Placing Sustainability at the Heart of Kering

PARIS, France — Sustainability is embedded in the very concept of luxury. A cornerstone of luxury is the long-lasting endurance of an item. And if one of the key roles of our industry is to beautify the world, we have no greater responsibility than to do so ethically and sustainably.

We may have short-term goals, like setting trends or designing new products. But what of our long-term goals? It is essential that we place sustainability at the core of what we do and hold ourselves accountable. Given the current state of our planet — with diminishing resources, a growing population, loss of biodiversity and of course, climate change — it would be a grave mistake to bury our collective heads in the sand. And, in fact, the pursuit of sustainability is not only an imperative in the face of our global challenges; it also makes good business sense.

In recognition of this, over the last decade, sustainability has become increasingly integrated into businesses across many industries. Although this shift is often initially driven by compliance issues with regulations and laws, not to mention reputational risk management, companies are also beginning to see the value in embracing sustainability in terms of their access to resources, efficiency and innovation across their supply chains, and brand value. A robust sustainability strategy can also provide the focus, information and solutions necessary to be a resilient enterprise in a rapidly evolving and volatile world and to address and adapt to the changing needs of consumers, resource constraints and overall unpredictability.

But let’s be honest. While sustainability is without a doubt a business opportunity, it is fraught with challenges and unknowns. As such, it is a journey, no matter the size of the business, and it takes time. What is essential is to act and to make a start in areas where positive results can be achieved. This, while sounding straightforward, is not necessarily so, as once you start looking into your business through the lens of sustainability, you will see that businesses touch the environment and deal with people and communities at every step of their complex supply chains. Thus, prioritisation and focus are essential.

The next step is to set smart targets that can help you measure your progress and then designing the solutions and actions to meet these targets. Underpinning success at every stage must be a culture of sharing and collaboration. Equally important is building buy-in across the business, so it’s not just the sustainability or CSR department driving change, but rather business operations units themselves, from sourcing and supply chain management to manufacturing, merchandising, and sales and marketing. I would add, too, that actions and results need to be articulated in terms of business value — and not only in terms of more traditional sustainability metrics like environmental and social benefits. This makes sustainability relevant to the overall business, which will ultimately help to drive buy-in.

(L) Stella McCartney (R) Gucci handbag | Source: Courtesy

Change is challenging at the best of times and implementing sustainability strategies will demand some degree of change across the company, which in turn, demands strong leadership.

For us at Kering, our CEO and chairman, François-Henri Pinault, focused his attention on the "bigger picture" issues and saw growing importance and opportunity in becoming more sustainable as a group. He is convinced that sustainability creates value by offering new business development opportunities and stimulating innovation, and ultimately enables the development of a more resilient business model in the long term. Following this commitment, our own journey has been strategically structured, but at the same time allows for more "organic" developments in order to respond to the changing state of the business and markets. We set environmental and social targets that are quite audacious considering that achieving them will require changing the very nature of the systems that are currently in place, particularly when it comes to our supply chain. And we are charting our progress in a transparent way to further challenge ourselves to reach our ambitions, publishing periodic progress reports.

At Kering, one of the most valuable tools that has helped us to understand our impact, prioritise our actions, work to meet our targets and develop a common language for sustainability across our business has been the creation and adoption of what we call an “environmental profit and loss” accounting methodology. It is basically an innovative approach that measures and monetises the environmental impacts and dependencies across our entire supply chain. Essentially, it is helping us to identify solutions to reduce our footprint and become more sustainable.

Unlike in many other sectors, the very nature of the design thinking and creativity that drives luxury brands can also be a driver of broader innovation and problem solving. Luxury design is all about reinvention and innovation — whether in terms of the raw materials used or the products made — so we are arguably predisposed to embracing new approaches and being leaders in sustainability.

Let’s focus on three of our unique characteristics that we can leverage. Firstly, we depend on the highest quality of natural materials and resources — nature and biodiversity are inextricably linked to our products. Second, quality craftsmanship is paramount and luxury focuses on training and supporting this through production, where there is also a focus on local communities and tradition. Thirdly, we lead global trends in fashion and design and, as such, we have a loud and influential voice.

But the key to all this is collaboration between our industry peers to scale up positive impact, while simultaneously collaborating with suppliers, with civil society, with academics and experts, and with governments. We see promising models of collaboration that we are engaged with on pre-competitive issues in the sport and lifestyle sector, but the luxury sector also needs to find ways to collaborate on setting and implementing standards at all levels of the supply chain.

Single companies cannot do it alone. Although at Kering, we are striving to be a catalyst for change, we know that ultimately, success will only happen when we can all work together to identify, prioritise and implement the actions that will reduce our impact on the increasingly strained resources of the planet. On sourcing, let’s work together to make sure that the beautiful raw materials upon which we depend — such as wool, cashmere, cotton, precious skins and gold — are sourced in ways that reduce the negative impacts on the environment and communities, and, in fact, create opportunities for delivering real, positive benefits to people and restoring and enhancing the “natural capital” of nature.

On creation and innovation, let’s put our creative powers to work to design products and supply chains that are more sustainable. Finally, using our voice as an industry, let’s contribute to raising awareness, finding solutions, building consensus and inspiring us all to create a more sustainable and vibrant world. It’s time to think beyond inconsequential incremental change and imagine what transformational change looks like. It will take time, but as long as we set the goals and chart our progress, we have an opportunity — and a responsibility — to make real strides towards becoming more sustainable as a sector and as a planet.

Marie-Claire Daveu is the chief sustainability officer and head of international institutional affairs at Kering.

This article originally appeared in the second annual #BoF500 print edition, 'Polymaths & Multitaskers.' For a full list of stockists or to order copies for delivery anywhere in the world visit shop.businessoffashion.com.