Sustainability in Luxury and Fashion: Time for Action

Delivery

This report comes in PPT.

Key Findings

Sustainable fashion will increasingly make economic sense

In the context of the climate crisis and high inflation, the social and environmental dimensions of sustainable fashion increasingly converge with the economic one, as natural resources deplete and policy-makers in the EU and some US states have started changing the law to force a transition towards mandatory climate risks reporting and greater circularity.

Shifting consumers’ mindsets benefit brands that strengthen our wellbeing and that of the planet

Becoming a purpose-driven brand or company that recognises the importance of bringing value beyond profits has become increasingly important to attract consumers’ favours and avoid reputational damage. In a crammed market, a growing number of consumers turn to brands that align with their values.

Economic headwinds boost demand for repair, resale and rental

High inflation has narrowed the gauge for what cash-strapped consumers are willing to pay a premium for, but the cost-effective option has also become about limiting and reducing. In this context, brands and retailers need to communicate well on the “value” they bring beyond the price, increasing the appeal of durability, resale, rental and repair.

Tightening regulation forces market players to rethink their operating models

Luxury and fashion players feel the growing pressure from governments and regulators to change the way they operate. New regulations in the EU, and the states of California and New York signal a significant shift in corporate practices, already leading to the adoption of digital product passports, greater traceability, crackdown on greenwashing and material innovations.

Challenges are multiple and complex but Gen AI could make an impactful contribution

The luxury and fashion industries are not on track to implement their sustainability goals from the 2030 UN Agenda, and the challenges are multiple and complex, from consumers’ belief-intention gap to the fashion industry’s tunnel vision. But Gen AI has the potential to reshape the fashion industry towards a more environmentally friendly and socially responsible future.