How climate change affects the luxury fashion industry

Climate change will specifically affect luxury fashion because the industry is particularly dependent on raw materials, thus already feeling the impact of changes in climate and environment in terms of business disruptions and increasing costs. This finds a new report by French luxury goods holding company Kering and British consultancy Verisk Maplecroft titled "Climate Change: Implications and Strategies for the Luxury Fashion Sector". The report identifies six materials - beef and calf leather, sheep and lamb leather, silk, vicuña, cashmere and (extra fine) cotton - as endangered, particularly the last three due to their limited geographical availability and dependence on natural systems.

While some of these impacts like transport and delivery disruptions, resource scarcity and challenges of social change are common across industries and companies with a global footprint, the report points out that the luxury sector is "particularly sensitive" to climate change because of its reliance on high-quality raw materials and those stemming from natural and agricultural systems that are limited geographically.

According to the Carbon Disclosure Project (CDP), around 50 percent of an average corporation's carbon emissions stem from the supply chain, and in regards to the luxury sector, the majority of these emissions occur at the raw material production and the initial processing stages.

Climate change report looks at cotton, silk, leather, cashmere and vicuna

The report outlines the climate risks facing global luxury fashion companies, focuses on the impact of climate change at the raw material production level and the impact on the natural and agricultural systems that deliver them. It also looks at current climate risks for the six key raw materials identified and shows in useful 'raw material hotspot maps' the expected change between 2036 and 2060 for each geographical area and raw material.

Climate-related hazards like a change in the intensity and frequency of extreme weather events like hurricanes, droughts, floods and changes in precipitation patterns will affect the availability of water while the vulnerability and exposure of natural systems will lead to a loss and degradation of biodiversity and ecosystem services such as water filtration, soil replenishment and crop pollination) as well as related social consequences, for example loss of livelihoods.

The report then continues to look at the specific risks per raw material - e.g. reduced water availability and temperature increases for cotton; droughts and availability of water for feed and warming climates for beef leather and sheep and lamb leather; increased temperature, droughts and fluctuations in humidity for silk; restricted water availability, droughts and restricted geographical range for vicuña - whose hair is widely considered the most expensive animal fibre in the world - and degradation, desertification and a restricted geographical range for cashmere.

In conclusion, the report states that "in particular, luxury fashion companies that focus on innovative approaches to resilience in raw material production will preserve their value proposition at its core". While COP21 and global efforts by the three largest GHG emitters - the US, China and EU - will aid climate regulation, it is up to the luxury brands to push for change: They will need to ensure an adequate supply of high-quality raw materials as well as promote climate-smart approaches and adequate and safe water supplies at the base of their supply chains.

The report advises luxury fashion companies to tackle climate change with three steps: invest in targeted raw material resilience, prepare operations for a low-emission future and assume a leadership position when it comes to climate action and provides case studies of Ikea, Chetna Organic and the Australian 'Cool Cows' programme as well as an overview of collaborative initiatives and platforms.

What the report fails to mention is that it may be easier, more economical and more sustainable in the long-term to at least consider and/or develop man-made alternatives to the scarce 'raw materials' mentioned. Especially with pressure from animal rights groups mounting and many consumers consciously choosing to give animal products a miss, this may be a truly forward-thinking approach.

Images: Kering-Maplecroft report