The grunion were nowhere to be seen, an absence that generated angry complaints and letters from Malibu townspeople and officials. In their sight lines: Kering SA, owner of the Saint Laurent brand. The company has positioned itself at the forefront of a movement to clean up fashion’s environmental impact but flew in participants from around the world, releasing thousands of pounds of carbon dioxide.
The luxury-goods business is walking a high wire. Fierce competition for consumer dollars and for social media attention is pushing brands to produce ever-flashier events. Surging demand from China has lifted production to unprecedented levels—meaning the manufacturers are using up more natural resources, such as metal hardware, leather skins, and cashmere, than ever before. At the same time, the industry is facing more pressure from consumers and regulators to curb the environmental impact of its rapid growth, heavily polluting supply chain and loose control of suppliers.
“You have regulators, consumers, and more and more the investors who are making environmental and social criteria an important red flag,” said Mario Ortelli, a London-based luxury consultant.
The industry is starting to wake up. Apparel makers including Giorgio Armani and Versace have discontinued the use of controversial materials, like fur. Burberry Group vowed recently to stop destroying unsold stock, a widespread practice in the fashion
industry to avoid unwanted products being spotted in bargain bins. Industry giant LVMH, the owner of Louis Vuitton, Christian Dior and Dom Perignon Champagne, in July bought a stake in Stella McCartney’s fashion
label, known for working with sustainable materials such as biodegradable shoe soles. Prada has said it wants to source all of its iconic nylon accessories from recycled materials including ocean waste by the end of 2021.
Leading the way is Kering, Saint Laurent’s owner, whose other brands include Gucci and Balenciaga. Chairman Francois-Henri Pinault is working to rally global fashion
companies around a new sustainability pact. French President Emmanuel Macron has put the issue on the agenda of the Group of Seven summit he's hosting this month in Biarritz, tapping Pinault to spearhead the initiative. The Kering boss is trying to get companies to sign on to targets that could include eliminating single-use plastics and accelerating their transition to renewable energy.
While Pinault’s brands spin a dream of luxury, he’s also made sure that more and more of the looks on display are produced from organic cotton, traceable leather skins or recycled plastic.
Kering says it’s also pressuring its networks of suppliers and sub-suppliers to open up about where exactly their raw materials come from, and imposing higher standards on energy efficiency and animal welfare. In an industry where leather goods drive profits, Pinault is pushing tanneries to invest in new processes for turning animal hides into supple handbags without employing chromium, a pollutant whose use remains widespread. Executives at Kering have even seen their bonuses tied to environmental performance since 2010.
“We shouldn’t wait for people to require us to use different materials before figuring out how,” Pinault said in an interview. “It’s up to us to come up with products that are respectful of the environment.”
Consumers may associate pollution and waste in the apparel industry with fast-fashion retailers or sneaker makers, whose supply chains often lead to massive factories in loosely regulated countries where labour is cheap. But now the spotlight is widening to fall on luxury companies, too, as a new cohort of young, wealthy clients looks to avoid glamorous products that come with an unsavory backstory.
Millennials and Generation Z will account for four-fifths of the luxury industry's growth in the coming years, Jefferies analyst Flavio Cereda said in a July report. Three-quarters of millennials said they’d alter their buying habits on environmental concerns; the comparable figure for baby boomers was 34 per cent.
As in the aftermath of Saint Laurent’s Malibu show, social media and smartphones have made it easier for criticism of the industry’s environmental sins to spread. Previous triggers included videos of suffering crocodiles or cashmere goats at sites that supplied leather or wool for luxury brands. Burberry’s burning of millions of dollars worth of unsold merchandise prompted some shareholders to demand change.