2024Yearly Report
ANNUAL IMPACT REPORT
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Our Vision, Mission, & Values
Our Vision
A transformed apparel, footwear, and textile industry that has a positive impact on people and the planet.
Our Mission
We identify, fund, and scale proven quality solutions to accelerate positive impact in the industry.
Our Values
We are humble
We put aside ego or concerns about status.
We are quick to acknowledge our mistakes and to point out the contributions of others, and slow to seek recognition for ourselves.
We share credit, emphasize team over self, and define success collectively rather than individually.
We are quick to acknowledge our mistakes and to point out the contributions of others, and slow to seek recognition for ourselves.
We share credit, emphasize team over self, and define success collectively rather than individually.
We are empathetic
We know how to effectively interact and authentically connect with others.
We understand the impact of our words and actions on others around us.
We actively listen and genuinely care for one another.
We work to understand each other’s strengths and use them strategically.
We understand the impact of our words and actions on others around us.
We actively listen and genuinely care for one another.
We work to understand each other’s strengths and use them strategically.
We are ethical
We uphold integrity and fairness, making decisions based on credible data.
We are fiscally responsible and environmentally conscious, fostering trust and accountability through transparency, respect, and inclusivity, ensuring sustainable success and positive impact for all stakeholders.
We are fiscally responsible and environmentally conscious, fostering trust and accountability through transparency, respect, and inclusivity, ensuring sustainable success and positive impact for all stakeholders.
We are passionate
Our mission drives us and we are always looking for more — more things to do, more to learn, more responsibility.
We are self-motivated and diligent, moving with urgency.
We drive towards our goals
but work efficiently and ensure we prioritize our well-being.
We are self-motivated and diligent, moving with urgency.
We drive towards our goals
but work efficiently and ensure we prioritize our well-being.
Our History
Apparel Impact Institute is a not-for-profit (501c3) registered in the state of California and founded in 2017 by four industry leaders — Cascale, the Sustainable Trade Initiative (IDH), Natural Resource Defense Council (NRDC), and Target Corporation — to accelerate positive change in the apparel, footwear, and textile industry, transforming its impact on people and the planet. The organization emerged organically as a result of a real need that apparel brands and retailers self-identified.
Today, Aii is recognized as an ecosystem leader in carbon reduction programming. You can learn more about our history here.
Today, Aii is recognized as an ecosystem leader in carbon reduction programming. You can learn more about our history here.
Aii’s Theory of Change
Two Aii reports form the foundation of our theory of change: “Roadmap to Net Zero: Delivering Science-Based Targets in the Apparel Sector,” which outlines six solutions for the fashion industry to meet 2030 GHG reduction targets, and “Unlocking The Trillion-Dollar Fashion Decarbonisation Opportunity,” which details the funding needed to achieve net zero by 2050. Guided by these insights, Aii blends capital from brands, philanthropy, and financial institutions to scale cost-effective, science-based solutions to cut apparel, footwear, and textile emissions by 50% by 2030 and achieve net zero by 2050.
Pathway to Net-Zero: Reduction Potential by 2050
Solution categories that enable a net-zero fashion industry by 2050. Source: Aii and FFG analysis (2021).
Our Focus Areas
Through our programs and solutions we are looking to:
- Reduce process demand for energy and reduce energy losses.
- Reduce/eliminate GHG emitted from generating heat and electricity.
- Reduce emissions from the production of natural & synthetic fibers.
- Minimize waste in each step of production.
- Maximize circular reuse of fibers, fabrics, or chemicals.
Our most recent annual update to the “Roadmap to Net Zero” identified material production as the biggest hotspot of emissions (55% of the total) followed by raw material extraction (21% of the total) (see figure below). As a result, Aii’s programs and solutions primarily focus on material production.
Total apparel GHG Emissions: 878.7 Mt CO2e (0.879 Gt)
Tier 4
RAW MATERIAL PRODUCTION & PRIMARY PROCESSING
188 Mt Co2e
0%
The extraction and farming of primary raw materials from the earth (e.g. fossil fiels), plants, (e.g. cotton), or animals (e.g. wool), and the collection of secondary raw materials into a commodity state.
Tier 3
INTERMEDIATE MATERIAL PROCESSING
134 Mt Co2e
0%
Processing of raw materials into yarn and equivalent state.
Tier 2
MATERIAL MANUFACTURING
482 Mt Co2e
0%
Production and finishing of materials (e.g. fabrics, trims) that go directly into the finished product.
Tier 1
FINISHED PRODUCT MANUFACTURING
75 Mt Co2e
0%
Assembly and manufacturing of final products.
How We Work
Aii provides tracking, implementation, and access to programs that result in positive environmental impacts in apparel and footwear production.
1. We Identify
We use verified data to identify programs and solutions that are poised to have a significant impact on industry carbon emissions.
2. We fund
We aggregate existing resources and attract new ones to build
a pipeline of scalable impact in the industry.
a pipeline of scalable impact in the industry.
3. We scale
We remove barriers to accelerate the implementation of proven solutions.
4. We measure
We ingest, analyze, and report critical data to move our partners closer to their climate targets.
Fashion Climate Fund (FCF)
To make urgent and meaningful strides in decarbonizing the supply chain, Apparel Impact Institute has called upon industry leaders to pool $250million in catalytic capital to unlock $2 billion in supply chain investment.With this support, we can enable approximately 2,000 suppliers to cut100 million tonnes of CO2e emissions by 2030 by empowering them toadopt proven carbon-reducing solutions, secure essential financing, andmeasure their impact. This will drive substantial and replicable changeacross the industry.
This capital is strategically allocated across four key areas:
- OUR PROGRAMS & PROCESS: We’re directly supporting suppliers with subsidies to jumpstart carbon technology assessments, efficiency programs such as Clean By Design, and the development of thermal energy roadmaps. Our approach and supporting framework provides a clear pathway for suppliers to be leaders in carbon reduction.
- CLIMATE SOLUTIONS PORTFOLIO: Through our rigorous, data-driven Calls for Application and grantmaking processes, we’re expanding our Climate Solutions Portfolio, which identifies and scales proven decarbonization programs, solutions, and technologies targeting Scope 3 emissions from production, the most significant source of carbon in the apparel industry.
- ECOSYSTEM & THOUGHT LEADERSHIP: We fund activities that enable systemic changes, such as cutting-edge research, comprehensive reports, and innovative programs. We convene key stakeholders, including suppliers, brands, investors, philanthropies, and solutions providers. These initiatives are designed to activate and drive project deployment in facilities, unlocking substantial reductions in carbon emissions and fostering the shift to a more sustainable industry.
- SUSTAINABLE FINANCE: Given that loans are often either inaccessible or market-rates too high for textile suppliers, the Fashion Climate Fund works with major financial institutions to derisk debt, resulting in accessible and more appealing financing. We identify and provide information on critical financial mechanisms such as first-loss provisions, loan guarantees, and other support necessary for securing sustainable finance, paving the way for substantial industry-wide impact.
Over the next five years, if we can fully fund the $250M Fashion Climate Fund, Aii will engage with approximately 2,000 diverse suppliers across key production regions. We will provide comprehensive support, including technical assistance, sustainable finance options, and access to the best available technologies. Through these efforts, we aim to empower suppliers to implement effective climate solutions and drive tangible emissions reductions.
Fund Deployment
The FCF supports our work, which can be split into four categories:
Allocation of Funds
Download the Allocation of FundsDigital Transformation
In 2024, Aii shifted its software and technology focus to “digital transformation.” Digital transformation is the process of integrating digital technologies in all areas of an organization to improve operations, efficiency, partner experiences, and service delivery value.
This strategic technology shift will position Aii for success in achieving our 2030 emission reduction goal by streamlining key processes such as program deployment and positioning Aii as lean and adaptable to evolving industry trends.
Key digital transformation areas within Aii include:
- Exploring strategic partnerships to deliver our key products and services more effectively, including the Carbon Toolkit and program reporting.
- Building a best-in-class database to improve and expand the overall quality of data.
- Implementing business intelligence tools to enable faster access to relevant information, identification of trends and patterns, and more impactful insights for the industry.
Outlook to 2025
STRATEGIC PARTNERSHIPS
Our aim is to fully digitize Aii’s program offerings, not only streamlining
our ability to deliver services but also greatly enhancing the overall experience for all stakeholders involved.
our ability to deliver services but also greatly enhancing the overall experience for all stakeholders involved.
OPERATIONAL ENHANCEMENTS
While delivering value back to the industry is essential, it’s equally important to ensure that our own subject matter experts within Aii have the tools needed to innovate. Aii is exploring customer relationship management (CRM) and business intelligence (BI) tools to increase efficiency and deliver additional insights to the industry.
DATA REPOSITORY
Data is the foundation for good insights, especially when tracking improvements to baseline metrics for facilities in our programs. Aii is establishing a best-in-class database that organizes data collected from our products and services, implements best practices for data quality assurance and security, and is accessible and actionable to our partners. Note: Aii follows all region-specific data privacy laws.
TECHNOLOGY ADJUSTMENTS
To set ourselves up for success, Aii is restructuring some of our current digital assets by retiring our current CSP platform and moving the registry of CSP registrants and grantees to our main public website, allowing the public to continue discovering impactful programs and technologies.
“While digital transformation may seem like a common strategy implemented by organizations across all industries, its impact relies heavily on commitment to a shared vision and execution. These are areas where Aii truly excels, and I’m already excited at the progress we’ve made in such a short time as a smaller organization. The industry will soon see not only Aii’s innovative mind at work but also our ability to take an idea and make it into a reality with all industry stakeholders in mind.”
- DAN XAVIER
Head of Software
Head of Software
Aii Team
Organogram⁷
⁷ Employees and job titles during the financial year 2023 until 12.31.2024
Download the OrganogramGeography & Demographics of the Team
Aii maintained an employee count of 26 in 2024.
At the close of 2024, Aii’s team consisted of 58% employees identifying as female and 42% male. Aii’s executive leadership team is composed of four people — 75% identifying as male and 25% as female.
As a smaller team, we are especially proud of our diversity, with employees distributed across 11 countries in three continents, and representing 10 different nationalities.
At the close of 2024, Aii’s team consisted of 58% employees identifying as female and 42% male. Aii’s executive leadership team is composed of four people — 75% identifying as male and 25% as female.
As a smaller team, we are especially proud of our diversity, with employees distributed across 11 countries in three continents, and representing 10 different nationalities.
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Click and Drag!
Graphic shows gender and nationalities of the Aii team.
Employee Recruitment, Engagement, & Retention
Aii recognizes that in order to deliver our mission with the urgency it requires, we need to recruit, engage, and retain a team of high-quality and passionate talent.
- RECRUIT We have fine-tuned our recruitment process to ensure we are vetting candidates not only for their qualifications but also their alignment with Aii core values: Humble, Empathetic, Ethical & Passionate. In the coming year, we also have plans to increase our regionally-focused recruiting efforts, hiring more employees who live and
- ENGAGEMENT Once we secure top talent, we work hard to make sure they’re satisfied and engaged in their work. We’re thrilled to report that our employees are happy! We saw an increase from our already high score of 4.2/5 to 4.3/5 on our 2024 annual employee engagement survey.
- RETENTION This year, we had a 92% retention rate and created a retention strategy for future years by polling staff on what is important to them and focusing our efforts on initiatives that will keep staff engaged, supported, and satisfied.
Our climate programs director, hired August 1, 2024, explains her start at Aii:
“My experience with Aii was a model in great recruiting. Responses to queries and clarifications were always received the next working day. The transparency to the process, the interviewers, and the purpose of each stage of the process were clear, informative, and really helped in preparing for each meeting. The meetings, exercises, conversations, and documents, were all concise, focused, and FUN! I met 5 of my new colleagues during the recruitment process and all demonstrated that this would be a positive, committed, and engaging environment — I knew from the get-go that this was a culture in which I could be vocal, be curious, and thrive.”
- LISA FROST
Climate Programs Director
Climate Programs Director
Remote Organizational Culture
As a remote, globally dispersed workforce, we need to work a little harder to build deep connections among our team. We have initiatives throughout the year such as virtual game nights, asynchronous “hometown video tours,” and our monthly staff newsletter to keep employees feeling connected. We solidify connections once a year at our annual in-person staff retreat, a time when we can build deeper bonds as a team to propel our work forward with renewed energy and purpose.
OUR TEAM IN PORTO
This year we chose the city of Porto for our in-person staff retreat, not only because of its tradition of textile manufacturing, but also to get to know the hometown of two of our employees, Bruno and Patricia.
This year we chose the city of Porto for our in-person staff retreat, not only because of its tradition of textile manufacturing, but also to get to know the hometown of two of our employees, Bruno and Patricia.
“I have participated in the previous staff retreats, but this year was very special. Having the opportunity to host and show Porto to my colleagues added a new dimension to team building. The sightseeing, the wonderful food, the whole experience of Portugal hospitality just screamed connection and led to amazing moments as a team.”
- BRUNO CARNEIRO
Data & quality assurance manager
Data & quality assurance manager
“I was thrilled to welcome my team to Portugal for our annual retreat and share with them one of my favorite cities, Porto. It was inspiring to visit local partners, Smartex and Impetus, and to showcase Portugal’s textile sector to colleagues from abroad, and I’m hopeful that we’ll soon launch a Clean by Design project here. The experience allowed me to strengthen connections with teammates I don’t often work with, making it all the more meaningful.”
- PATRICIA SOUSA
Program operations manager
Program operations manager
In addition to the challenges of team building as a remote organization, we also face the challenge of working across cultures — and time zones. We address these challenges through a dedicated culture committee that meets quarterly to discuss obstacles, initiatives, and solutions to bridge any cultural gaps across our team.
Aii Governance
Board of directors
Aii is governed by its Board of Directors, whose role includes:
- Determining Aii’s mission and purpose.
- Monitoring and strengthening programs and services.
- Ensuring adequate financial resources.
- Protecting assets and providing proper financial oversight.
- Building a competent Board, including articulating prerequisites for candidates, orienting new members, and periodically and comprehensively evaluating their own performance.
- Maintaining legal and ethical integrity.
- Enhancing the organization’s public standing.
- Establishing a balance of representation from a variety of fields on the Board to maintain diversity and encourage inspiration and innovation from a wide range of sources.
- Approving the final Fashion Climate Fund allocations as part of the budgeting process.
Aii board members serve a three-year term and attend quarterly meetings. The Board has three established committees: Board Development, Audit, and Finance.
CSP Advisory Council
The Climate Solutions Portfolio Advisory Council (CSPAC) operates as a diverse multi-stakeholder entity with a primary focus on identifying solutions capable of significantly reducing CO2e at scale within the textile industry. The aim is to include these impactful solutions in the Climate Solutions Portfolio (CSP).
Aii’s inaugural Climate Solutions Portfolio Advisory Council (CSPAC) members are concluding their two-year term this year. We extend our deepest appreciation for their commitment and expertise, which led to the development of a comprehensive strategy, a rigorous evaluation process for the Climate Solutions Portfolio (CSP), and the successful vetting of nearly 20 projects as Registrants and Grantees.
We are pleased to share that several members have renewed their roles, ensuring continuity as the CSP transitions from setup to scaling impact. Additionally, we are excited to welcome new advisory council members who will bring fresh perspectives to this critical work.
Aii’s inaugural Climate Solutions Portfolio Advisory Council (CSPAC) members are concluding their two-year term this year. We extend our deepest appreciation for their commitment and expertise, which led to the development of a comprehensive strategy, a rigorous evaluation process for the Climate Solutions Portfolio (CSP), and the successful vetting of nearly 20 projects as Registrants and Grantees.
We are pleased to share that several members have renewed their roles, ensuring continuity as the CSP transitions from setup to scaling impact. Additionally, we are excited to welcome new advisory council members who will bring fresh perspectives to this critical work.
Apparel Impact Roundtable
The Apparel Impact Roundtable is composed of industry partners contributing to the Fashion Climate Fund and other strategic industry partners. The Roundtable’s primary responsibility is to review and provide feedback on the strategies and initiatives of the Fashion Climate Fund.
Stakeholders
2024 Partners
Apparel, footwear, or retail companies since Aii’s inception who nominate, sponsor, or provide funding to Aii to drive facility-level environmental improvement programs and impact reductions.⁸
Abercrombie & Fitch, Acne Studios, Amazon, Amer Sports, American Eagle, Arc’teryx, ASICS, ASOS, Balenciaga, C&A, Columbia, Decathlon, Eileen Fisher, Express, European Outdoor Group, Everlane, Fast Retailing, Farfetch, FILA, Fjallraven, Gap, G-star, H&M Group, Helly Hansen, Icebug, JCPenney, J. Crew, Kering, Kontoor, Levi Strauss & Co., Li&Fung, LL Bean, Lululemon, Marks & Spencer, Nemo, New Balance, Nike, Nordstrom, Otto Group,Outdoor Industry Association, Prada, Primark, Puma, PVH, Ralph Lauren, Rapha, REI, REWE, SHEIN, Stella McCartney, Tchibo, Tesco,The Reformation, Under Armour, Uniqlo, VB,VF Corporation, Victoria’s Secret, W.L. Gore, WSCG, Zalando
Non-profit organizations with expertise and knowledge of the apparel, footwear, and textile industry or adjacent sectors collaborating with and providing guidance and insights to Aii in 2024.
Cascale
Fashion for Good
Solidaridad
Textile Exchange
ZDHC Foundation
Fashion for Good
Solidaridad
Textile Exchange
ZDHC Foundation
Organizations committing at least $1M per year to the $250M Fashion Climate Fund.
H&M Foundation
H&M Group
HSBC
Lululemon
PVH Foundation
The Schmidt Family Foundation
Target Corporation
H&M Group
HSBC
Lululemon
PVH Foundation
The Schmidt Family Foundation
Target Corporation
Organizations who provided funding to Aii in 2023 to advance our mission for the apparel, footwear, and textile sector.⁹
Bank Of The West
Cascale
Chaiken Foundation
Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ)
Fair Wear Foundation IDH
Roy A. Hunt Foundation
Cascale
Chaiken Foundation
Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ)
Fair Wear Foundation IDH
Roy A. Hunt Foundation
Organizations with expertise and knowledge on issues relevant to the apparel, footwear, and textile sector that collaborated with and provided guidance to Aii in 2024.
Accelerate Circularity
Fashion Conveners
Fashion Pact
Global Fashion Agenda
Natural Resources Defense Council (NRDC)
Pakistan Environment Trust
Race to the Top
The Industry We Want (TIWW)
United Nations Fashion Industry Charter for Climate Action (UNFCCC)
Value Change Initiative
World Resources Institute (WRI)
Fashion Conveners
Fashion Pact
Global Fashion Agenda
Natural Resources Defense Council (NRDC)
Pakistan Environment Trust
Race to the Top
The Industry We Want (TIWW)
United Nations Fashion Industry Charter for Climate Action (UNFCCC)
Value Change Initiative
World Resources Institute (WRI)
Solution providers with specialist knowledge in countries that implemented Aii’s programs in 2024.
Beijing
Jingneng Power
China
BluWin Ltd.
India, Bangladesh, China, Mexico, Honduras, El Salvador, USA
Ckinetics
India
Catoer Wibowo
Indonesia
Energica SRL
Italy
Jingneng Power
China
BluWin Ltd.
India, Bangladesh, China, Mexico, Honduras, El Salvador, USA
Ckinetics
India
Catoer Wibowo
Indonesia
Energica SRL
Italy
Enerteam
Vietnam
Hongyu (Guangzhou Hongyu Ecological Technology)
China
International Energy Management Association (IEM)
China
Leyton
Italy
Vietnam
Hongyu (Guangzhou Hongyu Ecological Technology)
China
International Energy Management Association (IEM)
China
Leyton
Italy
Pozzi Leopoldo
Italy
Process Factory
Italy
RESET Carbon
Multiple locations
VNCPC
Vietnam
Italy
Process Factory
Italy
RESET Carbon
Multiple locations
VNCPC
Vietnam
Organizations who contributed finance and blended capital expertise to Aii in 2024 to further our Sustainable Finance Strategy objective of unlocking $2 billion in decarbonization/climate funding for the apparel and footwear industry.
ADB
BluWin
DFI
Guidehouse
HSBC
IFC
Rockefeller Foundation
Workshop
BluWin
DFI
Guidehouse
HSBC
IFC
Rockefeller Foundation
Workshop
⁸Partners include organizations that previously contributed and/or currently contribute funding to Aii. For confidentiality reasons, some names are not mentioned.
⁹Industry & Funding Partners include organizations that previously contributed and/or currently contribute funding to Aii.
⁹Industry & Funding Partners include organizations that previously contributed and/or currently contribute funding to Aii.
2024 Suppliers Implementing an Aii Impact Program
