Sustainability in the apparel industry: Just do it.
A Case Study on Nike
The apparel industry accounts for 10% of global carbon emissions and is the second largest industrial polluter.  This can be partially explained by the size of the apparel industry, with estimates as high as $3 trillion, given that 150 billion garments, or 20 per person, are produced annually.
Context: Apparel Industry and Climate Change
A 2009 report estimated that the global apparel industry consumed nearly 1 billion kWh of electricity or 130 million tons of coal. Nike can focus on materials, since the company uses more than 16,000 materials products each year, one pair of shoes can have up to 30 materials, and the below 4 materials are found in 98% of its products.
Chart 1: Carbon Emissions by Material
There will be an imbalance between the demand for new clothes and the supply of water to produce these clothes, with demand predicted to exceed supply by 40% in 2030. The 28 billion kilograms of textiles that are dyed per year require over 5 trillion liters of water (2 million Olympic-sized swimming pools). Furthermore, countries that are part of the textile supply chain, such as China, India, and Bangladesh, are already stressed by insufficient water supply.
Chart 2: Water Waste by Stages
The COP21 Climate Agreement, effective in 2020 to address global warming, increases the risk that companies will be held to sustainability goals. 
Climate change results in extreme weather conditions that disrupt Nike’s supply chain. For example, in 2008, floods temporarily shut down four Nike factories in Thailand, and there is concern about droughts for cotton-producing regions.
Similar to what happened in the food industry, customers are starting to care about whether their clothes were produced sustainably. Customers may choose to shop at companies that have incorporated sustainability practices into their business model.
Nike: Steps Taken
Nike’s mission is to double the business while halving the impact.
Nike focused on increasing sustainable materials, resulting in the greatest environmental impact in the entire product cycle. The Material Sustainability Index lets teams compare the environmental impacts of 57,000 materials across 741 vendors, resulting in 26% sustainable cotton and 17% recycled polyester. Flyknit technology has reduced waste by 60% and expanded into 28 products across 6 categories.
Nike committed to decreasing its carbon footprint, especially during the high-impact, materials stage of the value chain: materials growing, processing, and finishing. In addition to using low-carbon materials, the company developed an energy-efficient resource toolkit for dyeing and finishing facilities to be rolled out in FY16/17. The company scaled renewable energy at its own factories, while encouraging manufacturers to decrease emissions. These actions resulted in an 18% per-unit reduction in CO2 emissions.
Nike reduced waste by designing better products from the start. Its Flyknit technology reduced waste by 2M pounds, and recycled polyester yarn diverted >182M plastic bottles from landfills. Nike used recycled materials in 71% of its footwear and apparel products, while encouraging material vendors to ship pre-cut pieces and recycle scraps at their own factories. The company achieved 6% per-unit savings across categories and reduced the shoebox weight by 6.3%.
Nike collaborated with material vendors with water-intensive textile dyeing and finishing operations to help manage water and reduce waste. Nike was incentivized to work with suppliers since the latter’s performance was incorporated into Nike’s sustainability index. The ColorDry technology was used by a Taiwanese facility to dye fabrics without water, saving 20M liters of water. Results included an 18% per-unit water reduction in apparel, and a 43% per-unit water reduction in footwear manufacturing.
Nike: Other Ideas
- Optimize logistics: While CO2 emissions per unit decreased, the overall energy use and CO2 emissions increased 14% from FY11 to 15 due to inbound logistics. Nike should think of ways to optimize its logistics.
- Recycling Campaign: The company emphasizes re-use and recycling, evident in the Nike Grind program, which is a collection of premium recycled materials. However, there is no clear way for consumers to recycle products. Like H&M, which collects used clothing at its stores, Nike should create an effective recycling campaign.
- Lead by Example: Nike has achieved significant savings and led the apparel industry in sustainability practices. They have encouraged partners to do the same, and now they should also galvanize other players to complete on sustainability.
Nike has shown that it’s possible to be both sustainable and successful in the apparel industry, developing technologies with the added complexity of sustainability. Nike should help other companies, work with its own suppliers, partners, and distributors, and keep innovating its technology and sustainability practices.
Abnett, Kate. “What the COP21 Climate Agreement Means for Fashion.” The Business of Fashion. Business of Fashion, 16 Dec. 2015. Web. 02 Nov. 2016.
Conca, James. “Making Climate Change Fashionable – The Garment Industry Takes On Global Warming.” Forbes. Forbes Magazine, 3 Dec. 2015. Web. 02 Nov. 2016.
Davenport, Coral. “Industry Awakens to Threat of Climate Change.” The New York Times, 23 Jan. 2014. Web. 2 Nov. 2016.
Kirchain, Randolph, Elsa Olivetti, T. Reed Miller, and Suzanne Greene. “Sustainable Apparel Materials.” Sustainable Apparel Materials (n.d.): n. pag. MIT Publication. MIT, 7 Oct. 2015. Web. 2 Nov. 2016.
Maxwell, D. McAndrew, L. Ryan, J. 2015, State of the Apparel Sector Report – Water a report for the global leadership award in sustainable apparel, aug 2015
Nike Sustainability Report FY14/15
 Nike Sustainability Report FY14/15
 Nike Sustainability Report for FY14/15
 Nike Sustainability Report for FY14/15