From Textiles to Transport: Reducing Fashion's Scope 3 Emissions

Scope 3 emissions cover all indirect emissions in a company’s value chain, making them the hardest to measure and the hardest to reduce. In fashion, these emissions come from: 

• Raw material production – Cotton, wool, leather, and synthetic fibers all have significant carbon footprints due to land use, fertilizers, and energy-intensive production.  

• Textile manufacturing & dyeing – High-energy processes, excessive water usage, and chemical treatments add to the industry’s impact.  

• Supply chain transportation – The fashion industry is global, meaning most brands rely on carbon-heavy international shipping.  

• Consumer use & disposal – Washing, drying, and end-of-life landfill waste contribute to emissions even after a product leaves the store.  

According to McKinsey & Company, the apparel industry emits 2.1 billion metric tons of CO₂ annually, accounting for 4% of global emissions. The stakes are high, but so is the opportunity for transformation 

Lowering Supply Chain Emissions 

The fashion supply chain is complex, with raw material sourcing and textile production contributing to the industry's largest carbon footprint. To combat this, brands are investing in more sustainable farming methods and low-impact materials. 

They achieve this by doing the following:  

• Supporting regenerative agriculture to restore soil health and reduce emissions. 

• Expanding the use of recycled and bio-based materials to minimize raw material impact. 

• Working with suppliers to implement precision fermentation and lab-grown textiles 

For example, Patagonia has been at the forefront of regenerative organic farming, working directly with farmers to transition cotton and wool production to low-emission, soil-enriching methods. These efforts are helping to reduce agricultural emissions and create long-term environmental benefits 

Reducing Waste & Loss 

Overproduction and excess inventory are major challenges in the apparel industry. AI-driven solutions and circular economy practices are helping brands optimize production, upcycle textiles, and minimize waste. 

How leading brands achieve this:  

• Using AI-powered demand forecasting to prevent overproduction. 

• Creating upcycling and repair programs to extend product lifespan. 

• Enhancing cold chain efficiency for temperature-sensitive materials. 

As an example, Levi’s launched the Levi’s Tailor Shop, allowing customers to repair and customize old garments instead of discarding them, reducing textile waste significantly. 

Switching to Renewable Energy 

Manufacturing is one of the most energy-intensive parts of the fashion supply chain. To decarbonize operations, brands are transitioning to renewable energy sources. 

How Leading Brands are Achieving This:  

• Securing Power Purchase Agreements (PPAs) and Renewable Energy Certificates (RECs). 

• Installing on-site solar and wind energy in manufacturing hubs. 

• Partnering with suppliers to power factories with clean energy. 

Adidas has made significant strides in reducing its carbon footprint by collaborating with its suppliers to adopt renewable energy sources. In 2023, 35 supplier factories sourced more than 50% of their electricity from renewable energy, totaling over 447,268 MWh—a 38% increase from the previous year. Additionally, the total capacity of rooftop solar projects at key supplier sites reached 267 MWp, marking a 44% increase compared to the previous year. 

Decarbonizing Packaging & Distribution 

From plastic-heavy packaging to fossil-fuel-driven transportation, the fashion industry is working to cut emissions from logistics and product delivery. 

How Leading Brands Are Achieving This:  

• Switching to compostable and recyclable packaging. 

• Implementing low-emission transport solutions like biofuel shipping. 

• Expanding electric delivery fleets to reduce last-mile emissions. 

Nike has partnered with Maersk’s low-carbon shipping routes, which use biofuels to cut transportation emissions. Nike has also introduced fully recyclable and compostable packaging, reducing its Scope 3 footprint from logistics. 

Tracking & Reporting Scope 3 Emissions 

As sustainability regulations tighten, fashion brands are prioritizing accurate emissions reporting and supply chain transparency. 

How Leading Brands Are Achieving This:  

• Using blockchain-based tracking systems for full supply chain visibility. 

• Engaging suppliers in sustainability programs to ensure compliance. 

• Partnering with third-party organizations for verified emissions reporting. 

Kering, the parent company of Gucci, is rolling out a blockchain-based emissions tracking system. This system provides real-time environmental impact data, ensuring compliance with new sustainability regulations while boosting transparency across its supply chain 

With the EU’s Corporate Sustainability Reporting Directive (CSRD) in effect as of January 2025, large fashion brands must now report Scope 3 emissions. Meanwhile, in the U.S., the SEC’s climate disclosure rules remain on hold, but investors and regulators still expect transparency. 

Brands that invest in automated emissions tracking, supply chain collaboration, and circular economy strategies will not only stay compliant they’ll lead the industry forward. 

Reducing Scope 3 emissions in fashion is complex—but you don’t have to navigate it alone. Karbon-X helps apparel brands track, manage, and reduce emissions effectively while ensuring compliance with global regulations. 

From supply chain decarbonization to sustainability reporting, Karbon-X partners with brands to drive measurable carbon reductions without compromising growth. 

Get in touch with Karbon-X today and take your sustainability strategy to the next level.