Sustainable fashion: does the circular economy really work?

The task of estab­lish­ing a cir­cu­lar fash­ion econ­o­my is wide­ly accept­ed as cru­cial, giv­en that a truck­load of tex­tiles is being incin­er­at­ed or buried every sec­ond, accord­ing to a glob­al esti­mate by the Ellen MacArthur Foun­da­tion. 

The char­i­ty has also cal­cu­lat­ed that the under-use of cloth­ing and a lack of gar­ment recy­cling costs the glob­al econ­o­my more than $500bn (£420bn) a year. The longer-term price paid by the envi­ron­ment is like­ly to be far greater. The microplas­tics that the syn­thet­ic fibres in our cloth­ing shed when washed have been found in human blood, pla­cen­ta and, most recent­ly, snow in the Antarc­tic. 

Devel­op­ments such as the EU’s cir­cu­lar econ­o­my action plan of 2015 and the UK’s cir­cu­lar econ­o­my pack­age of 2020 have prompt­ed many fash­ion retail­ers into action. The EU strat­e­gy for sus­tain­able and cir­cu­lar tex­tiles, pub­lished this March, also stressed the impor­tance to the indus­try of a cred­i­ble long-term strat­e­gy for dura­bil­i­ty, recy­cling and waste man­age­ment. In June, Boris John­son even pledged £80m of pub­lic fund­ing to help estab­lish a “cir­cu­lar fash­ion mod­el”. 

But crit­ics of the fash­ion industry’s his­tor­i­cal­ly prof­li­gate prac­tices argue that ‘cir­cu­lar­i­ty’ has become a mere buzz­word, used by firms seek­ing to apply a coat of green­wash over their con­tin­u­ing waste­ful ways. 

Cloth­ing take-back pro­grammes have become cen­tral to the sector’s cir­cu­lar­i­ty dri­ve. The char­i­ty Waste & Resources Action Pro­gramme (Wrap) esti­mates that such schemes – adopt­ed by the likes of H&M, M&S and Pri­mark – pre­vent­ed 620,000 tonnes of used tex­tiles from end­ing up in British land­fills in 2018. H&M has report­ed that its “Close the loop” recy­cling and repair­ing ini­tia­tive col­lect­ed 18,800 tonnes of unwant­ed clothes – the equiv­a­lent of 94 mil­lion T‑shirts – in 2020. 

Juli­et Lennon, pro­gramme man­ag­er at the Ellen MacArthur Foun­da­tion, says: “Rental, resale, remake and repair have the poten­tial to make up 23% of the glob­al fash­ion mar­ket by 2030, rep­re­sent­ing a $700bn oppor­tu­ni­ty.”

Retail­ers work with white-label ser­vices such as Yel­low Octo­pus and I:CO, which sort gar­ments into cat­e­gories for reuse or recy­cling, depend­ing on their mate­r­i­al prop­er­ties and con­di­tion. In the­o­ry, such inno­va­tions are wel­come, yet not all clothes col­lect­ed are suit­able for either process. I:CO, a part­ner in H&M’s take-back pro­gramme, recent­ly report­ed that 8% of what it received was nei­ther reusable nor recy­clable and would there­fore have to be incin­er­at­ed.

More con­cern­ing is research pub­lished by Green­peace in April, which claimed that no more than 30% of used clothes are stay­ing in the coun­try of dona­tion. Much of the remain­der is sent to coun­tries in the Glob­al South, where it often ends up “on huge dump sites, on open fires, along riverbeds and washed out into the sea”. 

Kan­ta­man­to Mar­ket in Accra, Ghana, illus­trates the scale of this prob­lem. About 15 mil­lion gar­ments enter the mar­ket every week. Some of these can be used to sup­port the local tex­tile indus­try, but researchers esti­mate that 40% of the items are of such poor qual­i­ty that they are deemed worth­less on arrival and are either buried or burnt. 

Vio­la Wohlge­muth, a cam­paign­er for Green­peace Ger­many, says that coun­tries such as Ghana “don’t have the infra­struc­ture to cope with the large vol­umes of tex­tiles that are arriv­ing, even if all of them were reusable”.

The large-scale dump­ing of unwant­ed tex­tiles is cre­at­ing a socioe­co­nom­ic and envi­ron­men­tal cri­sis for local com­mu­ni­ties. The waste mate­r­i­al is a health haz­ard, as its decom­po­si­tion not only releas­es microfi­bres into water­cours­es but also pro­duces dan­ger­ous lev­els of flam­ma­ble methane gas. 

Mov­ing clothes from one coun­try to anoth­er is by no means cir­cu­lar. The prac­tice sim­ply shifts the bur­den to a ter­ri­to­ry with lim­it­ed capac­i­ty to han­dle it and weak­er envi­ron­men­tal laws. Chile, for instance, has long been a hub for used and unsold gar­ments from all over the world. The port city of Iquique accepts near­ly 60,000 tonnes a year, but less than half of this mate­r­i­al is bought by mer­chants for resale. The rest is sim­ply dumped in huge mounds in the sur­round­ing Ata­ca­ma Desert, where it could take two cen­turies to biode­grade.

Wohlge­muth recounts a recent vis­it to Gikom­ba, Kenya, where she found her­self walk­ing along the banks of the Nairo­bi Riv­er and real­is­ing that they most­ly com­prised piles of tex­tile waste, from which gar­ments would fall and be swept down­stream. It’s not sur­pris­ing that such expe­ri­ences have led her to con­clude that “the sys­tem is not work­ing”. 

Trans­paren­cy is key to encour­ag­ing par­tic­i­pa­tion in any sus­tain­abil­i­ty ini­tia­tive. A recent sur­vey by Wrap found that 42% of con­sumers deemed it impor­tant to know the like­ly des­ti­na­tions of their donat­ed gar­ments. 

“When peo­ple give back clothes, they expect these items to be reused, to raise mon­ey for char­i­ty or to ben­e­fit peo­ple that need them,” Wohlge­muth says. “They wouldn’t expect them to end up in huge, over­flow­ing land­fills in Africa.” 

Some retail­ers oper­ate incen­tive schemes that offer cus­tomers dis­count vouch­ers for donat­ing used cloth­ing, but such ini­tia­tives have drawn crit­i­cism for fuelling fur­ther con­sump­tion, which works counter to the cir­cu­lar econ­o­my. There has been “lit­tle evi­dence of plans to reduce the flow of fash­ion – a pre­con­di­tion for any mean­ing­ful attempt at cir­cu­lar­i­ty”, Wohlge­muth argues. 

When donat­ing clothes or buy­ing ‘sus­tain­able’ gar­ments made from recy­cled poly­ester, con­sumers should pro­ceed with cau­tion, she adds. Reg­u­la­tions such as the Com­pe­ti­tion and Mar­kets Authority’s green claims code are designed to pre­vent com­pa­nies from mak­ing mis­lead­ing state­ments, but she argues that “most cir­cu­lar­i­ty claims are green­wash­ing. Few­er than 1% of clothes pro­duced are actu­al­ly made from recy­cled tex­tiles.” 

Sarah Gray, senior ana­lyst for tex­tiles at Wrap, rec­om­mends that com­pa­nies build “a sol­id evi­dence base to ensure that they can ver­i­fy details on recy­cled con­tent to make cer­tain that their claims about cir­cu­lar­i­ty are truth­ful”. 

Gen­uine and effec­tive cir­cu­lar ini­tia­tives call for high­er stan­dards of report­ing on sup­ply chain risks; effi­cient mon­i­tor­ing sys­tems; invest­ment in tech­nol­o­gy to enhance trans­paren­cy; and legal­ly com­pli­ant col­lec­tion process­es. 

Lennon believes that “eco­nom­ic and reg­u­la­to­ry incen­tives are need­ed to increase the via­bil­i­ty of cir­cu­lar busi­ness mod­els, as vol­un­tary com­mit­ments by indus­try lead­ers alone will not achieve the scale required”. 

Retail­ers should focus on con­sis­ten­cy too. Any firm that’s vocal about plas­tic pack­ag­ing as part of its cir­cu­lar­i­ty dri­ve, yet doesn’t pub­licly dis­close the vol­ume of syn­thet­ic mate­r­i­al in their col­lec­tions, should recon­sid­er its approach, for instance. Doing so will be key to its long-term sur­vival. 

Opaque reverse-logis­tics oper­a­tions and half-heart­ed cir­cu­lar­i­ty ini­tia­tives are leav­ing com­pa­nies vul­ner­a­ble to sev­er­al ESG risks – and investors, if not con­sumers, are watch­ing close­ly.