ENVIRONMENTAL SUSTAINABILITY STRATEGIES IN ORGANIZATIONS: THE CASE STUDY OF APPAREL COMPANIES

ABSTRACT

Companies are often seen as money making entities that place less emphasis on social concerns and promote inequality. However, many companies are coming to terms with their responsibility to make meaningful contributions to society. There have been growing needs for sustainable operations in all industries. This focus has turned to how companies can be more socially and environmentally responsible and sustainable. Sustainability is the design of human and industrial systems to ensure that humankind’s use of natural resources and cycles do not lead to diminished quality of life due either to losses in future economic opportunities or to adverse impacts on social conditions, human health, and the environment. Thus, the purpose of this paper is to gain insights into Global sustainability strategies, then streamline/compare that alongside Companies environmental sustainability practices processes and how this is utilized in delivering solutions to Partners and customers. Also, to evaluate apparel companies’ sustainable practices and gain in-depth understanding and knowledge of how sustainable the supply chain is structured. Some apparel industries were used as samples for this study.

KEYWORDS

Supply Chain Management, Sustainability, Apparel Industry, Procurement.

INTRODUCTION

The apparel industry is one of the most important sectors of the economy in terms of investment, revenue, trade, and employment generation [5]. It is an ancient business. As noted by [9] UNECE, the sector is the second largest industrial consumer of water. The supply chain from procurement to finished goods is widely fragmented, leading to large carbon footprint, pollution, and increased energy usage. While trying to maintain competitive edge, each player in the supply chain deals with the impact of their processes on the environment. [8] Wiedmann reported that significant portions (up to 64%) of total environmental, social, and economic impacts, including CO2 emissions, water, land, energy, labor, and wages, can be linked to international trade. Earth.org noted that the Apparel business is responsible for about 10% of global carbon emissions yearly, this is five times more than what the aerospace industry emits. The fashion industry is responsible for 8-10% of humanity’s carbon emissions – more than all international flights and maritime shipping combined [10]. The goal is to have a sustainable business strategy to positively impact the environment and society while still benefiting all shareholders and stakeholders of the organization. Designers must be well informed on topics surrounding methods of production, government regulations, and lifecycle analysis. They must be accountable for the environmental impacts of the materials used, the resulting waste from those manufacturing processes, how products are produced and packaged, where they will be made, and then sold, causing energy usage for transportation, also, how consumers may use and dispose of the product [2].

Environmental sustainability is the ability of something to continue without upsetting earth’s ecological balance [6] Allwood et al.

MATERIALS AND METHODS

EVALUATION OF SUSTAINABILITY PRACTICES IN THE APPAREL INDUSTRY

With the increase in production of apparel which has resulted in fast fashion trends, its impact on the environment is growing and there is an urgent need to reduce, reuse and recycle waste by ensuring that sustainable materials are used in production from selecting raw materials to the end-of-life products. It has been discovered by research that 88% of consumers want brands to assist them in being environmentally sustainable and responsible [1]. The figure below shows the global clothing and apparel market size.

Source: The Business Company, 2022

Apparel industry players have engaged in sustainable practices like adopting energy-efficient technologies for sustainable production, which helps firms make three-dimensional textile bodies while reducing time and energy consumption by 30%-40% compared to traditional practices [3] Arana et al. In addition, some apparel manufacturers in emerging economies like Vietnam are using Environmental Management Systems (EMS) such as Oeko-Tex 100 to reduce the environmental impacts on the fashion supply chain [4] Wiengarten et al.

Apparel companies like Levi’s, TS Designs (TSD), H&M, Boohoo, Toms, Everlane and Mango have kicked off their sustainability campaigns, which are focused on reducing the carbon footprint by using non-cotton materials, reducing water usage, and supply chain transparency. Other apparel companies like Patagonia, Eileen Fisher, Stella McCartney, Mara Hoffman have also created strategies to reduce greenhouse emissions in their manufacturing processes.

Levi’s as a denim manufacturer is working toward 100% sustainably sourced cotton and recycled pre-owned jeans. Knowing that denim requires large amounts of water to create pairs of jeans, their new collection uses to up 96% less water, the company is committed to ensuring sustainability through the entire design of their product stages.

TS Designs (TSD) is an apparel company in North Carolina, their journey to producing sustainable clothing started with some setbacks they experienced when customers shifted to Mexico because they had lower costs after the implementation of NAFTA (The North American Free Trade Agreement) in 1993. This made them go back to the drawing board and re-strategize by changing their business model to be sustainability focused. This is apparent from their tagline, which is ‘cultivating responsible clothing’. They pride themselves in being an example of a triple bottom line business and their collaboration with businesses of like minds. They are a certified B corporation. Over the years, they have worked with big clothing lines to print shirts.

They implemented Buying cotton directly from the farmer (People & Profit). TSD believes life is all about relationships and buying directly from the customer shows transparency, which ensures that the cotton bought is from a credible source, showing how aware and concerned the buyer is about the source of the apparels. Buying cotton directly from the farmer ensures a resilient supply chain, with direct relationships and trust with the farmers, they can overcome any unforeseen circumstances that may affect crop output. Furthermore, their production is locally made, which helps in cost reduction, saves money, promotes local wealth, uses land more productively and supports the community.

TS Designs has their plans laid out concerning the hemp apparel market, they plan to launch a three-stage process that starts by sourcing the hemp fabrics in China and sewing together in the USA. This will increase productivity in their actual outputs and efficiency as there would be better use of resources. Furthermore, this would bring jobs back to the US. H&M is also moving away from using non-cotton materials in their manufacturing process to reduce their environmental footprint. In addition, customers can recycle their unwanted garments at H&M stores at a discount.

Another Company is Boohoo, their Sustainability Plan involves use of better materials, more sustainable designs, and less waste packaging. The ‘READY FOR THE FUTURE’ strapline and icons are used on garments that meets their sustainability guidelines. Also, ensuring a transparent supply chain and long-term commitment to everyone along the value chain. By 2030, they plan to achieve carbon reductions that align with science-based targets equivalent to 52% reduction emissions across their value chain. In addition, they are focused on running their business responsibly with strong corporate governance, making their company a great place to work, tackling climate change, responsible marketing and being involved in Corporate Social Responsibility (CSR).

Toms is a B Corp Company which uses vegan shoes, greener packaging, and earth-friendly footwear. They also use sustainable cotton and aiming for 100% sustainable cotton by 2025. In addition, for responsibility and accountability, they have annual impact reports on their sustainability practices. In 2022, 30% of their footwear met their Earthwise requirements. There is more education around measuring carbon footprints, the company uses greener packaging, they have has gone plastic – free with their products. Furthermore, another fashion store, Mango has been making considerable progress in their sustainability drive. 44% of their entire line of 18,000 products uses sustainable materials and has made efforts to eradicate hazardous chemicals from their products.

Everlane is also an apparel company that focuses on radical transparency pricing. This is part of their overall business strategy, and it involves cost transparency in production throughout their entire supply chain - from materials sourcing to logistics and transportation. This marketing strategy has greatly moved their revenue earnings higher in the past years. Also, it breeds trust and loyalty with their customers because they are privy to all the costs involved in producing the apparel so if there were a price hike, they would understand why.

The graph below shows the most frequent price between sustainable and regular collections, surveying four apparel companies.

Source: U.S Apparel Industry Report, 2021

RESULTS

ISSUES RELATED TO THE IMPLEMENTATION OF THE SUSTAINABLE APPARELS

The fashion industry is responsible for 8-10% of humanity’s carbon emissions – more than all international flights and maritime shipping combined [10]. Creating change may not be easy or seamless, as some people are used to fashion-forward apparels and do not care where the fabrics are sought from. The cotton industry is experiencing a lot of environmental pressure, bringing cotton production to an acceptable environmental standard is a very challenging task [11]. Opportunities to leverage corporate sustainability policy in the industrial market sector can generally be found among three key stakeholder groups. The first group includes internal organizational stakeholders including corporate administration, mid-level management and employees, the second group are the external stakeholders who are very critical to the organization, as they provide value to customers, the last group are external stakeholders, like government agencies and regulatory bodies not directly involved in provision of services to customers [7].

By effective monitoring of apparels businesses process to avoid greenwashing and developing some compliance metrics. Some companies, even though certified, may still cut corners in their environmental sustainability practices.

The biggest competition is price and that could affect some companies in figuring out the tradeoff between price and quality, as regards to sustainable products, they may want to reduce quality if sustainable products are more expensive. Also, there may be the issue of how to control weeds and insects during organic production, this is because using pesticides are cheaper in controlling and managing crops.

In addition, automation of the supply chain could lead to unemployment and as a company vested in protecting the people, it may be hard to lay off staff. Furthermore, logistics and geographic distance may be an issue. Ordering hemp apparels from countries outside the home country, with different currency and political climate to satisfy demand would need a lot of accurate forecasting to ensure inventory is able to meet customer demand. In addition, there may also be the issue of lack of variety in eco-friendly raw materials.

DISCUSSION

OPPORTUNITIES / BENEFITS FOR THE APPAREL INDUSTRY

The apparel industry can define what success looks like in their sustainability campaign. This should be done on both short- and long-term basis, it would give room for evaluation and continuous improvement. Establishing some success metrics could be in farmers having a voice in price setting or making “Thinking sustainability” in every fashion forward trend a campaign. More awareness about, “knowing what fabrics are made of”. This would increase research for alternative sustainable products, encourage creativity and innovative ideas, which would also create more competitive employment opportunities in the eco-fashion industry. The apparel businesses can collaborate with the Climate Action industry to throw more light on the negative effects unsustainable materials have on the planet.

A comprehensive and more holistic approach in addressing the sustainability issues in the apparel industry locally, regionally, and globally. Spearheading eco-friendly initiatives will open them to more solid international affiliations. The prioritization of social and environmental responsibility would create and give more awareness to a new, meaningful way of doing business that can potentially create positive change and enhance brand loyalty. There is an opportunity to serve as intermediary between farmers and other apparel companies with sustainability mindset, especially the ones that think it may be stressful sourcing sustainable products.  Automation of the whole cotton supply chain can be on the pipeline, as an action item, as it will involve sufficient planning to lead to implementation. This would encourage lean technology/ production which would reduce waste, biodiversity loss, pollution, recycle resources and increase productivity. Furthermore, transparency in the supply chain will ensure accountability and its resilience, which could attract more business collaboration.

In addition, sustainable innovation, which involves being intentional about changing a company’s services, products, or processes to develop long-term social and environmental benefits while making profits makes them sustainable. It works with products and services by inventing and offering new products that has direct impact on sustainability. Also, this can be done by creatively reviewing a firm's operational processes, as regards their existing offerings, to include eco-friendly products and services. 

CONCLUSION

Apparel companies that plan to sort their materials from other countries like China should understand cultural differences. This is highly significant because it helps in learning and understanding the way of life of other people, as regards their traditions, culture, business environment and generally how they live. They must figure out a cultural fit with their host countries to be successful, there is need to ensure that their corporate practices align with the national culture of their host countries. Under the liability of foreignness, inability to understand local culture and way of life will create unfavorable business environment which may ultimately lead to business failure.

Apparel companies can also improve waste treatment processes by adopting more comprehensive procurement policies to improve their supply chain sustainability. Also, collaborating with B corps and other industry partners. They can equip consumers with the requisite knowledge about sustainability and the negative effects fashion-forward clothing has on the environment, there is always some kick-back against change but when people understand the ‘why’ and the benefit they stand to gain, they are more in tune with aligning with the change. This information can be disseminated through the Company’s marketing strategies and channels like commercials, social media, and other advertising outlets. The apparel companies must also be seen as truthful and living up to their words on sustainability, incorporating these into their vision and mission statements and overall business strategy will help build trust and loyalty amongst their customers. This would show social responsibility and accountability. In addition, the Apparel businesses should have full insight into their supply chain processes, there must be total transparency. Furthermore, the formal institutions should be leveraged, the government throwing their weight behind sustainable practices and putting compliance checks in place will ensure implementation of the sustainability policies. The government can also introduce some incentives for businesses that are either starting up or trying to incorporate sustainability into their corporate strategy.

Conclusively, digitization can help curb the sustainability challenges faced by the Apparel industry. Digitizing the supply chain will improve speed, reduce lead times, and make the value chain more transparent, sustainable, and predictable. Customers can verify exactly where products are made, who made them and how they were made. Moreover, there would be more quality control and effective audit systems in place.

REFERENCES

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