Fashion Headlines This Festive Season

By Dawn McGregor 18 December, 2017

With lots happening in fashion, CWR's McGregor gives us reasons to be both hopeful & fearful this Christmas

Some of the hopeful developments: the mainstreaming of sustainability & growing consumer environ awareness
Slowly but surely change is coming - clean & circular; Chinese regs are forcing a new relationship with poln
But hyper-consumption gives reason to fear: this year’s Singles Day saw >USD25bn in sales, smashing records

Whether you’re a consumer, brand or investor in the fashion industry, lots has been happening over the last quarter. Given all this buzz and with the festive season upon us, we look at some of the noteworthy headlines to bear in mind for Christmas and going into the New Year. While these make us hopeful for the future, there is reason to be fearful too.
First, a glance at the Top 5 and Bottom 5 fashion brands from the Institute of Public & Environmental Affairs’ 2017 Corporate Information Transparency Index Report. Those in the Top 5 we expect to see but we are a bit surprised by some in the Bottom 5, notably Timberland and North Face. who both have environmental programmes. We will look at this in more detail next year so stay tuned. For more on the report see IPE’s article here and previous year’s results here.

Updated Top 5 and Bottom 5 textile brands in 2017 CITI report (2)

Sustainability is becoming mainstream in industry convos…
…Plus, trend No. 8 in McKinsey’s 2018 fashion report is “Sustainability credibility”

Developments making us hopeful include the mainstreaming of environmental sustainability in industry conversations and increasing large-scale action on the topic. Two weeks ago, I attended Fashion Asia Hong Kong, where there was a dedicated session on sustainability.  In the 2018 “The State of Fashion” report by Business of Fashion and McKinsey & Company, trend No. 8 is “Sustainability credibility – Sustainability will evolve to be an integral part of the planning system…”. On the action front, Hong Kong hosted the inaugural Sustainable Fashion Summit for Asia in September, a two day conference dedicated to sustainability. I was happy to hear about so many projects both locally and regionally, and present key findings from our latest textile report on Chinese manufacturers.
However, for the industry to change consumers also need to be aware of the sustainability and environmental issues. This is why a first of its kind study showing rising awareness among consumers about the contributions of the fashion industry to climate change, is another reason we are hopeful.

“Slowly but surely change is coming…
…These regulations are forcing a new relationship with pollution.”

Slowly but surely change is coming. The question is then, what will this “change” mean for business, what will the new business model look like? Well, Chinese regulations will play a big part, especially the Water Ten Law coming into force on 1 January 2018 that will allow the government to tackle water pollution more vigorously, as it has done with air pollution. These regulations are forcing a new relationship with pollution.
Pollution is a big issue for the fashion industry. Pollution from denim is notorious (see here), so it is great to see four initiatives working to change this:

 7.5% of the global fashion market has signed the 2020 Circular Fashion System Commitment…

In addition to a new relationship with pollution, the new business model will need to be circular given the limited water resources for producing raw materials including cotton, chemical fibres etc. Some in the industry have already recognised this and are working to achieve it. Two big ticket items on this front are the 2020 Circular Fashion System Commitment (in June this year but worth noting), which 64 fashion companies signed, representing 143 brands and a combined value of 7.5% of the global fashion market, and the report “A new textiles economy: Redesigning fashion’s future” from the Ellen MacArthur Foundation. Other developments fuelling our hope for a circular fashion future are:

The transition to a new business model is a work in progress, in the meantime there are initiatives you personally/as a business can support. Better Buying is one such. The initiative is creating a rating platform to highlight areas for improved purchasing practices by brands – manufacturers rate their clients.
Another initiative is “MAKE SMTHNG week” by Fashion Revolution and Greenpeace, which encourages everyone to buy less and make more, running globally from Dec 2- 10. The reason behind choosing this time in the year, it’s just after the hyper-consumption during Singles Day, Black Friday and Cyber Monday. Enter my fear.

…but with record breaking sales y-o-y, is hyper-consumption  negating these hopeful developments?

This year’s Singles Day saw more than USD25 billion (RMB168.2 billion) in sales, smashing previous records. Shortly after, Cyber Monday also smashed records. It was the largest online shopping day in US history, recording USD6.59 billion (around RMB44 billion) in digital transactions – a 16.8% increase year-on-year.  Noted that these numbers cover all transitions, not just that of fashion products. While this increasing trend is great news for retailers and e-commerce platforms, it raises serious concerns around relentless consumption and planetary boundaries.
Fashion’s, particularly fast fashion’s, dichotomy between sustainability and high-level consumption is something I leave you with to think about this festive season.

Further Reading

  • Hopes & Fears While Remaining Irrationally Exuberant – Spurred by recent news, China Water Risk’s Tan shares her musings from not kidding ourselves, including that tech will solve-all, to adjusting our goals and piercing our irrational bubbles to bring down waste
  • Moutai: Risks Along The Intoxicating River – Moutai’s stocks have soared & with a 90% profit margin it is hard not to have a hopeful outlook but China Water Risk’s Yuanchao Xu warns of river basin risks – best to keep a clear head to ensure future prosperity
  • Aquaculture: 8 Fishy Facts – Think because we get fish from water that its “Fish forever more”( 年年有“鱼”)? China Water Risk’s Woody Chan shares 8 must-knows on aquaculture that will make you re-think this
  • Making Glaciers On Top Of The World – We sat down with Sonam Wangchuk, the real-life Phunsukh Wangdu of the Indian movie ‘3 Idiots’, to learn why he is and what challenges there are to overcome in creating artificial glaciers, known as Ice Stupas
  • A Chinese Model For Foreign Aid – As the US & the EU retreat from their foreign-aid commitments, Professor Asit K Biswas and Kris Hartley from the Lee Kuan Yew School for Public Policy see this as an opportunity for a new and willing aid champion, China. See why

Insights From Chinas Textile Manufacturers - CWR Report - August 2017 - Front Cover
This report, Insights From China’s Textile Manufacturers: Gaps to overcome for clean & circular fashion“, sponsored by the C&A Foundation analyses the insights of 85 Chinese textile manufacturers on their challenges to going clean and circular, as well as what assistance they want from stakeholders.
Both China Water Risk and the C&A Foundation hope that this report will support the fashion industry to fast track the transition to a circular apparel economy by raising awareness of manufacturers’ needs and enabling actors to further identify practical solutions.
Find out what manufacturers’ three overarching wishes are, as well as their requests to individual stakeholders. Plus, see their comments on issues from wastewater training to chemicals sourcing and wanting more enforcement.

  • 85 Voices: Insights From Chinese Textile Manufacturers – Hear from China’s textile manufacturers on their challenges and what help they need to transition to a clean and circular model. This is an opportunity for the global fashion industry. China Water Risk’s Dawn McGregor shares key takeaways from our new survey report
  • The Status Of Fashion’s Redesign – Fashion, an industry not often associated with climate change & technological innovation has been redesigning itself to change just that. With growing global focus on the environment China Water Risk’s Dawn McGregor takes a look at the status of this redesign
  • Circular Economy: From Theory To Action – As we move outside the ‘safe operating space of our planetary boundaries’, Ellen MacArthur Foundation’s Nick Jeffries explores what is a circular economy & implications for water
  • Fashion’s New Cycle – With 12,000 garments entering landfills every hour, the USD3 trillion fashion industry is ripe for a disruptive overhaul. FINCH Designs’s co-founder Heather Kaye shares how this Chinese brand is doing this through their swimwear made from recycled PET
  • A Decade Of Dedication – As Redress turns 10 years old, its founder Dr Christina Dean reflects on the victories achieved in driving circular thinking in fashion including the EcoChic Design Award and TV show Frontline Fashion. Plus, check out their initiatives going forward
  • Fast Fashion: Sucking Aquifers Dry? – Groundwater is over-extracted to grow cotton. As the world’s largest importer of cotton, is it China’s fault? Or is fast fashion to blame? China Water Risk’s Tan explores trends in the growth across major brands, China’s imports & global cotton production
  • Circular Fashion Today – Closing the loop in the fashion is not new. But perhaps now that China,  the world’s largest manufacturer of garments, wants to go circular, it might become a reality. Get on top of the latest trends with leading circular fashion innovators
Dawn McGregor
Author: Dawn McGregor
Dawn leads CWR’s work to help corporates navigate increasingly disruptive & material risks from water & climate threats, as well as transitional risks in the supply chain arising from new regulations in China. Here, Dawn engages extensively with the global fashion industry delivering on-ground workshops in China to keynotes and strategic input at European HQs. She has written at length on the end of dirty and thirsty fast fashion and her report to overcome gaps between brands and manufacturers for a clean and circular future inspired the industry to create a new wastewater tool. Dawn also works closely with the property and tourism sectors where she not only conducts strategic assessments of their exposure but builds collective action toward resilience via closed door working groups and invite-only events. Having helped build CWR, Dawn is a frequent keynote, panellist & moderator at events, including being twice selected as the lead-rapporteur at World Water Week. Her articles are cited in various industry publications including the UN’s ‘World Without Water’. Dawn previously worked in a global investment bank assessing geo-political risk, crisis management and business resiliency. She was born and bred in Hong Kong and has lived in France, England, Singapore and Beijing.
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