Jun 14, 2023 - Energy & Environment

The fashion industry shrugs at the "circular economy"

Illustration of a clothes hanger resembling a recycling icon

Illustration: Annelise Capossela/Axios

Most clothing brands are doing a lousy job on the environmental front, and most consumers aren't doing their part either, a new report from consulting firm Kearney concludes.

Why it matters: Despite much chin music about the environmental sins of the fashion industry — how it's a major polluter and carbon emitter but wants to do better — progress is slow toward the goal of "circularity," in which a garment is repeatedly reused, repaired and recycled before it's discarded.

Driving the news: In its third annual "Circular Fashion Index," Kearney assessed 200 brands and found a profound lack of urgency on climate goals.

  • Clothing makers are still "busy pushing more and more products into the market" — and incinerating unsold inventory rather than giving it a new life.
  • Manufacturers still lean heavily on virgin materials, and don't educate consumers about responsible ways to get rid of used garments.

What they're saying: The "clothing drop-off and collection infrastructure is underdeveloped," Kearney concludes. And the process of sorting used clothes is "complex and expensive because fashion products are not designed to be disassembled into sub-components for re-use."

Consumers get a share of the blame for not exploring donation, recycling, repair options, Kearney says.

  • "The resale thing has become very popular, and for obvious reasons — because you can make money off that," said Brian Ehrig, a Kearney partner and co-author of the report.

Where it stands: A few brands are the "notable exceptions," Kearney said — doing the right thing when it comes to sustainability.

  • Its top 10 were Patagonia, Levi's, The North Face, OVS (a casual-trendy Italian brand), Gucci, Madewell, Coach, Esprit, Lululemon Athletica, and Lindex (a casual-trendy Swedish brand).
  • Madewell got a shoutout for accepting used jeans in its retail stores and selling used or upcycled clothing through its "Madewell Forever" program.
  • Coach earned praise for its "Coachtopia" sub-brand, which sells items made with recycled or recyclable materials.
  • Kearney didn't name the lower-down performers, lest it offend a client.

Not much has changed or improved between last year's report and this year's, Ehrig said.

  • "There’s a lot more discussion about circularity than there is significant, measurable improvement," he said. "The companies that were already doing it well are primarily the ones that are still doing it well."
  • There's no financial incentive for "fast fashion" companies — which make cheap, disposable clothes — to change their ways.
  • Used clothes from first-world countries are causing huge environmental harm in places like Ghana, which the Guardian recently labeled "fast fashion's dumping ground."

How it works: Kearney used 7 criteria to size up the clothing makers:

  • Share of garments made from recycled fabrics.
  • Repair and maintenance availability.
  • “Circularity” in brand communications.
  • Detail/accessibility of care instructions.
  • Breadth/depth of secondhand sales.
  • Breadth/depth of rental services.
  • Availability of drop-off locations for worn clothing.

The big picture: While many big-name brands have signed on to the Fashion Pact — a 4-year-old environmental initiative aimed at lowering the industry's climate footprint — there's still a lot of daylight between the group's goals and individual companies' actions.

Yes, but: These goals are difficult, even for companies that say they're trying to do the right thing.

  • A case in point is Gucci. While it's owned by Kering — whose CEO initiated the Fashion Pact — it recently had to dial back its environmental goals after finding it hard to live up to a carbon-neutral pledge.

By the numbers: About 15% of used clothes and other textiles in the U.S. get reused or recycled, and 85% go to a landfill or incinerator, per the Commerce Department's National Institute of Standards and Technology.

  • "Only 7% of brands regularly employ recycled materials, 54% of companies use them just for a few selected items or product features, while 39% use no recycled materials at all," per WWD's report on Kearney's findings.

What's next: Change may be slow, but it's becoming more visible.

  • Companies like Circ, a startup textile recycler, sell materials back to retailers like Patagonia.
  • Thrifting has become a way of life for a growing number of shoppers.
  • Clothing brands like Reformation are touting their commitments to circularity.

The bottom line: "There are really two sides to this," Erhig tells Axios. "We need the brands to be doing more, and we need the consumers to be doing more as well."

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