Eric Whan, Sustainability Director, GlobeScan
Most would agree that some corporate giants have taken great strides toward sustainability in recent years. But experts in the field still cite too few companies doing so.
Instead, our latest GlobeScan/SustainAbility Leadership survey finds that experts believe that other non-governmental actors have been driving the sustainable development agenda since the United Nations Earth Summit in Rio in 1992. The business sector is not seen as the driver, with few exceptions.
What, if anything, can we learn from those few companies that have earned recognition from practitioners for their leadership?
In March and April when we asked our panel of 800-plus experts which companies they think are leaders at integrating sustainability into their business, Unilever emerged as the most-cited company yet again and by a wide margin. It was cited by 38 percent of respondents, up 5 percent from 2014.
Patagonia was the only other company to be mentioned by more than 10 percent of responding experts and remains in second place. BASF became the only newcomer to the top 10 rankings list in 2015, cited in 3 percent of mentions. Other companies listed in the top 10: Interface, cited by 8 percent; Marks & Spencer by 6 percent; Natura by 5 percent; IKEA by 5 percent; Nestlé by 4 percent; and GE, Nike and Coca-Cola, each respectively cited by 3 percent of respondents.
Natura (Portuguese), based in Brazil and now the world’s largest B Corporation, quietly has been moving up the rankings in recent years with its innovative business model — one that masterfully blends environmentally and socially shared values upstream and down.
Also notably, IKEA makes the top-10 list with only a couple of years of its “People & Planet Positive” (PDF) initiative under its belt. IKEA is perceived by experts “as leading beyond the firm” and “creating and supporting broader coalitions such as We Mean Business.” Unilever soon may have a battle for recognition on its hands — competition it surely would welcome.
Yet for now, the research finds an ongoing consolidation around a few leadership companies across all regions of the world. Unilever is in a leadership position throughout much of it — Asia (33 percent), Africa/Middle East (36 percent), North America (39 percent) — with the largest margin in Europe (44 percent). Natura, however, is perceived as the dominant sustainability leader in Latin America/Caribbean (33 percent), and Interface has a slight lead in Oceania (14 percent).
Our survey this year received responses from 816 qualified sustainable development experts from 82 countries. They span the public, private, NGO, institutional and corporate service sectors.
A historical perspective on our survey’s findings provides insight into the changing landscape of leadership over the years. Volatility has been the rule, and companies have had difficulty maintaining a top-ranked position for long.
Way back in our 1997 poll, the top four companies in terms of perceived leadership were Dow, Monsanto, DuPont and 3M. Quite a different leaderboard than that of today. This early era of sustainability, which we might call “do no harm,” was characterized by risk management and upstream supply chain work.
The dynamics have changed in more recent years, with brands such as Unilever, Patagonia, Marks & Spencer and Natura all ranking within the top five. This new phase of “mainstreaming” is all about reach and the number of consumers touched, in addition to sustainable sourcing.
But there’s more to it than rational sustainability management. Unilever and Interface, both of which enjoy long stints at or near the top of rankings, have had outspoken executive leaders who never shied away from speaking in emotional terms — and frequently. This kind of authenticity has been proven to drive trust in organizations, buttress reputations and build brand equity. Recognition for leadership follows.
So it is intuitive that, when we ask experts why they think the specific companies they name are leaders, the most common responses by experts relate to the values of an organization’s leaders and the degree to which they have integrated them across their enterprises (26 percent). Sustainability being a part of the core business model, an outcome of values-driven management, ranks second (22 percent, up notably in recent years), followed by the nuts-and-bolts of sustainable products and services (12 percent). Human characteristics seem to come first, and business attributes naturally follow.
Bay Area-based nonprofit Fair Trade USA works across a wide range of industries to ensure ethical production of consumer products. The group’s Fair Trade Apparel program, which was established in 2012, grew an astonishing 358% in 2014.
With recent the garment factory tragedies around the world, Fair Trade USA is offering actual solutions for many brands to help address supply chain issues. The group gives garment industry workers a voice, and ensures the safety of laborers and artisans around the world. The company just certified the first Fair Trade factory in the U.S., which is located in Los Angeles.
We recently spoke with Director of Apparel at Fair Trade USA, Maya Spaull, to learn about Fair Trade certification, international factory safety standards, ethically-sources brands and more.
What does Fair Trade USA do?
Essentially what we do is … we are connectors. We work with producers of over 30 product categories — coffee, tea, chocolate, bananas, clothing , home goods, soccer balls, footwear. We basically work with the producers around the world that are making the things that, you know, we consume, and certify that they’re making them in a more responsible and safe way. And then we connect those producers to buyers and companies here to ensure that the products are Fair Trade certified and create benefit to give back to those producers.
So, you know, we’re nonprofit. We don’t buy or sell anything. We basically certify a product and then create a consumer movement. Because we believe the consumers are increasingly conscious about what they’re purchasing, and they want to spend their dollars on things that are beautiful and well-made, but also that are fair and just and really are promoting a better livelihood for everyone who is participating in the creation of those products.
How is Fair Trade Certification different for the fashion and apparel industry?
About five years ago, we started looking at expansion of Fair Trade products, and we were getting a lot of requests for clothing — for products made with Fair Trade cotton, and then more importantly, I think there is a real hunger for some kind of assurance that people are safe in the work place. Particularly with the legacy of sweat shops that we saw come up in the 90’s, you know, the whole Nike campaign. And then these issues kept emerging — Rana Plaza, the fire that just happened in Manila last week in the Philippines …
So, basically we were getting a lot of consumer demand. So basically we went out and we developed the world’s first Fair Trade certified factory program. What that really means tangibly is that a producer of rugs, or of sweaters, or of knits can comply with this audit anywhere in the world. It’s extremely rigorous. It’s 334 compliance points. So what that means is we’re looking at everything; we’re looking at working conditions, gender equality, working hours, fire exits, safety in the workplace, protective equipment with sewing machines of if there’s any type of finishing’s or sprays.
It’s extremely thorough because when we put our label on something we’re guaranteeing that this is a safe, positive, great place to work.
You make it sound so easy. I’m wondering why other brands aren’t doing more to ensure these tragedies, like what happened in Manila, stop occurring.
I think in the category of fashion, there’s an extreme amount of pressure on suppliers. To create products quickly, cheaply, and there’s a lot of outsourcing that happens. So, a brand may say, ‘Okay, I need a million units of these pants.’ And the factory, who doesn’t want to lose the business, will say ‘Okay, yeah, we’ll deliver that. But then rather than sourcing it from the factory that they just promised that they’re manufacturing in, they’ll go to a couple guys down the street who can make the pants too, in order to deliver on the order. But maybe the brands aren’t aware of those factories — or in those factories there could be undocumented workers, bad pay and unsafe conditions.
There’s a lot of outsourcing and I think a lot of it is the pressures of the marketplace.
And then I think, sadly, there’s a lot of brands that don’t have the transparency or don’t really care. And there’s a lot of consumers that don’t really care or don’t know to care because they don’t have an awareness of these issues.
What are some Fair Trade certified apparel and accessories brands that people can shop?
You can see a full list of brands that now offer Fair Trade Certified apparel here.
**This article first appeared on Fashion Times here.
Since 2013, Greenpeace’s “Detox” campaign against apparel companies successfully has catalyzed new approaches to eliminate hazardous chemicals from products and supply chains. It’s not just activist pressure, but also the desire within the industry to do good, that is driving the reduction of hazards in everything from children’s clothing to sportswear.
Efforts to reduce hazardous chemicals and environmental pollution in the manufacturing supply chain include the Sustainable Apparel Coalition’s Higg Index, the Outdoor Industry Association’s Chemicals Management Module and the Zero Discharge of Hazardous Chemicals’ Roadmap to Zero.
Traditionally, such efforts have centered around Restricted Substance Lists, which have been used in the textile industry since the late 1990s. They contain restricted chemicals that are usually, but not always regulated. These chemicals can be used in manufacturing and be present in consumer products, as long as the amount is not greater than the allowable limit.
The RSL is a tool to help brands meet regulatory compliance requirements and is typically implemented in three steps:
1. Establish the allowable limit in the product.
2. Train and educate manufacturers to implement the RSL.
3. Verify through product testing.
Because restricted chemicals may be used in manufacturing, there is always the possibility that hazardous chemicals may end up in discharge water.
A fundamental shift to ‘input chemistry’
Today, however, a sea change is placing greater emphasis on managing input chemistry rather than treating effluent. Hazardous chemicals are eliminated at the beginning of the supply chain before they enter the manufacturing facility. This prevents the need to clean up waste water and toxic pollution.
Some tools, such as bluesign, have been available for several years, while others are just being introduced, and some chemical companies are seizing the opportunity to lead in the marketplace.
The initiatives below are gaining wider acceptance and use:
The bluesign system is a standard for environmental health and safety in the manufacture of textiles. It was developed in Switzerland 15 years ago and is gaining momentum with chemical suppliers, manufacturers and brands.
Bluesign works with chemical suppliers to ensure their formulations meet strict requirements. Production sites are audited and a set of guidelines must be met prior to a chemical supplier selling “bluesign certified” formulations. Approved bluesign partners regularly report their continuous improvement and progress in energy, water and chemical usage, and are subject to on-site audits. Many large global chemical suppliers including Huntsman, Archroma, CHT and Dyestar are bluesign partners and produce bluesign-compliant formulations.
Bluesign chemicals are available for all stages of textile production, from spinning to garment manufacturing. This enables brands and manufacturing facilities to make smarter and safer choices.
Bluesign assesses and assigns chemicals to one of three categories:
1. Blue: safe to use
2. Gray: special handling required
3. Black: forbidden
The bluesign system helps factories manage “gray” chemicals and replace “black” chemicals with safer alternatives.
Manufacturing Restricted Substance List
An MRSL differs from a Restricted Substance List (RSL) because it restricts hazardous substances potentially used and discharged into the environment during manufacturing, not just those substances that could be present in finished products. The MRSL addresses any chemical used within the four walls of a manufacturing plant, including those used to make products and clean equipment and facilities.
The Zero Discharge of Hazardous Chemicals group developed and published an MRSL with input from key stakeholders including brands and chemical companies. ZDHC developed one MRSL for the apparel industry. This benefits brands, manufacturers and chemical companies because they only have to adhere to a single set of criteria with the same chemical restrictions, limits and test methods.
Chemical companies are in the process of developing a list of MRSL-compliant formulations that adhere to the strict limits placed on a given chemical formulation rather than the finished product.
CHEM-IQ is a chemical management tool released by the VF Corporation. Developed in collaboration with third-party experts, including the Natural Resources Defense Council, CHEM-IQ provides a proactive, cost-effective method for identifying and eliminating potentially harmful chemicals before they enter manufacturing.
Samples from chemical formulations are tested in a lab for the presence of about 400 hazardous chemicals. If any are present above a certain limit, VF works with its supply chain to determine an action plan to move towards safer alternatives.
In addition to the tools and certification systems described above, two small textile chemical formulators, Garmon Chemicals and Beyond Surface Technologies, are also adopting a “front of the pipe” approach.
Garmon’s conscious chemistry
Innovative Italian chemical company Garmon Chemicals has taken an interesting approach in how it assesses, manages and chooses chemical ingredients in its formulations. It recently announced a partnership with Turkish mill Orta denim and Clean Production Action’s GreenScreen for Safer Chemicals.
Garmon incorporates GreenScreens into its raw materials assessment. GreenScreen chemical assessments are based on the hazard profile of a chemical rather than the risk profile. All intentionally added ingredients are screened and assigned a GreenScreen score. Chemicals scored as “Benchmark 1” (to avoid as a chemical of high concern) are not accepted in any formulation. This approach helps Garmon prioritize efforts to find safer alternatives.
The company has developed a range of specialty chemicals called “environmentally conscious chemistry” using GreenScreen as an inspiration for innovation. Garmon has positioned GreenScreen as a platform to develop products for the eco-conscious consumer who demands transparency.
Particularly impressive, Garmon has eliminated potassium permanganate and sodium hypochlorite, two cheap commodity chemicals used to bleach indigo denim. It replaced them with their Avol Oxy White, which provides a similar visual effect.
The advantages of environmentally conscious chemistry include the capability to:
1. Establish long-term partnerships across industries and co-create new capabilities.
2. Drive science and design, with the goal of developing new aesthetics.
3. Trigger healthy changes throughout the manufacturing supply chain that injects “premium” and “sustainable” and “quality” and “integrity” as operational guiding principles in the garment industry.
Beyond Surface Technologies
BST, a small and innovative chemical company, has a different approach to assessing its raw materials. It selects raw materials with either the highest possible content of bio-based carbon (PDF) or materials approved for use in the personal care or food industry, so that it does not need to worry about contaminants and impurities. If it is safe enough to eat or put on your skin, it is safe enough to be used in apparel.
As these examples indicate, the textile industry is making progress in reducing environmental pollution in the textile supply chain by focusing on the management of input chemistry. Stronger partnerships among brands, manufacturers and chemicals companies; a more rigorous approach towards the elimination of hazardous chemicals; and innovating to find safer alternatives to chemicals of concern are moving the needle towards safer consumer products within cleaner supply chains.
** This article first appeared on GreenBiz.com here.
By J. B. MacKinnon
Earlier this month, a peculiar vehicle appeared on the streets of Manhattan and Brooklyn: a biodiesel-fuelled, reclaimed-wood camper that could have been a food truck selling vegan “ish” and chips. But instead of a meal, the truck was made to sell a message on behalf of Patagonia, the outdoor-clothing company.
The camper, dubbed Delia, was on a six-week cross-country road trip, repairing outdoor gear and selling used Patagonia products along the way. The amount of fixing that went on was humble in scale: ninety-three garments in New York City and about twenty-one hundred nationwide. The tour, which ended May 12th in Boston, is better thought of as the latest embodiment of the company’s ongoing campaign to encourage a national conversation about the threat posed to the planet by a global economy that depends on relentless growth and consumerism.
That conversation—despite being spurred, in recent years, by such figures as the author-activists Bill McKibben (a former staff writer) and Naomi Klein; the economists Robert Costanza, Tim Jackson, and Peter Victor; and the participants in a thinly spread “degrowth” movement—has so far failed to reach the volume even of mainstream Internet buzz. Yet anti-consumerism is clearly helping to build the Patagonia brand. Indeed, the company is seeing double-digit annual growth.
Rick Ridgeway, Patagonia’s vice-president of environmental affairs, told me that the company’s approach was inspired by a 2009 Times story he read about consumer spending during the last days of the Great Recession. The article noted that the financial squeeze was putting “value in vogue”—and not only in the predictable form of bargain hunting. Impulse buying and conspicuous consumption had slowed, and some shoppers were seeking goods that offered enduring worth, such as fuel-efficient vehicles and gardening tools that allowed them to grow their own food.
“That really caught my eye, because that is our value proposition. That is what we’re trying to deliver to our customers—those kinds of products,” Ridgeway said. “I thought, Wow, if at least some small cohort of people are recognizing that, then those people are our people, and how could we do a better job of giving them what they need to live more responsibly, not just in recession but any time?”
The company’s anti-materialistic stance ramped up on Black Friday, 2011, with a memorable full-page advertisement in the Times that read, “Don’t Buy This Jacket.” The ad’s text broke down the environmental costs of the company’s top-selling R2 fleece sweater and asked consumers to think twice before buying it or any other product. The attention the ad received helped to bump Patagonia’s 2012 sales significantly.
In September, 2013, the company launched its Responsible Economy campaign. In an accompanying essay (which, like the rest of the campaign’s material, is no longer available at Patagonia.com but still can be read in Google’s cache), under a graphic that declared “growth is a dead end,” Ridgeway argued that global environmental crises such as climate change, toxic pollution, and resource depletion were only symptoms of a larger problem. Annual, compounded economic expansion, of the kind that the Club of Rome warned against in its 1972 book, “The Limits to Growth,” was the “elephant in the room.” Since Ridgeway published his essay, Patagonia’s own expansion has continued unabated: this year, the company expects to gross about six hundred million dollars.
All of this would be jet fuel for the engines of modern cynicism, if not for the fact that Patagonia, a privately owned corporation now in its fifth decade, has a distinguished record of environmental philanthropy and investment. The company has often made risky choices in favor of its ecological and social ethics, including early bets that consumers would pay more for products made with organic cotton or Fair Trade certification, the latter of which is now available on thirty-three of its products. The Responsible Economy campaign similarly backed talk with action. Patagonia is trying second-hand-clothing sales at its shop in Portland, Oregon, and has made product repair and recycling a growing part of its business model. It recently invested in Yerdle—a Web startup whose stated mission is to reduce new-product purchases by twenty-five per cent—as a way for people, and even the company itself, to swap or give away used Patagonia gear.
This spring’s truck tour was part of a related campaign called Worn Wear, which is an attempt to draft a new compact between Patagonia and its customers. The company promises to make products that endure, and to repair, resell, or recycle them as necessary, while consumers, in turn, pledge to buy only what they need, and to similarly steward their purchases from new garment to storied heirloom to the recycling bin.
It is confounding to try to draw lines around when Patagonia’s marketing encourages sales and when it discourages them. The gimlet eye will find no shortage of contradictions. Watch enough of the company’s promotional videos, which feature real Patagonia customers, and you might start to believe that the United States is mainly a nation of earthy, physically fit people who are handy with a framing hammer, enjoy rock climbing, and know their way around Bhutan (one Worn Wear spot depicts an actual mountain guide turned family farmer). But visit the company’s stores in locations like the Upper West Side, Hong Kong, and Chamonix, and you will also see the affluent recreational shoppers who helped to inspire the nickname Patagucci. Online, the company offers D.I.Y. garment-repair tutorials, produced in partnership with iFixit, but these also feature a thirty-dollar “expedition sewing kit” that resembles a prop designed for the Khaki Scouts in Wes Anderson’s “Moonrise Kingdom.” Click for more information on the kit and a typical marketing stratagem plays out: you will be offered six other Patagonia products.
Corporate-social-responsibility theorists say that successful activist companies go though a “sense making” process that renders their efforts meaningful both within the corporation and among its customers. In Patagonia’s case, self-inquisition was part of the campaign. Even two years ago, with the launch of the Responsible Economy concept, Ridgeway was publicly questioning Patagonia’s steady expansion. “Companies, including ours, are reducing the environmental footprint of our individual products but increasing the footprint of our company as a whole as we grow,” he told Adweek. To GreenBiz, he said this: “It’s our hunch that all these sustainability innovations put together are not going to be enough to offset the continued increase in our human footprint that comes from this tie to growth.”
These days, the company is less ambivalent. “We’re not afraid of growth—we’re excited about it,” Adam Fetcher, the company’s director of global P.R. and communications, told me. Ridgeway was more expansive: “There is a point out there where our own growth is going to likely create more problems than it does solutions,” he said. “But as far out on the horizon line as we can see right now, we’re continuing to produce products that allow people to live a more responsible life with the apparel that they choose. As long as there’s a lot of other people out there that don’t do that, and that are creating more problems than they are solutions, then we should be growing.”
That narrative explains the Patagonia paradox: there’s bad growth, and then there’s good growth. An expanding economy driven by ever greater individual consumption of ever more disposable products is bad. In a more sustainable future, people will buy fewer things at higher prices, technological innovation will reduce the impact of those products’ manufacture, and the goods themselves will be made to last and then be recycled at the end of their useful lives. Since those are the kinds of products Patagonia is striving to make, and the kinds of relationships to products that Patagonia is trying to foster, then the more that Patagonia expands its market share, the better. The new economy must grow out from beneath the old one.
It makes sense—provided that is what’s actually happening. Company spokespeople say that Patagonia’s impressive growth over the past few years is explained by the fact that, like explorers in search of a lost tribe, they have made contact with a largely untapped market of sophisticated customers who support the brand’s anti-consumerism by thoughtfully consuming its products. “These new customers are the ones inspired by our approach with Worn Wear and other programs that stem from our values,” Fetcher said. Maybe so, but more conventional explanations are also available: for example, that the company is growing because it has expanded its reach (Patagonia has doubled its scale of operations in the past six years, and has opened forty new stores worldwide since 2011) and the impact of its marketing. Cognitive dissonance can cut both ways: it’s quite possible that Patagonia’s philosophy has attracted many shoppers to the brand without deeply affecting their buying habits, as suggested by the way that “Don’t Buy This Jacket” translated, for many, into “Buy This Jacket” in 2012.
Patagonia can’t say for sure if its growth is in fact the good kind or the bad. Fetcher says that they’ve had an “enormous outpouring of interest” from their customers, but that the company cannot currently provide any numbers on how many people are hanging onto their Patagonia jackets and board shorts for one more year rather than buying something new. Company records do indicate that Patagonia recycles about twenty thousand pounds of gear per year (roughly equal by weight to twenty thousand R2 jackets) and repairs some forty thousand garments; their Reno repair shop is the largest facility of its kind in North America. Given Patagonia’s sales figures, it is clear that the company repairs and recycles only a very small fraction of the number of products sold each year. Not a revolution at this point, then, though surely a significant gesture—corporate social responsibility’s version of propaganda of the deed.
Patagonia’s boardroom is now enough at ease with growth that they’re applying their business model in new directions. A foodstuffs division called Patagonia Provisions (shades of Wes Anderson again) aims to sell quality products that address the ecological consequences of farming, fishing, and livestock husbandry. So far, it’s small potatoes: “Just a tiny little million-plus-dollar business,” Ridgeway said. Products on offer are limited to sustainably caught Alaskan salmon; an organic toasted-grain-flour soup mix based on tsampa, the staple food of Tibet; and all-natural energy bars. “We are imagining a point out in the future where that business is probably going to eclipse the apparel business,” Ridgeway said, “because that’s where the biggest problems reside, and that’s also where the biggest solutions reside.”
A sense-making narrative survives only as long as it is believed, and it depends on being both true and perceived to be true. It is still the early days of Patagonia’s appeal to “good growth,” and the company’s core customers, sometimes referred to as Patagoniacs, appear to be patient. Lydia Baird, a student at the Fashion Institute of Technology who founded a campus cotton-muslin-composting project, was on hand when the Worn Wear truck made its Manhattan stop on the timeworn bricks of Greene Street, in front of Patagonia’s SoHo store. None of her Patagonia gear needed mending, but the repair crew was cool with patching a hole in a competing brand’s jacket, and they delivered her dad’s favorite Patagonia vest to Reno, free of charge, for a more complicated zipper fix. Environmentally literate, socially engaged, and with a clear sense that contemporary consumerism is a warm bath of contradictions, Baird is the shopper that Patagonia wants to be in business for—whether or not it really is.
“Their growth now is only positive in my eyes. The bigger they get, the more impact they can have,” Baird told me. “We definitely have to consume less, and there’s no way the world is going to be a perfect place. But maybe production can be done better. Maybe production doesn’t have to be a bad thing. And maybe Patagonia can lead us there.”
J. B. MacKinnon is the author, most recently, of “The Once and Future World: Nature As It Is, As It Was, As It Could Be,” which won the Green Prize for Sustainable Literature. He lives in Vancouver.
Patagonia today announced a strategic investment in a chemical company focused on making high-performance textile treatments based on natural raw materials.
Beyond Surface Technologies, a Swiss firm, was founded in 2008 by scientists and marketing experts with more than 40 years of experience in the textile industry. They left careers at big chemical companies to build a business based on the premise that it is possible to make textile treatments based on natural raw materials — without sacrificing performance or reducing the lifespan of a product.
The investment comes through Patagonia’s “$20 Million & Change” fund, which launched in 2013 to “help innovative, like-minded companies bring solutions to the environmental crisis and other positive change through business.”
Chemicals are a required component in achieving the high performance needed for harsh outdoor conditions — it’s what makes waterproof materials stand up to torrential wilderness downpours, jackets that can resist wind on a steep pitch and pants that have the right amount of protection as you’re knee-deep in fresh powder, Patagonia says.
However, these chemicals which are relied on for technical performance can be toxic and persist in the environment, a serious issue Patagonia says it is tackling aggressively. It plans to share any breakthroughs Beyond Surface Technologies may produce with the entire outdoor industry in order to amplify the environmental impact to the greatest extent possible.
“Patagonia’s investment gives us the opportunity to accelerate testing and reduce time to market for our pipeline of groundbreaking new treatments for the entire apparel industry, Matthias Foessel, CEO of Beyond Surface Technologies said in a statement. “Patagonia is enabling us to grow even faster — benefiting the environment and enhancing product performance — while remaining completely independent and in control of the original founders.”
In related chemicals news, the Cradle to Cradle Products Innovation Institute late last year announced it would begin offering a Material Health Certificate, a tool for manufacturers across industries to communicate their work toward chemically optimized products. The Material Health Certificate marks the first time the Institute has offered reporting of its comprehensive methodology in only one category.
** This post first appeared on Sustainable Brands here.