“Creating a strong business and building a better world are not conflicting goals — they are both essential ingredients for long-term success.”
-William Clay Ford Jr., Executive Chairman of Ford Motor Company
Are you familiar with the outdoor clothing brand Patagonia? This brand made news in 2011 when it officially supported a consumer boycott of Black Friday. The company encouraged consumers to purchase just what they need and to retain their garments for as long as possible. By taking such a courageous step, Patagonia was able to solidify its position as a pioneer in sustainable fashion and enhance customer loyalty. In 2022, the company introduced a new effort beyond its main business and was named “Regenerative Organic.” The objective of this new venture is to go beyond only decreasing the negative effect on the environment and instead start actively renewing the ecosystem.
Sustainability has emerged as a subject of discussion that is pervasive throughout all sectors of the economy, and the luxury sector is not an exception. The term “sustainability” is used in the luxury business to refer to adopting responsible methods that respect the environment, human rights, and local communities. Additionally, it speaks to promoting transparency and ethics across the whole supply chain. The economy, society, and the environment comprise sustainability’s three pillars. Sustainability is crucial in the luxury sector to reduce the negative effect it has on the environment and the communities in which it operates, to satisfy the requirements of a customer who is becoming more conscientious and demanding, and to serve as a source of innovation, efficiency, and distinctiveness for luxury businesses.
There is still a widespread prevalence of the ironic paradox of sustainable luxury companies. Luxury is sometimes seen as superficial and having potential to inflame societal friction. Still, luxury companies are centred upon longevity, exclusivity via limited numbers, and fine workmanship reinforced by high-quality materials and transmission. As a result of this, the sense of social peace, which serves the idea of sustainability, is finally rejected, and a socially conscious client is compelled to boycott luxury businesses in favour of other firms that are more concerned with sustainability.
At first glance, luxury is in an excellent position to move freely within sustainability. Its goods are long-lasting by nature since they are crafted from materials of the greatest calibre. Even without effort, luxury is a way to save the earth. But is that the case?
During the middle of the 2010s, there was a movement in buying attitudes, which started to correlate with the rising presence of ethical issues. An industry-wide sustainable transition that pioneered good development in the luxury business was driven by COVID-19 in 2020, which acted as the trigger for change. Millennials and Gen Z are the most environmentally concerned generation, and it is anticipated that they will account for 70% of the luxury market by 2025. Luxury firms are moving their focus towards sustainability to cater to this generation.
In recent years, for instance, two of the greatest luxury fashion businesses in the world, LVMH and Kering, have made substantial efforts to address issues over sustainability and the environment. Brands that embrace sustainability and make it a part of their DNA will be the ones that stand out. It is no longer the case that luxury and sustainability are incompatible in today’s market; instead, they are a critical mix that will drive success and development for businesses in the coming years, offering the chance to contribute to a more sustainable and caring environment. There are many similarities between sustainability and luxury. For instance, it encourages creativity by cooperating with professionals from different fields and provides a sense of trust and direction through solid values. In today’s world, the degree to which a firm is devoted to sustainability is becoming an increasingly crucial component of how consumers perceive a brand. It is called ESG, which stands for environmental, social, and governance.
When seen in this light, luxury businesses may have a significant potential to capitalise on this by adopting sustainability and successfully communicating about new ethical efforts via various touchpoints. They represent the starting point of a more positive cycle, in which businesses teach customers about sustainability while simultaneously strengthening their brand image and growing their impact among a larger audience searching for a more meaningful way to consume. To successfully include sustainability in a brand’s strategy, considerable preparation is required to ensure optimum positioning, authenticity, transparency, and independent monitoring.
Throughout the last few years, we have seen a rise in luxury businesses that promised to lower their carbon footprints, used more sustainable materials, rethought their packaging, sold or donated excess textiles to save waste, and used more sustainable materials. There is a need to act more sustainably to maintain relevance. To avoid negative publicity, transparency needs to become a priority. Companies that are seen to be socially responsible and exhibit openness about their activities and how they carry them out are more likely to be trusted and have a favourable image of their brand. Luxury businesses may create new tales and offer their consumers a feeling of respect and belonging by building awareness via a subtle and realistic plot. This is a creative method for luxury brands to show their customers they mean something. Sustainability in luxury is all about finding the perfect balance between driving demand for exquisite experiences and goods and taking responsibility for maintaining the world for future generations of luxury consumers.
Author: Fatema Nawar Silme
