ROSI Helps Apparel Companies Make Strategic Investments in Sustainable Business Practices
There are numerous material environmental, social and governance (ESG) issues facing the apparel industry including unfair labor practices, pollution, waste, and climate change. In addition, the COVID-19 crisis has created new crises (e.g. supply chain disruptions, labor and employee challenges) while also presenting opportunities for companies to find innovative ways to connect with consumers and to ensure resiliency in their supply chains. But companies lack sufficient frameworks and methodologies to understand how their investments in tackling these challenges can drive positive financial value for their companies.With support from HSBC Bank USA, NYU Stern Center for Sustainable Business partnered with a set of apparel companies on the ROSI methodology to estimate the value of tangible and intangible benefits that apparel companies can accrue by making strategic investments in more sustainable business practices. We engaged companies including EILEEN FISHER, Reformation, and REI in the project, and conducted both primary and secondary research leveraging industry experts, company contacts, and academic literature to inform our framework. To view a full overview of the process and the strategies framework, click here.
Eight Strategies for Success
Our research found that there are eight key sustainability strategies that apparel companies are focusing on to drive impact in their business models. These include operational efficiency focused activities such as improving chemical management and waste management, improving sustainable raw material sourcing, and rethinking business models through a focus on increasing circular economy practices and improving people well-being. Underneath these eight practices we’ve identified over sixty practices and sub-practices that describe the crucial activities companies are undertaking to realize and implement their strategies. For example, we found that companies are realizing their goals to increase sustainable raw material sourcing by both integrating more sustainable raw materials (i.e. increasing organic materials, and investing in R&D to identify new sustainable alternatives) and also incorporating more reused and recycled materials (e.g. by designing product to reuse fabric scraps).This website will continue to be updated as we develop additional tools and resources. We welcome feedback and partners to further our work. Please reach out to Sophie Rifkin, Director of Corporate Research and Engagement, NYU Stern CSB (srifkin@stern.nyu.edu) to discuss further.
