In collaboration with the DBS Bank, global fashion brands Gap, H&M, Bestseller and Mango are launching a new groundbreaking financing model to decarbonise the fashion industry.
Termed as the Future Supplier Initiative, the initiative is being facilitated by The Fashion Pact and supported by the Apparel Impact Institute and Guide house along with the DBS Bank.
To debut in Bangladesh, the initiative will be further expanded toVietnam, India, China, Italy, and Turkey. It will focus on sharing financial risks and responsibilities associated with Tier I and II textile and garment factories transitioning to renewable energy sources.
Designed as a brand-agnostic mechanism, the Future Supplier Initiativeaims to develop and finance projects to help brands and suppliers meet their Science Based Targets (SBTs) and adhere to the 1.5°C climate trajectory.
The initiative will use a combination of technical support and financial incentives to help overcome barriers that prevent factories from adopting electrification and renewable energy solutions. Encouraging other brands and investors to join the initiative, Daniel Ervér, CEO, H&M Group, highlights, collective action is needed to address the fashion industry’s climate impact.
Eva von Alvensleben, Executive Director, The Fashion Pact, notes,the initiative provides a unique opportunity to fashion retailers to collaborate and drive progress towards science-based targets. Anders HolchPovlsen, CEO, Bestseller, adds, it offers innovative, joint solutions to address emissions within the value chain.
Offering technical support, the initiative also helps suppliers identify and implement low-carbon technologies and solutions. Additionally, it monitors baseline emission reductions to demonstrate the impact of financed projects.
Reflecting on the initiative, Richard Dickson, CEO, Gap Inc, reiteratesthe company’s commitment to collaborate with supply chain partners to reduce emissions. Tan Su Shan, Group Head-Institutional Banking, DBS Bank, highlights the need to expand low-carbon technologies and innovative financing modelsto drive adoption.
Toni Ruiz, CEO, Mango, echoes Lewis Perkins’, President, Apparel Impact Institute demand for collective action by brands and retailers. GauravMenon, Partner, Guidehouse, emphasises on the importance of accelerating supplier decarbonisation to meet scientific climate targets while Adam Karlsson, CFO, H&M Group, affirms the company’s commitment to the initiative.
