Project Greenway: Why is the EU under criticism for their new greenwashing proposal?

Welcome to the fifth edition of?Project Greenway, a bi-weekly newsletter on everything in fashion that piqued our interest at?charles.app ?in the past two weeks.?Follow us on Instagram to get the news (and a lot of sass) daily.

?? What we read

EU passes laws to reduce greenwashing and boost repairs

The European Union has just proposed new legislation against greenwashing.

What is this?

• The Green Claims Directive, as it is casually referred to, could see brands that make unsubstantiated environmental claims for marketing purposes sanctioned. According to the rules, such brands could be penalised with fines equal to 4 per cent of their revenue and/or be banned from public procurement processes for a year.

Why this is interesting:

• The latest version of the proposal has already stirred controversy: some industry experts have described it as too vague to be effective, calling out the lobbying pressure that has led to the watering down of previous, more aggressive versions of the proposal.
• Contrary to the previous drafts of the proposal, unveiled by the FT, which adopted a specific, universal methodology to assess such claims of sustainability, the new proposal does away with such specificity. In practice, this means any companies that want to make such claims are free to pick-and-choose the methodology that supports their claims the most.
• The approach taken by the proposal creates a threat: by allowing different companies to use different methodologies, it could lull the public into calmness under the potentially false security of this proposal. This could turn consumers to taking sustainability claims more seriously, even when they should not. As Gilles Dufrasne from Carbon Market Watch notes, the proposal could "backfire and create legitimacy for claims that amount to greenwashing”.

Why now?

• The time has been ripe for regulation against greenwashing - according to the UK Competition Authority, some categories suffer from overwhelming claims of sustainability (100% of toilet products are marketed as green or environmentally friendly). Fashion brands are not excluded: after recycled polyester was found to be just as damaging to the environment as actual polyester, for example, many fashion brands were found in the middle of serious greenwashing claims in the past two years (H&M, Nike, and Zara are just three of those).
• Although stricter regulation is desperately needed, the EU may be holding back due to disagreements across its member states on the required severity of any proposed measures: Germany and Italy are two examples of countries whose most lucrative industries (automotive and fashion) are bound to be slowed down by regulation that is deemed to be too strict.

Read more about the proposal here and here .

Mango enters the rental space

Mango has invested in and launched a partnership with the Spanish rental startup La Más Mona.

What is this?

• Mango has been actively investing in new fashion tech businesses through its venture arm, Mango StartUp studio. The latest investment is in La Más Mona, a startup which creates a white-labelled rental platform for brands that want to rent out their clothing.
• Mango is also launching their rental marketplace (powered by La Más Mona) in Spain. The rental platform (found on mangorenting.com ) features 40 women's outfits every month, ranging from dresses to stylish suits. These are available for 4-day rentals at an average price of 35EUR / ￡30.

Why is this interesting?

• Rental provides concrete benefits for the consumer. They can keep their closet interesting without endlessly spending, they can don new outfits without cluttering their wardrobes, and they can stay on-trend without hurting the environment. With this in mind, B2C rental is more complicated: for a profit-seeking business, rental has to be executed flawlessly to avoid tarnishing the brand.
• The nature of renting out the same item to multiple people paired with the risk of brand damage if consumers receive items that are not up to scratch leads to an interesting outcome: the brand has to impose a very high standard of quality inspection between consecutive rentals which elevates the cost of a rental, relative to a purchase, thus making rentals less attractive to consumers who are looking to save money.
• Indeed, Mango's rental is pricey. Someone would pay EUR35 to rent out a dress for 4 days: although not prohibitive, the cost of rental approaches the outright cost of buying similar items from Mango, as Mango dresses can be bought for prices ranging from EUR30.
• From a commercial perspective, B2C rental has a narrow application: it could target people who are firmly in the "only-wear-once-and-never-resell" category, so would never opt for purchasing an item for a premium, as they derive no incremental value from it that could justify the small additional cost of an outright purchase. Additionally, it could target people who are so sustainably-minded that they would always choose the more sustainable option, even if it comes at a similar or higher cost.

Why now:

• Mango is coming out of its best year: in 2022, it posted its strongest financials yet, with its womenswear line crossing the EUR2bn mark for the first time. It also signed a refinancing agreement for its debt, linked to ESG criteria. Given the pressure consumers have put on most fast-fashion brands and the regulated fashion path ahead (increasingly obvious to everyone as regulation around the world gets passed), it is not surprising to see Mango Group invest in a carbon-light revenue stream. If successfully executed, rental could become a non-polluting, albeit logistically complex revenue stream for the brand.
• Mango just launched its premium Capsule collection . Rental could allow the brand to comfortably launch higher-margin luxury lines: they could fuel growth by bringing in a higher income consumers, without alienating their core demographic, as the latter could still access the luxury line through rental.

Read more about Mango here and here .

Other Interesting Reads

• Primark proposes durability standard in partnership with WRAP - Link
• Allbirds showcases first-ever carbon-neutral shoe - Link
• Kering commits to reduce group emissions by 40% by 2035 - Link
• Stella McCartney launches plant-based cellulose BioSequins in partnership with Radiant Matter - Link

?? What we watched

Shawn Mendes x Tommy Hilfiger

We kept our eyes peeled as Tommy Hilfiger unveiled the first collection under the "Classics Reborn" campaign, a collaboration with Shawn Mendes. The collection features 28 looks from Tommy's 1985 collection, reimagined with more sustainable materials. It further includes a US $ 1 million donation to mitigate the environmental impacts of Shawn's ongoing world tour.

• The collection reimagines Tommy Hilfiger's classic pieces in a more sustainable way, using recycled cotton and other sustainably sourced materials. It also includes a $1m donation to mitigate the environmental impact of Shawn Mendes' tour (which has since been cancelled).
• Check out all the campaign photos here and learn more about what the fashion industry thought about it here .

? Who we followed:??

Neem London

Why?

The public usually thinks of female fashion as faster and more polluting, so sustainable menswear brands often receive less attention. Neem London is a proudly sustainable menswear brand which has made "Clean Living" its motto. They openly disclose the impact of their clothing everywhere (just check out their website) and they regularly organise cool events that focus on making the fashion industry more sustainable. (there's one on regenerative cotton happening tonight - check it out)!