climate crisis

Climate action and the new materiality: when climate risk becomes a profit crisis

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Why climate risk is no longer a sustainability issue, but a financial one


What makes companies truly sensitive to climate action?

Profit.

Not moral pressure.
Not awareness campaigns.
And not even public outrage.

Profit.

And this is precisely why the new report, The Cost of Inaction, by Apparel Impact Institute (AII), feels different. It does not appeal to conscience. It speaks the only language that boardrooms consistently understand: financial survival.

The new materiality: from responsibility to financial necessity


For years, the fashion industry has discussed climate targets, net-zero pathways, decarbonisation roadmaps. The vocabulary has been refined. The pledges have multiplied—and with them, so has greenwashing.

But awareness without structural action changes very little. (We explored the knowledge gap here).

This report shifts the narrative. Climate risk is translated into numbers. And the numbers are not symbolic.

  • Operating margins could shrink by up to 34% by 2030
  • Losses could reach 67% by 2040
  • Under a net-zero transition scenario, the $1.77 trillion fashion industry could lose up to 70% of its value by 2040

This is no longer about “doing better.”
It is about remaining economically viable.

The three pressures that will reshape fashion


The report identifies three main financial risks:

  1. Rising carbon pricing
  2. Increasing raw material costs
  3. Higher and more volatile energy prices

The message is clear: delaying the energy transition increases exposure. Conventional operators heavily dependent on fossil fuels and coal will face multiplying costs.

Climate volatility is not a future scenario.
It is a cost driver already embedded in supply chains.

The most interesting part: action pays


The report is not apocalyptic. It is pragmatic.

It shows that early investments — particularly in supplier decarbonisation — create resilience and protect margins.

Incremental improvements such as: 

  • Energy efficiency
  • Heat recovery systems
  • Electrification
  • Renewable energy adoption

can deliver meaningful short-term relief while building long-term competitiveness. The report advises CFOs to view these not as costs, but as capital allocations that stabilise the Cost of Goods Sold (COGS) and protect EBIT—a framing that transforms a sustainability expense into a margin-defence strategy.

Companies that de-risk their supply chains and decouple profitability from climate-sensitive inputs could face four to five times less exposure by 2040.

This is not activism.
This is financial strategy.

CFOs at the centre


One of the most revealing aspects of the report is who it addresses: chief financial officers and finance teams.

Climate strategy is no longer confined to sustainability departments. It now belongs in capital allocation, risk modelling, and governance discussions.

Kristina Elinder Liljas of AII describes the report as putting a “price tag” on delayed net-zero transition. And that phrase matters. Because once a risk is priced, it can no longer be ignored.

Even industry leaders — such as H&M Group — acknowledge that awareness without decisive action will not deliver science-based targets—a notable admission from a company emblematic of the fast-fashion business model.

However, when it comes to sustainability and climate change, fast fashion reveals a striking paradox. The overproduction model remains untouched — as if it were neutral, inevitable. Yet choosing not to change is itself a powerful act of choice. The fast-fashion perspective is not just limited; it is inherently flawed. The core issue is that maintaining an unchanged overproduction business model is not a viable option; it is the very barrier preventing real progress.

Climate action: collaboration is not optional


The report emphasises co-financing and collective investment. Supply chains are interconnected ecosystems. One actor alone cannot stabilise the system.

Lewis Perkins, CEO of AII, highlights that maintaining business stability in a climate-disrupted world requires industry-wide cooperation, channelled through initiatives like AII’s own Fashion Climate Fund, which pools brand capital to de-risk and accelerate supplier-level investments.

This is perhaps the uncomfortable truth: resilience is a collective effort.

Beyond fashion


Although focused on apparel, the message extends far beyond fashion.

Any industry that postpones climate mitigation is not protecting its profit. It is accumulating risk.

The cost of inaction is not abstract.
It is measurable.
And it compounds.

A final reflection


For years, we have framed sustainability as an ethical evolution. Perhaps we were speaking the wrong language. Ethics, it seems, has become unfashionable.

If profit is what finally moves companies, then maybe this is the real turning point: climate action is no longer about virtue.

It is about survival.

And when survival becomes the question, hesitation becomes the most expensive choice of all.

But a final irony remains: the very brands whose business depends on relentless overproduction are now positioned as architects of the solution. Can those who built the problem truly deliver the cure — or will profit and habit always win?

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Milano Cortina Olympics: snow needs cold, not crude

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The uncomfortable truth behind “sustainable” and “neutral” Winter Olympics


There is a lot of excitement in the air for Milano Cortina Olympics. In fact, the Games are set to showcase sport, landscape, and international cooperation. We are told to celebrate fashion, food, culture, and people.

In reality, it risks becoming yet another glossy exercise in greenwashing. And not only that. The Games also reveal a deeper, more disturbing contradiction: selective ethics, selective exclusions, selective silence.

Winter sports need snow, not fossil fuels


Winter sports depend on snow, ice, and stable temperatures. Yet the Milano Cortina Winter Olympics are sponsored by Eni, one of Italy’s largest oil and gas companies—an industry that directly fuels the climate crisis threatening the very existence of winter itself.

This contradiction is not accidental. It is strategic.

As Greenpeace Italia recently stated:

Winter sports need snow, not polluting companies.”

Milano Cortina Olympics: when sponsorship becomes image laundering


Sponsorships like these are not neutral acts of support. They are tools of reputation laundering, designed to associate fossil fuel corporations with values such as resilience, excellence, and sustainability, while diverting attention from the environmental damage caused by their core business.

Eni’s presence at the Olympics does not reduce emissions.
It does not protect glaciers.
It does not safeguard mountain ecosystems.

What it does is offer a powerful stage to rewrite a narrative.

The climate crisis is not an abstract backdrop


The climate emergency is already reshaping winter sports:

  • artificial snow replacing natural snowfall
  • shortened seasons and shrinking glaciers
  • increasing environmental pressure on fragile alpine territories

Allowing companies that actively contribute to global warming to sponsor the Winter Olympics means ignoring this reality—or worse, normalising it.

As Greenpeace puts it:

“Those who fuel the climate crisis, threatening the survival of ice and snow on which the Winter Games depend, cannot be sponsors of the Games.”

This is not radicalism. It is coherence.

The IOC’s responsibility


The International Olympic Committee often speaks the language of sustainability. But language without action remains branding.

If the Olympic movement genuinely wants to protect the future of winter sports, it must take a clear stance and end sponsorships from oil and gas companies—just as tobacco sponsorships were once banned from sport for ethical reasons.

Some industries are simply incompatible with certain values.
Fossil fuels and the Winter Olympics are one of those cases.

A double standard dressed as neutrality


Russia is out. Israel is in.

The official justification for excluding Russia from the Olympic Games was the violation of international law and the incompatibility of war with Olympic values. Yet the same principles seem to dissolve when it comes to Israel, despite the scale of destruction and civilian deaths in Palestine far exceeding many past conflicts that have led to sanctions.

This selective morality undermines any claim of neutrality. When sport chooses silence in the face of certain atrocities and outrage in others, it stops being a space of peace and becomes a mirror of geopolitical hypocrisy.

The discomfort was impossible to fully contain. During the opening ceremony, J.D. Vance was met with loud boos from the audience—an unplanned rupture in the performance of neutrality. Even as cameras attempted to manage the narrative, the reaction exposed a growing gap between institutional silence and public conscience.

Israel’s parade was embarrassing. 
Just as embarrassing was the attempt to erase Ghali through selective camera framing—an evident effort to censor his words and silence his pro-Palestinian stance.

Is it really still unclear that Israel is committing genocide, as widely documented by human rights observers?

Ghali, Rodari, and the words that should never be censored


Ghali recited Reminder, a poem by Gianni Rodari:

“There are things to do every day:
wash, study, play,
and set the table at midday.

There are things to do at night:
close your eyes, sleep,
have dreams for dreaming,
ears for hearing.

There are things never to do,
neither by day nor by night,
neither by sea nor by shore:
for example, WAR.”

Words simple enough for a child. Apparently too dangerous for a stage.

What kind of future are we celebrating?


The Olympic principles are excellence, respect, and friendship. They aim to unite people through sport, promoting peace, solidarity, and inclusion.

And yet, this is what Ghali later wrote on Instagram:

“Peace? Harmony? Humanity?
I did not feel any of this last night, but I felt it through your messages.
People are what truly matter, and in a time of so much hatred, please do not play their game. Respond as we would want the world to be.
‘There are things that must never be done.’”
Ghali

Beyond the beautiful façade


We can celebrate Italianness at Milano Cortina Olympics. We can take pride in the landscape, culture, fashion, food, and athletes and everything else. But this could also be an opportunity to rethink how major events relate to territory, climate, and responsibility.

Instead, it risks becoming another case study in how sustainability is used as a decorative word—applied after the damage is done. A study in beautiful façades.

Snow is not a metaphor.
Ice is not a logo.
The climate crisis cannot be sponsored away.

And humanity does not come in Series A and Series B.

If they sold you the Winter Olympics as ethical and sustainable, this is greenwashing.

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Wildfires Devastate Los Angeles: A Climate Change Wake-Up Call

Reading Time: 3 minutes

Extreme weather in Los Angeles: why climate change action cannot wait


Our thoughts are with our friends and everyone affected in Los Angeles, as relentless wildfires devastate the region, destroying thousands of homes and businesses. The disaster, fuelled by powerful Santa Ana winds, low humidity, and dry vegetation resulting from a prolonged lack of rain, paints a grim picture of a landscape increasingly vulnerable to climate extremes. These recurring tragedies underscore an urgent truth: addressing climate change is no longer optional—it is a matter of survival.

Five major wildfires devastating Los Angeles: causes and impact


At least five major fires are active in Los Angeles County, including the Palisades and the Eaton Fire. While investigations into the causes of the largest blazes are still ongoing, the conditions driving their rapid spread are unmistakable: months of little to no rain, critically low humidity, and widespread drought. The National Weather Service office in Los Angeles had already warned of the danger, citing damaging winds of up to 100 mph and extremely dry conditions as a perfect storm for “extreme fire behaviour”.

This devastating fire season comes after an exceptionally dry year. Over 83% of Los Angeles County is in drought, according to the latest U.S. Drought Monitor. In fact, Los Angeles has not seen even a quarter of an inch of rain since April, as reported by Accuweather.

Whether caused by human activity or natural forces, these wildfires that devastate Los Angeles are yet another stark reminder of our collective disregard for nature. Recently, the Copernicus Climate Change Service confirmed a grim milestone: 2024 has become the first year to exceed 1.5°C above pre-industrial levels, marking the warmest year since record-keeping began in 1850.

The role of climate change in extreme weather


Experts agree that climate change is reshaping baseline conditions, significantly increasing the likelihood of such catastrophic fires. California, like much of the western United States, endured a decades-long drought that ended only two years ago, leaving the region exceptionally vulnerable to fire outbreaks.

The wildfires devastating Los Angeles are shocking, but, sadly, they are no longer surprising. As our planet warms, extreme weather events have shifted from rare anomalies to an unsettling new normal. These fires—among the most destructive in LA’s history—carry an urgent message: climate change is not a distant threat but a present crisis. The time to act decisively is not “before it’s too late”—it is now, because we are already running out of time.


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A Pause in a Boiling World

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Confronting climate change during the hottest summer ever


After a brief pause from writing, we’re confronted with a stark reality: the world isn’t just metaphorically but literally boiling. This realisation resonates deeply with us, not only with our work in the fashion industry but also with our entire lives.

Over the past few weeks, we journeyed through Italy, from Milano to the tranquil landscapes of Basilicata. Along the way, we immersed ourselves in beautiful places, savouring the food, connecting with people, and even grappling with Wi-Fi issues that forced us to momentarily step back from blogging. But what left the most profound impression was the relentless heat. The scorching temperatures, the unnaturally boiling seawater, everywhere. This was an unprecedented experience that made the reality of climate change feel more tangible than ever.

The summer of 2024 is now officially the hottest on record.

A Pause in a Boiling World
Basilicata – Marina di Pisticci


This extreme weather is having a profound impact not only on production chains and labourers but also on consumer habits and retailers. Yet, the fashion industry remains largely indifferent to this urgent crisis. Instead of responding to these challenges, the slowdown in consumer spending and the resulting decline in brand revenues are driving the industry in the opposite direction.

According to Business Of Fashion “Sustainability teams at big brands have been hit with layoffs; some companies have watered down their climate targets; and others are deprioritising sustainability efforts to focus on growth amid market volatility.”

Faced with financial pressures, the fashion system is prioritising growth and profitability, relegating sustainability to the background. Even the industry’s outward commitment to sustainability is starting to crumble.
Are we about to witness the facade completely collapse?

And so, in this moment of pause in a boiling world, the harsh reality of climate change compelled us to question everything.

How can we ignore the effects of this climate crisis on our lives and our work? Can the fashion industry really continue with business as usual? Should we reopen our boutiques as if nothing has changed? Is it possible to approach the Spring/Summer 2025 buying season without acknowledging the profound shifts happening around us?

Moreover, should we rush into the new Fall/Winter 2024-25 season? Still clinging to the outdated practice of dividing collections by season?

These are questions we can no longer avoid. The reality of our boiling world demands a thoughtful and immediate response.


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“We Are Not Only in Danger, We Are the Danger”

Reading Time: 2 minutes

UN Secretary urges to stop taking fossil fuel advertising


In a speech in New York, UN Secretary-General Antonio Guterres delivered a powerful message to the audience, stating,”We are not only in danger, we are the danger.” 

Highlighting new data from the World Meteorological Organization (WMO), Guterres underscored that the world is facing a “climate crunch time.” According to the data, there is an 80% chance the planet will exceed 1.5°C (2.7°F) in warming above pre-industrial levels in at least one of the next five years. A record already breached during the past 12 months.

Guterres: “We are the danger”


“We are playing Russian roulette with our planet. We need an exit ramp off the highway to climate hell. Like the meteor that wiped out the dinosaurs, we’re having an outsized impact. In the case of climate, we are not the dinosaurs – we are the meteor. We are not only in danger – we are the danger” – Guterres warned.

The UN Secretary-General declared fossil fuel companies are “the god-father of climate chaos.” He urged news and tech media to stop taking money from fossil fuel advertising. He emphasised the urgency as the world struggles to limit the “climate crunch time.”

“It is a disgrace that the most vulnerable are being left stranded, struggling desperately to deal with a climate crisis they did nothing to create. We cannot accept a future where the rich are protected in air-conditioned bubbles, while the rest of humanity is lashed by lethal weather in unlivable lands,” he added.

Also, Guterres criticized fossil fuel companies for their minimal investments in cleaner forms of energy. Specifically, he accused them of”distorting the truth, deceiving the public, and sowing doubt” about climate science. He urged governments to ban fossil fuel advertising. And he called on public relations and media companies to cut ties with oil, gas, and coal interests. 

A call to action: choosing the planet over profit


Guterres’ words sound strong but true: “We are not only in danger, we are the danger.” In conclusion, he added, “It’s ‘we, the peoples’ versus the polluters and the profiteers. Together, we can win. But it’s time for leaders to decide whose side they’re on.”

His message underscores the urgency and gravity of the climate crisis. And he calls for collective action and leadership to prioritise the planet over profit. By framing the fight against climate change as a battle between the people and those who perpetuate environmental harm, Guterres challenges leaders and citizens alike to take a stand for a sustainable future.

The time for decisive action is now. And the choice is clear: protect our planet or face the consequences of inaction.

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