Is Sustainable Luxury Just a Fashionable Facade?

Go back a hundred years in time and the epitome of luxury would probably look like a fox-fur clad Maharaja with a retinue of a dozen gas-guzzling Rolls-Royces. However, if the good old Maharaja were to find himself in 2024, he’d probably be cancelled, quite swifty, by the deadly combo of ‘Greta and PETA’. High-end brands love to think of themselves and their brand of luxury as timeless. But like most other concepts, luxury too is quite fluid – in fact, it changes with every generation. And if one were to ask what was the zeitgeist of luxury in our time, the answer might actually be – ‘sustainability’.  

From Bezos’ mega-yacht to Taylor’s jet-setting, few things in the luxury space have managed to escape Gen-Z ire. But anecdotes aside, there’s enough data to attest to this sweeping change – the Global Sustainability Study, a major endeavour involving 10,000 people from 17 countries found that 85% of consumers were willing to spend more on sustainable products. A survey by Savanta, a US-based market research firm, further found that 47 percent of the wealthiest consumers in the US deemed a brand’s social responsibility as important when it comes to making purchase decisions. A good 22 percent even claimed that they had already boycotted brands due to ethical and sustainability considerations. It’s no surprise then that most luxury brands are now trend-jacking themselves on to the sustainability bandwagon. 

But how did the luxury segment that used to pride itself on its disdain for resource conservation and a certain gay abandon for material use supposedly come to adopt sustainability? The short answer is, definitely not by its own choosing. But here’s the long answer…

Seeds of Sustainability in Luxury

To start with, the concept of sustainability in fashion originated in the 60s and 70s along with the counter-culture. It took two decades after that for the luxury industry to start talking about it and another two before products branded as sustainable luxury – from faux fur Stella McCartneys to the ‘vegan leather’ Chanel 22 – actually made it to the stands. However, it’s only in the last decade or so that terms like fairtrade, sustainable-sourcing, circularity, socially conscious fashion, have made it into the luxury lexicon. This friction is understandable – as Prof. Anne Michaut from HEC Paris notes in her research, some tenets of luxury such as ostentation and superficiality are diametrical to tenets of sustainable development. But as the luxury segment’s hand was forced – partly due to increasing pressure on the overall fashion industry and also due to the huge influx of Gen Z consumers among the ranks of luxury buyers – the market has now wholeheartedly adopted sustainability. Or so it seems. 

Race to Net Zero

According to the World Bank, the fashion industry accounts for almost 10% of all global emissions – more than the emissions from aviation and maritime transportation combined. This has led to serious pressure and calls for action from the industry. However, since the turn of the century, fast fashion – or what those in the luxury space disparagingly call ‘waste couture’, has taken the brunt of this pressure. After almost a decade of deliberations, the fashion industry agreed in 2018 to sign on to FICCA – the Fashion Industry Charter for Climate Action – a landmark charter spearheaded by the UNCC (UN Climate Change) to enable net zero transition in the sector. The most crucial turn for the luxury segment towards sustainability came in the form of the G7 Fashion Pact which followed FICCA. The G7 pact, which includes signatories such as Stella McCartney,  Chanel, Prada, Calvin Klein, and Burberry, requires companies to align themselves to SBTi (Science Based Targets Initiative) and cut down 45-50 percent of their emissions by 2030. 

The Great Subterfuge of Luxury Sustainability

Actual climate action and sustainability aside, due credit should be given to brands that have cleverly positioned markers of luxury as juxtaposed with sustainability. Exclusivity, quality of being handmade, and a singular feeling of disdain towards mass market practices – these erstwhile markers of luxury are now synonymous with sustainability. While this strategy has proven successful, it might not be, for the lack of a better word ‘sustainable’ in the long term. Let’s take the example of LVMH, the biggest name in the luxury market, which incidentally is not a signatory to the G7 pact. LVMH has set an SBTi target of 30 percent reduction in emissions against a 2019 baseline. If one were to look at their website and sustainability report, the company also proudly touts that against the 2019 baseline, they have reduced their ‘Scope 1 and 2’ emissions (direct emissions controlled by the company) already by a whopping 28 percent. It might be easy to conflate this as progress. But on closer inspection, 96 percent of LVMH’s emissions come from their supply chain. While the company revealed that they managed to reduce their scope 3 emissions by 15 percent, this was per unit of value added – which means that their absolute emissions (the more material metric) can in fact still keep increasing. LVMH is not alone in this picture. The primary problem of sustainability in the luxury segment is one of supplier sustainability. 

And while brands have focussed ferociously on how they have reduced their direct impacts, precious little has been done to reduce supply chain impact, which often accounts for the lion’s share. In fact, while luxury brands love to espouse principles of circular economy, the top 200 brands in fashion scored a dismal average of 2.97 out 10 in Kearney’s Circular Fashion Index (CFX). Another key consideration is transparency and greenwashing – with major fashion brands scoring a disappointing average of 26 out of 100 in Fashion Revolution’s Transparency Score.  

What Lies Ahead 

The story of sustainability and luxury is in fact a dismal one. The irony however is that while the luxury segment resists sustainability and offloads its impact to its supply chain, some of the most basic tenets of luxury are extremely congruent with sustainability – high quality, know-how, slow time, the preservation of hand made traditions, and transmission from generation to generation of timeless products.

So, are luxury brands truly embracing sustainability, or is it just a masterful display of trend-jacking? The jury’s still out. While both FICCA and the G7 Pact represent significant steps, skepticism lingers. Critics point out the lack of transparency in reporting progress, the continued use of environmentally damaging materials like virgin cashmere, and the prevalence of greenwashing – where brands make misleading claims about their eco-credentials.

The future of sustainable luxury remains to be written. However, one thing’s certain – Gen Z, the most environmentally conscious generation yet, will hold luxury brands accountable. Whether it’s genuine commitment or a well-crafted marketing ploy, luxury brands that fail to prioritize environmental and social responsibility risk being cancelled by a generation of discerning consumers who demand both style and sustainability.