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INVESTOR’S VISION: how does the fashion industry harm the environment, and what can be done about it?

INVESTOR'S VISION: how does the fashion industry harm the environment, and what can be done about it?
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Mikhail Merkulov. Sustainability focused investor, Founding Partner of Green Recovery Fund I, Co-Founder of 7Looks platform


Is the fashion industry ready to switch to the principles of sustainable development? Mykhailo Merkulov, Ukrainian and international investor in sustainable development projects, founding partner of Green Recovery Fund I, co-founder of 7Looks platform, shares with Huxley’s readers the impact of the fashion industry on the environment and conscious consumption.

Today consumers all over the world buy more clothes and wear them for a shorter period of time than ever before. We renew our closet as fast as fashion trends change, and we throw away what we don’t need. Every second an entire truckload of clothes is sent to the landfill or incinerated. Add to this the environmental damage caused by the production, delivery, and disposal of clothes… Contrary to popular opinion, beauty threatens to destroy the world if nothing is changed.




When buying the next pair of jeans or a sweatshirt, most of us don’t think about the «dark side» of the fashion industry. About what’s behind the abundance on the shelves and in online stores. Meanwhile, the fashion industry is yielding to the petroleum industry in terms of pollution, and the consumption of natural resources in the production of clothing is truly enormous.

Let’s have a look at a few numbers. It takes 20,000 liters of water to produce 1 kilogram of cotton while producing a T-shirt eats up 2,200 liters of water. Dyeing and decorating fabrics for clothing ranks second source of freshwater pollution after agriculture.

The production of polyester and other synthetic fibers consumes 70 million barrels of oil annually. And according to the UN Environment Program, carbon dioxide emissions from the textile industry worldwide reach 1.7 billion tons a year — up to 10% of the world’s total. That’s more than air travel and shipping combined.


Viktor Minyailo. Fashion Matrix, 2018
Viktor Minyailo. Fashion Matrix, 2018 / Facebook, «Sil-sol»




The environment is not only harmed in the production of clothing but also in the process of being worn. One of the biggest sources of pollution is polyester. It has long since overtaken cotton and wool as the basis for textile production, being present in almost every piece of our closet. Sportswear, lingerie, faux fur coats, silk dresses — polyester is everywhere.

Clothing that contains polyester and other synthetic fibers is a major source of microplastic contamination. When wearing and washing synthetic microfibers that are contained in clothing find their way into the groundwater and further into the world’s oceans, posing a threat to the life and reproduction of all marine life, from microscopic crustaceans and clams to large fish.

According to the estimation, there are from 9.25 to 15.86 million tons of microplastics in the oceans, and their number is growing by half-million tons each year. Of this amount, textiles account for 35%, making it the largest source of microplastic pollution in the world’s oceans.

However, neither manufacturers nor consumers want to withdraw from polyester. Clothes with synthetic fibers are more durable and comfortable to wear, and polyester production does not require as many natural resources (land and water) as cotton.

The International Energy Agency estimates that plastic will be the main driver of oil demand growth in the next 20 years. It is displayed in a 47% increase in global polyester fiber production over the next 10 years and an increase in the global polyester yarn market from $106 billion in 2022 to $174 in 2033, according to a study by international agency Fact MR.

For oil companies, petrochemicals for apparel are becoming increasingly important given the growing trend of electric vehicles in the world and the associated impending reduction in fossil fuel consumption by transportation. Nowadays the textile industry ranks second after packaging in the consumption of petrochemical plastics, accounting for 15% of all petrochemical products.




It’s not a secret that the textile industry produces far more clothing than it consumes. Fast fashion has given consumers an abundance of quickly updated collections and affordable prices, but the numbers show a critically high inefficiency of the industry as a whole. About 150 billion pieces of clothing are produced worldwide each year, of which only 30% are eventually bought and used. The cumulative overproduction is 70%!

Statistically, 30% of clothing produced is never sold — product leftovers lie in warehouses awaiting recycling or disposal. Returns aggregate another 20% (in offline stores they are 5–10%, in the e-commerce segment — 40–60%). Another 20% are items that are worn once or twice and then not used until they are sent to the dump or donated to charity.





INVESTOR'S VISION: how does the fashion industry harm the environment, and what can be done about it?



The reason for this situation lies in the way the sales system in the fashion industry is set up. It is extremely simple: sell at any cost! Potential buyers are bombarded with intrusive social media ads and push notifications about discounts and promotions. Under the influence of an endless stream of lures, we make a lot of emotional purchases. We buy a thing and then don’t wear it: our mood has changed, we have nothing to match it with, etc.

This is the «wine at the winery» effect. For some reason, wine always tastes better at the winery, and when you come home, you taste it and wonder how you could drink it. It’s the same here.

The flip side of the overproduction and availability of mass-market clothing is tens of millions of tons of textile waste per year. In the United States alone, 2.1 thousand items of clothing are thrown away every second, or 11.3 million tons annually. Globally, this number is about 90 million tons per year.

Ending up in a landfill, synthetic fiber clothing takes hundreds of years to decompose, polluting the soil and groundwater. And when it is burned, all carcinogens and harmful substances are released directly into the atmosphere and then into the soil and water bodies with precipitation.


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What to do with unsold clothes that have served their purpose? Similar to the wise phrase about the dilemma: “recycle not dispose” as each option often has mutually exclusive strategies behind it.

One way to combat overproduction could be to resell unsold branded clothing in second-hand stores. However, this idea is still met with resistance by fashion brands. It is better to burn and reduce the losses than to publicly admit that the product is not in demand.

Sometimes it gets absurd. In 2017, a thermal power plant in Västerås, near Stockholm, started using clothes thrown to the landfill by H&M instead of coal.

Recycling clothes is also not easy. And it is not cheap. Sorting and  separation of metal and plastic fittings — all this makes the process laborious, expensive, and often economically unprofitable. Globally, only 20% of discarded clothing is reused or recycled.

And the share of reuse is very low. Detailed statistics are not available due to the difficulty of collecting data, but the Ellen MacArthur Foundation (an international non-profit organization created to accelerate the transition to a circular economy) estimates that less than 1% of clothing collected for recycling worldwide is reused in the production of new clothing.




How can the industry be re-engineered in this case? It can happen only with the help of the consumer, who creates demand, and through technologies that ensure the satisfaction of the purchase. And here you need to focus on millennials and Generation Z, their opinions, and shopping preferences.

Millennials and Zoomers often prefer to buy clothes in second-hand stores. First, it is an opportunity to buy high-quality branded clothing in fairly good condition at a lower price. Second, it is a way to reduce your carbon footprint. Both factors are extremely important to millennials and especially to Zoomers.

Zoomers consider environmental issues important and pay attention not only to price and quality but also to environmental friendliness when choosing products. The respect for the environment and the use of energy-saving products and technologies are as much a sign of individuality and status as the latest smartphone or expensive car was for previous generations.

As a result, the trend toward responsible consumption is becoming more and more popular around the world as the share of millennials and Zoomers in purchases grows.


Anastasia Arakcheeva. Fashionista No. 5, «Kyiv fashionistas» series, 2020
Anastasia Arakcheeva. Fashionista No. 5, «Kyiv fashionistas» series, 2020 / Facebook, «Sil-sol»




Zoomers are about one-third of the world’s population, and most of them are already solvent enough to drive demand. According to Bloomberg, they accounted for 40% of all purchases in 2020. And this number is growing every year.

Therefore, following the change in consumer preferences of this audience, brands, including clothing manufacturers, are forced to adopt the principles of sustainable development.

Today, many mass and premium brands have various sustainability projects that allow them to test different eco-friendly materials, technologies, and sales formats. For example, H&M has a clothing rental service and a program to reduce greenhouse gas emissions by 20% from the company’s sources and 10% from intermediaries. Zara has a Join Life project to use the best technological processes and environmentally friendly raw materials. Tommy Hilfiger has Circle Round and Made for Life programs (environmental protection from production to sale).

There are also eco-brands on the market whose business model is initially based on the principles of sustainable development. Pangaia is related to such companies, which create clothing from recycled textiles. New Zealand’s Sheep claims to be the first carbon-neutral clothing brand.

However, on a global scale, the share of sustainable fashion is still not very large, although it is growing every year.




Zoomers are deciding on the rationality of their purchases, giving preference to more durable and environmentally friendly clothing. And they vote for it with their money. However, a fully circular approach, which involves reducing the rate of production and consumption and refusing to use non-renewable resources at all stages of the clothing life cycle, has not been implemented on a global scale yet.

Therefore, brands need to look for additional ways to attract an environmentally conscious consumer audience. Personalization is another important factor for Zoomers and to a large extent for everyone. We don’t just want to buy clothes, we want to look good wearing them.

The most obvious solution is to take digital measurements of the client and move to tailor. Sooner or later, the fashion industry will come to the point where a customer will periodically (say, once a year) come to some physical location to have their body scanned. Then they will go to the stores or online platforms of their favorite brands, where they will choose clothes by style and color and leave their measurements. And after a while, he will receive a jacket or jeans that will fit him perfectly with a 99.9% probability.

At the same time, the area of physical stores and warehouses of online platforms will be reduced by an order of magnitude. The brands themselves will be interested in giving the buyer exactly the clothes that fit them perfectly. After all, a personalized item can be sold at a higher price, increasing marginality.

With the synergy of conscious consumption and production, returns can be reduced to almost zero, which in turn will reduce logistics costs by at least 25%. This is a way to solve the problem of overproduction and reduce environmental damage throughout the entire life cycle of clothing.

The apparel industry, which was killed at the beginning of the last century by department stores that offered ready-to-wear, can be revived at a qualitatively new level. This will not only be beneficial for the consumer and the manufacturer but also a real tool for the fashion industry’s complete transition to the principles of sustainable development.


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