Fast Retailing: How sustainable is the largest fast-fashion company in Japan?

Fast fashion and its environmental and social costs

Fast fashion refers to clothing that is inexpensive and produced rapidly by mass-market retailers in response to the latest trends (via Oxford Languages). With these characteristics, fast-fashion products are very attractive to the majority of consumers interested in both cost-efficient and trending clothing, especially the younger generation. However, there is a lot of criticism focusing on its true cost: environmental and social costs.

Not only fast fashion, but the apparel industry itself also has environmental and social costs. For the environment, the fashion industry is responsible for a significant amount of greenhouse gas emissions, environmental pollution from wastewater and plastic materials, and water exploitation. The industry also has social costs, such as lower wages, poor working conditions, and gender-related issues in developing countries.

Fast Retailing and their practices for sustainability

Fast Retailing is the largest apparel company in Japan, known for Uniqlo, their signature brand, and GU, with $18.45 billion in sales in 2021 (ranked third globally, after Zara of Inditex and H&M). To begin with, Fast Retailing advocates “Unlocking the Power of Clothing” in its sustainability statement, and they believe “we can turn the power of clothing into a force for good.” For them, good clothing means simple, high-quality, and long-lasting products that enrich the lives of people, which is consistent with their group’s concept, “LifeWear.” In their model below, you can see how the group integrates their sustainability vision into their business from a systematic perspective.

On the company side (on the left), they are trying to reduce greenhouse gas emissions both from their own operations (by 90%) and from their supply chain (by 20%) by 2030 over 2019 levels, in their attempt to achieve carbon neutrality by 2050. In addition, they clearly state that they respect human rights in all production processes by strengthening transparency in their supply chain, partnering with the Fair Labor Association (FLA) to pursue a living wage for workers.

On the consumers’ side (on the right), they refer to their responsibility for clothes reaching customers’ hands and the importance of building a recycling-oriented society, where people wear their clothes for a long time or recycle them rather than throwing them away (along with their initiative to increase the proportion of recycled materials in their products to approximately 50% by 2030). They also emphasize “society” and “people” (stated at the bottom of the LifeWear Concept), by contributing to communities, diversity and gender equality, and sustainability promotion.

From the above-mentioned information, it is safe to say Fast Retailing is a relatively sustainable clothing company with their tangible model for sustainability, as the company is ranked high on the list from major ESG rating companies, such as Sustainalytics.

Next week, I will introduce actual examples of their actions toward sustainability and make a critical review of their vision and practices.