, Rebelle, a second-hand designer clothing resale platform, applied for listing, planning to become the world's first "green IPO" in the NASDAQ system; Start-up e-commerce platform Responsible completed €5.8 million financing to develop a technology solution called "Buy Back"; Textile recycling company Debrand receives strategic investment from Waste Management; Mango announces a €3 million investment in Recovo, a sustainability startup that provides a platform for the resale of stocked fabrics, yarns and production materials, through its fashion startup accelerator, Mango StartUp Studio; Resale platform Treet announces $3.5 million seed round led by First round Capital...
Positive consumer feedback on resale consumption patterns has given businesses the opportunity to grow in various sectors related to it. However, it is worth noting that although catering to market trends and responding to new business models in a timely manner is not harmful to brands, how to find unique ways to operate, improve the consumer experience of resale business, and awaken more potential consumers is the biggest challenge for brands.
Inclusion, environment, history...
Sustainable investing is becoming more diversified
In the global market, more and more fashion companies practice ESG concepts and deeply integrate them with corporate operations. Such a long-term strategy also feeds back the resilience and risk resistance of enterprises to a certain extent. In the past three years, fashion companies that have always reflected social aesthetics in various dimensions, from humanistic spirit to urban appearance, have become important respondents in the epidemic examination.
The proposition "invisible hand" put forward by British economist Adam Smith in The Wealth of Nations is often considered the starting point of the concept of corporate social responsibility. Since then, the concept of corporate social responsibility has become clearer, from Milton Friedman's "shareholder first" to Kenneth Arrow's negative spillovers, to Edward Freeman's stakeholder theory.
In the nineties, Archie Carroll proposed the corporate social responsibility pyramid, which gave it a more complete definition. With the "Ten Principles of the Global Compact" promulgated by the United Nations in 1999, the concept of "corporate social responsibility" has been recognized internationally and has become an important value pillar in business operations.
"Corporate Social Responsibility" is especially important for fashion companies that use cities, nature and people as sources of inspiration
After nearly 70 years of development, the connotation of corporate social responsibility has long developed from a single economic responsibility to cover all aspects that may be affected by business activities. This is not only an important pillar of value with historical context, but also a key measure of corporate growth.
This is especially true for fashion companies that use cities, nature and people as sources of inspiration. In the short term, diversified sustainable investment can enhance the reputation of brands and enterprises, and improve consumer stickiness in an unknown market environment, while in the long run, diversified sustainable investment is not only about investing in the present, but also creating people-to-people connections and absorbing upgrading and expansion energy for future development.
Cartier supports snow leopard conservation projects
Different races, different genders, different cultures, as well as the protection of ecology and traditional skills, these financing cases strongly related to corporate social responsibility not only tell the respect and love of cultural diversity, ecological balance and tradition in the fashion industry, but also reallocate resources, provide a broader development space for different people, things and things, and help brands reach a wider range of groups.
Scientific and technological innovation
——The primary productive force for promoting the development of sustainable fashion
Values are the soul of the product, and technology is the driving force of the industry.
In the context of the fashion industry, "innovation" not only represents a better sensory experience, but also one of the key to transforming existing business models to create value for all stakeholders, as well as achieving long-term development. At present, the sustainable fashion transformation empowered by technology is bringing more inspiration and novel perspectives to the entire fashion industry.
In the past year, the fashion industry has actively embraced change and innovation, achieved growth and recovery to a certain extent, and technological innovation has gradually become the source of new thinking, new models and new channels.
Scientific and technological innovation has gradually become the source of power for creating new ideas, new models and new channels
Achim Berg, senior partner and global head of apparel, fashion and luxury goods at McKinsey, said technology can help brands gain a competitive advantage in consumer-facing activities and a growing number of operations, and more importantly, it can support companies to better address sustainability issues. That's why he makes a bold prediction: In 2021, fashion companies typically invest 1.6% to 1.8% of their revenue in technology, and by 2030, technology investment will double to 3% to 3.5% of revenue.
In April 2022, Sweep, a French corporate carbon management platform, announced the completion of a $73 million Series B financing. As a platform that visually measures carbon emissions data, Sweep helps large enterprises build data-based and science-driven climate plans by tracking global carbon emissions across their entire value chain. In addition, Sweep provides a carbon market that enables companies to become more carbon neutral by investing in climate projects, including multinational companies such as Siant Gobain and JCDecaux. And in May, French carbon management startup Greenly announced a $23 million Series A funding round. The platform can help enterprises monitor carbon emission data in operations and supply chains, issue carbon footprint reports, and perform the functions of consulting firms to provide enterprises with specific practices to reduce energy conservation and emission reduction.
Sweep closed $73 million in Series B funding
At the same time, advances in materials science have attracted more brands to invest more in the research and development of environmentally friendly materials in various categories. In May 2022, lab-bred leather company Vitrolabs announced the completion of a $46 million Series A funding round with the participation of Kering; In June, Israeli man-made diamond company Lusix issued a statement announcing that LVMH Luxury Ventures, the investment arm of LVMH Group, Ragnar Crossover Fund and investment firm More completed a $90 million funding round; In November, Ecco Leather, a premium leather producer owned by Danish footwear brand Ecco, announced a partnership with mycelium technology company Ecovative to develop and commercialize "next-generation mycelium materials" for footwear, fashion and apparel. In December, L'Oréal expanded its business into green science by acquiring a minority stake in French biotech company Microphyt. In the future, they will jointly establish a technology platform to create microalgae biomass-derived raw materials.
Kering invests in Vitrolabs, a lab-cultivated leather company
Green finance is booming
While fashion brands and enterprises are focusing on increasing investment in humanities-related fields, the green finance market continues to flourish.
Compared with traditional finance, the most striking feature of green finance is that it emphasizes the environmental interests of human society. Generally speaking, it takes environmental protection and efficient use of resources as one of the criteria for measuring the effectiveness of its activities, and guides brands and companies to focus on ESG indicators through its own activities.
In May 2022, established fashion group Guess announced that its wholly-owned Swiss subsidiary, Guess Europe Sagl, had successfully secured a sustainable loan worth €250 million. The loan has an initial term of five years and focuses on business integrity, consumer empowerment and environmental protection, with interest rates adjusted annually based on the Group's greenhouse gas emission reduction, sustainable material sourcing and use, and increased penetration of environmentally friendly products. After the expiration of the initial loan term, the loan term can be extended for two years and an additional loan line of up to EUR 100 million is obtained.
Guess
In late 2022, Dubai-based retail giant Majid Al Futtaim Group announced the completion of another $1.25 billion sustainable loan. The financing, led by Abu Dhabi First Bank, aims to reduce Majid Al Futtaim Group's Scope 1 and Scope 2 GHG emissions and help its shopping malls achieve LEED certification. In June of the same year, Majid Al Futtaim Group raised $500 million through green perpetual bonds.
Majid Al Futtaim Group
Affected by macro factors, investment and financing have cooled, and there is indeed no booming green financing case in 2022 as in 2021. However, the more deeply rooted brand positioning and larger financial support just prove that in addition to luxury companies, more and more fashion brands and enterprises are accelerating the embrace of green finance, and the capital market's attitude towards green finance is becoming more innovative and positive.
The new generation, the academy, the budding force worth looking forward to
With the promotion of basic education and the appeal of social media, the new concept of "sustainable fashion" has long been integrated into the daily life of the younger generation, and the seeds of green creativity have been planted in the hearts of young people who love fashion.
In fact, since 2021, major design and art schools around the world have paid more and more attention to education in the field of "sustainable fashion", and added more professional courses in sub-categories, hoping to bring students vivid knowledge and the latest sustainable fashion solutions that keep pace with the development of the industry through the special teaching method of "theory + practice".
In April 2022, LVMH announced a major strategic collaboration with Imperial College London and Central Saint Martins to develop alternatives to fur. The two-year research program will start with keratin, the main protein in hair, to develop an innovative and sustainable alternative to fur. Hélène Valade, director of environmental development at LVMH, said the collaboration will create entirely new lab-grown biomaterials. In May, Stella McCartney announced a partnership with Lenovo to offer an eight-week fashion tech course "to help inspire and empower the next generation of sustainable fashion designers" for students at her alma mater, Central Saint Martins.
LVMH Group announces important strategic collaborations with Imperial College London and Central Saint Martins to develop alternative fur
Subsequently, Central Saint Martins launched the Master of Regenerative Design; Kingston University offers two postgraduate courses in sustainable fashion; Kering offers sustainable fashion at HEC Paris Business School; The School of Design and Innovation of Tongji University has partnered with the LVMH Group to offer a workshop on circular design...
Kering has partnered with the London College of Fashion, University of the Arts London, to launch an online sustainable fashion course
Through the upgrading of traditional service models, sustainable material use, packaging system improvement, and sustainable office environment, the fashion industry has continuously and actively innovated to provide relevant hands-on learning opportunities for young students who will lead fashion trends and trends. In the past year, while actively preparing for related courses, universities have also cooperated with fashion groups to integrate theory and practice to improve students' problem-solving skills.
In the past year, although fashion companies have continued to accept new challenges in the consumer market, they have never encountered a cold in terms of green and sustainable development. Whether it is the globally prevalent ESG concept or the "dual carbon" goal advocated by China's top level, building a green ecosystem has become a common goal of the entire industry. "The economic and social value of ESG system, including humanistic values, is of great benefit to the development of enterprises", such a concept is recognized, accepted and practiced by more and more fashion companies. Such a trend may move from extensive discussion to substantive action in 2023, and greater synergies will be achieved. WWD