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Intro to Impact by Kurt Kipka

In 2022, Aii continued to grow the geographical coverage and the scope of our programs and the impact they generate for our partners and the industry. Throughout the year we, like many of our partners, felt the momentum building for frameworks that take climate commitments and translate them into climate action and we began to position ourselves as the industry aggregator of impact solutions accordingly. We also proudly announced the Fashion Climate Fund which will supercharge Aii’s ability to rapidly identify, fund and scale carbon reduction projects for the sector. We now stand poised to fill the void between ambition and action for achieving carbon reduction goals.

Turning Ambition to Action

  • We refined our Carbon Leadership Program to formally connect planning activities like benchmarking and target setting with implementation programs like Clean by Design in order to represent the full change management framework.
  • We standardized our data gathering, tracking and reporting framework, readying our programs and our partners for a more rapid scale in years to come. The standardized approach enables more sophisticated data analysis and modeling capabilities as we seek to bring on brands, manufacturers, and implementation partners into our decarbonization framework.
  • We introduced the Climate Solutions Portfolio, the Fashion Climate Fund’s program evaluation and deployment mechanism. In this “Year 0” of Climate Solutions Portfolio development, we established a groundbreaking project assessment methodology and the CSP Advisory Council that will put it to good use in years to come.
  • We prepared a call for applications to receive grant funding via the Fashion Climate Fund, a first-of-its-kind process aimed at rapidly identifying and growing the industry’s programs with the most impact potential.

As I look ahead to 2023 and beyond, I am particularly excited about the potential that the Climate Solutions Portfolio and Aii’s decarbonization framework can have for the industry. We will continue to map the path to net zero for the industry through existing initiatives and those that are yet to be discovered while ushering our partners along a path that turns ambition into action and, most importantly, data-driven results.

Kurt Headshot

Kurt Kipka
Chief Impact Officer, Apparel Impact Institute

Aii’s Programs Impact Benchmarking

In 2022, we began understanding the impact of Aii programs relative to the cost expended. We benchmarked the greenhouse gas emissions reduced through Aii programs as compared to alternatives, such as switching energy sources from coal-fired boilers to using offshore wind.

The comparison data was taken from publicly available analysis published in the International Monetary Fund in 2018. For the data, an estimate of the unsubsidized costs of various technologies to reduce greenhouse gas emissions was taken based on a review of recent economic literature. It is important to highlight that these estimates are averages from the United States. [source]

Aii’s data show the costs for an Aii program to reduce CO2e emissions by one ton, including Aii’s total spending (G&A and program related cost) as well as the invested capital by the facility to implement the actions.

The following bar chart shows the results for each of the solutions in cost per ton of reduction of CO2e over useful life.

Impact Benchmarking

Co2 Reduction over useful life graph

Program Funding

Program funding graph

Overview of Our Programs

The programs offered by Aii in 2022 were:

In 2022, Aii evolved the Carbon Leadership program developed in collaboration with RESET Carbon Ltd by adding its heritage impact programs, such as the Clean by Design Program, to the benchmarking and carbon target setting elements of the program.

The Climate Solutions Portfolio will further become an important lever to drive low carbon manufacturing.

The Carbon Leadership Program offers a holistic solution to successfully decarbonize apparel supply chains and covers benchmarking, target setting, implementation, carbon target monitoring and third-party data validation.

Climate Solutions Portfolio

The apparel/textile industry is facing three key challenges in achieving its necessary GHG reductions:

  • 1. What solutions exist to reduce emissions?
    Stakeholders struggle to locate science-backed initiatives and programs with the potential to support their GHG reduction goals.
  • 2. Which solutions are credible and verifiable?
    A limited amount of unstandardized data on the effectiveness of many of these solutions creates uncertainty and confusion about their efficacy.
  • 3. Which solutions do we prioritize?
    Fragmented coordination across the industry around priorities and timelines slows down the scaling of proven programs.

Failure to “follow the tons of CO2e” opens the door to spending time and money where it is easiest to start rather than to where it delivers the largest results. The Apparel Impact Institute’s Climate Solutions Portfolio has been established to find, fund, monitor, and report on climate impact solutions. The CSP will identify proven programming and funding opportunities in the climate impact space, allowing fashion and apparel/textile companies to connect to programs that deliver on their science-based targets, supplying verified data as validation towards GHG reductions and impact.

Criteria and Process for Program Evaluation

The CSP application is designed to identify solutions with data that indicate real GHG reductions for apparel manufacture. We will apply four criteria areas when evaluating applications:

  • 1. Effectiveness
    What is the magnitude of the reductions the solution is estimated to deliver relative to a typical industry baseline?
  • 2. Reach
    What is the potential breadth of impact of the solution across the apparel/textile sector at scale?
  • 3. Scale
    What factors may enable/accelerate or impede the chances of the solution achieving its maximum reach?
  • 4. Funding Request
    What funds are requested, how will they be spent, and what outcome(s) are they intended to achieve?
CSP program pipeline graph

CSP Timeline

  • Step 01
    Applicants should download and carefully read the Application Guidance. We advise using it as a workbook to crunch numbers and compose answers, so you can complete the application form itself in one sitting.
  • Step 02
    Applications for the first round of funding will be accepted between January 31, 2023 and March 31, 2023.
  • Step 03
    Grant finalists will be identified and communicated to applicants in June 2023.
  • Step 04
    The Climate Solutions Portfolio registry populated by identified applicants will go live to the public in Summer 2023.

Carbon Leadership Program

The objective of Aii’s Carbon Leadership Program is to put the industry on a collective action roadmap to factory decarbonization.

The Program consists of 5 steps:

  • Step 1. Benchmark
  • Step 2. Target Setting
  • Step 3. Implementation
  • Step 4. Carbon Target Monitoring
  • Step 5. Third Party Data Validation

In 2022, we made great progress to drive scale for Carbon Tech Assessments and Carbon Target Setting as a starting point to put factories in impact programs like our Clean by Design program.

Carbon Leadership 5 steps graph

Step 1: Benchmark

Carbon Technology Assessment (CTA)

Process flow graph
Carbon technology assessment graph 1

Step 2: Target Setting

Carbon target setting
Carbon tech assessment graph

Step 3: Implementation

At Aii, we identify and validate program opportunities that drive decarbonization on the factory level. Once a program is selected, we pilot and test it before we bring it to a model phase and ultimately scale it.

It is important to us to accelerate the implementation of impact programs and projects that meet our criteria for quality programming: science-based, measurable results, profitable, and globally scalable.

The CbD program in Vietnam is implemented in close collaboration with IDH.

a. Clean by Design Energy & Water Efficiency

clean by design

Best practices

milestones and timeline

b. Clean by Design Plus

c. Clean by Design Chemistry & Wastewater Management

management of wastes
wastewater management best practices

d. Renewable Energy Transition Initiative (RETI)

Renewable Energy Transition Initiative (RETI)

e. Renewable Energy Procurement

Renewable Energy Procurement

Since 2021, Aii has collaborated with CEIA — a public-private partnership supporting the acceleration of the corporate clean energy transition in key emerging markets — and IDH to address barriers and enable replication of rooftop solar solutions across Vietnam’s apparel and footwear industry and create apparel sector-focused tools and processes that could be adapted and utilized in future phases.

Alongside motivated brands and a focused subset of suppliers, Aii, CEIA, and IDH applied an aggregated approach for onsite solar energy procurement in Vietnam that resulted in an RFP. By using economies of scale driven by group procurements, shared learnings, and standardized resources, the project partners are working to establish sector-specific tools to overcome existing barriers for renewable energy implementation and enable replication and expansion.

The project outcome has proven that aggregation helps bring prices down. CEIA used the RFP to request proposals at different price points to reflect the anticipated amount of MW the overall project bidder may win. Bids indicated that winning a high percentage of the projects on a MW basis would result in up to a 6% discount.

f. Production Waste Management

production waste management
production waste milestones

g. New Construction Factory Optimization

factory optimization

Step 4: Carbon Target Monitoring

With implementation being core to achieving carbon reduction on the factory level, continuous carbon target monitoring through regular action plan follow-up with facilities is an important tool to drive progress and an opportunity to celebrate achievements to date. Aii will launch the fourth step of the program in early 2023.


Step 5: Third-Party Data Validation

Going forward, Aii is building out an approach to data validation to support carbon accounting practices that will include external third-party verification. In an industry effort, agreements will be discussed and aligned within the Value Change Initiative Apparel & Footwear Working Group in 2023.

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