How digitization can make the fashion industry more sustainable

This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum.

Author: Ankiti Bose, Co-founder & CEO, Zilingo

• The fashion industry is rightfully vilified for being environmentally unsustainable.
• It takes over 4,000 litres of water to make a pair of jeans and most of that water is not recycled.
• The industry is also responsible for 10% of annual global carbon emissions.
• Technology and the rapid digitization of the supply chain can make fashion more sustainable.

Fashion has long been perceived as a major contributor to forest fires, rising sea levels, unfair wages, exploitation of labour and overflowing landfills. Unfortunately, these perceptions hold true. It takes over 4,000 litres of water to make a pair of jeans and most of that water is not recycled – indeed, one-fifth of all wastewater globally originates from fashion. The industry is also responsible for 10% of annual global carbon emissions, that’s more than all international flights and maritime shipping combined.

The entire fashion industry has been vilified for years. More recently, observers have lamented the rise of fast fashion for its unethical manufacturing practices, and general lack of respect for the environment. Yet despite the backlash, most fast-fashion companies have continued to grow.

As humans, we feel the social pressure to conform to attitudes that are widely accepted by society, often socially claiming that we support these causes even if our actions are not aligned with our claims. While most people are aware that ethical initiatives are important for a better future, they don’t easily deviate from their default behaviour, especially when it offers perks like affordability, style, and convenience.

This is where technology and the rapid digitization of the supply chain can make all the difference.

Digitizing the supply chain

Aside from the moral argument of leaving the planet better for future generations, we now have a very powerful tool in the industry’s arsenal – profits. Yes, it does sound like an oxymoron, but thanks to digitization, companies can unlock profitability sooner and create a significantly more transparent supply chain.

Digitization removes opacity and middlemen, improves speed, and lowers inventory days. This frees up margins and makes favourable changes to the bottom line. Digitization also comes with other significant benefits like transparency, predictability, accountability, and traceability, all of which are critical to creating irreversible positive change in fashion supply chains.

Here’s how we can finally put our thoughts to action and make it all worthwhile.

Once all factory floors are digitized, manufacturers, brands and consumers can verify exactly where a product was made, who made the product and how it was made. When sourcing flows are digitized, the same stakeholders can verify whether the fabric was truly ethically sourced and if the material is as sustainable as it is claimed to be.

If manufacturing processes are digitized and logged, carbon footprint becomes transparent for all to see. Finally, if quality controls, audits, and environmental, social and governance (ESG) assessments are digitized, their reports become verifiable and available for all brands and consumers.

We already know that the majority of Gen Z – the generation that was born between 1997-2012 – and millennial consumers would prefer to buy sustainable and ethically sourced products at the same price. Many would even pay more for it. But the important catalyst to increase the adoption of ESG-friendly practices is to get brands, manufacturers, and old-school businesses to adopt them. And perhaps the quickest way would be to use digitization-driven-profitability to catalyze, incentivize and encourage it.

Benefits of digitization

Digitization will certainly make the bottom line better for businesses and in return provide significantly greater levels of transparency and sustainability. Newly available funds could then be re-invested in setting up processes that are both environment and employee-friendly. This would mean, fairer wages, better practices, and more sustainable fabrics without costing businesses a cent.

These changes will ultimately help the business landscape become more ethical as corporates adopt an inside-out approach as opposed to following a remedial exercise. Leveraging technology in businesses will have a bigger impact on collective productivity gain due to transactional efficiencies and the innovation-multiplier effect that results from digitized processes.

The time is now to drive the transformation of global capitalism towards a more digital, more inclusive, and more ethical future.