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Investing in fashion - how do our investments measure up?

Investing in fashion, with sewing machines in background, cabon emmission, labor practises and ethical business practises

It's Fashion Revolution Week 2024!  Fashion revolution is an initiative advocating for a fashion industry with positive environmental and social impacts.  It was founded following the devastating Rana Plaza disaster in 2013, when a building in Bangladesh housing five garment factories collapsed, leaded to the deaths of 1,134 people, highlighting the clear need for reform of the industry.   

To coincide with Fashion Revolution Week 2024, and inline with our goal of responsible ownership and stewardship we took a closer look at our fashion investments, to see if they measure up to suitably high standards. 

Sewing machine factory
Why does this matter to WPF? 

Did you know that fashion accounts for 10% of the World's carbon emissions from human activity?  It is also a heavily polluting industry, which is one of the main drivers of biodiversity loss. 

As a fund with a net zero by 2050 target, we need to understand how our investments in fashion companies are managing these issues. 

From a recent review of our holdings, we hold shares in 16 different fashion companies, at a value of £20m. 

90% of this exposure is made up of 5 companies, representing several underlying brands, which is where we focussed our efforts for this report. 

Social & Environmental factors 

Assessing the credentials of a fashion company is challenging, as multiple different ESG issues need to be woven together. 

Examples of issues to consider are as follows: 

  • Carbon emissions, pollution, water usage, sustainable materials
  • Labour practices, human rights, equality, diversity and inclusion

  • Transparency, ethical business practices, product lifecycle management

Infographic, Carbon emmissions, Labour practises, Transparency, ethical business .

One of our investment beliefs is that we wish to invest in a way that minimises negative impacts on society and the environment, and where possible, makes a positive contribution. 

Case study - Adidas (WPF holding £0.3m) 

Blue footprints
 Engagement work:  Adidas maintains operations in Myanmar, a country with significant human rights issues, and one which many other companies have exited.  The company was also subject to a letter from the US House Select Committee on the Chinese Communist Party regarding supply chain links to cotton produced with Uyghur forced labour. LAPFF (Local Authority Pension Fund Forum, of which WPF is a member) was keen to understand why Adidas has decided to maintain operations in the country. 

Outcome: LAPFF met with Adidas to ask questions around the company's approach to human rights risk management in its global supply chains and received comprehensive answers. 

Ongoing issues:  LAPFF will continue to monitor how the company chooses to publicise its supply chain practices, as well as continuing to monitor labour rights issues in both Myanmar and Xinjiang. 

WPF opinion:  We are pleased that LAPFF have asked these questions and will continue to monitor this as an ongoing issue. 


Finding a sustainable way forward for the fashion industry will be an important part of the planet's journey to net zero, alongside behavioural changes such as excess consumption.  To assess how our largest companies are doing, we turned to some valuable industry tools*. 

Within our sustainable equities portfolio, managed by Brunel, we hold shares in Kering (£4m).  What makes this company more sustainable than its peers?  Let's see how the top 5 fashion companies in our portfolio measure up: 

Image of table, download available

Download link for above table (Excel doc) [10KB] (opens new window)

Based on this information alone, we can see that Kering stacks up well as a company that is setting targets, making progress, and being transparent with stakeholders, and clearly standing head and shoulders above peers, therefore earning its place in our sustainable equities portfolio.  All the companies have progress to make, but some more than others in this area.  The information above will provide us with an improved knowledge of the risks for each company, and we will be discussing these findings with our managers. 

Blue Scissors Icon

LAPFF (Local Authority Pension Funds Forum, of which WPF is a member) have begun a programme to engage with luxury goods retailers, specifically on their practices around human rights risk management in their supply chains, with an aim of encouraging better due diligence and disclosure. 

The first meeting in this programme was with a senior independent director at Richemont, where the company acknowledged it still has a way to go, but discussions were positive.  The second meeting, with Kering, showed that this company is further ahead with disclosures, and was open to discussions on further improvements.


Fashion Revolution Week 2024 serves as a pivotal moment for assessing the fashion industry's impact on our planet and society.  By engaging with companies like Adidas and analysing the environmental and social governance (ESG) performance of key brands within our portfolio, we're advancing toward our net zero by 2050 goal. Notably, Kering emerges as a leader in sustainability efforts, reflecting our investment strategy's alignment with our environmental and social objectives. This evaluation reinforces the importance of ongoing engagement and investment scrutiny to promote a more sustainable and responsible fashion industry, guiding our future actions towards positive change. 

_9 Safeguard assets, 10 strong risk adjusted returns, 12 positive impact, 15 transparency and information sharing,


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