Every year, VF Corp, the owner of brands including Vans, The North Face and Supreme, carries out a detailed analysis of the risks that threaten its business. Last year, it included climate change for the first time.
In many ways, VF has already taken more steps than its peers to address and mitigate climate issues in its supply chains. The company is supporting rubber farmers and cattle ranchers to adopt regenerative agriculture practices, which help sequester carbon and restore soil health and resilience; it’s launched worker and community development programmes to improve stability and quality of life for more than 650,000 of the 1 million people who make its clothes; it’s traced the full supply chains of 100 products and identified regions of high water risk.
But it’s still not enough. “Very soon, any company will realise how small [it] is in the bigger scheme of the potential trajectory of climate change,” said VF senior director of sustainability David Quass. “I think in all honesty, … the global community is struggling [to find] definite answers to tackling the potential adverse effects of climate change, which are enormous.”
It’s a mounting risk for the fashion industry and the resources and workers it relies on, particularly as hopes of limiting global warming to a level that would stave off some of the most catastrophic impacts of climate change become increasingly unlikely.
“Nature is being destroyed faster than it can regenerate and we’re nearing irreversible tipping points,” said Claire Bergkamp, chief operating officer and incoming chief executive of non-profit Textile Exchange. “We have to make changes and we have to make [them] now, and at scale.”
Make Nature Stronger
Crop failure is one of the most visible and immediate ways climate change is taking hold of fashion supply chains as weather extremes hit harvests of key raw materials.
Just this year, cotton production in many of the world’s biggest growers have been hit by a mix of drought and floods. Pakistan, the world’s sixth-largest cotton producer according to US Department of Agriculture data, lost an estimated 40 percent of its crop to deadly flooding in recent months.
The disaster was caused by rainfall well above predicted ranges, Syeda Faiza Jamil, programme director at non-profit Net Zero Pakistan, told attendees at a panel hosted by the UN Fashion Charter at the COP27 climate summit last month. “What is happening right now is something we were expecting would happen 30 to 40 years from now,” she said.
Brands can’t change the weather, but experts say that promoting regenerative agricultural practices designed to restore soil health can help make croplands more resistant to extremes, improving the amount of water that can be absorbed in floods and retained in times of drought.
“It’s not just a trendy thing, it actually physically builds resilience,” said Dr Helen Crowley, partner at climate investment and advisory firm Pollination and former Head of Sustainable Sourcing Innovation at Kering.
But today only a tiny fraction of the materials fashion uses are produced in this way. Changing that is complicated, despite splashy corporate commitments in support of regenerative agriculture. The concept can be hard to pin down and what works on one farm may not work on another. Switching is expensive and time consuming and carries considerable risk for farmers. Most projects are still in the pilot phase.
Long-term purchasing commitments from brands and policies that incentivise regenerative farming will be needed to change that, said Bergkamp. “I think this must be a part of the conversation around climate resilience,” she added.
Build Supply Chains with a Conscience
Fashion is a resource- and labour-intensive industry, with a production system that rests on tens of millions of workers across the globe. Climate change is likely to make life for many of these workers much more precarious.
That’s a problem for the industry as it comes under growing regulatory pressure to ensure its supply chains are free of labour abuses. Dangerous and productivity-dampening heat stress is likely to become a growing challenge as temperatures rise, while natural disasters and food insecurity in countries with little to no social safety nets create fertile ground for challenges like modern slavery, according to risk consultancy Verisk Maplecroft.
To address this, fashion companies will need to establish stronger, long-term partnerships with suppliers, and go directly to communities on the ground to better understand the challenges they face, said Cliodhnagh Conlon, associate director at consultancy Business for Social Responsibility. Brands could establish a stronger social and financial safety net for workers in their supply chains by offering insurance for crop-growers, for example, or supporting ecosystem restoration like reforesting mangroves, a key coastal defence against flooding that could save homes and livelihoods.
In the face of growing climate catastrophe, supply chain experts say companies need to be both nimble and responsible, balancing risk management, agility and diversification with real, established commitments and partnerships in sourcing countries. “These shocks will be more and more [frequent]” said Shameek Ghosh, co-founder and chief executive at supply chain traceability platform TrusTrace. “You have to optimise your supply chain for these risks.”
Engage in Lobbying and Advocacy
Fashion brands — and indeed the wider industry — cannot manage all the far-reaching impacts of climate change on their own.
Huge infrastructure projects on a national scale will be needed in order to make manufacturing hubs climate-resilient. For instance, flood defences will be crucial in places like Bangladesh, Vietnam and Guangzhou in China, where thousands of factories stand to be underwater by 2030 as a result of rising sea levels, according to a working paper published last year by Cornell University’s New Conversations Project in the School of Industrial and Labour Relations.
It’s in the fashion industry’s interests to ensure that local policymakers are primed to address these outcomes, or risk ending up with a broken supply chain. It’s an issue that has cemented itself on the global agenda, though advocates say it remains underfunded. Funds to help poorer nations adapt to now-inevitable impacts of climate change accounted for just over one-third, or $28.3 billion, of all climate finance received in 2020, according to OECD analysis, but combatting the issue in earnest could cost hundreds of billions of dollars per year.
While fashion’s engagement with climate lobbying is relatively new, there are emerging examples: in 2020, consortia of major industry players opposed the Cambodian Government’s plans to expand coal-based energy production, and called on lawmakers in Vietnam to make renewable energy sources more accessible. As Rachel Kitchin, corporate climate campaigner at advocacy group Stand.Earth, notes, big brands showing they are serious about their commitments to such issues can be a strong market signal to countries where garment manufacturing is a major export.
“If brands … use the voice that they have in conversations with government and in public advocacy, they can make a real impact,” she said, “because countries will know that it is a requirement, if they’re going to keep getting that business.”
