Plastic use causes greenwashing concerns for fast fashion

Half of items listed on sites such as Boohoo, ASOS and PrettyLittleThing are entirely made from petrochemically-derived polymers

Despite many promoting environmentally friendly clothing, fast fashion brands such as Boohoo and ASOS are coming under fire for greenwashing, with most of their products found to contain damaging plastics.

Investors’ focus on ESG issues when building or adding to their portfolio is rapidly increasing, and any company that isn’t up to scratch will find itself cast aside.

A report from the Royal Society for Arts, Manufactures and Commerce (RSA) titled Fast Fashion’s Plastic Problem found most items listed on sites such as Boohoo, ASOS and PrettyLittleThing contain new plastics, with half being entirely made from petrochemically-derived polymers such as polyester, acrylic, elastane, and nylon.

These synthetic fibres use large amounts of energy and create environmental damage in their production, taking thousands of years to break down. Combined with a ‘throwaway culture’, the RSA warns the bulk of these garments are ending up in landfill.

Shopping habits

The pandemic, while contributing significantly to the boost in fast fashion, has also seen people change their attitudes towards clothing and spending habits. More than 60% of consumers admitted they spent less on clothing during the Covid-19 lockdowns, with nearly half feeling less pressured to do so.

Meanwhile, 17% said they had spent time repairing items in their existing wardrobe, and 19% confirmed they would continue to do this post-lockdown rather than buy new.

Josie Warden, head of regenerative design at the RSA, said: “The enormous tide of plastics used in the clothes we wear is one of the great environmental scandals of our generation. While we have been quicker to act on issues like plastic packaging and moving towards renewables, the fossil fuel industry has begun to pivot to new areas – including cheaply-made synthetic textiles.”

Greenwashing concerns

But when it comes to investing their wealth, greenwashing has topped the list of concerns for investors, according to research from Liontrust Asset Management.

The research shows 73% of discretionary fund managers and advisers said the proportion of clients investing sustainably had increased in the previous 12 months, compared to 59% in November 2019.

This considerable increase in sustainable investing goes hand in hand with the rising concerns about greenwashing – 64% of those surveyed said they were concerned, compared with just 35% in November 2019.

The Covid-19 crisis has intensified the spotlight on sustainable investing among investors, with 52% now viewing it as a more important focus because of the pandemic, according to Schroders Institutional Investor Study 2021.

In Europe, views were particularly strong, with 62% of investors now attaching a greater significance to sustainable investing because of the pandemic.

This report, like the research carried out by Liontrust, also names greenwashing as the biggest issue for investors, with 59% stating this as the most significant obstacle.

“Covid-19 has sharpened investors’ focus on ensuring their assets are being directed in the most sustainable ways. The global economy has a long way to go to return to pre-pandemic levels but ensuring that the recovery is sustainable is a key objective for many now,” explains Andy Howard, Schroders global head of sustainable investment.

“There is clearly work that still needs to be done to support this change. We need to ensure that any concerns or challenges our clients may perceive when it comes to investing sustainably are completely allayed, through ever clearer reporting and disclosures.”

Targeting fast fashion

Brands such as Boohoo and ASOS, popular stocks for many smaller company investors, have already faced hefty criticism for the use of synthetic materials, with others are likely to come under fire too.

Associated British Foods has hinted its popular Primark brand could soon have an online presence, which could result in an uptick in purchases of its already popular cheap clothing, and put it under the ESG spotlight.

“Fashions change and brands with a sustainability tag are increasingly being sought out by ethical minded shoppers,” says Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, adding that Boohoo, in particular, has already made some changes in the form of an electronic audit program and supplier consolidation, bringing on board those with better ethical and sustainable policies.

This article was originally published in ESG Clarity‘s sister title Portfolio Adviser.


Natasha Turner

Natasha is global editor at ESG Clarity, part of the Bonhill Group, and has been a financial journalist for seven years. She has been shortlisted for Story of the Year and Investment Journalist of the...