This Week's Obsession: How Luxury Brands Disappoint on Earth Day

This Week's Obsession: How Luxury Brands Disappoint on Earth Day

Earth Day began with purpose, and that purpose did not involve selling things. The inspiration for the first Earth Day took the form of a major oil spill off the coast of California in 1969, and has since become an annual event to promote “green” products, offer Earth Day discounts and release new sustainability reports.  

Earth Day 2024 comes as a worrying new report found that global concentrations of carbon dioxide, methane and nitrous oxide – the top three heat-trapping gases – reached a record high again in 2023. Meanwhile, a separate study found that Antarctica saw an astonishing rise of 38.5 degrees Celsius above its average seasonal temperature back in 2022, leading to major concerns about the alarming rate at which global warming is affecting our planet.

Using consumerist culture to mark Earth Day is directly at odds with the underlying spirit of the global event. It promotes consumption as an answer to a problem that was caused, in large part, by overconsumption. And it perpetuates the notion that brands can tweak their way out of a mess that requires systemic change to solve.

As a wise person (most likely a woman) once opined, "Every day is Earth Day." Yet 55 years has passed and and Vogue Business this year declared they would not cover Earth Day because "No brand is doing enough to warrant a celebration for its impact on the planet." How is this possible, we ask ourselves.  Let's take a deeper dive. 

The luxury fashion industry has a sustainability problem. while some brands have take small steps to towards more ethical and eco-friendly practices, the industry as a whole remains slow to change.  

Lack of Transparency

Many luxury brands continue to lack transparency in their supply chains and manufacturing processes. It's difficult for consumers to know where and how their products are made, and whether fair labour and environmental practices are followed.

Prioritising Profits

For most luxury fashion executives and shareholders, increasing profits and share holder returns remain top priorities.  Investing in sustainability initiatives and ethical practices is often consider to costly or difficult. And when profits falter as they are currently for many luxury brands, the focus intensifies and sustainability may well fall off the priorities list.  

Even Luxury Pushes a "Fast Fashion" Mindset

Luxury brands continue to push seasonal collections which fuels a "fast fashion" mindset. The rapid cycle of new styles leads to over consumption and waste.   It also puts pressure o supply chains increasing the risk of poor working conditions and environmentally damaging practices. 

Not to mention the problem ow what do to with all the overstock. Last month Business of Fashion reported that:

  • The value of excess inventory held by luxury fashion’s biggest groups has grown to billions of dollars over the last decade, reaching €3.2 billion at LVMH and €1.5 billion at Kering last year.
  • Such overproduction is a feature of fashion’s business model, intended to maximise production efficiency and sales prospects and is accepted by investors because it represents just a small portion of companies’ overall revenue.
  • But disposing of this excess inventory is an increasingly complicated challenge, with regulators banning its destruction and luxury players reluctant to lean too heavily on discount channels.

While brands try to figure out different ways to address the issue of overstock,  the biggest lever for change is not producing too much to begin with. “Eliminating the need to think about unsold products in the first place is the vital starting point,” said Elisa Niemtzow, vice president for consumer sectors at consultancy BSR. “It’s going to take creative and innovative thinking — and maybe thinking about different models of doing business.”

The overall fashion industry has a massive environmental footprint. The latest statistics say that apparel and footwear account for 8% of the world's carbon emissions, more than international air travel and maritime shipping.  And the average consumer buys 60% more clothing items than then did 15 years ago but keeps each garment 1/2 as long. 

At the current pace of change the fashion industry won't reach environmental sustainability for another 50 years. Luxury fashion is seen as glamorous and aspirational.  But brands have been slow to match customer values.

Why are luxury brands slow to embrace sustainability?

One of the main reasons luxury brands have been slow to embrace sustainability is the traditional focus on exclusivity and high-end materials. Many luxury brands have built their reputation on using rare and exotic materials, which are often not sustainable or ethically sourced.

Additionally, the luxury industry has been slow to change due to the high costs associated with implementing sustainable practices. From sourcing sustainable materials to overhauling production processes, the initial investment required can be substantial, deterring many luxury brands from making the switch.

What are the consequences of this slow progress?

The slow progress of luxury brands in embracing sustainability has significant consequences for the environment and society. The fashion industry is one of the largest contributors to pollution and waste, and luxury brands play a significant role in this impact.

Furthermore, as consumer awareness and demand for sustainable products continue to grow, luxury brands risk losing market share to more sustainable and ethical competitors. Failure to adapt to changing consumer preferences could result in a decline in sales and brand reputation.

What steps can luxury brands take to improve sustainability?

Despite the challenges, there are steps that luxury brands can take to improve their sustainability practices. This includes investing in research and development to find innovative sustainable materials, implementing transparent supply chains, and reducing waste in production processes.

Collaborating with sustainable fashion initiatives and organisations can also help luxury brands learn best practices and stay up to date with the latest trends in sustainability. By taking proactive steps towards sustainability, luxury brands can not only reduce their environmental impact but also appeal to a growing segment of conscious consumers. Another approach that is gaining traction is the adoption of circular models.

What are circular models?

Circular models are based on the principles of circular economy, which aims to eliminate waste and keep products and materials in use for as long as possible. In the context of luxury brands, this means rethinking traditional linear production processes and moving towards a more sustainable and environmentally friendly approach.

How can circular models help luxury brands?

By embracing circular models, luxury brands can reduce their reliance on virgin materials, minimize waste, and extend the lifespan of their products. This can not only help them reduce their environmental impact but also appeal to a growing segment of consumers who are looking for sustainable and ethical options.

What are some examples of circular practices in the luxury industry?

Some luxury brands are already leading the way in adopting circular practices. For example, some brands are incorporating recycled materials into their products, offering repair and refurbishment services to extend the life of their products, and implementing take-back programs to recycle old items.

What are the benefits of adopting circular models for luxury brands?

There are several benefits to adopting circular models for luxury brands. Not only can they reduce their environmental impact and appeal to eco-conscious consumers, but they can also differentiate themselves in a competitive market, build brand loyalty, and future-proof their business against changing consumer preferences.