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March To Sustainability 2010 Excerpt
March To Sustainability 2010 Excerpt
com/photos/ta na k w ho
2010
Getting Manufacturers to Create Business Value through GHG (Energy), Water and Waste Conservation REPORT EXCERPT
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F O O D, C L O T H I N G , S H E LT E R ROTI, KAPDA, MAKAAN NOURRI, LOAG, BLANCHI ...
fOr centuries, these three have defined our basic human needs
across all cultures around the globe. Of these three, however, only textiles are both non-perishable and easily transported. Thus, textiles have been part of a global market since the days of the Silk Road. This market has continually evolved over time, and just as the mills of Manchester and Leeds radically changed the way textiles were produced and distributed over a century ago, rapid shifts are continuing in the way textiles are produced and supplied. Yet just as in centuries past, much of the production is based in Asia. Today it is difficult to go shopping anywhere in the world and not find goods made in China, India, Bangladesh, Vietnam, Cambodia, etc. As the textile supply chain has evolved to meet changing price and quality demands from the global marketplace, so has the sophistication of buyers in tracking their suppliers. In the mid-1990s, buyers added a new dimension to their requirements, and began making demands regarding health, safety and labour conditions. Global manufacturing centres have increasingly had to respond not only to local requirements but also to global ones. In this report we talk about a new dimension on the cusp of being rolled out throughout the supply chain: Environmental Sustainability. Environmental Sustainability takes into account the use of water, energy, and natural resources, and seeks to minimize negative impacts to the environment in the production of textile-based goods, as well as in their use by consumers. The long term goal of such initiatives would be complete sustainability. Progressive brands and retailers have been exploring sustainability initiatives since the middle half of the last decade: testing initiatives first internally and now considering roll-out through their global supply chains. This report profiles such firms and what they are doing. Sustainability is about doing more with less, which means finding savings and creating business value in addition to having a positive impact on the environment. For the purpose of this report, we are looking at aspects of sustainability which concern the textile supply chain from the raw material (natural fiber or man made fiber) to the point that it is converted to finished product. The focus in the report is primarily on the following aspects: energy efficiency, carbon / greenhouse gas emissions, water and chemcial footprint as well as logistics. We have intentionally left out raw material production and product composition since they are typically out of the control of textile suppliers and since they are vast topics in themselves to work upon.
The report is written keeping a supplier perspective in mind: 1. What are some of the progressive brands and retailers doing and planning for their supply chain? 2. How does one begin to measure sustainability and compete in this changing market? This report also touches upon initiatives that companies have already started to engage in to improve raw materials in the supply chain, such as the Better Cotton Initiative and the Organic Exchange. In addition, the report discusses other initiatives where buyers are coming together to form a unified voice, including the Outdoor Industry Association, and working groups assembled by the Business for Social Responsibility (BSR). While much of the current work being done to increase the sustainability of the global textile supply chain is still in its early stages or being applied regionally, in the next 24-36 months these initiatives will become mainstream globally. The message for the supply chain should be clear: make no mistake, sustainability is the next wave in the ever-changing landscape of textile manufacturing.
OTTO AS FLAGSHIP AND OVER 20 GROUP COMPANIES AND BRANDS CALVIN KLIEN, ARROW, IZOD, BASS, VAN HEUSEN CORTEFIEL, PEDRO DEL HIERRO, SPRINGFIELD, WOMENSECRET ZARA, OYSHO, KIDDYS CLASS, BERSHKA, MASSIMO DUTTI EARTH POSITIVE APPAREL
EARTHKEEPERS
CREATI NG
The goods of the textile sector are such an intrinsic part of our everyday lives that we take them for granted. The clothes we wear, cushions we sit on, bed sheets we sleep in, carpets we walk on textiles surround us so completely, that the only other comparable global human needs are food and shelter.
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c r e aT I n g b u S I n e S S va l u e
Walmart is well-known for making its stores and build ings more energy ef ficient, and now the company is us ing that knowledge to help suppliers save money. The program is called S.E.E.P., which stands for Supplier Energy Ef ficiency Project . James Stanway, Senior Di rector of Global Energy Ser vices at Walmart says that the program only makes our suppliers more profitable; and there is an environmental impact . In an illustrative success of the program, Walmart sent its engineers to a supplier in Georgia: Dana Undies where 71% of the utility bill was saved.
1. Sustainability generates business value. Less is the new more and firms are looking at identifying resource savings which come from undertaking sustainability measures. 2. Capital market shareholders and stakeholders are rewarding firms with sustainability practices (and this is applicable to sectors outside textiles too). The Dow Jones Sustainability Index and the FTSE4Good Environmental Leaders which track the financial performance of the leading sustainability-driven companies worldwide have been outperforming the market. Additionally, investor groups interested in sustainability are uniting their voice through organizations like Ceres and Carbon Disclosure Project. 3. Risk mitigation at a few different levels. As climate legislation continues to develop in Europe and some of it is being planned in US/Canada, firms are looking to get an idea of their supplychain risk and proactively managing it. In addition, developing countries themselves are working on looking at legislation on carbon and water usage. This too impacts the brands and retailers depending on their sourcing regions. 4. Attracting conscious consumers with new products and carbon/sustainability labelling. There are consumer segments getting savvy and looking to make purchase decisions based on environmental impact. R&D work on sustainability for some of the firms has been done in their corporate responsibility groups and now is being entered into the mainstream (Nike, Adidas), while in other cases firms have made it a centerpiece of their new strategy (M&S, Walmart) and still in some other cases internal EHS initiatives are evolving further to focus on sustainability (PvH, IndiTex). Nike for example began building capabilities through its Considered range of products in 2005 and now has plans to require all its apparel products to meet the Considered Standard by 2015. The company sees sustainability as a route towards future profitability. It created a dedicated group of 130 people in what is called Sustainable Business & Innovation, and last year made a commitment to weave sustainability into the mainstream. According to the non-profit organization Organic Exchange, global retail sales of organic cotton apparel and home textile products reached an estimated $3.2 billion in 2008, a 63 percent increase from the $1.9 billion market in 2007. The top ten users of organic cotton include some of the biggest names in retail including Walmart, Nike, H&M, and the Inditex brand Zara. The direction is clear. Many brands and retailers are moving rapidly and inexorably toward increased sustainability standards for their textile supply chains, all the way from raw material through to finished goods.
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how does one begin to measure sustainability that makes sense to buyers?
In this report we have compared a few standards and certifications underway that ought to be on the radar of every supplier. While most of the standards are still in the adoption phase, the underlying data requirements for most of them are quite similar. The section titled Standards and certifications on Page 50 summarizes a few key standards and initiatives.
The Carbon Footprint is developed on basis of the PAS 2050 guideline. Tesco, Continental Clothing, Levi Strauss & Co. are amongst those that have been testing some products with the Carbon Label.
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IN FOCUS
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ADIDAS
Using EBA to collect data from Tier I and II suppliers Better Place Project to mainstream sustainability Global Apparel Strategic Alliance
CARREFOUR
CDP supply chain leadership collaboration Training regional supply chain teams on logistics
GAP
Clean Water Programme Expanding the environmental footprint programme into supply chain in 2010
H&M
Efficiency index for suppliers on wet processing Cleaner Production Programme for fabric mills Initiate supply chain footprint monitoring in 2010
IKEA
OTTO GROUP
Own tool: e-Wheel Internal IKEA Goes Renewable is now extendfor assessing environing to suppliers to cut CO2 emissions mental impact Implementing new quality standards to reduce textile weight Proprietary toolbox con- Climate Protection Strategy being rolled out taining over 70 customised measures Sustainability Index CDP supply chain leadership collaboration GOTS Certification for Supplier Energy Efficiency Programme organic textiles Walmart online resources for supplier sustainability Expanding supplier assessment internationally in 2010
WALMART
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carbon
energy
As per the strategy 2008-2010, Adidas has identified three primary sustainability areas as being core to their business: Embedding environmental sustainability across the business. Effectively managing business risks and social compliance in the supply chain. Extending engagement internally and externally. The Group has stated its commitment to reducing energy consumption by 20% per square meter of sales area by 2020 (compared with 2004 levels). By 2010: Complete first phase of an environmental footprint assessment across select owned and operated locations. Complete the implementation of the denim clean water programme. Have LEED accredited designers at Gap, BR and old Navy Brands. Develop quantifiable environmental goals based on data from the environment footprint assessment. Introduce new supply chain waste management initiatives. Since 2005, H&M has set a clear goal to reduce their carbon footprint 10% by 2009 compared to a 2004 baseline year. In 2008, H&M listed Key Focus Areas for the environment including reducing CO2 emissions, promoting environmentally responsible cotton growing, and paying increased attention to water impacts throughout their product life cycle. Reducing CO2 emissions, and also increasing their share of renewable energy.
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Reducing 20 million tonnes of CO2eq from its supply chain (not only textiles) by 2015
Waste
LEVI STRAUSS
Finalizing methodology for analyzing water footprint of supply chain partners, to be deployed in 2010. Information management system being rolledout to suppliers to collect and track energy use data. Extending its Global Effluent Guidelines (GEG) to second-tier suppliers of bulk fabric and sundry items. Extended its Greenhouse Gas Inventory to all of owned and operated locations worldwide M&S Supplier Exchange for sharing best practices Cotton Sourcing Strategy in 2010 Aim to have 20 million clothing garments that use Fairtrade Cotton by the conclusion of Plan A Working with suppliers to improve logistics efficiency Looking to promote PAS to suppliers as the preferred method for calculating product carbon footprints Nike Water Programme Will require all its apparel to meet the Considered Standards by 2015 Integrating energy efficiency practices at supplier factories and bringing contracted factories to the same relative energy performance level Closed loop business models Lean manufacturing
NIKE
Material Analysis Tool (MAT) to evaluate lifecycle impacts (Nike internal tool) Considered Index (Nike Internal Tool)
CONTINENTAL CLOTHING
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carbon
energy
Current goals are mainly for Scope 1 and Scope 2 and the company is collecting data on its supply chain to define its goals.
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Nike will require that 100% of its apparel meet Considered Standards by 2015.
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Waste
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and Planning ahead
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