Through the looking glass: the hidden deforestation in the fashion industry

We take an in-depth look at the deforestation commitments of some of the world’s biggest clothing companies sourcing leather and cellulose, and consider what needs to happen to ensure our wardrobes are deforestation-free in this long read.

A long read by Emma Thomson, with contributions from Honor Cowen, James MacPherson and Susan Harris at Anthesis

8 minute read

When we pick up an item of clothing in a shop, we think about many things. Does this suit me? Can I wear it with items I already own? How much does it cost? But there are some things we tend not to think about. Who made it? What is it made from? And one we tend to think about even less – has the production of this item contributed to tropical deforestation?

Yet the environmental and social impacts of the fashion industry – including water shortages, exploitation of workers, irresponsible sourcing of materials, and of course climate change – cannot be ignored.

The global economic downturn triggered by the coronavirus pandemic has hit the fashion world hard. In one devastating example of the scale of the crisis, an estimated two million garment workers in Bangladesh lost their jobs as shops cancelled or failed to pay for their orders. But this crisis for the industry could provide an opportunity to build a more sustainable industry – and it is vital that it is deforestation-free.

Fashion from forests?

The contents of our wardrobes could not seem further away from a tropical rainforest. Yet the leather in our trainers, bags and belts, and the wood-based cellulose used for viscose and rayon fabrics, can in many cases be linked to the destruction of rainforests and other vital ecosystems.

Cellulose, viscose and rayon are all man-made cellulosic fibres (MMCF) made from wood pulp. They are often considered more sustainable than plastic-based fibres such as acrylic or polyester, but they might be doing more harm than we think. Boreal and tropical forests are being cut down to make way for plantations of just one tree species to produce enough pulp to meet demand, reducing the biodiversity of the world’s most important ecosystems.

In South America, large swathes of rainforest are cleared every year to make way for cattle pastures, driven by demand for both beef and leather around the world. Last year, the fires in the Amazon rang alarm bells for some companies sourcing leather from Brazil, but with these fires burning more widely in 2020, more needs to be done.

“From your car seat to the clothes on your back, the materials we interact with every day have a profound impact on the environment. Consumers and companies alike are searching for sustainable solutions that are functional, fashionable, and cost-effective, but today’s options are few and far between.” 

Nicole Rawling, co-founder and executive director of the Material Innovation Initiative

The textile industry is already the fourth largest source of climate emissions from industry (ahead of air travel and shipping combined), without even counting the emissions released from associated deforestation and degradation of tropical rainforests for the production of leather and cellulosic fibres for our shoes and clothes.

Isn’t the industry becoming more sustainable?

Fashion companies are signing up to sustainability initiatives in growing numbers, in part due to growing demand from consumers, with 90% of ‘Generation Z’ believing that companies should be environmentally and socially responsible.

Many companies are starting to take action to achieve more sustainable supply chains – with initiatives to reduce their water usage, to pay their workers a living wage, and to recycle and repurpose fabrics where possible.

For some companies, deforestation is moving up the agenda. During the Amazon fires in 2019, several companies, including VF Corporation and H&M committed to stop sourcing leather from Brazil until they could be certain that it wasn’t contributing to deforestation. Over 250 companies have signed up to the CanopyStyle initiative to ensure that the cellulosic fibres they are producing and procuring are sustainable.

However, there is still lots of work to be done.

The UK spent £59.3 billion on clothes in 2019. The environmental and social impacts of the fashion industry are often most associated with high-street fashion. But some of the most influential companies in forest-risk supply chains are in fact in the luxury goods market.

Global Canopy’s Forest 500 ranking identifies the 500 companies and financial institutions with the greatest influence on tropical deforestation, based on their exposure through their supply chains based on market share, tonnes of each forest-risk commodity used, and other information. Our selection includes a number of luxury goods companies – including LVMH, Kering and Prada.

Fast-fashion brands and the high end market are both exposed to deforestation in their supply chains. Deforestation is a problem across the industry.

Have any companies committed to act on deforestation in their supply chains?

The companies identified by Forest 500 as exposed to deforestation through the forest-risk commodities in their supply chains are assessed annually on the strength of their deforestation commitments and on their approach to implementation.

Our most recent data shows that clothing companies – particularly those producing leather shoes, bags and accessories – are failing to take action to ensure their products are deforestation-free.

Lacklustre action on leather

Three quarters of the 38 clothing companies assessed had not made a public commitment related to forests for their leather supply chain. These companies, including Prada, Inditex (Zara’s owner) and Capri Holdings (which owns Michael Kors) had not published information about what they were doing to ensure that the leather they source is deforestation-free. Failing to take these steps leaves these companies at risk of sourcing leather linked to the destruction of tropical forests.

38 companies were assessed on their deforestation commitments for leather, 9 had a forest-related commitment, to protect key forest ecosystems such as the Amazon, to guarantee zero deforestation, or to ensure that no natural landscapes are converted.

But not all forest-related commitments are equal.

Of the nine companies with a commitment, five had committed only to protect priority forests in the Amazon. Three (Marks and Spencer’s, Nike and VF Corporation) had made a commitment to zero-deforestation throughout their leather supply chains. And one company, Kering, had committed to ensure that no natural landscapes, including forests, are converted to produce leather.

So why is so little action being taken on leather?

Leather often faces significantly less scrutiny than other commodities because companies and consumers consider it a ‘by-product’ of beef. And certainly for some, not using leather would be a waste of the raw material. But, selling leather is actually a profitable co-product for most companies and therefore demand for leather does have an impact on the cattle industry.

There are some industry sustainability initiatives focused on leather, such as the Leather Working Group (LWG), but none of these initiatives focus on deforestation. Although the LWG audits include an assessment of traceability to the slaughterhouse, this is not sufficient for the company to know or act on their impact on deforestation. So while 17 of the 38 leather companies identified by Forest 500 are members of the Leather Working Group, including Adidas, Asics and Deichmann, this means they are focusing on improving the sustainability of the tanning process, not their impact on deforestation.

Cattle supply chains are opaque, with cows often moving from farm to farm before being taken to slaughter. As large processing companies frequently purchase live cows from small-scale farmers, there is often little record of where the cattle came from. However, the biggest issue of transparency in cattle supply chains is the gap between the slaughterhouse and the tannery where the hides are made into leather. Some tanneries source directly from the slaughterhouse, but others procure hides through traders making it harder to track back. As a result, some processors – and by extension the traders, manufacturers or retailers – don’t know who they are sourcing the raw materials from. As a result, companies do not necessarily know if their suppliers have deforestation commitments, and whether or not the products contributed to deforestation.

The problem with cellulose

Man-made cellulosic fibres are now the second largest cellulosic fibre product following cotton, and are thought of by many consumers as sustainable alternatives to plastic-based fibres, such as polyester and nylon. Plastic fibres are a problem – approximately eight million tonnes of plastic, including up to 236,000 tonnes of microplastics, enter the oceans every year just as a result of washing plastic-fibre clothes. But simply replacing these fibres with wood-based alternatives does not guarantee that the clothing has less impact on the planet.

Replacing natural forests with single-species tree plantations to harvest cellulose fibres reduces the natural biodiversity of the area and destroys critical natural habitats. If global biodiversity continues to decline, the ecosystems we depend on will collapse – impacting everything from food and water security to economic livelihoods.

The sustainability of these natural fibres depends on how they are sourced and how forests are managed. Cellulose should be sourced without the destruction or degradation of ancient, endangered, or tropical forests – and companies can make sure that their suppliers are also operating in line with these standards to ensure the protection of these critical habitats.

Company commitments for cellulose

In comparison to leather, a greater proportion of companies in cellulose supply chains are addressing the problem of deforestation. Of the 22 companies we assessed, 15 had made a forest-related commitment.

Some well-known brands, including Adidas, Amazon and Associated British Foods (the owners of Primark) did not have a forest-related commitment for procuring wood-based fibres.

Of the 22 companies assessed for cellulose, 15 had made a forest-related commitment, to protect key forest ecosystems such as endangered or high-conservation value forests, or to guarantee zero deforestation.

But some high street brands, including H&M, Cofra, and Zara-owner Inditex had committed to procuring cellulose which doesn’t impact tropical forests. At the time of the most recent Forest 500 assessment, seven of the companies with forest-related commitments were members of the Canopy Style initiative, but this has now risen to all but three. Set up to drive change within the wood-based fibre industry, Canopy Style works with companies to develop and implement commitments to protect endangered forests from deforestation and degradation in their sourcing of viscose. With over 320 members, Canopy Style is helping to drive positive action.

Once commitments have been made, they must be implemented well to drive change in the way companies source materials in their supply chains. But one of the biggest impediments to this change is a lack of transparency on who is supplying who with what.

But don’t companies know who they are buying their products from?

Supply chains are complex, often involving a number of different companies at each stage.

To ensure a product is deforestation-free, companies have to be able to trace the product back through their suppliers to the point where they can check the product was produced in line with their commitment. In some high-risk areas, or for commodities like leather where applicable certification schemes are not available, this may mean tracing all the way back to where the raw materials were produced. Without this, any commitments companies make to consumers cannot be guaranteed.

Yet just four of the 15 companies with a commitment for their cellulose supply chains had committed to traceability (Cofra, Inditex, Bestseller A/S and Fast Retailing). And only Fast Retailing had made a commitment to track through to the point of production.

The leather supply chain is even more complex, with the steps from cow to fully-processed leather taking up to two years, and cattle being moved between farms before slaughter.

Half of the companies with a commitment to ensure their leather is not linked to deforestation had committed to trace their leather supplies through their supply chain, and only one company – Kering – had committed to tracking the leather through to the point of production.

The remaining companies that didn’t have traceability commitments, which include New Balance, Clarks and VF Corporation, cannot provide any guarantee that their shoes, bags, and accessories are deforestation-free.

Traceability is particularly critical for leather as there is no credible certification scheme for deforestation-free leather, unlike for some other commodities. Without this third-party scheme, it is even more pivotal that companies are able to track their own leather and monitor compliance throughout their supply chains.

Can I buy any deforestation-free clothing from these brands?

Companies do not always disclose their progress towards the commitments they have made, making it hard to know whether their products are deforestation-free. This could be because they are reluctant to reveal slow progress, or because they aren’t taking action.

The fashion industry has long avoided scrutiny by failing to be open about its practices, but as consumers demand greater transparency the time for this to change has come.

Only one company with a forest-related commitment for leather, Tapestry, reported on their progress towards this goal in the latest Forest 500 assessment, while not one of the companies with a deforestation-free commitment did.

As with making forest-related commitments, more companies were actively reporting on their progress for cellulose. But still, only six of the 15 companies with a forest-related commitment reported on their progress towards their goal.

Without this progress reporting, consumers and external organisations cannot know if the company is actively working towards the target – or if the commitment is anything more than greenwash. But by opening up their supply chains to the public, companies can empower their customers to hold them accountable, and as a result increase the trust between consumers and the company.

By being open and clear about what the company is doing, how they are doing it, and how much progress they are making, companies can let everyone know that they are working towards a more sustainable future. And they can raise the bar for other companies in the sector to follow suit.

It is important to note that transparency and sustainability are not synonymous. However, transparency is a critical step in the right direction. It can create a race to the top for sustainability in all elements of a fashion supply chain, and as the Amazon continues to burn, the need for transparency in cellulose and leather supply chains is urgent.

What can companies do to stop deforestation?

For companies, deforestation is just one of the corporate responsibility issues to address, according to Dr James MacPherson, from global sustainability consultancy, Anthesis Group. It intersects with climate change, biodiversity loss, water & catchment management, and human rights, and these issues are all being taken more seriously.

The first step for a company, he explained, is to understand the risks in their supply chain. Could suppliers be linked to deforestation? Finding this out can be difficult, but there are a growing number of specialist tools that can be used to help. For example, jeans brand Wrangler has gone through this process. Tools such as Trase provide deforestation risk data by mapping links between consumer countries via trading companies to sources of production, helping companies to chart where and when deforestation risk is material.

Once the source of any risk has been identified, companies can address that risk, and often will set a goal or commitment aiming for zero deforestation by a set date. Forest 500 found that 60% of the most influential companies in forest-risk supply chains had made a commitment to zero deforestation.

Commitments of course need to be implemented. MacPherson said that achieving deforestation-free supply chains is likely to involve engaging and collaborating with a range of stakeholders in the supply chain, perhaps working with suppliers to achieve certification or helping them identify where the risks lie. This might include working towards certification, but it is increasingly recognised that deeper interventions are required. Such interventions might involve working with community and conservation organisations to balance the needs of local communities, businesses and biodiversity within landscapes and jurisdictions that lie within their supply chains.

Companies should also be transparent about the actions they have taken, providing reassurance for consumers that their products are not driving biodiversity loss and climate change.

What can consumers do?

As consumers, we all can help influence the decisions of the brands we buy. And the responses of H&M and VF Corp to the Amazon fires in 2019 show that companies do listen to the growing demands of consumers for sustainability – either due to consumer pressure or to avoid risking their reputation.

“Consumers are more informed than ever about the impact of their choices, and they are demanding more eco-friendly offerings. Where the needs of the planet and the desire of the consumer meet, there is a tremendous opportunity to do well financially while doing good for the world.”

Nicole Rawling, co-founder and executive director of the Material Innovation Initiative

Looking out for the potential connections between products and deforestation, demanding transparency from clothing companies, and using their buying power to support companies that are committed to making their products deforestation-free are key ways consumers can exert their influence.

But legislation is also needed. The UK government and European Union are both currently considering new laws designed to address the problem of deforestation in supply chains. Through both the EU and UK public consultations that have been set up around these new proposed laws, consumers can send a message that they want strong action to remove deforestation from their wardrobes.

Conclusion – the future for fashion and forests

Although we are a long way from deforestation-free options being the norm, as awareness around the impact of our shoes, bags and shirts on tropical forests grows, so too does pressure on companies to make changes within their supply chains. Consumers want to know that their purchases are deforestation-free, and companies have an opportunity to lead the way in manufacturing deforestation-free fashion.

As some companies take the first step towards a green recovery, they can use the opportunity to build sustainable supply chains.

The need for action is urgent. Analysis by Global Fashion Agenda suggests that by 2030 the land used by the fashion industry will increase by 35% (for livestock, cellulosic fibres and cotton) amounting to 115 million additional hectares. This is not something which ecosystems, or the global climate can afford.

Fashion companies can no longer just talk the talk – as consumers increasingly demand sustainability and transparency, they must now walk the walk.

Read more about how we assessed the fashion companies.

Image: Burning Amazon, Ritu Singh