There is Something Fascinating About Kering’s Push Towards Sustainability

There is Something Fascinating About Kering’s Push Towards Sustainability

image: Gucci In a market that is full of greenwashing and promises of sustainability based by little – if any – substantive action, all aimed at enticing in-the-known millennials to shop, few companies are delivering results in as effective (and interesting) a ...

October 15, 2017 - By TFL

There is Something Fascinating About Kering’s Push Towards Sustainability

Case Documentation

There is Something Fascinating About Kering’s Push Towards Sustainability

 image: Gucci image: Gucci

In a market that is full of greenwashing and promises of sustainability based by little – if any – substantive action, all aimed at enticing in-the-known millennials to shop, few companies are delivering results in as effective (and interesting) a manner as Kering. The Paris-based conglomerate, which is parent to Gucci, Balenciaga, Yves Saint Laurent, Bottega Veneta, and Alexander McQueen, among others, is making strides – in more ways than one – to establish and adhere to protocols for more socially and environmentally sustainable business practices.

The François-Henri Pinault-chaired company has managed to find a remarkable balance between adopting a business model based on sustainability and keeping intact its image as a purveyor of luxury goods, two things that have often proven mutually exclusive.

Certainly impressive are Kering’s actions on the sustainability front. As the group outlined in its “Beyond Our Limits: 2012-2016 Sustainability Targets Final Report,” which it released in the spring of 2016, its “targets” – which are aimed at eradicating PVC and other harmful chemicals from all product lines, increasing traceability and sourcing from European Union-based production systems to enable the use of higher quality skins with a lower environmental footprint, offsetting CO2 emissions, and eliminating various types of waste from its supply chain –  are ambitious and unlike those of nearly any other luxury company.

Kering’s series of sustainability reports outlining its progress since 2012 detail the goals the company has succeeded in reaching between 2012 and 2016. Quite notably, it also shed light on those for which progress has been slower (for instance, Kering reports that it reached only 64 percent of its target to source 100 percent of its leather from sustainable sources) – something many companies tend to neatly gloss over to save face.

In addition to the aforementioned targets, Kering’s report also notes its attention to auditing suppliers in a stringent manner. Since labor concerns are only occasionally linked to high fashion manufacturing – such as when Prada came under fire for allegedly subcontracting its bags to Chinese-run factories in Prato and Florence, which hosted over-worked, underpaid illegal immigrants – Kering likely has it relatively easy in this sense.

It is still absolutely necessary for luxury brands to devote resources to ensuring supply chain audits. Unlike fast fashion retailers, which are well-known for their cheap offerings and the questionable labor practices that come hand-in-hand with manufacturing such garments/accessories, luxury brands have significantly more to lose in terms of reputation. A sweatshop scandal stands to create significant damage to a brand like Gucci, both in terms of the expectations of its investors and its consumers. 

With such significant efforts in mind and considering the lengths to which the conglomerate has gone to be transparent in its strengths and shortcomings, it is difficult to question the validity of its findings and the sincerity behind its targets. It does not appear as though we have a Zara or H&M-like company on our hands – both of which are known for their widespread promotion of “easy fixes” when it comes to sustainability in lieu of addressing some of the dire and difficult issues, such as the nearly continuous labor condition deficiencies and human rights abuses.

Can High Fashion Be Green?

Maybe most interesting, though, is Kering’s ability to make strides in terms of sustainability while maintaining its position as luxury entity and one in the uppermost echelon of the fashion industry. The “eco-fashion” space is an interesting one, and it is one in which many brands struggle. The term – and those associated with it, such as ethical fashion, sustainable fashion, and green fashion, etc. – come with some very heavy associations. Eco-fashion, for instance, has for many years been viewed largely as a product for hippies and not of luxury fashion consumers.

Oprah’s O magazine put it well recently, stating: “A key factor in environmental style is raw materials, organically produced traditional crops; versatile fibers like bamboo, hemp and soybean; and fabrics cooked up out of everything from recycled plastic to seaweed … and associated with a natural, beige to brown palette.” Given that this is the description that commonly accompanies sustainability in terms of appeal and accessories, it is not surprising that many consumers – particularly high fashion ones – believe they must compromise style for sustainability.

This is almost certainly why Kering’s individual brands opt to market their wares very carefully. As the Washington Post’s Robin Givhan noted last year, “With little fanfare, [Gucci’s] nearly $4 billion business has been making changes. The handbags — namely the trendy $2,400 flower-bedecked Dionysus shoulder bags stitched from the signature ‘GG’ Supreme canvas print — now use polyurethane in their design rather than PVC … But the marketing doesn’t highlight the switch; only the vaguest reference on the Gucci website notes that it is produced using an ‘earth-conscious process.’”

Givhan continued: “Gucci’s reluctance to make that shift evident — let alone exciting or sexy for its consumers — highlights the unsettled relationship between the luxury business and eco-fashion.” Gucci’s hesitation to begin slapping “eco” labels on its products also seems to suggest that its parent company is not merely putting such targets in place to please consumers.

As Quartz’s Jenni Avins noted last year on the heels of the release of Kering’s first “Environmental Profit & Loss” report, “Kering is approaching sustainability as a business strategy, not a marketing one.

“Customers aren’t the ones to convince that the company’s commitment to sustainability is worthy,” Marie-Claire Daveu [Kering’s chief sustainability officer] says— “the products alone should still inspire them to spend. The real stakeholders to win over are the investors, the employees, and the executives.” According to Daveu, “Investors are more and more convinced by sustainability—even if they don’t use the word sustainability—but for them it’s a risk management approach.”

Long-term implementation of Kering’s sustainable practices could have a dramatic impact on the fashion industry as a whole. For not just one luxury company, but a conglomerate of them, to successfully integrate “eco-conscious” processes has the potential to sway more than just investors. Other companies – from Kering’s most direct rivals to more tenuously connected rivals – will hopefully look to Kering-owned brands for inspiration.

And given the fickle nature of fashion, other brands will ideally take note and be reassured by Kering’s actions that it is possible – and profitable – to move towards more sustainable production techniques, while still maintaining an image of luxury and high fashion.

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