Sustainable Supply Chains: Ralph Lauren Is Latest Corporation to Commit to Sourcing Materials from Responsible Suppliers

Ralph Lauren Corporation today said it has developed sustainable sourcing guidelines, making it the latest major multi-national to commit to better environmental management of its supply chain.

The company says it will trace the source of wood-based fabrics, like viscose and rayon, used in its products, and will eliminate sources connected with rainforest destruction and human rights violations. The new policy will apply across its operations as Ralph Lauren “continues to work on its framework for tracking, assessing and developing purchasing guidelines for the raw materials used in its products.”

In a statement, Halide Alagoz, Ralph Lauren’s senior vice president of global manufacturing and sourcing, said the company has already communicated this sustainable sourcing commitment to its vendors.

Later this year the company will publish and implement its new sourcing guidelines. These are “part of a broader initiative to establish a traceability, risk assessment and verification framework for the raw materials that we use,” Alagoz said.

Ralph Lauren’s policy on wood-based fabrics was developed in cooperation with Rainforest Action Network, whose Out of Fashion campaign targets major apparel and luxury-good companies and puts pressure on them to develop responsible sourcing practices for their forest-based fabrics.

Brihannala Morgan, senior forest campaigner with Rainforest Action Network who worked with Ralph Lauren on its policy, says more than 60 other brands have developed policies similar forest products purchasing policies. These include H&M, Zara, Stella McCartney, ASOS, Levis Strauss & Co.

Deforestation also represents a financial risk to companies — as much as $906 billion total annual turnover could be at stake, according to a recent CDP report.

Ralph Lauren’s announcement comes as Unilever, earlier this week, released new research that found a third of consumers (33 percent) are now choosing to buy from brands they believe are doing social or environmental good.

The study, carried out in conjunction with Europanel and Flamingo, asked 20,000 adults from five countries how their sustainability concerns impact their choices in-store and at home. It then mapped their claims against real purchase decisions, which Unilever says gives a “more accurate picture than ever of what people are actually buying — and why.”

Unilever says this represents a potential untapped opportunity of €966 billion ($1,024 billion) out of a €2.5 trillion ($2.7 trillion) total market for sustainable goods.

Unilever has first-hand experience with making money from making its sustainability credentials clear. It’s one of at least 10 global companies that generate a billion dollars or more in revenue annually from sustainable products or services.

Unilever, which generated sales of €53.3 billion ($56.5 billion) in 2015, reported 30 percent faster growth for its “Sustainable Living” brands, compared to the rest of its business, with these brand nearly half of the firm’s total growth in 2015.

Unilever defines its Sustainable Living Brands as those that integrate sustainability not only into their marketing platform but also their products.

And last month Ikea committed $1.1 billion to sustainable sourcing, on top of more than 2 billion already earmarked for renewable energy.

These efforts are also helping Ikea grow its business; the company says its total revenues during fiscal year 2016 reached €35.1 billion ($37 billion), up 7.4 percent from last year.