Explainer: Fashion and textiles — what it is, why it matters, and how to evaluate options

The fashion industry produces 92 million tonnes of textile waste annually, with only 1% recycled into new garments—yet the sustainable fashion market reached $8.1 billion in 2024 and is projected to grow at 9.9% CAGR through 2032. This tension between catastrophic environmental impact and nascent solutions defines the current landscape. For sustainability leads navigating material choices, supply chain decisions, and circularity investments, understanding what's real versus what's greenwashing has never been more critical. The EU Commission found that 59% of sustainability claims by fashion brands in 2024 were vague, misleading, or unverifiable—making rigorous evaluation frameworks essential.

Why It Matters

Fashion accounts for 8-10% of global carbon emissions—more than international aviation and maritime shipping combined. The industry consumes 93-215 trillion liters of water annually and is responsible for 20% of global industrial wastewater pollution, primarily from textile dyeing and treatment. These aren't abstract numbers: producing a single cotton t-shirt requires 2,700 liters of water, while one pair of jeans demands approximately 7,570 liters.

The production trajectory compounds the crisis. Global clothing production doubled between 2000 and 2014, with per capita consumption surging from 5.9 kg to 13 kg between 1975 and 2018. Consumers now buy 60% more garments than in 2000 but keep them half as long. If current trends continue, fashion's share of the global carbon budget could reach 26% by 2050.

Material composition drives much of the environmental burden. Approximately 60% of clothing materials derive from plastics—polyester, nylon, and acrylic—requiring 98 million tonnes of non-renewable resources annually. Synthetic textiles contribute 35% of ocean microplastics, with 500,000 tonnes of microfibers released annually from washing alone. The chemical footprint is equally concerning: textile manufacturing uses over 15,000 chemicals, many unregulated, contributing to 11% of global plastic waste.

Economic losses parallel environmental damage. The Ellen MacArthur Foundation estimates material value loss at $100+ billion annually from linear production models. With 87% of materials ending in incinerators or landfills, the business case for circularity is increasingly clear—yet less than 0.3% of resources used in textile production currently come from recycled sources.

Key Concepts

Circularity in Textiles

True circularity requires designing out waste, keeping materials in use, and regenerating natural systems. In fashion, this translates to three intervention points: pre-consumer (design and manufacturing), consumer use (longevity and care), and post-consumer (collection, sorting, and recycling). Each stage presents distinct technical and economic challenges.

Fiber-to-fiber recycling represents the holy grail—transforming used garments into feedstock for new textiles. Mechanical recycling (shredding and respinning) works for single-material items but degrades fiber quality. Chemical recycling (breaking materials to molecular level) handles blends and produces virgin-quality output but requires significant capital and energy. Current chemical recycling capacity covers less than 1% of global textile production.

Life Cycle Assessment (LCA)

LCA quantifies environmental impacts across a product's entire lifecycle—raw material extraction, manufacturing, transport, use, and end-of-life. For textiles, key metrics include:

Impact Category	Measurement Unit	Key Drivers
Carbon Footprint	kg CO₂e per garment	Fiber production, dyeing, transport
Water Consumption	Liters per garment	Cotton cultivation, wet processing
Eutrophication	kg PO₄e per garment	Fertilizers, wastewater
Toxicity	CTUh/CTUe	Chemical treatments, dyes
Microplastic Release	Grams per wash cycle	Synthetic fiber composition

Critical caveat: LCA results vary dramatically based on boundary definitions and data sources. A polyester garment can appear better or worse than cotton depending on whether the analysis includes microplastic impacts, end-of-life scenarios, or land use change. Always verify methodology before comparing claims.

Scope 3 Emissions Dominance

Over 96% of emissions from major apparel brands are Scope 3—occurring in supply chains rather than direct operations. This means brand sustainability claims hinge on supplier data that few can independently verify. The 2024 Fashion Transparency Index found no major brand has achieved full supply chain traceability.

Key Performance Indicators by Intervention Type

Intervention	Primary KPI	Industry Median	Top Quartile
Recycled Content	% post-consumer recycled	3-8%	>25%
Water Reduction	Liters saved per garment	15-25% reduction	>50% reduction
Chemical Management	ZDHC compliance level	Foundational	Progressive/Aspirational
Garment Longevity	Wears before disposal	30-50 wears	>150 wears
Take-back Rate	% sold items returned	2-5%	>15%
Traceability	Supply chain tiers mapped	Tier 1 only	Tier 4+ (farm level)

What's Working

Chemical Recycling at Scale

The chemical recycling sector has attracted substantial investment and begun proving commercial viability. Infinited Fiber Company closed a €40 million funding round in March 2024, with backing from Inditex, H&M Group, and adidas. Their first commercial factory in Northern Finland targets 30,000 tonnes annual capacity by 2026. Circ raised $25 million in March 2025 to scale polycotton separation technology, partnering with Levi's and Adidas for fiber supply.

Ambercycle's cycora® regenerated polyester secured multi-year deals: a four-year agreement with Ganni (January 2025) and strategic partnership with Shenghong for global scaling. These aren't pilot projects—they're commercial commitments representing industrial-scale adoption.

Brand Investment Signals

Major brands are moving beyond pledges to capital deployment. H&M Group has invested over $29 million in textile recycling technologies since 2017. Inditex (Zara's parent) committed $74 million to Ambercycle in October 2023. Breakthrough Energy Ventures, backed by Bill Gates with $2+ billion committed capital, has invested in Circ—validating the technology thesis from climate finance leaders.

Resale and Rental Models

The secondhand apparel market demonstrates proven demand, with 90% carbon mitigation potential versus new production. Resale programs are growing at 3.4x annually, with the market expected to reach $64 billion by 2029. Brands like Patagonia (Worn Wear), Eileen Fisher (Renew), and The North Face (Renewed) have integrated resale into core operations rather than treating it as peripheral.

AI and Digitization

Technology applications show measurable impact. Smartex's AI vision software detects textile defects during production, achieving 0.37% more garments per kilogram of fabric through waste reduction. The company raised $24.7 million in Series A funding from Lightspeed Venture Partners, with backing from H&M Group and Tony Fadell.

What's Not Working

The Renewcell Collapse

Renewcell's February 2024 bankruptcy offers a cautionary tale about the gap between brand rhetoric and purchasing behavior. The Swedish pioneer of Circulose® (dissolving pulp from cotton textile waste) had support from H&M, Reformation, and Ganni. It built the first industrial-scale facility and generated significant press coverage. Yet it sold only 18,000 tonnes in 2023 against 60,000-tonne capacity—needing 50% utilization just for breakeven.

The lesson: brands publicly supported sustainable materials but didn't commit purchasing volumes at scale. First-mover disadvantage proved real when high costs met weak demand.

Greenwashing Proliferation

The EU Commission's 2024 analysis finding 59% of sustainability claims vague or misleading reflects systematic dysfunction. Common patterns include: highlighting small recycled content percentages as major achievements, using undefined terms like "conscious" or "eco-friendly," and promoting take-back programs with minimal actual recycling. The prevalence erodes consumer trust and disadvantages genuinely sustainable operators.

Collection-to-Recycling Gap

While take-back programs proliferate, collected textiles rarely achieve fiber-to-fiber recycling. Most end up exported, downcycled into industrial materials, or landfilled. The global infrastructure for sorting blended materials, removing contaminants, and feeding recycling facilities remains underdeveloped. Collection without recycling capacity creates feel-good programs that don't address material flows.

Living Wage Failures

Environmental sustainability cannot be isolated from social sustainability. According to Clean Clothes Campaign analysis, 93% of fashion companies don't pay workers a living wage. Supply chain improvements in carbon and water often occur in facilities with unaddressed labor rights issues—creating sustainability reporting that ignores human costs.

Key Players

Established Leaders

Patagonia — Integrated repair, resale (Worn Wear), and regenerative organic cotton sourcing; industry benchmark for authentic sustainability positioning
Stella McCartney — Pioneered luxury fashion without leather or fur; early adopter of innovative materials including Bolt Threads' Mylo mycelium leather
H&M Group — Largest apparel investor in textile recycling technology; operates global garment collection program (though recycling rates remain low)
Inditex — Major capital deployment into recycling startups; committed to 100% sustainable fabrics by 2030 with significant sourcing agreements
Eileen Fisher — Circular system leader with Renew resale program; take-back rate significantly above industry average

Emerging Startups

Circ — Polycotton separation technology enabling blended textile recycling; $25M raised March 2025 with Taranis, BEV, and Inditex backing
Infinited Fiber Company — Infinna™ regenerated fiber from textile waste; €40M raised 2024, first commercial plant 2026
Ambercycle — Cycora® regenerated polyester from garment waste; multi-year deals with Ganni and major manufacturers
Smartex — AI vision for defect detection reducing textile manufacturing waste; $24.7M Series A
Syre — Chemical recycling for circular polyester; first gigascale plant planned for 2027 (150-250K tonnes/year)

Key Investors & Funders

Breakthrough Energy Ventures — Bill Gates-backed fund with $2B+ capital investing in textile recycling (Circ)
H&M Group Ventures — Strategic investments in Ambercycle, Smartex, and Worn Again Technologies
Fashion for Good — 9-month accelerator with 22 corporate partners including major brands
Laudes Foundation — Philanthropic capital for sustainable materials and circular business models
Taranis Carbon Ventures — Industrial-scale sustainable solutions; led Circ $25M round (March 2025)

Examples

Infinited Fiber Company: From Lab to Commercial Scale

The Finnish startup demonstrates successful navigation from innovation to industrialization. Founded in 2016, Infinited Fiber developed Infinna™—regenerated fiber from cotton-rich textile waste. Unlike competitors who struggled with demand, they secured multi-year purchase commitments before building capacity: PVH Europe (Tommy Hilfiger), Inditex (three-year deal), H&M Group, and adidas all became both investors and customers.

Their €40 million March 2024 funding round (during the same month Renewcell filed for bankruptcy) included strategic partners TTY Management (Uniqlo CEO's firm), Youngone, and Goldwin. The €400 million commercial factory in Northern Finland targets 30,000 tonnes annually by 2026—with contracted offtake providing revenue visibility before the facility opens. Products using Infinna™ are already in market: PANGAIA shirts (100% Infinna), Tommy Hilfiger pieces, and Ganni collections.

Patagonia Worn Wear: Integrated Circularity

Patagonia's Worn Wear program exemplifies how resale can integrate with core business rather than operating as marketing exercise. The company repairs approximately 100,000 garments annually through its repair centers, extending product lifespan and reducing replacement purchases. Worn Wear resale operates online and through dedicated store-in-store concepts, with trade-in credits incentivizing returns.

Critical to success: Patagonia designs for durability and repairability from product inception. Ironclad guarantee policies encourage rather than discourage purchases. The company doesn't separate "sustainability" from business strategy—repair and resale strengthen brand loyalty while demonstrating that reduced consumption is compatible with commercial viability.

Smartex: AI for Manufacturing Waste Reduction

The sustainable fashion discourse often overlooks manufacturing-stage waste. Smartex addresses this with AI vision systems deployed in textile factories worldwide. Their technology identifies defects in real-time during production, preventing flawed materials from becoming flawed garments.

Results are measurable: 0.37% more usable garments per kilogram of fabric processed. At industrial scale, this compounds to significant material savings and cost reductions. The startup attracted $24.7 million Series A led by Tony Fadell (iPod/Nest inventor) and Lightspeed Venture Partners, with H&M Group participating as strategic investor. They were selected for AWS Compute for Climate Fellowship, validating the technology thesis from major infrastructure partners.

Action Checklist

Map your current material mix by fiber type and calculate baseline environmental metrics using verified LCA data
Audit supplier sustainability claims—request ZDHC compliance documentation, third-party certifications, and actual (not projected) recycled content percentages
Evaluate chemical recycling partnerships based on commercial traction, not pilot results—prioritize companies with multi-year offtake agreements
Implement product design reviews for recyclability: mono-materials where possible, removable trims, standardized components
Establish take-back programs with documented end-of-life pathways—know where collected garments actually go
Calculate true unit economics for sustainable alternatives including durability, repair costs, and resale value retention
Build supplier traceability beyond Tier 1—target farm/fiber origin visibility
Set internal carbon price to evaluate material and sourcing decisions against climate commitments
Engage with pre-competitive initiatives (Fashion for Good, ZDHC, Ellen MacArthur Foundation) for standard-setting participation

FAQ

Q: How do I verify recycled content claims from suppliers? A: Require third-party certification (Global Recycled Standard, Recycled Claim Standard) with chain of custody documentation. Request transaction certificates for specific orders, not just general facility certification. For post-consumer recycled content specifically, verify feedstock sources—many "recycled" claims use pre-consumer waste (manufacturing scraps) which is easier to source but less impactful. Consider periodic audits through organizations like OEKO-TEX or Textile Exchange. If suppliers cannot provide this documentation, treat claims skeptically.

Q: What's the realistic timeline to achieve meaningful recycled content in product lines? A: For commodity items (basic tees, underwear), 20-30% post-consumer recycled content is achievable within 12-18 months through certified recycled polyester suppliers. For complex garments with blends, expect 3-5 years to reach significant percentages as chemical recycling capacity scales. Budget for 10-25% cost premiums initially, declining to 5-10% as volume increases. The bottleneck is usually supply availability rather than willingness to pay—secure long-term offtake agreements with recycling startups to guarantee access.

Q: How should we prioritize between carbon reduction and water impact reduction? A: Context determines priority. For cotton-heavy product lines or manufacturing in water-stressed regions (South Asia, Mediterranean), water reduction may deliver greater local impact. For synthetic-heavy lines with Asian manufacturing, carbon typically dominates. Use materiality assessment to identify where your specific supply chain creates most impact—then focus resources there rather than spreading thinly across all metrics. Be wary of "whack-a-mole" where solving one problem creates another (e.g., switching from water-intensive cotton to microplastic-shedding synthetics).

Q: What KPIs should we track for circular fashion initiatives? A: Focus on outcome metrics rather than activity metrics. Track actual recycling rate for collected garments (not just collection volume), product longevity (average wears before disposal, return rates for durability issues), and material loop closure (percentage of take-back that becomes new products vs. downcycling). For resale programs, monitor attachment rate (percentage of new purchasers who buy secondhand), price retention (resale value as percentage of original), and channel substitution (whether resale cannibalizes or complements new sales).

Q: Is certification worth the cost for small-to-medium brands? A: Certification ROI depends on customer segment and retail channel. For B2B sales to major retailers with sustainability requirements, certification (GOTS, GRS, OEKO-TEX) is often table stakes—cost is offset by market access. For direct-to-consumer brands, certification matters less than transparent communication about practices. Consider staged approach: start with high-volume products where certification cost per unit is lowest, expand as volume and margin support broader coverage. For chemical management specifically, ZDHC participation provides framework without full certification cost.

Sources

Ellen MacArthur Foundation, "A New Textiles Economy: Redesigning Fashion's Future," 2017
European Commission, "Environmental Claims Study," 2024
Fashion Transparency Index, "Annual Report 2024," Fashion Revolution
Geneva Environment Network, "Environmental Sustainability in the Fashion Industry," 2024
McKinsey & Company, "State of Fashion 2025," November 2024
UNEP, "Sustainability and Circularity in the Textile Value Chain," 2020
Business of Fashion, "Renewcell Files for Bankruptcy," February 2024
Infinited Fiber Company, "EUR 40 Million Development Financing Round," March 2024
Tracxn, "Textile Recycling Market & Investment Trends," 2025
Clean Clothes Campaign, "Living Wage Analysis in Global Garment Supply Chains," 2024