The Vogue Business sustainability leaders survey: Mounting pressure clips progress

This article is part of our Advanced Membership package. To enjoy unlimited access to The Long View from Vogue Business and bi-monthly Market Insights Reports and webinars, sign up for Advanced Membership here. A year ago, an exclusive Vogue Business survey revealed many sustainability teams embedded within fashion brands were small and siloed with limited executive buy-ins, yet were being tasked with making monumental changes. This year’s survey results paint a more positive picture, but limitations are still rife. Across the board, sustainability leaders report that their teams are still being asked to do too much with too little: 40 per cent of respondents said this was one of their biggest challenges. A wave of new sustainability regulation is only heightening this pressure, creating more work through disclosure and compliance. In response, new positions are being added, and reporting lines seem to be improving, with more direct access to the C-suite than last year. However, the more systemic changes sustainability teams need to unlock progress remain overlooked in favour of incremental changes. Cross-function collaboration has also become a greater priority, with many brands attempting to educate staff outside of sustainability teams and encourage action through personalised KPIs and financial incentives. This year’s survey includes responses from 45 leading fashion and beauty companies, representing 90 brands, who shared their sustainability team structures, as well as the steps they have taken to minimise barriers and maximise impact. Participants range from premium and luxury players such as Richemont, Tapestry and the Prada Group to fast fashion giants including H&M Group, Mango and Primark, in addition to startups and scale-ups that position themselves firmly within the responsible fashion bracket, such as Reformation, Everlane and Veja. The sustainability teams surveyed range in size from newly minted teams of one or two people created in the last year to more well-established departments with highly specialised roles and executive oversight. Among the companies with over 1,000 total employees, the size of the direct sustainability teams ranges from one person directly reporting to the most senior sustainability employee and three further indirect reports (Mulberry) to a global team of 60 (Ralph Lauren), with up to 300 indirect reports (H&M Group). Some brands have no dedicated sustainability employees in-house, including Peregrine, Hylo Athletics and Another Tomorrow; either their sustainability leads work solely with third parties or other employees contribute to the sustainability strategy without it being defined in their job title. Two of the brands in last year’s top five largest sustainability teams took the survey again this year — The Estée Lauder Companies has grown its sustainability team by one person, while Reformation’s has shrunk by 23, which it says it due to turnover and promotions in the factory and operations functions. Regulation is spurring new roles and ways of working Sustainability regulations are coming thick and fast: the US is legislating garment worker rights at state and federal levels, the EU is addressing waste, circularity and sustainable design, and France is leading the charge for transparency and traceability. “The mounting pressure on reporting puts significant resource pressure on our team,” says Renee Morin, chief sustainability officer at Ebay. “The more complicated reporting schemes get, and the more of them that pop up, the more of our team’s time it takes to report accurately. The more time we dedicate to reporting, the less time we have to drive positive impact.” The survey shows that fashion companies have been hiring to meet the increased workload that regulation has brought. In the last year, Ebay has increased its sustainability headcount by hiring an ESG and sustainability strategy lead and a sustainability assistant. Likewise, British luxury brand Mulberry hired an additional sustainability coordinator in October 2022 to increase capacity in line with demand and brought in a business analyst in February 2023 to focus on specific projects requiring experience with science-based targets and carbon accounting. Some brands are evolving existing employees’ roles to be sustainability-focused. John Smedley recently promoted its technical design manager to the newly minted position of head of sustainable design. Traceability roles have also been gaining momentum in the last year as brands work to ensure their compliance with the wave of new sustainable fashion legislation. The survey shows brands have been building out their teams with roles such as director of responsible supply chain, director of supply chain compliance, or sustainability and compliance manager. Uniqlo says it intends to hire a head of traceability in the next 12 months, while Veja plans to hire a compliance and regulations coordinator. Even if brands don’t have dedicated transparency or traceability roles, there is more collaboration with the supply chain. Among the companies surveyed, 97 per cent say the most senior sustainability employee knows the company’s immediate and subcontracted suppliers and has direct communication with them (a new question for 2023). “You wouldn’t want to see compliance, sustainability, sourcing and production happening in siloes. There needs to be a strong and comprehensive sourcing system, which also includes indirect procurement, something brands often overlook,” says Elisa Niemtzow, vice president of consumer sectors and global membership at business network and consultancy Business for Social Responsibility (BSR). The influx of new regulations requires more cross-functional collaboration, experts say. “All of the new regulations coming out have really changed the game for sustainable business,” says Niemtzow. “Before, ESG could easily be delegated to the sustainability team. Now, it needs more explicit and diligent oversight of sustainability at the C-suite and board levels. The constellation of functions needed to manage risk and ensure compliance is also broadening – sustainability teams now need to collaborate with legal, finance, compliance, investor relations and more.” Brands are approaching this in different ways. Responding to the survey, Eileen Fisher says its sustainability team reports to its general counsel because of the increased regulation around sustainable fashion, especially in the EU and California. Conversely, Tapestry says its sustainability team previously reported to its legal team, but it transitioned to the supply chain team in 2021. It argues that this allows for greater cross-functional collaboration and puts the emphasis on reducing impact in the company’s supply chain. When it comes to the changing regulatory landscape, brands have a variety of ways to stay updated. Several mention the Policy Hub, a non-profit aiming to accelerate circularity across the apparel and footwear industries, supported by Global Fashion Agenda, the Sustainable Apparel Coalition, Textile Exchange, and the Federation of European Sporting Goods. New York designer Angel Chang, who leads the sustainability practice for her eponymous brand, says she keeps abreast of regulation through non-profit Remake, of which she is currently a fellow, meaning she is able to attend monthly meetings to learn about and advocate for pending legislation such as the Fabric Act and the New York Fashion Act. Canadian beauty company Deciem says its parent company, The Estée Lauder Companies, shares policy updates. Reporting lines are improving Across the companies surveyed, 45 per cent of the most senior sustainability employees report directly to the CEO, which is considered best practice, compared to 39 per cent last year. Only 8 per cent report to someone below C-suite, board of directors or founder, compared to 28 per cent last year. Among the 17 per cent of companies where the most senior sustainability employee reports to the founder, there are two key justifications: the first being that the founder takes on the responsibility for sustainability because the staff is not big enough for a dedicated sustainability team yet, and the second being to make sustainability fundamental to the business from the outset. “Ideally, the person leading on sustainability will report directly to the CEO and sit at the highest decision-making level of the company, so they’re able to work with other C-suite colleagues seamlessly, and the board has the right competencies for sustainability,” says BSR's Niemtzow. This becomes increasingly important as sustainability teams start to reckon with questions of growth and volume, she adds. “The industry is finally beginning to talk about the reconciliation of business strategy and planetary boundaries, which has been missing from the conversation in the past. It’s such a vast, existential question that companies need to examine it at the highest level. This debate will not go away.” In cases where the founder is either responsible for or overseeing sustainability, several respondents said this was limiting progress. There were reports of founders being stretched across multiple functions and having limited knowledge of sustainability or limited time to invest in it. In almost every instance, the intention was to delegate sustainability to a dedicated person or team once the company grew enough to hire for this role. Others say the direct line allows businesses to be more agile. “Directly reporting to the founder means decisions and company-wide change can be made quicker,” says Josephine Philips, founder and CEO of repair and alterations platform Sojo. While having the most senior sustainability employee report to the CEO can ensure sustainability is embedded across all departments, so can having key departments report to the most senior sustainability employee. Ralph Lauren’s chief global impact and communications officer Katie Ioanilli has six direct reports: the heads of global sustainability, global citizenship, public affairs, corporate communications, employee communications, and creative. Many of the most senior sustainability employees sit across product and design teams, which they say allows for sustainability to be embedded in the product life cycle from the very beginning. Many of the most senior sustainability employees have other functions in their job titles too, implying a necessary crossover between teams to achieve impact. At New York fashion brand Mara Hoffman, Dana Davis occupies the role of VP of sustainability, product and business strategy. At fast fashion giant Mango, Andrés Fernández is the head of sustainability and sourcing. The Valentino Group’s efforts are led by its chief HR, procurement and sustainability officer. Several respondents highlighted the lack of qualified employees, especially for more technical sustainability roles like carbon accounting. Dr Subramanian Senthilkannan Muthu, chief sustainability officer at fashion life cycle analysis (LCA) company Green Story, which supports Thredup with LCAs, says this is the company’s main challenge, especially as it is drafted in to support an ever-growing roster of brands that lack the internal talent themselves. “Sustainability skills are in high demand, but we need a unified strategy to increase that talent pool,” says BSR’s Niemtzow. This will require companies to take a two-fold approach: upskilling current executives and supporting business schools embedding sustainability into their core curriculum so emerging talent is equipped to take on sustainability roles. Giving adequate resources for that ambition is vital.” How brands break sustainability down into dedicated roles can reveal a lot about their priorities within sustainability and how they define the term itself. Ganni has four managers reporting directly to its sustainability director Lauren Bartley: the social responsibility manager, environmental responsibility manager, traceability manager, and responsibility project manager. At Mango, Fernández’s direct reports include the head of environment, head of circularity, head of social compliance, head of quality and production, and head of product ID. Tapestry has divided its sustainability team into seven core functions: supply chain responsibility; traceability; supply chain environmental responsibility; ESG and sustainability; product sustainability; product and packaging sustainability; and social and labour remediation. Spreading change across the organisation The survey shows fashion brands are making efforts to embed sustainability across the entire organisation through education, training and upskilling, and introducing incentives. In last year’s survey, some large brands were already formalising this process, and small businesses said all employees were involved by virtue of their size, but progress in mid-sized companies was limited, and it was fragmented across the board. Experts agree this is essential if they are to enact real change. “Today, one of the biggest challenges is how to move from a system where sustainability is just a target-setting and best practice-identifying exercise to one where change is institutionalised,” says François Souchet, global head of sustainability and impact at communications agency BPCM. Deciem says it provides development grants for employees to take external courses on sustainability, while H&M Group and Capri Holdings have created internal courses which are mandatory for all employees, depending on their job function and seniority. Gant says it trains all 2,000 of its retail store staff six times each year and has delivered a total of 18 educational films since 2020, each translated into the dominant language of every country the brand operates in. Jessica Cederberg Wodmar, EVP of global sustainability and CSR, says the brand has also trained all of its suppliers to get Textile Exchange and Animal Welfare certifications. Several companies now embed sustainability training into their onboarding process for all employees, and others say they make time for sustainability feedback and training in regular company meetings. Vivobarefoot has an ongoing regenerative leadership training programme with consultant Giles Hutchins and gives individual employees a £1,000 professional training allowance. When it comes to spreading sustainability awareness and progress, brands run the gamut from voluntary to mandatory engagement, says BSR's Niemtzow. “Over time, companies seem to move from voluntary green champions — people raising their hands to help because they’re personally invested in the change — to more mandatory engagement, where sustainability might even be linked to performance evaluations or financial remuneration.” Many companies are starting to introduce tangible incentives for progress on sustainability, hoping to accelerate change across the business. Deciem says it will tie a percentage of its senior managers’ compensation to the achievement of sustainability, social impact and belonging targets from the next fiscal year onwards. H&M Group and Capri Holdings say this is already the case. At Ganni, senior managers have carbon KPIs linked to their annual bonuses, and members of its voluntary “carbon squad” receive one half-day learning session led by experts in their respective fields, as well as one dinner with co-founders Ditte and Nicolaj Reffstrup each year that they participate. For J Crew Group, the next task is spreading sustainability awareness to its retail and supply chain staff. “We have regular calls with sustainability representatives across the brand and our fleet of stores, but we need more, so this is a priority for 2023. There are also huge opportunities to educate our distribution centre staff,” explains Liz Hershfield, SVP and head of sustainability for J Crew Group and SVP sourcing at Madewell. Having a strong mechanism for internal sustainability communications can also help engage employees in other teams and keep people motivated when progress stalls or issues become more complex than they seemed, says BPCM's Souchet. “Historically, there has been a sense of disconnection between sustainability teams and operational teams. Maybe there is a lack of understanding about what targets mean or how individuals can contribute to them. At the same time, people are looking for more purpose in their jobs, so internal sustainability communications can actually help with retention as well as impact.” “Communication is one of the biggest pillars of a well-established sustainability team,” says Lubomila Jordanova, co-founder and CEO of sustainability software company Plan A and a member of the sustainability advisory board at Chloé. “It’s not just about marketing campaigns for consumers; it’s about storytelling the challenges you have faced implementing a sustainability agenda, engaging internal stakeholders to do their bit, and translating the message across different levels of the business, each of which essentially speaks a different language. We need to broaden our definition of communication to get a clear view of sustainability progress.” Brands also need to broaden the scope of people they engage with sustainability, says BSR's Niemtzow. Four out of five of the respondents to Vogue Business’s 2023 survey are female. “We see a lot of female sustainability leaders, which could be because some of the necessary competencies — being a changemaker, making connections between various functions, engaging with stakeholders — are traditionally associated with things that women are good at,” Niemtzow explains. According to the United Nations, women also face higher risks and greater burdens from the impacts of climate change, which could increase their personal investment in the cause. The survey questions related to race and ethnicity did not see high enough engagement to report any significant trends, but Niemtzow says, anecdotally, that there is also a lack of BIPOC representation in sustainability roles. “This is a huge miss for the profession, especially given that the key issues in sustainability are so closely linked to injustice and equality. Moving forward, businesses need to ensure they have a diverse slate of candidates for these roles and identify more ways to empower people from disadvantaged backgrounds.” Exposing the emotional toll The existential nature of sustainability can take an emotional toll on the individuals implementing it. When asked about the biggest challenges they face in their roles, survey respondents highlighted the need to balance sustainability work with pastoral care and time for rest and reflection. Many view their work through the lens of the climate crisis and say they feel the paradox of working in sustainability in fashion deeply. “How do we do good by the Earth as part of a capitalist system which seeks sales and product growth? While we believe education is a start, knowing better is not always enough to do better,” say Proto Collective’s head of design, Nick Daiber, and COO Jillian Ricciardi. “The world is overheating and ending — why we are continuing to create products when we should be not participating in capitalism at all?” posits Hillary Taymour, founder and creative director of New York brand Collina Strada. It’s not just big-picture questions weighing on employees; the constant need to justify their work and convince others of its validity is another strain. “Some important implementations — especially those connected to changing corporate culture — come free of charge, but at a high self-energy cost,” adds Taciana Abreu, head of sustainability for the Soma Group, the holding company for Brazilian fashion brand Farm Rio. “The more we change the culture, the more access we get to money. That’s how we’ve been evolving our sustainability strategy: culture must come first.” Brands have long made the claim that sustainability is “core to their business”, or “part of their DNA”, but making this a reality is no easy feat, and the extent to which sustainability needs to be embedded is often misunderstood. “Sustainability touches all functions in the business, all regions and markets,” says BSR's Niemtzow. “One of the biggest mistakes businesses make is giving small sustainability teams ambitious goals that require buy-in from leaders across the business, many of whom don’t feel accountable for those goals.” “The main limitation is the size of the role,” says Tim Clark, technical and sustainability director at British brand John Smedley. He also points to the infinite room for improvement as a challenge, one which is often misunderstood by others. “Sustainability is a journey, not a single event or achievement.” These burdens — combined with the increased workload from new regulations — have created a need to outsource work and responsibilities to other teams, says Niemtzow. “I’ve seen companies be successful when they give ownership of specific sustainability goals to key leaders in other functions which are relevant to the goal. So, the chief procurement officer might own or co-own goals related to sustainable sourcing. It can also be good practice to give regional leadership specific goals as well.” Respondents say progress is underway, however slow. “Sustainability is a complex topic, which takes time for people to understand and therefore become interested in,” says Hanna Griesbeck Garcia, impact manager at Hylo Athletics. “We struggle when we feel alone in battle, but thankfully this is changing, and the urgency of the matter is reaching new levels of awareness, which helps us all do our jobs,” adds Soma Group’s Abreu. However brands choose to structure their sustainability teams, the key to success is giving them the time, budget and resource to deliver, says Niemtzow. “The industry needs to get better at prioritising long-term needs, planning and impact over short-term performance or financial targets. That’s not really happening at the moment, and it’s a permanent tension.” Key takeaway: Sustainability regulations are quickly evolving, putting more pressure on already-stretched sustainability teams, who say budget and bandwidth are their biggest challenges. Since last year, executive buy-in has improved, brands have invested in cross-functional collaboration, and new roles have been added to deal with the workload, but limitations remain rife. The exclusive Vogue Business survey outlined above was completed in May 2023 by: Angel Chang, Another Tomorrow, BITE Studios, Capri Holdings, Collina Strada, Deciem, Ebay, Eileen Fisher, The Estée Lauder Companies, Eton Shirts, Everlane, Fanfare Label, Farm Rio, Ganni, Gant, H&M Group, Haelixa, Hylo Athletics, J Crew Group, Janessa Leone, John Smedley, Kankan, Keen, Mango, Mara Hoffman, Missoma, Mulberry, OTB Group, Outerknown, Peregrine, Prada Group, Primark, Proto Collective, Ralph Lauren, Reformation, Sojo, Tapestry, The Seam, Toiletries Amnesty, Uniqlo, Valentino Group, Veja, Vestiaire Collective and Vivobarefoot. With additional insights from: Core UK, Green Story, Pivotal Consulting, Sarah Ciel, The Growth Activists and This Way Next. To receive the Vogue Business newsletter, sign up here. Comments, questions or feedback? Email us at feedback@voguebusiness.com. More from this author: Can regenerative agriculture help farmers face climate change? A rare glimpse inside Peru’s regenerative organic cotton supply chain What if fashion prices put workers first?

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