A new investment fund, the Good Fashion Fund,
aims to address a real need in the garment industry by promoting scalable
solutions around key supply chain challenges.
“The Good Fashion Fund is ... focused solely on driving the implementation of
innovative solutions in the fashion industry,” Katrin Ley, Managing Director
of Fashion for Good, the initiator of the fund,
told Sustainable Brands.
In addition to Fashion for Good, the fund counts C&A Foundation, FOUNT
and Mills Fabrica as founding members. The initial size of the fund is about
$13 million, which will be dispersed to manufacturers as loans to enable them
to adopt highly disruptive, early-stage technologies.
Solutions are necessary because it's become clear that the global garment and fashion
industry has a broad negative impact on people and the planet. From
widespread labor abuses
and water
pollution
to waste
management,
if we are to make textile supply chains sustainable or reach the ultimate goal –
full
circularity
– a lot has to be done, and fast.
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There are solutions to this, and several companies have shown it’s possible to
create an ethical apparel supply chain.
Industry veterans including EILEEN FISHER, Kering and Patagonia has for years been a
leader in this; and startups such as
Outerknown, Pact
Apparel and
Reformation are also
showcasing new practices. The problem is that these companies only account for a
tiny percentage of global garment production — and whatever impact they have had
has more than been outweighed by the overall growth in demand for clothing and
fast
fashion.
What we need are scalable solutions that can be used by companies of all sizes,
and all around the world.
“While sustainable solutions do exist today, there is a lack of capital
available to scale these technologies within the supply chain,” Ley said. “The
fund was created to address this gap — connecting the most promising
technologies to the industry to collaboratively tackle its challenges.”
The fund wants to make a dent in several sustainability and ethical gaps the
team have identified, including the high water usage of cotton; the fact that
over 70 percent of used textiles end up in landfills, rather than being
recycled or
reused;
low wages; and pervasive gender inequality. They also found that there is a lack
of financial vehicles willing to take the risk of investing in new innovations,
as well as a lack of expertise to assess these innovations.
“The fund demonstrates how to invest beyond sustainability towards a restorative
and regenerative apparel supply chain, addresses the need in the local markets
for long-term financing for manufacturers, and contributes to multiple
SDGs,” Bob Assenberg,
Director of the Good Fashion Fund, said in a press statement.
The Good Fashion Fund will initially focus on South Asia, a region that is
increasingly at the center of global
textiles
and fashion. We also know all too well the problems facing this region —
especially after the horrific 2013
collapse
of the Rana Plaza factory in Dhaka, Bangladesh, which killed over 1,300
workers, mostly women. But in neighboring India and Pakistan, too, the
garment industry has been expanding rapidly; and there are growing concerns
about labor and environmental
impacts.
“We hope to have reached the $60 million target fund size [in three to five
years], and we should have disbursed most of the committed capital at that point
to investees, thereby supporting many South Asian manufacturers in their
implementation of best-in-class sustainable solutions,” Ley said.
If we are to really shift the textile industry from one that is harming workers,
local communities and the environment to one that is circular and sustainable,
scalable solutions will be necessary. Years of advocacy and awareness-building
have brought us to a stage where we understand the problem better than ever
before. Now, it's time to create and implement solutions.
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Media, Campaign and Research Consultant
Nithin is a freelance writer who focuses on global economic, and environmental issues with an aim at building channels of communication and collaboration around common challenges.
Published Sep 12, 2019 11am EDT / 8am PDT / 4pm BST / 5pm CEST