The carbon footprint of the fashion industry is globally significant, evidenced by a growing number of studies, most recently World Resources Institute (WRI) and Aii (2021). The report estimates that the industry’s share comprises 2% (1.025 gigatons CO2eq) of annual global greenhouse gas (GHG) emissions, with most impact taking place in the raw material and processing steps of the supply chain.
THE FASHION INDUSTRY’S GREENHOUSE GAS CHALLENGE
The global fashion industry is a multi-trillion dollar industry, producing over 100 billion garments annually. Given its size and nature, the industry faces a number of social and environmental challenges. The key environmental challenges are complex and interrelated, but most broadly fall under: land use, water use, chemical use, biodiversity loss and greenhouse gas (GHG) emissions. This paper focuses on the latter — GHG emissions.
The recently published WRI and Aii (2021) report identifies six solutions the fashion industry can adopt to deliver the GHG reductions needed to stay within the 1.5°C pathway by 2030.21
For each existing and innovative solution category in the
scope of this report, the total funding requirement across all stakeholders is estimated as outlined below.
“When it comes to a complete change in energy use or a new way of manufacturing, the manufacturer cannot take on the entire cost burden and project risk. There needs to be additional stakeholders to co-invest alongside the manufacturer to implement disruptive and sustainable technologies.” – Punit Lalbhai, Executive Director, Arvind Limited
Based on interviews with manufacturers, investors, and key industry stakeholders, nine key factors that contribute to a lack of financing availability have been identified (see Figure 30).
To mobilise $1 trillion through overcoming the aforementioned barriers, a concerted and collaborative effort is needed by key stakeholder groups inside and outside of the industry.