Over the past six years, since we started Scandinavian MIND, I’ve seen sustainability go from a hot investment trend (impact anyone?) and an urgent EU compliance matter to persona non grata in fashion discourse. When war, tariffs, and energy prices are worrying corporations and consumers alike, no one seems to be interested in talking about the environment.
We’ve done our best to keep the conversation alive during our five Transformation Conferences, but we’ve also noticed a clear convergence between the commercial and environmental discussions. When overproduction became both an emissions issue and a cost-problem for brands, sustainability merged with fiscal responsibility.
In the industry as a whole, sustainability has plummeted in the C-suite agenda. According to the latest State of Fashion Report by McKinsey & Company and BoF Insights, only 18% of fashion executives listed sustainability as a top risk for growth in 2025, down from 29% in 2024.
Given this, it was fascinating that H&M pushed its sustainability agenda so hard when it released its latest annual report last week. As one of their main PR outings, CEO Daniel Ervér did an exclusive with Business of Fashion and talked up the group’s investments into recycled textiles and resale platform Sellpy, its phasing out of onsite-coal from supplier factories, and its use of “sustainably sourced” materials.
Many were worried that the sustainability agenda would diminish when the previous CEO, Helena Helmersson, left the company. Helena rose to the throne by being the group’s sustainability director, but left abruptly after Swedish newspaper Aftonbladet revealed that H&M-collected second-hand garments had ended up in landfills in Ghana.
At the same time, the company has struggled to keep up with its competitor Zara on the growth side. They were similar sizes ten years ago; today, Zara’s owner, Inditex, is almost twice as big.
When Daniel Ervér took over, the focus seemed to be on profitability over sustainability.
Two years later, he was sitting in their showroom in Stockholm with the company’s chief sustainability officer, Leyla Ertur, emphasising their sustainability initiatives. Among them is a new collab with sustainability champion Stella McCartney and a newly launched “Insights Board”, aimed at“reshaping consumer perceptions of sustainable fashion and making it more accessible”.
”Sustainability has always been part of how we build resilience over time”, he says in the interview.
Talking about H&M and sustainability is always a tricky topic. On the one hand, the group is making real investments into the space, almost 3 billion SEK according to the report, and its portfolio companies are doing good work on making the industry less wasteful. Take the mega-investment in polyester recycler Syre or the textile collector Looper, to name a couple.
On the other hand, it’s obvious that its focus on growth and manufactured garments makes it part of the problem. But so is any company that sells affordable textiles at scale, including the aforementioned Zara/Inditex, the Japanese retailer Uniqlo, and rising ultra-fast-fashion companies like Shein and Temu.
Last month, DI Weekend profiled Inditex CEO Óscar García Maceiras, a story clearly written with H&M as a backdrop. The headline of the article read “How Inditex beat H&M” (“Så utklassade Inditex rivalen H&M”), and in it, we learned that Inditex turnover may be twice that of H&M, but its profit is five times bigger.
Maceiras seemed financially confident, but when it came to sustainability, his talking points came up short, saying that sustainability is “core to their business model”.
“Our model is built on precision. We produce on actual demand, rather than pushing out product. That way we minimise overproduction”, he said.
This is a weak and deceptively vague comment that seems to indicate they are far behind H&M in specific sustainability efforts.
The extent to which sustainability drives consumer behaviour remains unclear. Consumers are notorious for their hypocrisy on the issue, often claiming they want to shop sustainably but then acting otherwise. Case in point: in less than a decade, ultra-fast-fashion retailer Shein has surpassed both H&M and Zara in market share and attracts an average of 145.7 million monthly active users in the EU, despite ongoing scrutiny of its practices.
But there are signs that consumers might still care, albeit indirectly, and this is what H&M is betting on. In the Business of Fashion interview, Ertur admits that “customers don’t care about our Scope 3 emissions” and that communication is centred on the product. But when discussing competitors, Ervér makes the distinction explicit:
“It is important for us […] to show that we do operate differently, and that there is a real distinction in how we conduct our business from others.”
What emerges is a shift in how sustainability functions within the industry: it is no longer primarily driven by consumer demand, but used as a strategic tool for differentiation.
Sustainability becomes a proxy for how a brand is perceived.
