Circular Economy in Fashion

Millennials are driving companies to sustainable practices even if their business model is based on volume, low margins. New generations demand for sustainable products and a visible and transparent value chain: from “sheep to shop”, something that blockchain is already enabling. Another interesting trend to mention is nownership, or the end of ownership as repair and rental business models continue to evolve (e.g.  Bag Romance, Haute Vault). Note that Rent The Runway was recently valued at $1 Billion (March 2019).

Sustainability goes beyond fashion and embraces other industries such as the Food and Beverages Industry.  There is a growing concern over healthy, authenticity and provenance. A clear example is the declining consumption in sugary drinks in Western Countries. Are Millennials going to kill Coke?

Slow Fashion, Ethical Fashion, Upcycling, Vegan Fashion, Circular Fashion…

Fashion brands sustainability meaningful circular fashion

Meaningful Fashion Brands

Sustainable Fashion article commented on what brands are leading the “eco” trend and how they are achieving it. Other initiatives have been launched such as Make Fashion Circular, that brings together industry leaders including Burberry, Gap Inc., H&M, HSBC, NIKE Inc., PVH and Stella McCartney as core partners. Fortunately, there is a growing number of companies exploring circular fashion potentials.

What is Circular Economy and what is the impact in the Fashion Industry?

According to Ellen MacArthur Foundation, looking beyond the current take-make-waste extractive industrial model, a circular economy aims to redefine growth, focusing on positive society-wide benefits. It entails gradually decoupling economic activity from the consumption of finite resources, and designing waste out of the system. Underpinned by a transition to renewable energy sources, the circular model builds economic, natural, and social capital. It is based on three principles:

  • Design out waste and pollution
  • Keep products and materials in use
  • Regenerate natural systems

Circular Economy in Fashion Ellen McArthur Foundation

Circular Economy System Diagram ©Ellen MacArthur Foundation

Another interesting definition of Circular Fashion is the following: “Clothes, shoes or accessories that are designed, sourced, produced and provided with the intention to be used and circulate responsibly and effectively in society for as long as possible in their most valuable form, and hereafter return safely to the biosphere when no longer of human use”. (Dr. Anna Brismar, 2017,

Circular Fashion Value Chain McKinsey

Circular Fashion Value Chain – McKinsey & Company

Fashion is the second most polluting industry globally

The fashion industry is the second largest polluter in the world, just after the oil industry. According to Ellen MacArthur Foundation, every second, the equivalent of one garbage truck of textiles is landfilled or burned. An estimated USD 500 billion value is lost every year due to clothing being barely worn and rarely recycled. If nothing changes, by 2050 the fashion industry will use up a quarter of the world’s carbon budget. Washing clothes releases half a million tonnes of plastic microfibres into the ocean every year, equivalent to more than 50 billion plastic bottles.

So, isn´t “Sustainable Fashion” of “Fashion Sustainability” an Oxymoron? How companies that base their business model on product freshness and inventory turnover, while selling in more than a thousand stores globally, call themselves sustainable?

What are the companies leading in Circular Economy Innovation in Fashion or Apparel?

Dyecoo is one of the companies awarded during the Circular Economy awards,  an initiative of the World Economic Forum and the Forum of Young Global Leaders. The technology uses reclaimed CO₂ as the dyeing medium in a closed loop process. When pressurized, CO₂ becomes supercritical (SC-CO₂). In this state CO₂ has a very high solvent power, allowing the dye to dissolve easily. The process of dyeing cloth uses no water at all, and no chemicals other than the dyes themselves. The company already has partnerships with major brands like Nike and IKEA.

Patagonia Worn Wear Repair Recycle Reuse circular fashion circular economy sustainability brand

Patagonia is synonym of sustainability, a brand born with the aim of respecting the environment and from its early ages, the company applied circular economy, transparency of their supply chain and a close collaboration with “heavy users” in order to innovate and perform their products.

In 2011, Patagonia was already protecting the ecosystem, introducing the Common Threads InitiativeReduce, Repair, Reuse, Recycle, Reimagine. Then, launched other initiatives or programs like Worn Wear, that allows customers to trade in their older gear for credit toward buying new products from the company. In 2017, Worn Wear has a specialized online shop.

Patagonia Environmentalism

Today, the California-based company is more than a brand. It breaks the politics´ taboo, endorsing democratic candidates that will help protect natural resources in Nevada and Montana, for example. The company said it is making the move “because of the urgent and unprecedented threats to our public lands and waters” as described in Fashion Politics.

Fashion Politics brands supporting the vote democracy activism

Another interesting program, created by Ecoalf, is the project Upcycling the Oceans that collects the trash that is destroying the oceans and turns it into top quality yarn to produce fabrics and products. Ecoalf Foundation has managed to involve more than 2500 fishermen in 32 ports, amounting to a total of 440 sea trawlers and collecting more than 300 tons of trash from the bottom of the Mediterranean Sea. Furthermore, the brand uses recycled materials as recycled wool, nylon, cotton and used tyres to produce t-shirts, pullovers, jackets and flip-flops.

ECOALF Upcycling the oceans sustainability circular fashion brand

A competitor of Patagonia, The North Face, is also investing in circular economy with its Renewed Program that reduces waste by remaking refurbished clothing. Many outdoor clothing brands include sustainability into their DNA or value proposition, a logic move or characteristic when your customers enjoy “outdoor” sports.

But here we need to distinguish functional apparel from fashion because a customer buying a jacket from Patagonia is buying functionality, technical features (e.g. lighweight, waterproof, breathability) and maybe status, but not fashion. Aesthetic is always important, buy here (outdoor clothing), clothes are not out-of-date every season.


“What you wear is how you present yourself to the world, especially today, when human contacts are so quick. Fashion is instant language” – Miuccia Prada.

Fashion means freshness. To be trendy, translated in business operations, means to reduce collection periods and accelerate inventory turns. It means high levels of consumption and therefore waste. This is why fashion, fast-fashion or value brands, which value proposition is built on ephemeral needs, should be mentioned apart when talking about sustainabilty.

H&M Group, a so-called fast-fashion company (but still far from Inditex Zara in that sense) publishes a Sustainability Summary every year. Anna Gedda, Head of Sustainability at H&M, said “a company of our size and scale has a responsibility as well as a great opportunity to lead the change towards a more sustainable fashion and design industry.”

H&M fashion retail sustainability commitment

H&M´s website, like Patagonia one, shows a list of suppliers (name and address) by country to give visibility of their supply chain. Furthermore, in 2017, the Sweedish retailer launched the Conscious Collection, an exclusive collection allowing customers to see where garments are made, what materials are used and what are the suppliers. Also, H&M is supporting innovative companies that are leading circularity like re:newcell, Worn Again and Treetotextile.

Worn Again Circular Fashion sustainability

Worn Again

Inditex is investing in circular fashion and sustainability in every phase of their value chain. During 2017 it received many sustainability awards like the gold medal in the Sustainability Yearbook, Shanghai Green Supply Chain Good Case Award, the Gartner Supply Chain top 25, Dow Jones Sustainability Index (score 78/100), amongst others.

Inditex Right to Wear philosophy sustainability circular fashion

Inditex Right to Wear philosophy

The Spanish retailer created the Join Life, an environmental labelling standard to evaluate the environmental and social impact of the textile sector. Join Life products have been manufactured by suppliers with an A or B rating in the social audit. In addition, all factories where wet processes of the main fabric or component take place, must be evaluated by the Green to Wear Standard of environmental sustainability and receive a classification of A or B, or have a continuous improvement plan.

Inditex Join Life standard circular fashion sustainability

Requirements to label Join Life environmental attributes as Care for Fiber, Care for Water and Care for Planet can be seen here.


Some could argue that fast-fashion business model is opposite to sustainability, as fast-food is from healthy food. In my opinion, a product from Zara can last around 1 or 2 seasons while another one from Patagonia could last for many years. But this is an average, because a basic t-shirt from Zara will be used far more times than a winter jacket from Patagonia, for example. As mentioned above, sustainability is different depending on your assortment characteristics or position in the fashion pyramid.

Customers will continue to purchase fashionable, trendy basics while looking for fresh wardrobe renewal, and it is key that those corporations (Inditex, H&M, GAP, Fast Retailing, C&A…) invest in sustainability and circular economy to respond to this “non-sustainable”, self-fulfilment need. The impact in the industry and ecosystem will be huge as those companies produce tons of textiles every year (Inditex produces more than 1 billion clothes a year for example).

The automotive industry could gives us some clues. Tesla can invest in electric-vehicles like Stella McCarney is doing it in sustainable fashion, but not everybody can afford those products. So, brands positioned at the bottom of the pyramid (mass-market brands) will be the ones to make the big impact, like Volkswagen in the automotive manufacturing industry. Therefore, beyond criticising the oxymoron, we need to trust on fast-fashion effort to reduce waste.

44 thoughts on “Circular Economy in Fashion

  1. Clearly explained with so many examples for different fashion companies to take inspirations from. We believe in Circular business model as well. The brands should focus on efforts providing a way (like digital platform) for customers to make actions (submitting their products for recycle, exchange, credits, etc).

    Awareness is not good enough in this industry. Platforms like poshmark, vestiaire collective are making positive impact in the fashion industry. There need to be many platforms that focus on niche and solve this issues.

    PS: We do run a SaaS platform(Tradly) that allow companies to launch their circular economy initiatives by launching their apps that encourage their customers to sell, exchange, rent items.

    1. Hi JK, thanks for your comments. Would be good to know more about the platform. Reach me out by email (see about us) and we can discuss about it or maybe an interview will reflect you value proposition. Thanks

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