Sustainability is a key topic on the fashion forecast for 2025 but there’s a noticeable cooling effect on what has been one of the hottest issues of the past few years. McKinsey’s State of Fashion 2025 report found that only 18% of fashion executives consider sustainability a ‘top three’ risk for growth in 2025, compared to 29% for 2024. Foresight agency The Future Laboratory’s trend barometer for 2025 reported that searches for “sustainability” on its insight platform were down 44% this past year and Deloitte’s report on The Sustainable Consumer highlighted growing consumer fatigue and skepticism on the topic as its key finding for 2024.
Foresight editor at The Future Laboratory, Fiona Harkin believes fashion brands are less invested because consumers are changing their priorities: “There’s a switch in where customers place value, and what they want is a really good product first, and they want that sustainability to be baked in as a given.”
This values shift exists among a difficult political and economic climate for both consumers and brands.
Consumer psychologist and chief behavioral officer at Humanising Brands, Kate Nightingale, says: “The wars and recessions, cost of living crisis, the political upheaval, all those things create a lot of uncertainty and a lack of safety in individuals. We are continuously dropping people onto that really basic, lowest levels of needs.”
This is influencing buying behavior, explains Nightingale: “Our major motivations are: I need to be secure. I want brands and businesses to make me feel safe.”
The State of Fashion report shows a pessimistic outlook among executives for the coming year with just 20% expecting improvements in consumer sentiment in 2025, while 39% see industry conditions worsening.
Sustainability messaging has done a bad job of making consumers feel safe by placing much of the burden on their choices, rather than corporate responsibility says Harkin. “People have been hit over the head with it. This constant pressure that’s put on the consumer of every single one of their choices. Brands need to take that off the consumer if they really want to make a difference.”
Sustainability is still central to good business
Consumers may be fatigued with sustainability and more concerned about issues of financial and emotional security, but experts warn that it could still hurt brands if they don’t address sustainability within their business.
Lewis Perkins, CEO and president of the Apparel Impact Institute, says: “Forward-thinking companies understand that failing to act now risks an expensive game of catch-up, not only with compliance but also with maintaining competitiveness and resilience in the face of growing scrutiny.”
Several pieces of legislation are due to come into force this year to ensure progress on sustainability continues this year despite dimming consumer interest. Perkins highlights the Corporate Sustainability Due Diligence Directive and Ecodesign for Sustainable Products Directive in the EU as two key pieces of legislation for 2025.
McKinsey experts also highlighted the long-term sustainability risks for fashion in a blog post summarizing the findings of the State of Fashion report. They say: “Even though shoppers have proven less willing than hoped to pay extra for planet-friendly products, making the business case for sustainability less obvious to executives among other competing priorities, the mounting cost of climate change, and government action to combat it, mean sustainability must remain at the top of the agenda. Those who choose to approach sustainability with a long-term mindset even while battling short-term problems will be rewarded with more efficient business operations and a competitive advantage.”
Behavioral strategy consultancy, Humanising Brands, listed “default sustainability” as a top retail trend for 2025. It says the issue has now become a “hygiene factor”, where consumers are unlikely to choose a brand because of its sustainability credentials, but will avoid brands that don’t meet their standards. Nightingale says that in this way, sustainability has become akin to having good online delivery for fashion businesses.
Perkins believes that this shift towards sustainability as a fundamental actually shows how far the industry has come: “While sustainability may feel less like a differentiator and more like a baseline expectation, that shift itself reflects progress. It signals that sustainability is no longer optional but a fundamental part of how the industry operates. However, the real risk lies in complacency, where businesses treat sustainability as a ‘tick-the-box’ exercise rather than driving meaningful, transformative action.”
Focus areas in sustainability for 2025
While business might be challenging in 2025, Perkins wants to see brands developing ways to fund a sustainable transition. “Brands need to align sustainability strategies with financial mechanisms to unlock capital for suppliers and invest in innovation. Importantly, these actions must extend to improving worker welfare and ensuring just transition pathways for communities most affected by the industry’s transformation.”
He highlights H&M Group’s Green Fashion Initiative which funds suppliers to phase out fossil fuels and an initiative by PVH Corp which invests in innovation for suppliers and finances eco-friendly and renewable material projects as examples of good practice in the industry.
Collaboration with suppliers to address scope 3 emissions and pressure on brands to fund these initiatives will be an important topic for next year.
“Given the regulatory environment, global market pressures, and the capital already invested in sustainability, businesses have a true incentive to continue their work and create more positive environmental and social outcomes,” says Perkins but a strong financial plan is integral to achieving goals. “If the C-suite of major fashion and apparel brands do not have an investment strategy for climate, the company simply does not have a credible climate transition plan.”
The changing outlook on sustainability may be hardest for brands who have positioned themselves with altruistic values at the core of what they do. “Sustainability isn’t your USP anymore. Make sure you’ve got a really good product, because that will be your selling point, it will just be taken for granted that you’re good to the environment too,” advises Harkin. “But I don’t think we’ll be losing some of those things that we’ve picked up along the way, which is a kind of transparency and a level of information that the customer will require to help make them make better choices. They just want a lot of those choices to be made by the brand before it even gets to the product that they’re choosing.”
Nightingale also advises brands to embrace transparency as a communication tool that supports sustainability without turning customers off: “When you have something like a digital product passport, a lot of customers won’t necessarily use it, but the simple presence of it being there makes you feel like the brand is more trustworthy. That makes consumers feel safer and more secure, so you are developing a better relationship with them.”
The work on a just transition towards a sustainable fashion industry is still as important as ever but to reap the business benefits of it through a challenging climate in 2025, brands must shift the way that they talk about it with their customers to embrace transparency and accountability.
