Inauguration Day set the tone for much in Donald Trump’s second administration. On that day, he had the U.S. pull out of the Paris Agreement (again), which was just his first step toward rolling back the country’s climate commitments. Since then, the government has slashed the National Oceanic and Atmospheric Administration budgets hobbling severe weather predictions, defunded clean energy grants and repealed a slate of environmental regulations. But the biggest impact the current U.S. president might have on climate action is the laundry list of tariffs announced on “Liberation Day.” Though they were subsequently paused and have been challenged in ongoing legal battles, tariffs still threaten sustainability progress, as the apparel industry grapples with the uncertainty and braces for increased product and logistics costs.
The good news is, there are other, more positive factors at play.
Romain Narcy, partner at the Erek-Blue Matters mill in Turkey, doubts the political climate will be enough to convince international brands to pull back on their sustainability efforts. “We work with some major U.S. clients. There is no change now, because they cannot afford that change, because when they sell to Europe, they need to comply with local regulation. You cannot just decouple what you sell in the U.S. from what you say in Europe in terms of compliance or CO2 emissions and so on,” he said. “I don’t think the term of a presidency is going to impact their strategy, or change their strategy.”
Anecdotal evidence suggests otherwise, however.
Raffay Bin Rauf, sustainability, HSE and compliance senior manager, for Pakistan-based Sapphire Mills, said he’s noticed a difference between some of his U.S. customers and those in Europe, where ESG policies are piling up. “The customers in the EU are really gearing up. They are asking a lot of difficult questions nowadays,” he said, contrasting that with conversations with U.S.-based brands. “I would say they’re not asking us a lot of questions.”
In one instance in particular, a customer has seemingly made an about-face on its sustainability stance over the last few months. “Before Trump came in, there was an American brand that rolled out their 2025 roadmap. They told us, ‘We will source more from the suppliers, which are more advanced on sustainability’. But that brand went silent after Trump came in,” Bin Rauf said. While he can’t say this was solely attributable to the administration’s climate stance, he feels there was at least a correlation.
To ensure the U.S.’s shift in national priorities doesn’t influence individual company’s sense of urgency, Katrin Ley, managing director, Fashion for Good, said it’s important for sustainability teams to communicate about sustainability in a way that resonates with their audience, be it the consumer or their C-Suite.
“Given that it’s so politicized in the U.S., the narrative is shifting,” she said “Rather than positioning this from a sustainability perspective, you would lead from a risk perspective. Sustainability cannot be the narrative that leads. It needs to be an attractive solution that A, delivers on impact, but B, delivers on price and has a pathway to become competitive with solutions that are out there, and C, delivers against performance characteristics and quality characteristics.”
Even if Trump’s general attitude toward sustainability doesn’t result in changes to climate strategies, some say there’s almost no getting around the dampening effect of a prolonged trade war.
Iftekhar Zaman, executive director, Transparency International Bangladesh, said many in Bangladesh’s RMG sector have made good progress, with some companies even recognized internationally for their sustainability efforts, but the trade war is likely to have “negative implications.” “Compliance to environmental standards consistent with the global practices involves resources, additional investment, more profit,” he said. “If the U.S. imposition of tariffs results in the potential of lesser profit for these companies, they would have lesser incentive to be environment friendly.”
“If the U.S. imposition of tariffs results in the potential of lesser profit for these companies, they would have lesser incentive to be environment friendly.”
—Iftekhar Zaman, Transparency International Bangladesh
Chandrima Chatterjee, secretary general of the Confederation of Indian Textile Industry (CITI), told HGI revenue has to flow—and flow predictably—for factories and suppliers to be able to stick to their climate commitments.
“The tariffs have brought back a certain uncertainty. Unless you have a long-term vision, the other things [like] EPR or any other such moves towards enhancing circularity in the value chain gets a little hampered,” she said. “If I don’t know whether my next few orders are in place or not, how do I put my systems in place?”
These days, when the orders do come, they’re often accompanied by requests for discounts to offset the tariffs, leaving even smaller margins for cash-strapped suppliers.
Already, the tariff announcement, followed by subsequent stays, adjustments and legal actions, have put the industry in a pause, as everyone waits to see how it will all play out. Where business is continuing, it often looks different, as brands and retailers doing business in the U.S. attempt to move production to countries with the lowest tariff rates.
This hopscotching around the globe has Ley concerned since it could be the result of short-term solutions and breed more transactional relationships. “That leads to even more changes and instability on the supplier side. It has created uncertainty, or it has led to ending of long-standing partnerships,” she said.
And with those long-term relationships goes sustainability progress. “What this means also is that brands have no incentive—if we’re thinking of their decarbonization strategies—to invest in any of the suppliers, given that they don’t necessarily know whether this is a supplier that they will work with in the next six months,” Ley said. “Conversely, suppliers that might have been very committed to collaborate with their customers to invest in phasing out fossil fuel, might not have an incentive to do that either.”
Michelle Mendlewicz, senior sustainability strategist for fashion & sporting goods for consulting firm Quantis, would like to see sustainability teams at the center of the decision making when it comes to redesigning supply chains. “For example, if procurement will be spending millions on a sourcing project, then spending a little bit more to future proof that investment by adding sustainability criteria to that plan is smart business,” she said. “It would be cheaper to do than having to retrofit everything down the line when suddenly they realize there were all these risks or climate impacts.”
The brands that understand this, could set themselves up for a strategic advantage in the future, she said. It could ultimately be a silver lining to the current turmoil. “When we see challenges in the industry, it also comes with opportunities,” she said.
One such opportunity could be a direct result of the tariffs.
Robert Antoshak, vice president, global strategic sourcing and development, at Grey Matter Concepts sourcing company, said for all of the complications and business risks the trade war has introduced, it actually could prove to be a boon for sustainability. “It’s kind of weird but the situation could kind of make odd bedfellows of the Trump tariffs and environmentalists,” he said. “If it shortens supply chains by making it more advantageous to produce closer to market for economic reasons, then you have to ask yourself, ‘Boy, isn’t there an environmental benefit to that?’”
That would be ironic, but it would be nice to think today’s headaches aren’t in vain. But no matter how U.S. trade policy shapes up over the next few weeks, Mendlewicz would like to see the industry remain focused through what will surely be more ups and downs.
“The fundamentals haven’t really changed,” she said. “There’s a lot of noise in the industry now, but if we think about what needs to happen, nothing has changed. My climate risks are still there. The work that sustainability teams have been doing still needs to get done.”
