The green transition of Bangladesh’s apparel industry received a significant boost as a syndicate of global fashion business leaders launched a joint financing model to support decarbonization efforts.

The Future Supplier Initiative, spearheaded by H&M Group, Gap Inc., Mango, and Bestseller, aims to propel the apparel sector toward a more sustainable future by reducing carbon emissions.

The Future Supplier Initiative, announced on Thursday, represents a collective effort to address the pressing issue of carbon emissions within the fashion industry.

The Fashion Pact facilitates this initiative with the Apparel Impact Institute, Guidehouse, and DBS Bank. It offers a collaborative financing model designed to support deep decarbonization in the apparel sector, Bangladesh’s largest export earner.

The initiative targets the significant portion of emissions in the fashion industry, estimated at 99%, within the supply chain, specifically in Tier 1 and 2 garment and textile factories. The goal is to accelerate the transition to net zero by sharing the financial risks and responsibilities of transitioning to renewable energy sources.

This collaborative approach aims to help both brands and suppliers meet their Science-Based Targets (SBTs) and adhere to the 1.5-degree Celsius trajectory set by global climate agreements.

In its first year, the initiative will prioritize factories based on their potential impact. It will build technical proposals to achieve deep decarbonization and de-risk lending to suppliers, making it more attractive for them to adopt renewable energy solutions.

The second year will focus on project implementation and monitoring the climate impact of these investments. Alongside financial incentives, the initiative will provide technical support to help suppliers identify and implement low-carbon technologies.

Eva von Alvensleben, Executive Director and Secretary-General of The Fashion Pact, emphasized the urgency of addressing climate change.

“The cost of inaction on climate change is unaffordable. If the fashion sector is to meet its goals and transform its supply chain, we urgently need to address the gap between ambition and action,” she stated.

The involvement of prominent brands underscores the industry’s commitment to sustainable practices. Anders Holch Povlsen, Owner and CEO of Bestseller, highlighted the initiative’s potential impact.

“We know that as an industry, we still have many steps ahead of us, but we believe that the Future Supplier Initiative can make a positive and significant difference,” he said.

H&M Group’s CEO, Daniel Ervér, encouraged other brands and investors to join the effort. “The Future Supplier Initiative shows that solutions are readily available and come with proven impact, but it requires commitments from brands and investors willing to invest,” he noted.

Toni Ruiz, CEO of Mango, stressed the importance of collective action. “To achieve this industry’s ambitious climate goals, every stakeholder must leverage their influence to drive tangible change. A joint effort among brands and retailers is essential to create conditions where suppliers are motivated and capable of making these investments,” he said.

The initiative plans to expand beyond Bangladesh to other key apparel manufacturing regions, including Vietnam, India, China, Italy, and Turkey. The initiative aims to enable a global and regional joint effort among fashion brands by identifying common factory units, interventions, and costs.