Overview and scope

The purpose of the Working Group is to create a roadmap in line with the Charter principles: 1 (support the goals of the Paris Agreement); 2 (commit to 30 per cent reductions in all 3 scopes); 3 (analyze and set a decarbonization pathway for the industry based on SBTi targets); and 4 (quantify, track and publicly report emissions). For this, the following scope of work was agreed upon:

• Define a strategy and approach to analyze and set a tangible decarbonization pathway aligned with science-based emission reduction targets;
• Map and recruiting leading organizations and actors that can help define the strategy;
• Develop a playbook for brands, retailers and suppliers;
• Define agreed methodologies for calculating and reporting scope 3 GHG emissions;
• Set benchmarks on how emission reductions will be assessed and defined for consistency of application;
• Define systems to assess/monitor carbon reductions in raw material, manufacturing, use phase and so on;
• Define reporting methodology and frequency guidelines;
• Define ways to account for activities such as insetting and offsetting;
• Define a tracking and recognition process;
• Define a system to reward companies that set and achieve more ambitious climate targets.

Achievements and next steps

The Decarbonization Working Group has convened regularly to discuss key elements that would lead towards a holistic and unified decarbonization pathway. Scopes 1, 2 and 3 of the Greenhouse Gas Protocol are included in the Charter’s interim target of 30 per cent emissions reduction by 2030 compared to a baseline of no earlier than 2015. The Working Group is currently in the process of analysing the level of ambition required from the fashion industry to set 2030 goals on scopes 1, 2 and 3 that align with a 1.5 °C pathway and will use this assessment to set a more ambitious target. The use of offsets is not included in the Charter text, and the principles and goals continue to be guided by best practices from credible third party organizations (such as the Science-Based Targets).

Signatories to the Charter have committed to publicly report their greenhouse gas emissions, consistent with best practices in terms of measurement and reporting. A task team of the Decarbonization Working Group assessed all available reporting options for credibility and suitability, and selected CDP as the reporting platform for the Charter. CDP, formerly known as the Carbon Disclosure Project, is a global, investor-led coalition on greenhouse gas and other types of environmental disclosure.

Charter signatory companies are required to report their greenhouse gas emission baselines, targets, progress and working group commitments through the CDP reporting platform, with aggregate results available at or before COP 26 and each individual company’s results shared publicly after the next reporting cycle. Many signatory companies are already sharing their greenhouse gas progress transparently through CDP or their own websites, and all Charter companies are requested to do so.

To help less experienced fashion companies that have not yet taken action on climate change but want to join the sector to deliver net zero emissions by 2050, the Playbook for Climate Action was developed by Decarbonization Working Group members. The Playbook is intended to serve as a living guide that enables fashion stakeholders to identify which climate actions to take and the initiatives and programmes that could support them in their decarbonization journey. It also aims to increase their level of understanding of climate change and provide a road map to guide their actions.

The Working Group continues to identify ways to leverage and complement existing environmental and sustainability initiatives with a strong focus on climate action under the Paris Agreement. The newly formed Decarbonization Pathway Task Force on 1.5 °C alignment was created to assess the appropriate level of ambition so that the Charter can best align with the 1.5 °C target and reflect the scientific or highest possible ambition. This exercise will include an analysis of CDP reports and current ambition levels to identify possible gaps and synergies.

Fashion Industry Decarbonization: Milestones Document

In collaboration with the COP 26 High-Level Climate Champions team, the Charter's members engaged in discussions to deliver the milestones document - a representation of known decarbonization targets, implementation initiatives and report analyses, compiled to support the fashion industry’s transition to net zero carbon emissions. The creation of this document has been driven by the Climate Champions Fashion Sector team in consultation with a wide set of industry stakeholders and is anchored in the Decarbonization Working Group. The aim of this document is to help generate alignment on short, medium, and long-term actions and milestones, and has provided a holistic overview of decarbonization actions and milestone tracking. Going forward the document aims to facilitate collaboration and solutions between actors to address gaps and inspiring action. The document provides a mechanism for promoting and amplifying existing initiatives on the road to COP26 and beyond.

“The Fashion Industry Charter for Climate Action is delighted to use the Race to Zero Milestone Document for the fashion industry. This document helps the Charter and its working groups to reflect on the current status of Climate Action within our industry and to identify existing gaps as well as further collaboration opportunities. We will use the document to communicate on the urgency of implementing GHG reduction programs now and to increase the level of ambition for a fast decarbonization of the fashion industry.” Stefan Seidel, Co-Chair of the Decarbonisation Pathway Working Group and Joint Chair of the Steering Committee

“The Race to Zero milestone document is a valuable resource for the Fashion Industry Charter for Climate Action and reflects the ambitious initiatives and bold milestones we strive for. Charter's working groups fully support collaboration to leverage synergies and bridge existing gaps. The milestone document further inspires and guides our aligned efforts to decarbonize the fashion industry.” Jeremy Lardeau, Co-Chair of Decarbonization Pathway Working Group

Overview and scope

The purpose of this Working Group is to create a roadmap in line with the Charter principle 6 (commit to prioritizing materials with low-climate impact without affecting negatively other sustainability aspects). With the understanding that company-specific targets will be self-defined, the following scope of work was agreed upon:

• Mapping out different materials that are being used in the industry;
• Mapping and recruiting leading organizations and actors to define the roadmap;
• Building an approach to underpin best practice efforts;
• Exploring tools to quantify positive impacts such as carbon capturing and sequestration;
• Encouraging the take-up and systematization of more concrete and more ambitious targets;
• Exploring the whole life cycle of fibers to provide for a holistic point of view.

Achievements and next steps

The Raw Materials Working Group published a report that points to the processes that contribute to less carbon-intensive raw materials for cotton and polyester. The work was carried out through engagement and consultation with a range of industry experts and textile and apparel organizations.

Voluntary climate action in the raw materials segment has progressed but on a limited scale. Regulation, standards and economic incentives are required to help to transform the initial segment of the industry. Connecting the diverse stakeholders in the fashion industry, including raw material producers, textile producers and contract apparel manufacturers, and scaling up existing initiatives that connect the value chain could lead to significant reductions in emissions. This, in turn, may also help the broader textile, clothing and fashion industry to move faster towards a holistic climate commitment.

A comprehensive set of data and a narrative illustrating how climate change threatens the fashion sector would make a strong case for action. However, the direct impacts of climate change, such as its effect on cotton production, often seem too distant and removed from brands and consumers to trigger the necessary response. In this context, the Charter can assist by developing a clear, common narrative on the impacts and scope for action against climate change, especially as it connects to data gaps and constraints on the supply of raw materials.

The extensive report '"Identifying Low Carbon Sources of Cotton and Polyester Fibers"', prepared by the Raw Materials Working Group, is one step in that direction. It reviews different methods for the production of materials, such as organic farming as compared to conventional farming, or virgin polyester as compared to mechanically recycled polyester. It is intended to provide insights into how to reduce greenhouse gases for an individual material by changing methods of production, rather than to promote the use of one material over another. The report also highlights where there are data gaps and inconsistencies in the methodology and scope of life cycle assessments.

As a result, the Working Group also initiated a call to action — the "rPET Challenge" — for Charter signatories to commit to recycled polyester as the first step in this direction. This undertaking was done in collaboration with Textile Exchange, which manages and promotes a suite of leading industry standards and collects and publishes critical industry data and insights that enable brands and retailers to measure, manage and track their use of preferred fibre and materials. With over 130 brands and suppliers already committed, the 2025 Recycled Polyester Challenge is intended to serve as an essential catalyst for change in the apparel and textile industry. The rPET Challenge petitions the apparel industry to commit to increasing the global percentage of recycled polyester from 14 to 45 per cent, at 17.1 million metric tons, by 2025. The Challenge continues.

Looking ahead, the Raw Materials Working Group will conduct an expert gap analysis on human-made cellulosic fibres and animal fibres. It will release reports similar to those published on cotton and polyester. Building on these initial evaluations, the Group will continue its work to facilitate industry collaboration on filling data gaps and providing recommendations on consistent methodologies across life cycle analyses. In parallel, the Group plans to help scale up low-carbon commitments in the raw material phase in collaboration with key industry forums. Further plans are in place to start work on publishing guidance on raw material claims and verification challenges, high-level road maps and recommendations to support movement towards circular business models. In addition, an industry action plan on nature-based solutions to greenhouse gas emissions associated with raw materials is to be produced. About 90 Charter signatories participate in the Working Group, which draws on the vast expertise of its members to provide industry recommendations for a low-carbon transformation of raw materials in fashion.

Overview and scope

The purpose of Low Carbon Manufacturing Working Group is to create a roadmap in line with the Charter principles: 7 (continuously pursue energy efficiency measures and renewable energy in the value chain) and 8 (commit to not installing new coal-fired boilers or other sources of coal-fired heat and power generation). The following scope of work was agreed upon:

• Mapping out existing energy efficiency initiatives and renewable energy programs in priority manufacturing countries;
• Defining a roadmap for energy efficiency and renewable energy scalability, including the how, where and when of specific actions;
• Preparing a strong signal of intent and relevant messages across the value chain;
• Identifying major manufacturing countries and regions to prioritize activities;
• Developing a strategy to address legislative limitations that exist in countries with limited capacity to switch to cleaner energy;
• Developing an easy access strategy for signatories to join those existing initiatives;
• Seeking the help of local actors to scale existing initiatives beyond suppliers to international brands;
• Exploring practical ways in which brands can work together to support manufacturers where governments give priority to renewable energy;
• As part of the roadmap, defining opportunities for increasing energy efficiency and for scaling up renewable energy, including competitive recommendations/specific targets in line with decarbonization, all of which are points that would be used and strengthened by the Policy Engagement Working Group.

Achievements and next steps

During 2019-2020, the Low-Carbon Manufacturing Working Group defined the scope of work to be done and conducted a mapping of priority markets, where most of the supply chain is located. This outlined local programmes, service providers, the cost of programme implementation and average savings, financing opportunities, country risks and regulatory support, the financing environment and subsidies, electricity prices and grid reliability.

Together with the Policy Engagement Working Group, it developed summaries presenting opportunities, solutions and barriers with regard to energy efficiency measures, renewable energy opportunities, and coal phase-out options for six markets (Bangladesh, Cambodia, China, Indonesia, Italy and Viet Nam). These analyses have been critical to understanding the root challenges in delivering Charter goals and have been shared with a wider signatory base. Efforts are now focused on defining easy-access strategies for signatories to join existing initiatives and programs that deliver greenhouse emission reduction actions.

Discussions also revealed that capacity-building in the supply chain is a fundamental next step. The Playbook for Climate Action has been used as a centrepiece to commence the development of online training modules for suppliers, funded and developed by the German Development Agency (GIZ FABRIC). These modules are aimed at providing suppliers with foundational knowledge on how to start their greenhouse gas reduction journey towards achieving net zero emissions no later than 2050. The development of the training modules for suppliers is a collaborative effort between the UN Climate Change secretariat and German Development Agency, with significant input from Charter signatories (members of the Manufacturing & Energy Working Group). This open-source training series is expected to be rolled out in the third quarter of 2021.

Given the need to create an enabling architecture for climate action and the collective decarbonization of the industry, the Manufacturing Working Group’s focus areas in 2021 will include:

• Defining concrete opportunities for scaling up renewable energy and phasing out coal in the supply chain and identifying strategic initiatives and programmes;
• Outlining an ease-of-access strategy for signatories to join and scale up renewable energy programmes for their facilities;
• Consolidating policy priorities and working closely with the Policy Engagement Working Group to address specific policy constraints;
• Outlining financial mechanisms available in collaboration with the Financial Tools Working Group.

Overview and scope

The purpose of the group is to create a road map in line with the Charter principles: 13 (develop a strategy including targets and plans to advocate for the development of policies and laws to empower climate action in the fashion industry, especially in supply chains) and 14 (establish a dialogue with governments in key countries to enable renewable energy, energy efficiency and the necessary infrastructure for a systemic change beyond the fashion industry). This group will work to design a strategy to engage various levels of government to enhance climate action, for example by advocating for renewable energy. For that, the following scope of work was agreed upon:

• Selecting target countries (primarily major producer countries);
• Mapping existing initiatives and seeking dialogue to explore how existing initiatives can be leveraged and complemented;
• Pursuing linkage with governmental agencies engaging on climate policy;
• Designing an action plan with specific targets and timelines to advocate for policy support for energy efficiency and renewable energy implementation in key markets;
• Developing messaging based on the Charter (bearing in mind the different political contexts).

Achievements and next steps

The Policy Engagement Working Group has continued to expand the understanding of the climate policy environments in key priority markets and has sought to mobilize fashion stakeholders and leaders that can work together to shape a favorable low-carbon policy environment. The focus has been to present a unified front when engaging policymakers. This began with a public communiqué launched at COP 25 and endorsed by all Charter signatories, which called on governments to collaborate on climate action together with the fashion sector. Building on that effort, local engagement and advocacy planning has continued with task teams set up in Bangladesh, Cambodia, China, India, Indonesia and Viet Nam to further evaluate policy barriers while building relevant local and international networks (e.g. with local/regional industry associations).

Successful deliverables for the Working Group will be to establish effective dialogues with governments in key countries that can lead to an enabling policy environment and incentives to accelerate decarbonisation of energy systems through renewable energy, coal phase out and energy efficiency projects. This includes active dialogue, collaborative approaches and concrete goals that link with relevant local initiatives, programmes and institutions.

Overview and scope

The purpose of Financial Tools Working Group is to create a roadmap for financing options to support climate action in line with the Charter principles: 5 (partner with experts, businesses, investors, environmental advocates and other stakeholders to develop and implement a decarbonization strategy for the fashion industry) and 12 (partner with the finance community and policymakers to catalyze scalable solutions for a low carbon economy throughout the sector).

With the understanding that various financial support mechanisms and partnerships with a wide array of financial stakeholders will be crucial to achieving the vision of climate neutrality in fashion, the following scope of work was agreed upon:

• Designing a strategy to identify scalable solutions by ensuring, among other things, effective communication, share of information, and joint activities with the Policy Engagement and Manufacturing/Energy working groups;
• Mapping relevant stakeholders, tools and scalable financial solutions;
• Identifying and addressing existing barriers (engaging with the Policy Working Group to find synergies);
• Identifying ways to facilitate links between fashion stakeholders and implementing programs and agencies beyond the fashion sector;
• Establishing a global forum where fashion stakeholders, the finance community and policymakers can cooperate on climate action.

Achievements and next steps

Discussions in the Financial Tools Working Group have revealed a large disconnect between sustainability and financial stakeholders. Regular calls have tried to bring these two groups together through capacity-building activities in the form of webinars and case studies. The case studies aim to showcase how existing and emerging financial tools, such as sustainable supply chain finance and green bonds, can be deployed in the fashion industry. Several examples can be seen in the videos below:

The Financial Tools Working Group hosted a number of webinars aimed at helping financial stakeholders in buyer and supplier organizations to understand their role in supporting the shift to a low-carbon future for fashion (e.g. positioning a company for green finance). Webinars focused on green bonds in the apparel industry, establishing environmental, social and governance-linked supply chain finance, and financing green buildings for apparel, retail, manufacturing and warehouses. The Working Group will continue to offer webinars related to accessing available financial instruments, while also engaging with the Manufacturing Working Group to provide expertise on financing opportunities for renewable energy in key markets.

Overview and scope

The purpose of the Logistics Working Group was to create a roadmap in line with Charter principle 9 (support global transition to low carbon transport by giving preference to low carbon logistics). The following scope of work was agreed upon:

• Mapping options and opportunities for fashion brands to give preference to low carbon logistics;
• Defining actions that can help promote and increase the use of low carbon logistics;
• Recommending an action plan for the fashion sector.

Achievements and next steps

In 2019–2020, the Working Group on Logistics mapped existing low-carbon logistics solutions for the wider Charter signatory base. The conclusion was that low-carbon solutions are widely available and that the Charter should explore how the fashion sector can best build relationships with logistics providers to coordinate cross-sector collaboration. The Group also contributed to the Playbook for Climate Action section on logistics and linked members to resources and initiatives through webinars. As logistics are more broadly applied across sectors, the Group decided that work on the topic would be better served through engagement in other well-established forums such as Clean Cargo and Smart Freight Centre. Consequently, the Working Group was discontinued. The Charter remains committed to addressing logistics issues, and expertise will be made available to signatories through webinars with logistics service providers sharing best practices and available solutions.

Overview and scope

The purpose of this Working Group is to contribute to Charter principle 2 (commit to 30 per cent emission reductions in all 3 scopes by 2030 against a baseline of no earlier than 2015), focusing on the owned or operated emissions of brands and retailers. For that, the following scope of work was agreed upon:

• Developing guidance for effective and relevant greenhouse gas reduction strategies for brands and retailers;
• Mapping out existing energy efficiency initiatives and renewable energy programs relevant to brands and retailers in different geographies;
• Seeking dialogue and alignment with existing initiatives to explore how they can be leveraged and complemented;
• Developing a collection of best practices from leading brands and retailers;
• Providing guidance for renewable energy sourcing practices for brands and retailers, in key markets;
• Coordinating with other Charter Working Groups to build on synergies and avoid overlaps.

Achievements and next steps

The Group was formed in 2020 in response to the priority focus of switching to renewable energy under scopes 1 and 2 by signatory brands and retailers. Participants have been sharing their experiences related to sourcing renewable energy and accounting practices for emission reduction certificates, among other areas (e.g. methodologies, strategies and tools). Looking ahead, the Working Group will continue to exchange knowledge and best practices on climate action strategies under scopes 1 and 2.