How to make the best of a challenging year? While the lasting impacts of COVID on industry may take years to accurately assess, one thing we can see right now is how the pandemic has focused the textile industry’s attention on sustainability. Globally, with both the COP26 on Climate Change and COP15 on Biological Diversity happening this year, the urgency couldn’t be more clear.
The numbers tell the story of this shift, and we’re thrilled that for many in the textile industry, The Textile Exchange’s Material Change Index (MCI) has been a big part of tracking changes and revealing their impacts.
The MCI is the largest peer-to-peer comparison initiative in the textile industry. It tracks the apparel, footwear and home textile sector’s progress toward more sustainable materials sourcing, as well as alignment with global efforts such as the Sustainable Development Goals and the transition to a circular economy.
The MCI is a key component of Textile Exchange’s Corporate Fiber & Materials Benchmark program, which enables participating companies to measure, manage and integrate a preferred fiber and materials strategy into their business. With the Climate+ strategy goal of 45 percent reduced CO2 emissions from textile fiber and material production by 2030, Textile Exchange is the driving force for urgent climate action.
Between now and 2030, we need to turn linear, exploitative consumption of natural resources into models that are regenerative, circular and inclusive.
The MCI was launched in 2019 in partnership with GreenBiz, with a goal to accelerate action and impact by driving a race to the top. 2019 was a "baseline year," which gave us the grounding from which to track the efforts and progress of leading corporations as we all make our way through the next decisive decade. Between now and 2030, we need to turn linear, exploitative consumption of natural resources into models that are regenerative, circular and inclusive.
This year, we’re launching the Insights Report, Leaderboard and Dashboard all together. This will provide a comprehensive, multi-faceted analysis of the state of the industry and allow multiple ways to explore and engage with the data. We encourage you to explore sub-sectors (outdoor/sports), company progress cards (a snapshot of how they are tracking) and outcomes and impacts modeled in the dashboard, and read the report for details.
Our 2021 launch includes a new and highly interactive MCI Leaderboard. It shows how companies performed and where they are focusing their efforts in sustainability. The Impact Dashboard model’s outcomes and impacts associated with preferred materials sourcing — and environmental indicators of greenhouse gas emissions, water consumption and fossil-based energy use is modeled using the Higg Materials Sustainability Index (Higg MCI). The impact modeling is important, and the dashboard is a key tool for tracking industry progress towards the climate goal of a 45 percent reduction in greenhouse gas emissions over the next decade.
A few key takeaways from this years analysis:
Ambition is in fashion
Business is driving a race to the top with leading companies stepping up on ambitious target setting. Eighty-eight percent of participating companies, a clear majority, have set 100 percent "more sustainable" uptake targets for materials sourcing, and 45 percent have set ambitious and measurable "circularity" targets to track their company’s progress towards a circular economy.
"For over two decades, sustainability has been an integral part of adidas’ way of doing business,” said Katja Schreiber, senior vice president for sustainability at adidas. "As part of our new strategy, 'Own the Game,' sustainability will play a key role. We are committed to only be using recycled polyester from 2024. This year we will launch the first running shoe that is made to be remade. By 2025, nine out of 10 adidas articles will be sustainable: Made with recycled materials, made to be remade or made with nature."
These are big goals, and the pressure is on for achieving them. Alongside grit, determination and carving out finances and resources, companies also need enabling frameworks and the right incentives from governments, investors and civil society so everyone is swimming with this turn of tide.
While uptake of preferred materials is growing, now at 44 percent of all materials sourced, arguably the indicator to watch is textile-to-textile recycling. When we released the industry’s first primary data on this topic it surprised even us to see how low it was. This year, results show a slight growth, from 0.06 percent to 0.07 percent and, as with any new area of data collection, we have to treat this as an indicator only as accuracy is difficult to confirm.
From selling goods to selling good
When a surf wear brand’s website is all about ocean conservation rather than selling clothes, and it commits to 100 percent recycled or more sustainable materials, we know the system is shifting. Piping Hot, an Australian surfwear brand, focuses its sustainability strategy by asking themselves how we can continue to surf for generations to come
"Materials are the biggest area that we can make an environmental impact," explained Amy Low, Piping Hot’s brand and communications director. "We've been assessing the resource requirements for all of our materials and particularly looking at them through the lens of water, waste and energy and then tackling each of our product categories."
Backing up this ambition with action and results, Piping Hot has moved up from a Level 2 "Establishing" in the 2019 Index to a Level 3 "Maturing" this year, meaning they have improved considerably across the all index parameters from strategy to materials sourcing and increased their uptake of preferred materials over last year, closing the gap further on conventional.
People and planet at the heart
Beyond the business targets, action has become a moral imperative for leaders, joining the dots between interconnected crises. Companies now have a materials mission. Whether it is focused on climate change, nature loss or the mountains of waste driving the cause, leaders know their business depends upon integrating solutions to these problems.
Bruno Van Steenberghe, founder of Kalani home textiles, started by only using 100 percent organic and fair trade cotton. They are able to do this by controlling their supply chain, specifically by focusing on the farmers they work with: "We provide them the security that we will work with them directly," he said. "They know that we are going to pay the right price for organic and fair trade cotton. We provide long term commitments that then help them to get loans from NGOs and banks."
Finding their superpower
Companies are finding their own path to making an impact, while keeping their eye on the goal. Leverage and scale might work for some companies, while agility and intimacy may work for others. First movers can develop an innovation and others can follow with scale; there can be complementary fits between a new startup and an iconic brand. We are seeing a shift from siloing issues to thinking about system shifts, and this is where the Insights Report plays a role to surface and share these individual learnings for everyone to benefit from.
Mark Walker, CEO of surfwear brand Outerknown, knows that the biggest and easiest way to move the sustainability needle is the raw materials that they use. Through the benchmarking program, they know they are part of a community of companies who are improving, trying to make things better and sharing together.
In his words: "Most people that are in this sustainability space believe and operate under an 'open sourcing' guideline where you share what you've learned for the better of people and planet. If you find an amazing new innovative fiber, share it. If you find a farm that is doing amazing regenerative farming techniques, share it, get the word out, let other people use it."
Committed to improvement, together
Collecting data and reporting is central to transparency. Textile Exchange works hard to keep everyone on track and accountable. We provide the framework, the yardstick and the support. Beyond just providing the data template, we train, educate and support companies completing the benchmark with workshops, training and connecting members to each other. The virtuous cycle of benchmarking and knowledge-sharing allows the entire industry to benefit, so we’re committed to continuing this support.
Despite the challenges of COVID, we saw a growth of 10 percent in participating companies this year, and scores have increased on average by 17 percent across the Index. Last year, only one company, Mud Jeans, achieved a Level 4 for Circularity and this year there are nine: C&A; H&M Group; Knickey; Mud Jeans; Nudie Jeans; Outerknown; Patagonia; PrAna; and The North Face.
Prama Bhardwaj, CEO of Mantis World, talks about how useful it has been to be part of the CFMB: "The MCI gives us a broad stroke view of the industry as a whole and it also shows us what our part to play is. It cuts through all the pretty words and actually gives us real data and information that's measurable. The process has pointed out areas of our business that perhaps we haven't thought about, and as it develops, we learn. And as we learn, we can share."
While it’s too early to make definitive assumptions, each year matters. Our commitment at Textile Exchange is to urge our members and the wider industry to step up on ambition and acceleration — but to do this transparently. We serve the industry with robust reporting and progress tracking each year. Our results show progress, but the transition towards a kinder and more sustainable world needs to happen fast. This means our industry must be socially just, nature positive and circular. We have this decade to do it.
While it was a tough year, these results do give us hope. It is with no exaggeration that I say all 191 companies are our class of 2020 and indeed leading the way on Creating Material Change.