Kering championing 'disruptive' innovations to push towards science-based targets
Luxury fashion group Kering is partnering with "disruptive" new minds to uncover innovations that will help reach ambitious science-based targets, and the firm's chief sustainability officer Marie-Claire Daveu wants to pass these learnings to the sector through an open-sourced approach.
In December 2016, Kering had its target to reduce emissions from business activities by 50% officially verified by the Science-Based Targets initiative. The 50% reduction is the flagship target of a “new chapter” in Kering’s sustainability agenda, which has been re-defined under the “Crafting Tomorrow’s Luxury” strategy for 2025.
Targets have been set for 100% traceability of key raw materials, and the creation of a supplier index to ensure the entire supply chain complies with Kering’s values by 2025. Other objectives include a strategy to develop an industry leading performance metric system that will measure achievement of the Sustainable Development Goals (SDGs), and a new supplier platform to offer technical support and training to share best practices.
These goals are lofty in nature and a challenging aspect of most science-based targets is that the company setting them doesn’t have a fully-formed idea of how they are going to reach them. In short, it’s a journey of ambition.
Kering’s approach to its science-based targets it holistic, but is built on two key platforms; capturing new technologies and building the business case for sustainability through an innovative environmental profit and loss (EP&L) system.
The EP&L accounts place a monetary value on the financial costs or benefits associated with Kering’s environmental impacts, both operational and across the supply chain. It has given Kering a new way to examine its business decisions and although it isn’t perfect, the company’s chief sustainability officer Marie-Claire Daveu told edie that numerous companies are reaching out to them about the open-sourced accounting method.
“We’ve had very good feedback,” Daveu said. “More and more companies come to see us to ask questions about implementing EP&L in their company. I can’t disclose names, but more people and institutions are really interested in understanding the methodology and understanding how they can apply it to their own needs.
“We don’t say that our methodology is perfect but it’s a good solution and our new strategy adds EP&L into the supply chain and it is helping with our science-based targets. If you want to make these targets, you need to understand where your emissions are coming from, the EP&L is really useful here. If you don’t put sustainability at the core of your strategy you’ll have a problem. It’s no longer an option, it’s a necessity.”
Through the EP&L, Kering learnt that 90% of its environmental impact was in the supply chain, and that 70% of that figure was in relation to the methane from cows and sourcing raw materials such as cotton.
Daveu wants to develop the EP&L a step further to create a “360 approach” that covers the environmental impact of a product once it reaches the consumer. She also wants to push the EP&L out to more companies so that it becomes a common tool for businesses to better understand their environmental impacts.
The innovative model builds on some of the concepts of Natural Capital to link ecosystem impacts with investment portfolio risks. With a 2015 report from the luxury fashion company claiming that the industry urgently needs to improve its supply chain resiliency as climate impacts exacerbate, the EP&L could give willing companies better understanding of supply chain risks and opportunities.
Notably, Kering doesn’t shy away from the necessity of better management of its own supply chain. With 90% of Kering’s environmental impacts found among suppliers, the EP&L analysis highlighted the need for the science-based targets.
Since 2012, Kering has reduced carbon emissions by 12%, water use by 19% and waste by 16% - equating to 44%, 76% and 64% of the company’s targeted reductions, although Kering’s environmental impacts are less than 45% of the global average business based on comparative turnover. To push the agenda further, innovation will sit at the heart of the new strategy.
Kering will further address all supply chain environmental impacts with a goal to reduce at least 40% of its EP&L accounts, and the methodology is just one aspect of the company’s innovation drive, which aims to equip the firm with new business models, production practices and products to promote sustainability to its peers and consumers.
Kering founded a Materials Innovation Lab (MIL) in Northern Italy 2013. The lab contains more than 2,000 certified fabrics which have been mapped and ranked against external standards and Kering’s own evaluation tool.
The MIL is enabling Kering to reach out to academics and specialists to uncover potential new solutions for the fashion industry, and the company wants to create a separate innovation lab for watches and jewellery by the beginning of 2018.
“We know we won’t be able to reach our 40% target without innovation, and our ambition is to put the research and projects out at scale,” Daveu said. “We want to invest more time, money and ideas into innovation and identify the most sustainable raw materials from environmental and social criteria.”
School of thought
Kering’s commitment to innovation can be seen through its partnership with acclaimed academic institutions. As well as a long-standing partnership with New York’s The New School’s Parsons School of Design, Kering has an ongoing commitment to develop a joint curriculum of academic modules at the London College of Fashion’s Centre for Sustainable Fashion (CSF).
Set up in 2014, Kering and the college task students to account for human wellbeing and natural systems in the design phase of fashion. As part of this year’s curriculum, Kering brands Gucci and Stella McCartney offered students a €10,000 grant and an internship to develop new fashion innovations.
One of the winners of this year’s award was Dianjen Lin for her “Regenerative Sustainability Activism” project, which is exploring t-shirts that can produce oxygen while its being worn.
Lin was presented the internship at the Kering 2017 talk at the London College of Fashion last week. During the event, Gucci’s president and chief executive Marco Bizzarri told of the importance of “unlearning instead of teaching” noting that experience can act as a “prison” for businesses that are struggling to embrace innovation.
As for Daveu, these types of partnerships enable Kering to get close to “disruptive” minds and solutions that could potentially bring Kering closer to its 2025 goals. For example, Kering will act as the first founding anchor partner of the Plug and Play Fashion for Good initiative. The platform links incumbent businesses with innovative start-ups to support the scaling-up process of new technologies, methodologies and business models.
At the launch on the Plug and Play initiative, Daveu said that the future of luxury fashion was “dependent on innovation to help weave sustainability into every niche of our industry” and engaging with schools and colleges has acted as a valuable bridge to new ideas.
“What is good with this type of programme is that it has two dimensions,” Daveu added. “It is key for us as a group that we have a specific responsibility to raise awareness to the new generation. If we want to change the paradigm, it is key to invert the new generation.
“As we think sustainability is key for the future we want to get in front of the students to share more thinking on climate change and give them solutions where sustainability has to be taken into account from the beginning. We have millennials that have many ideas and that want to create disruptive solutions. For us to have this kind of project, means we can help them develop.”