Can H&M set a new standard for sustainability if their business model is unsustainable?

/ H&M works with approximately 820 independent suppliers with 1900 factories that employ 1.6 million people, of whom 60% are women.

/ The H&M Group owns H&M, Cos, & Other Stories, Cheap Monday, Monki and Weekday.

/ In 2015, H&M made approximately $25 billion in sales.

/ In 2016 H&M plans a net addition of around 425 new stores.

/ H&M has 3,730 stores in 62 markets and 32 online markets.

/ H&M outlines its goals, predicted timeline and progress towards achieving these goals in its sustainability report.

/ H&M shares a list of 98.5% of its supplier names and addresses of its first tier suppliers. The brand also shares the names and addresses of suppliers of fabric and yarn making about 50% of the pieces produced by the brand. Visitors to the brand’s website can access this information through an interactive map. H&M aims to update this list every 3 months.

/ It is unclear if the brand can trace its entire supply chain.

/ A published report, issued by the Business & Human rights Resource Centre (BHRC), summarized the responses of 28 European clothing brands on how they are protecting the rights of Syrian refugees in their supply chain. H&M reports it was one of the nine brands that fully responded to the questionnaire sent out by BHRC. One question asked if the brands had identified supplier factories employing Syrian child refugees in 2015. H&M disclosed that in 2015, the brand’s regular audits identified one case of child labour in Turkey. In accordance with H&M’s policy on Syrian refugees in Turkey, the brand terminated this business relationship immediately. H&M then informed its NGO partner CYDD (Association for the Support of Contemporary Living) to get their support on remediation activities. H&M reports that together with the NGO created an action plan aligning with the brand’s policy by identifying the most suitable education option based on the need and aspiration of the individuals.

/ H&M discloses the compliance level of its entire supplier base by region (Far East: Cambodia, China, Indonesia, Myanmar, South Korea, Taiwan, Thailand, Vietnam. South Asia: Bangladesh, India, Pakistan, Sri Lanka. EMEA: Bulgaria, Czech Republic,  Denmark, Egypt, Estonia, Ethiopia,  France, Germany, Great Britain, Greece, Italy, Kenya, Latvia, Luxembourg, Netherlands, Poland, Portugal, Romania, Spain, Sweden, Tunisia, Turkey, USA) and by questions from H&M’s Sustainable Impact Partnership Programme. Results included:

• Are workers in the factory free to join or form a union? All regions where H&M operates scored 100%
• Is there a trade union represented in the factory?: EMEA scored 17%, Far East scored 60%, South Asia scored 6%
• Does the factory have legally required worker committees?: EMEA scored 85%, Far East scored 59%, South Asia scored 78%
• Are the regular working hours within legal limits? (Excl. overtime): EMEA scored 99%, Far East scored 82%, South Asia scored 95%
• Are monthly overtime hours within legal limits?: EMEA scored 56%, Far East scored 10%, South Asia scored 17%
• Are the chemical containers properly labelled?: EMEA scored 78%, Far East scored 51%, South Asia scored 55%
• Have the workers who regularly handle chemicals been trained in safe chemical handling?: EMEA scored 70%, Far East scored 66%, South Asia scored 53%
• Is hazardous waste disposed of in a legal manner?: EMEA scored 86%, Far East scored 73%, South Asia scored 88%
• Are all home workers performing their work voluntary at all times?: EMEA scored 100%, Far East scored 97%, South Asia scored 89%
• Are legally required air quality measurements done?: EMEA scored 72%, Far East scored 92%, South Asia scored 58%
• Are the workers spraying chemicals using the personal protection equipment needed?: EMEA scored 29%, Far East scored 78%, South Asia scored 83%
• Is the management transparent?: EMEA scored 99%, Far East scored 100%, South Asia scored 100%

/ In the Fashion Revolution Fashion Transparency Index 2016, H&M scored an overall 76%, putting it in the top 25% quartile, meaning the company is making significant efforts in the given areas, and has made some or most of this information publicly available.  H&M responded to the questionnaire request from Fashion Revolution and provided information that was used to rank the brand for the Index.

/ H&M states that a fair living wage should be enabled through the brand’s purchasing practices and based on a skilled workforce with wage reviews on an annual basis. H&M is working with its suppliers to deliver best practice examples and gradually scale them up. The brand is focusing on its strategic suppliers to start with. In 2015, H&M reported that 68 manufacturing factories had implemented improved pay structures. The brand aims to increase this to 146 manufacturing factories in 2016 and then to have all of its manufacturing factories implement improved pay structures by 2018. To assess the progress made, H&M is surveying workers in regularly facilitated by third parties such as the Fair Wage Network.

/ In 2011, H&M launched a social dialogue project in Bangladesh. The aim was to help supplier factories in establishing democratically-elected workplace committees and to improve the dialogue between management and factory employees. H&M collaborated with external experts to train the management and workers which finally led to the free election of workplace committees that are in an active dialogue with the management. More than 40% of the factories producing for H&M in Bangladesh were covered by the project. Both workers and management learn about workplace rights and responsibilities, as well as bring up and solve problems through standardized procedure. About 77 factories have performed worker representatives election, where 973 elected workers represent more than 150,000 workers in Worker Participatory Committees. H&M aims to reach 100% of the supplier factories by 2018.

/ H&M reports that it is moving away from standard compliance auditing to a partnership approach that encourages transparency and enables the brand to capture performance beyond compliance level and measure real impact. Over the last two years, H&M states that it has developed a new program called SIPP (Sustainable Impact Partnership Programme) that assesses the sustainability performance of its suppliers and how to better support them. This new assessment method is based on the Higg Index, and some complementary questions and Key Performance Indicators developed by H&M. H&M hopes that the large scale adoption of this tool by other brands will create a sustainability benchmark between factories, save time and ultimately stop the need for factories to undergo multiple audits.

/ Through its membership with the Better Cotton Initiative (BCI), H&M helps train cotton farmers to grow cotton in a way that is measurably better for the environment, farming communities and the economies of cotton producing areas. H&M is a founding member and has been a contributor to BCI since its establishment in 2009. So far, the brand has invested a total of more than 4 million euro, reportedly making H&M the biggest financial contributor. Since 2010, more than 1.2 million farmers have been trained and licensed as BCI farmers, which exceeded BCI’s goal of 1 million farmers. The next goal is to train 5 million farmers and produce 30% of global cotton production by 2020.

/ In May 2016, Clean Clothes Campaign released a follow up report on the Bangladesh Accord CAP’s (Corrective Action Plans) of 54 of H&M’s strategic Gold & Platinum Suppliers with information available as at April 26, 2016. According to Quartz, These factories make up approximately one quarter of the brand’s total Bangladesh suppliers.

• 32 of these factories were covered by previous reports and the findings showed that all but one remained behind schedule, relative to deadlines mandated by the Accord, with an average 26.5 required renovations still to be completed per factory. 9% had not removed all sliding doors or collapsible gates, and 84% had yet to install all required fire-rated doors.  69% of these factories had not completed the installation of all fire-rated doors required for a safe exit for all workers in the factory.

/ H&M aims to move towards a 100% circular business model. The brand states that it wants to only use recycled or other sustainably sourced materials and take a circular approach to how products are made and used. The strategy is being formed in dialogue with a number of partners including the Ellen MacArthur Foundation.

/ According to the Textile Exchange’s Organic Cotton and Preferred Materials Benchmark Report 2015, H&M is the second biggest user of organic cotton by volume, the fourth biggest user of recycled polyester by volume and the second biggest user of lyocell by volume.

/ As part of the implementation of H&M’s SIPP sustainability assessment program, H&M has included strategies to help suppliers to measure and manage their own climate impact. H&M states that this program helps the brand to shift resources to provide its suppliers with more effective support.

/ H&M has partnered with the WWF and World Resources Institute (WRI) to create a plan to support positive climate actions. H&M states that it is committed to science-based target setting across its value chain and during 2016 the brand plans to have science- based targets for its value chain greenhouse gas emission reductions in place.

/ During H&M World Recycling Week campaign, from April 18-24, H&M aimed to collect 1,000 tonnes of unwanted or worn out garments from customers worldwide in its more than 3,600 stores. To raise awareness M.I.A. wrote the song ‘Rewear it’ for H&M and the World Recycle Week campaign. We don’t have any further information on whether or not H&M achieved its goal.

/ In April 2016, the Guardian reported issues with H&M’s Recycling Week. Technical problems with commercial fibre recycling mean that only a small percentage of recycled yarn is used in new garments. Using publicly available figures and average clothing weights, it appears it would take 12 years for H&M to use up the 1,000 tons of fashion waste it aimed to collect during the week. The Guardian also reported that if 1,000 tons is recycled, that roughly equates to the same amount of clothes a brand of H&M’s size pumps out into the world in 48 hours. The article went on to criticize the vouchers on offer to customers who recycle their clothing as they often fuel more purchasing.

/ H&M reports that its three major focus areas for its Sustainability Commitment are:

• Clear expectations regarding fair living wages
• More detailed expectation regarding environmental performance
• Clear standards regarding animal welfare in H&M’s value chain

/ H&M states that a fair living wage should be enabled through the brand’s purchasing practices and based on a skilled workforce with wage reviews on an annual basis. H&M is working with its suppliers to deliver best practice examples and gradually scale them up. The brand is focusing on its strategic suppliers to start with. H&M aims for all of its strategic suppliers to implement improved pay structures such as the Fair Wage Method by 2018. To assess the progress made, H&M is asking the workers in regular surveys conducted by third parties such as the Fair Wage Network.

/ H&M believes that functioning industrial relations and collective bargaining are key to achieving fair living wages and good working conditions in the brand’s supply chain. H&M’s Sustainability Commitment requires that all of the brand’s suppliers respect the right to freedom of association. Despite a lack of sufficient systems and restriction of freedom of association by law in some countries, H&M aims to have democratically-elected and functional workplace representation in place at all of its strategic supplier factories by 2018 at the latest. In order to achieve this the brand reports that it is addressing the issue directly with its supplier factories as well as on the industry and government levels.

/ H&M aims to have full traceability of cotton by 2020, man-made cellulosic fabrics by 2017, and down, wool and animal hair by the end of 2016.

/ H&M reports that it is a member of the ZDHC group. The brand is working to implement the joint roadmap to achieve zero discharge of hazardous chemicals by 2020. This involves working on a methodology to find safer alternatives. Together with other committed ZDHC brands H&M states it is engaging with stakeholders such as governments, textile industry associations, NGOs, third party labs and the chemical industry to raise awareness of industry standards and work collaboratively for change.

/ In 2013, H&M joined the Ethical Trading Initiative (ETI) program to address exploitative labour practices in Tamil Nadu’s garment and textile sector, in particular those associated with the Sumangali scheme. This three-year program aims to catalyze positive change within the industry through activities that empower young female workers, strengthen industrial relations, build community awareness and support legislative reform. H&M reports that this will have a direct positive impact on 45,000 young women. Initially H&M had one mill connected to the program, but due to business reasons the brand stopped working with them during 2015. However, H&M remains committed to the program.

/ Globally, H&M and the H&M Foundation have set a goal to provide at least 500,000 people with access to safe water by 2016. Together with partners such as WaterAid, H&M reached this goal a year earlier than planned and has provided more than 530,000 people in Bangladesh, India, Pakistan and Ethiopia with clean water since 2002.

/ The H&M Foundation made a follow-up donation of another $100,000 to the Rana Plaza Donors Trust Fund (after an initial donation of $100,000 in 2014) in order to support the victims of the Rana Plaza disaster and their families in Bangladesh. The H&M Foundation states that it made this donation based on humanitarian grounds, even though H&M never had any business relations with any factories in Rana Plaza.

/ The H&M Foundation partnered with UNICEF to invest in children’s early education and development. This program aims to reach 73,600 children who will benefit from early childhood development programs by 2017. Since 2014, more than 45,000 children have benefitted from the H&M Foundation’s funded activities. H&M also aims to contribute to the first-ever Global Report on Early Childhood Development highlighting key early development indicators to be released before 2017 to help shift global perceptions of the importance of early childhood development.

/ For each kilogram of clothes that H&M collects through its garment collection initiative, 0,02 Euro is donated to a local charity organization chosen by H&M. The brand shares the names of its charity partners that in each of the countries where it operates, how much money has been raised and how many kilos of clothing has been collected.

/ In 2015, the brand’s CEO, Karl-Johan Persson, earned an estimated $1.86 million.

/ In February 2015, Ecouterre reported that in a press release to the Guardian (page no longer available), H&M’s CEO encouraged people to buy more otherwise there would be a social catastrophe. He said “But if we were to decrease 10 to 20 percent of everything we don’t need, the result on the social and economic side would be catastrophic, including a lot of lost jobs and poverty.”

/ The brand has been criticized for running its annual World Recycling week, which it launched in 2013, in the same week as Fashion Revolution Week.  Ecocult reported Hendrik Lampa, H&M Development Sustainability Manager, “it’s unfortunate that we were doing it at the same time, that was not our intention.”

/ In June 2016, Withers and Rogers reported that The Hague Court of Appeal had found H&M liable for infringement of G-Star Raw’s trademarks in use of the word RAW.

/ H&M reports that it is moving away from standard compliance auditing to a partnership approach that encourages transparency and enables the brand to capture performance beyond compliance level and measure real impact. Over the last two years, H&M states that it has developed a new program called SIPP (Sustainable Impact Partnership Programme) that assesses the sustainability performance of its suppliers and how to better support them.

/ H&M launched its 2016 Conscious Exclusive Collection in March 2016. Materials included organic silk, hemp, recycled linen and Tencel® blends as well as materials such as beads and rhinestones made from recycled glass and Denimite − a material made out of recycled worn-out denim, which H&M is the first fashion company to use.

/ In 2014, H&M launched its first closed-loop denim collection using at least 20% recycled cotton from collected clothes. The brand estimates that each of these denim pieces uses up to 1,000 fewer liters of water compared to using only conventional virgin cotton.

/ Any money made from H&M’s garment collection service is invested into social projects, as well as research and innovation projects on how old textiles can be turned into new fibers, with the ultimate goal of being able to recycle all clothing waste and achieve a closed loop for fashion.

/ The Global Change Award is an innovation competition by the H&M Foundation that was launched in August 2015. The aim of the competition is to protect the planet by closing the loop for fashion. The first award ceremony took place in February 2016 where five winning ideas received grants totaling one million euro. The winners were selected out of more than 2,700 entries from 112 countries by an expert jury. Additionally, the global public was invited to distribute the grant through an online vote. Neither the Foundation nor H&M will take any equity or intellectual property rights in these innovations. In addition to the grants, the winners will also be provided with a one-year innovation accelerator, a collaboration with Accenture and the Royal Institute of Technology in Stockholm. They will also receive coaching, exclusive fashion industry access and opportunities to build networks and try out the ideas within the fashion value chain.

“I am really proud of what H&M has achieved and the positive impact we are making. We are leading the way today within several sustainability areas and I want us to continue to raise the bar. This is why I am so happy to see that sustainability is on the minds of so many people at H&M – every day and in all departments. When I hear colleagues discussing sustainability over coffee, I honestly feel we have come a long way. But it is a very complex issue and we are certainly not at the end yet – there is more to do, for us and the entire industry.” – Interview with Karl-John Persson, CEO of H&M

“Consumption as well as trade between countries and production in developing countries is necessary to create jobs and lift nations and people out of poverty. H&M is indirectly creating employment for over one million people, not least women, in the countries that manufacture our products.” – unnamed H&M spokesperson as quoted by Marc Bain for Quartz – 04/16/2015