ASN Impact Investors divests from fast fashion companies
August 29, 2024
Dutch investor ASN Impact Investor has sold approximately €70 million worth of shares in fast fashion companies, after adopting a stricter sustainability policy.
It sold stakes in 12 companies across seven of its Article 9 funds, including retail giants H&M, Next, Marks & Spencer, Puma and Asics as well as online retailer ASOS.
The divestment aims to send a “strong signal” to clothing companies and other investors that they must make headway when it comes to improving sustainability in the clothing industry.
It also forms part of ASN Impact Investor’s new strategy to exclude all companies that produce fast fashion and do not take sufficient steps to achieve a circular business model.
The new strategy was implemented because fast fashion is increasingly harming the climate, biodiversity and human rights, yet many major clothing companies continue to neglect sustainability and social impact.
ASN Impact Investors cited research that estimated the clothing industry is responsible for 10% of global greenhouse gas emissions.
Even though the investor divested all its holdings in the clothing industry, it will not rule out any future investments in the sector. Unlike the fossil fuel industry, which it has excluded since its formation, ASN Impact Investor views clothing as a basic necessity.
However, in order for such investments to be made, clothing companies will have to meet its newly tightened criteria and demonstrate their commitment to move towards a low-waste circular clothing industry, in which garments are designed to be reusable, repairable, biodegradable and/or recyclable.
San Lie, director of ASN Impact Investors, said: “Despite our engagement efforts, the companies have failed to take sufficient steps to improve the situation in recent years.”
“These clothing companies are now also competing with Chinese players such as Shein and Temu, which produce garments even more quickly. This hinders sustainability, which is why we have taken the drastic decision to stop investing in them.”
Last Updated: 29 August 2024