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Is Zara a Sustainable Business?

3 March 2023 | 5 Min Read

Zara, the flagship brand of Spanish clothing giant Inditex, boasts over 3000 stores around the world and millions of dollars in profit. Zara is a fast-fashion retailer that sells trendy clothing at discounted prices - we’re sure you’ve seen them when walking through the high street or mall.

The company has taken steps to improve its practices, such as joining forces with a non-profit organization that captures steel mill emissions and turns them into energy. Unfortunately, there are still some substantial shortcomings in current practices, with much improvement to be made. We try to be optimists, so let’s see what they’re doing, and what Zara can do to improve their environmental imapct. So, is Zara a sustainable brand?

Table of Contents

    ESG Score

    ESG, or environmental, social and governance, has become an increasingly significant factor in the fashion industry. Many companies strive to become more sustainable while consumers become increasingly concerned with their consumption habits, so the expectation gap between supplier and consumer is getting ever closer.
    One way to assess a company's sustainability credentials is through its ESG score. This score measures the company's performance on environmental, social and corporate governance matters and serves as an important indicator for investors when selecting stocks to invest in.

    Unfortunately, not all companies are created equal when it comes to sustainability. In fact, some may do more harm than good for the environment. For instance, Zara uses viscose material sourced from trees in India and China which has polluted local water and air.

    Thus, it's essential to comprehend the actual impact of a company's ESG initiatives. Furthermore, one should avoid "greenwashing" when it comes to sustainability claims as this could mislead consumers. Keep your eyes open to the greenwashing double-speak some brands may use! 

    Zara does have some commendable environmental policies, however, it is essential to be aware that they are not fully transparent regarding their supply chain traceability. Furthermore, less than 50% of their materials are produced sustainably and in ways that respect animal rights. Inditex, the parent company, is however investing more into its R&D for traceability and higher standards. 
    One ethical step Zara have taken is to not use any animal fur, angora, and products tested on animals.

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    Sustainable Products

    Are you looking to incorporate more sustainable items into your wardrobe? Zara has plenty of stylish clothes made from organic cotton and Tencel fibers. Their 'Join Life' collection is one such example.

    Zara advertises its Join Life clothing as being made from 100% sustainably-sourced materials, but there are some warning signs. For one, the apparel is manufactured in Turkey and many other East Asian countries where human rights violations and labor law violations remain prevalent. Costs are reduced, and passed on to the consumer. Is the saving worth it in your eyes?

    The Join Life collection incorporates some natural fabrics without relevant certifications, like cotton or linen. Furthermore, it includes a small amount of semi-synthetic fibers and regenerated cellulosic fabrics like Tencel lyocell, modal, acetate and viscose. There are some goals to address this over the coming years, including fully renewable energy being used in manufacturing, 100% organic status materials and more. 

    Although these materials are generally better than those employed in non-sustainable products, it's essential to remember that many still come from factories in the Global South where workers often receive inadequate pay and work under extreme pressure. As a result, fast fashion can have serious negative consequences on both its production process and those responsible.

    Inditex, the parent company, has taken several measures to address these concerns. In addition to creating a code of conduct for suppliers, they have published factory lists and details about supplier audits. Furthermore, Zara Pre-Owned' is now live - an online platform where consumers can sell their old items at discounted prices or donate them in kind.

    Meanwhile, the brand strives to improve its sourcing practices and create new fabrics that reduce strain on endangered forests. For instance, they're working with suppliers to expand access to more sustainable materials.

    These improvements are certainly a positive step, but they won't be enough to guarantee Zara is truly sustainable. Can that be achieved at massive scale? There’s no reason not to try and find out! 

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    Sustainable Initiatives

    Zara aims to reduce emissions, protect biodiversity and minimize waste while powering its factories with clean energy sources, avoiding toxic chemicals and producing zero discharge of hazardous materials.

    The company is part of the Global Fashion Agenda and uses sustainable fabrics such as organic cotton, recycled polyester and Tencel lyocell. Additionally, it has a clothing collection program similar to H&M or Uniqlo's, where customers can donate their unwanted garments in stores. 

    Zara follows suit with other fast fashion brands in using both natural and synthetic fibers for its garments. Unfortunately, it uses a relatively small proportion of organic and recycled fabrics. It’s also a founding member of the Canopystyle initiative, which seeks to minimize forest destruction.

    To achieve a sustainability score of 50, companies must be open about their environmental policy and worker rights must be respected, and ensure their workers are not exploited and the products they make don't harm animals. Furthermore, they need to cultivate a good relationship with their suppliers and manufacturers, especially learning towards local, and/or sustainable suppliers.
    Zara has made an impressive start, but it must improve in several areas to be truly sustainable. An overall score of just under 50% on the Fashion Transparency Index indicates this isn't good enough to support a long-term business venture.

    It has also earned poor ratings in regards to labor conditions and animal treatment. They do not pay their employees a living wage, and there have been reports of child labour in their Turkish and Brazilian factories.

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    Overall Score

    Zara has made great strides toward improving its environmental and ethical practices, but there are some concerning elements that raise alarm among sustainability advocates. These include the lack of transparency and their failure to pay a living wage across their supply chain.

    Furthermore, a recent study revealed that even when brands make an effort to be eco-friendly, their sustainability scores can still be low. This is likely because it's difficult for shoppers to accurately gauge the effects of sustainability initiatives.

    Fortunately, companies committed to sustainability can readily disclose their sustainability policies. This enables workers' rights and environmental advocates to detect and report abuses in supply chains, as well as brands and retailers managing risks while monitoring progress.

    Unfortunately, however, many companies fail to be as transparent as they should be. This often stems from a lack of awareness on the part of management teams, lack of resources and the intricacies involved with managing an international supply chain.

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