• Over 50 brands, suppliers, retailers, NGOs, and industry associations are supporting a request to governments for trade policy to incentivize the use of environmentally preferred materials.

• Presented by Textile Exchange at COP26, the request calls for preferential tariffs on materials like organic cotton and recycled fibers.

• Using trade policy to incentivize better practice in raw materials sourcing would be a ground-breaking use of legislation to level the playing field for fashion and textile companies looking to lower their environmental impacts.

• The request supports Textile Exchange’s aim to accelerate progress towards its industry goal of a 45% reduction in greenhouse gas (GHG) emissions from textile fiber and material production by 2030, in line with the Paris Agreement.

The global apparel and textile industry, which generates over $1.5 trillion in annual revenue and used 109 million tons of fibers in 2020, is actively working to be part of the solution to the climate crisis.

Over 50 companies and organizations have joined forces to ask for policy change to incentivize the use of environmentally preferred materials such as organic cotton and recycled fibers.

The request, presented at COP26 by global non-profit Textile Exchange, is a practical solution to help the industry achieve its climate goals with an important but often overlooked policy lever: trade policy.

Cost is one of the key barriers faced by companies looking to shift their supply chain towards environmentally preferred materials. But by mitigating or narrowing price premiums, trade mechanisms can be used to incentivize the increased production and adoption of these fibers, making them more favorable than, or at least equal to, their conventional counterparts.

Using trade policy to incentivize better practice in materials sourcing is a ground-breaking use of legislation for the industry, working alongside regulations and penalties to promote positive action instead. It has the potential to level the playing field financially for companies committed to better materials sourcing, without the reduction in cost being felt by their supply chain or the farmers who grow the fibers.

Environmentally preferred materials should be defined as those from certified, verified sources that can be traced from raw material to finished product, and that are connected to data-driven environmental impact reductions. Organic cotton typically has a lower carbon footprint than conventional cotton, for example, as is the case with recycled polyester when compared to virgin polyester.

Textile Exchange has, for years, been positively impacting climate by accelerating the use of these materials across the fashion and textile industry. Today, it is uniquely positioned to work with governments to identify what is needed to qualify for incentives as an environmentally preferred material in a particular context, and how these credentials should be verified.

The policy request builds on Textile Exchange’s Preferential Tariff Project, initiated in 2018, which explored incentives such as tax credits and/or suspension or duty reductions of an imported component or finished, certified product.?It provides governments with a tangible action to remove a key barrier to scaling environmentally preferred materials: increased cost. Since nearly all major fashion producing and consuming countries have signed the Paris Agreement, it is addressed to every government present at COP26

With the recognition that appropriate policy initiatives may differ by jurisdiction, in this critical moment at COP26, Textile Exchange urges policymakers to consider working with the apparel and textile industry to develop thoughtful trade policy mechanisms in this area.

In turn, this would enable achievement of Textile Exchange’s industry goal of a 45% reduction in greenhouse gas (GHG) emissions in the pre-spinning phase of textile fiber and material production by 2030.

Supporting Quotes:?

Accelerating Circularity demonstrates how to put textiles to good use through building circular systems. We support preferential treatment of the materials that will enable the industry to meet our GHG reduction goals. Policy is an essential lever that can incentivize circular textiles system growth. We firmly stand behind this initiative as a positive path forward for the textile industry.

Karla Magruder, Founder, Accelerating Circularity

We must send one signal to the market with a shared definition and a cohesive movement as we double down on reaching targets for carbon emissions reductions. This will only be possible through an agreed policy for preferential tariffs with preferred materials.

Lewis Perkins, President, Apparel Impact Institute

Using environmentally preferred materials has been pivotal for Chloé to start our GHG emissions reductions. Of course, supply chain of such materials can be challenging, and we must encourage more and more farmers, growers, textile companies and designers to use organic and recycled natural fibers. We fully support better practices incentivizing trade policies that will help the spread of environmentally preferred materials: these are strong levers enabling higher quality products with innovative design, while reducing our global environmental footprint.

Christophe Bocquet, Fair Sourcing and Quality Director, Chloé

Scaling preferred materials, and driving the innovation of next generation materials, is pivotal in meeting the industry’s ambitious, but necessary, climate goals. Policy instruments, notably preferential tariffs are key levers to incentivize the industry to increase the uptake and accelerate the development of materials that can significantly decarbonize the industry. Fashion for Good wholly supports the efforts led by Textile Exchange to collaborate with policy makers in fostering an industry that encourages and supports innovative technologies to reach scale.

Katrin Ley, Managing Director, Fashion for Good

Sourcing more preferred fibers such as recycled polyester and organic cotton is an essential part of Gap Inc.’s efforts to reduce the impact of our products, and enabling us to progress against our climate and product sustainability targets. Supporting this transition via lower tariffs on these products helps the apparel industry move swiftly towards a more sustainable future.

Judy Adler, VP Environment, Social, and Governance (ESG), Gap Inc.

Global Fashion Agenda fully supports Textile Exchange’s call for incentive policies. Leaders at COP26 have the power to drastically reduce fashion’s greenhouse gas emissions in line with the Paris Agreement if they implement informed and impactful measures. Incentivising the use of environmentally preferred materials will help to break down the cost barrier, making sustainable material alternatives more accessible and enticing for fashion companies to utilise.

Federica Marchionni, Chief Executive Officer, Global Fashion Agenda

For the fashion industry, incentivizing traceable, lower impact and alternative materials is key to driving change. Currently there is nothing to induce uptake in trade policy and this makes no sense given the state of our planet. We need both regulation and incentives to reward positive action in fashion’s ecosystem. At Kering we encourage policymakers to rethink import duties to adapt, support and respond to the fashion industry’s pursuit of sustainability and contribution to a low-carbon economy.

Marie-Claire Daveu, Chief Sustainability and Institutional Affairs Officer, Kering

As a global company with production sites in different continents, we can only underline the importance of thoughtful trade policies to achieve the industry’s ambitious climate goals.

Florian Heubrandner, Vice President of Global Textile Business, Lenzing