India
17,662
158
Annual Impact Report 2025
Executive Summary
Hover over or click the cards below!
We advanced the Aii Energy & Carbon Benchmark through public consultation and pilot testing, strengthening the tool ahead of formal release.
We launched the Deployment Gap Grant, selecting two grantees to advance renewable thermal technologies and energy-efficient retrofits that prepare suppliers for full electrification.
We strengthened our Climate Solutions Portfolio, supporting three new grantees with the potential to reduce nearly 60,000 tonnes of CO2e and awarding our first Supplier Electrification Grant to accelerate scalable, low-carbon solutions.
We developed The Cost of Inaction, building a clear evidence base that connects climate inaction to business risk and capital allocation decisions.
We published strategic roadmaps for China and Bangladesh, mapping pathways and finance solutions to accelerate decarbonization across two of the sector’s most critical manufacturing hubs.
We partnered with Made2Flow to build a digital platform that supports program deployment, data collection, action planning, and supplier progress tracking, creating a single source of truth for our partners’ decarbonization journeys.
Letter from Lewis Perkins
Dear Friends,
2025 was a year of clarity for our industry.
For more than a decade, sustainability was often framed as responsibility. Important? Yes. But too often separate from the core business strategy. Now, we’re seeing a shift. Brands, suppliers, and investors are asking more direct questions: What happens if we move too slowly? Where does our real exposure sit? Which actions materially reduce risk? How does this affect long-term resilience?
In a year when some companies scaled back visible sustainability commitments, those who remained engaged became more disciplined. They moved beyond broad targets and focused more deliberately on operational execution. Effort concentrated around priority suppliers and the parts of the supply chain where emissions are most material, particularly thermal energy in Tier 2 mills. Electrification, heat pumps, and renewable integration became less theoretical and more central to investment planning. Capital decisions increasingly reflected both emissions impact and long-term cost stability.
That shift shaped our priorities.
In 2025, we expanded the deployment of low-carbon thermal solutions in key manufacturing regions, working directly with mills to assess feasibility, structure financing, and move projects into implementation. Through our Climate Solutions Portfolio, we directed catalytic funding toward commercially proven technologies with measurable emissions reductions and clear economic return.
Our Deployment Gap Grants moved from concept to proof. These grants were designed to unlock projects that had strong technical cases but stalled due to capital constraints or misaligned incentives. The early results reinforced what we have seen across regions: progress accelerates when suppliers have confidence that capital support and demand signals will be sustained. Trust and continuity matter.
We also strengthened engagement at the regional level. In priority markets, we worked with brands and manufacturers to connect decarbonization roadmaps with procurement and capital planning decisions. Ambition must connect to sourcing behavior and financial decision-making if it is to scale.
Across these efforts, one theme continued to surface. The constraint is rarely technological feasibility. More often, it is the shared discipline required to align capital, incentives, and long-term commitments across partners who each operate under real commercial pressure.
We recognize this transition is not simple. Suppliers manage thin margins and energy volatility. Brands balance regulatory shifts and cost competitiveness. Financial institutions are reassessing risk. Progress depends on sustained collaboration across these realities.
At the same time, the financial implications of delay are becoming more visible. Climate exposure influences energy costs, carbon pricing exposure, and raw material volatility, all of which ultimately shape the cost of goods sold. In a low-margin industry, even a modest one to three percent shift in input costs can materially affect operating profit.
The numbers in this report reflect a broader shift. Climate performance is no longer a parallel conversation; it is increasingly tied to how companies manage risk, allocate capital, and build long-term resilience.
The cost of inaction is rising. So is our readiness to act.
Warm regards,
For more than a decade, sustainability was often framed as responsibility. Important? Yes. But too often separate from the core business strategy. Now, we’re seeing a shift. Brands, suppliers, and investors are asking more direct questions: What happens if we move too slowly? Where does our real exposure sit? Which actions materially reduce risk? How does this affect long-term resilience?
In a year when some companies scaled back visible sustainability commitments, those who remained engaged became more disciplined. They moved beyond broad targets and focused more deliberately on operational execution. Effort concentrated around priority suppliers and the parts of the supply chain where emissions are most material, particularly thermal energy in Tier 2 mills. Electrification, heat pumps, and renewable integration became less theoretical and more central to investment planning. Capital decisions increasingly reflected both emissions impact and long-term cost stability.
That shift shaped our priorities.
In 2025, we expanded the deployment of low-carbon thermal solutions in key manufacturing regions, working directly with mills to assess feasibility, structure financing, and move projects into implementation. Through our Climate Solutions Portfolio, we directed catalytic funding toward commercially proven technologies with measurable emissions reductions and clear economic return.
Our Deployment Gap Grants moved from concept to proof. These grants were designed to unlock projects that had strong technical cases but stalled due to capital constraints or misaligned incentives. The early results reinforced what we have seen across regions: progress accelerates when suppliers have confidence that capital support and demand signals will be sustained. Trust and continuity matter.
We also strengthened engagement at the regional level. In priority markets, we worked with brands and manufacturers to connect decarbonization roadmaps with procurement and capital planning decisions. Ambition must connect to sourcing behavior and financial decision-making if it is to scale.
Across these efforts, one theme continued to surface. The constraint is rarely technological feasibility. More often, it is the shared discipline required to align capital, incentives, and long-term commitments across partners who each operate under real commercial pressure.
We recognize this transition is not simple. Suppliers manage thin margins and energy volatility. Brands balance regulatory shifts and cost competitiveness. Financial institutions are reassessing risk. Progress depends on sustained collaboration across these realities.
At the same time, the financial implications of delay are becoming more visible. Climate exposure influences energy costs, carbon pricing exposure, and raw material volatility, all of which ultimately shape the cost of goods sold. In a low-margin industry, even a modest one to three percent shift in input costs can materially affect operating profit.
The numbers in this report reflect a broader shift. Climate performance is no longer a parallel conversation; it is increasingly tied to how companies manage risk, allocate capital, and build long-term resilience.
The cost of inaction is rising. So is our readiness to act.
Warm regards,
Lewis Perkins
President, Apparel Impact Institute
Our Impact at a Glance
Overall Impact Achieved Since our Inception
10.9%
of goal achieved
of goal achieved
GOAL:
100 Mt CO₂e
saved over useful life by 2030
STATUS:
10,898,199 tonnes CO₂e
saved over the useful life1
Or
1,165,182 tonnes CO2e
total annual reduction by producers that have completed Aii programs2
Total annual actual GHG emission reductions (in tonne CO2e) per year over useful life by suppliers that have completed Aii programs
Total annual actual GHG emission reductions (in tonne CO2e) per year over useful life by suppliers that have completed Aii programs, CSP solutions and Aii grants1.
1 Sum of total GHG emissions saved by suppliers participating in Aii’s Supplier Journey in each year from 2018 until the end of 2024 multiplied by the respective useful life factor. In 2024, we updated our emissions and conversion factors, including historic data — read more about our data and calculation methods in our Methodology/Calculations section.
2 Sum of total GHG emissions saved by producers participating in Aii’s Supplier Journey in each year from 2018 until the end of 2025 multiplied by the respective useful life factor (see How We Report section)
3 Sum of total actual GHG emissions saved by producers participating in Aii’s Supplier Journey in each year from 2018 until the end of 2025.
1,545 facilities and 17,662 farms
reached through Aii’s Supplier Journey from 2018 until the end of 2025
China
484
Bangladesh
146
Vietnam
199
Other Regions
558
Aii’s Supplier Journey is a framework designed to support suppliers on their journey toward decarbonization. For more information, read the chapter Our Programs and Processes.
78 brands worked with Aii on their facilities' decarbonization journey.
Capital Unlocked
GOAL:
2 Billion $ capital unlocked by 2030
2 Billion $ capital unlocked by 2030
STATUS:
US $188,285,394
Total Capital Unlocked
=
US $144,597,578
Total investments made by suppliers from 2018-2025
+
US $43,687,816
Total Aii spending⁴ from 2018-2025
=
US $144,597,578
Total investments made by suppliers from 2018-2025
+
US $43,687,816
Total Aii spending⁴ from 2018-2025
⁴ This includes all expenses made by Aii, e.g. brand contributions, software development
9.41%
of goal achieved
of goal achieved
Our 2025 Impact
Total No. of
Active Solutions1
473 facilities & 17,662 farms
Total No. of
Completed Solutions2
297 facilities
Total No. of
Brands3:
48
Total No. of
Regions4:
48
Cost per tCO2e summary
Average actual cost per tCO₂e:
US $17.28
Average actual facility investment cost per tCO₂e:
US $13.27
Average actual Aii cost per tCO₂e:
US $4.01
Average actual cost per tCO₂e includes Aii’s total spending (i.e., all Aii G&A and program-related expenses) and supplier capital investments to implement actions between 2018-2025.
1Facility is actively engaged in the program, the kick-off session has occurred, and the facility is now implementing the program.
2Facility completed all activities within a program and a certificate was issued.
3Total number of brands Aii was working with in 2025 (active and completed programs). Brands include organizations that contributed funding to Aii in 2025.
4All countries/regions Aii offered programs in 2025. A region has at least one producer that has started program work with Aii.
2025 Key Impact Results of Suppliers That Completed a Solution in Phase 2 of Aii’s Supplier Journey
Level 1 - Assured
Total actual GHG emission savings in tCO₂e
191,846
Level 2 - Not Assured
Total actual GHG emission savings in tCO₂e
79,777
Total actual GHG emission savings in tCO₂e: 271,623
Average actual factory GHG emission savings in tCO₂e: 3,395
Average % of GHG emission savings: 7.81%
x 63,357
Total GHG emissions savings equal to 63,357 cars removed from the roads in 2025.
Total GHG emissions savings equal to 63,357 gasoline-powered passenger vehicles driven for one year. Source: United States Environmental Protection Agency
Level 1 - Assured
Total actual water savings in m³
3,385,759
Level 2 - Not Assured
Total actual water savings in m³
763,238
Total actual water savings in m³: 4,148,997
Average actual factory water savings in m³: 56,836
Average % of water savings: 7.53%
x 1,660
Total water savings equal to almost 1,660 Olympic-sized swimming pools not filled in 2025.
One Olympic-sized swimming pool contains 660,430 gallons of water. Source: FINA Facilities Rules 2015-2017, Wayback Machine (archive.org)
Level 1 - Assured
Total actual energy savings in GJ
2,002,463
Level 2 - Not Assured
Total actual energy savings in GJ
688,570
Total actual energy savings in GJ: 2,691,033
Average actual factory energy savings in GJ: 33,638
Average % of energy savings: 6.36%
x 15,904,450
Total energy savings equal to 15,904,450 washing machines not used in 2025.
Washing machines not used are calculated using a 17.6 lbs capacity Miele WWD020 WCS machine and assuming it is used for 100 cycles per year. EU energy class: A. Source: Washing Machines and Washer-Dryers (europa.eu)
External Events & Stakeholder Engagement
April 2025
Inaugural BMO Climate Solutions Conference
May 2025
Cascale Manufacturing Forum
June 2025
Sustainable Apparel and Textiles Conference USA, Innovation Forum
June 2025
The Scope 3 Innovation Forum, Innovation Forum
September 2025
Cascale Annual Meeting
October 2025
UNFCCC Fashion Charter Annual Meeting
November 2025
COP30
December 2025
Scope 3 Innovation Forum USA, Innovation Forum
Our Programs
& Process
& Process
Climate
Solutions
Portfolio
Solutions
Portfolio
Our Grants
Carbon & Energy
Benchmark
Benchmark
Ecosystem
& Thought
Leadership
& Thought
Leadership
Sustainable
Finance
Finance
Our Programs & Process
In 2025, we continued to implement a supplier-centric, data-driven framework to support decarbonization across the apparel value chain. Through three supplier pathways: existing partners, priority suppliers with high reduction potential, and brand-nominated suppliers, we adopted a more flexible, solution-oriented approach to engagement. This is supported by a structured implementation journey, from baseline assessment and action planning to on-the-ground execution and continuous performance monitoring.
Across its programs, Aii advanced key initiatives to drive impact at scale. High Impact Projects (HIPs) were defined and initiated in China and Vietnam to support deep decarbonization in wet processing. Regional and sector-focused efforts expanded, including the Apparel and Textile Transformation Initiative and increased engagement in Italy’s luxury supply chain. In parallel, pilot programs with Made2Flow and RETI in Vietnam strengthened data infrastructure and renewable energy pathways.
Looking ahead to 2026, Aii will continue scaling this integrated model, expanding platform deployment, advancing supplier implementation, and accelerating high-impact decarbonization across key regions and production tiers.
Climate Solutions Portfolio
The Climate Solutions Portfolio (CSP) is the industry’s registry for vetted climate solutions, designed to accelerate the adoption and scale of technologies that deliver measurable CO₂e reductions. Through solution vetting, grant funding, and technical assistance, CSP supports both emerging and mature solutions and connects them with brands and suppliers to enable real-world deployment.
In 2025, we advanced its clean heat strategy, focusing on electrification and thermal load reduction as key pathways for decarbonizing textile manufacturing. Through coordinated workstreams—including renewable energy deployment, heat pump feasibility and implementation, and efficiency-driven load reduction—CSP supported facilities in moving from assessment to execution. Pilot grants for steam-generating heat pumps and other technologies generated early evidence to support broader adoption, and six new solutions were added to the registry.
Looking ahead to 2026, CSP will transition to a supplier-led, electrification-focused approach to accelerate impact and scale.
Our Grants
Aii’s grant programs provide targeted funding to accelerate the development and deployment of low-carbon solutions across the apparel value chain. Through the Climate Solutions Portfolio (CSP) Grants, Supplier Electrification Grants, and the newly launched Deployment Gap Grant (DGG), Aii supports both early-stage innovation and the implementation of proven technologies that face financial or operational barriers.
In 2025, CSP grants supported a cohort of three grantees addressing thermal energy and material innovation, while the Supplier Electrification Grant enabled the installation of the first steam-generating heat pump in Vietnam’s textile sector, demonstrating the viability of fully electrified thermal systems. In parallel, Aii launched the DGG to bridge the gap between short payback expectations and the longer return periods of low-carbon technologies, piloting projects in India focused on renewable thermal energy and electrification readiness.
In 2026, Aii will scale these funding mechanisms to accelerate supplier adoption of electrification and energy-efficient technologies.
Carbon & Energy Benchmark
Aii’s Energy and Carbon Benchmark provides tailored energy and emissions intensity reference values that facilities can use to assess performance at the manufacturing process level. Developed with technical experts and guided by a multi-stakeholder Technical Review Committee, it delivers benchmarks across textile and garment production tiers and process configurations, distinguishing between single-tier and vertical facilities operating multiple processes on site.
In 2025, Aii advanced the Benchmark through technical review, public consultation, and pilot testing. More than 60 submissions were received through surveys and direct feedback during the consultation period, while approximately 400 facilities participated in pilot phases to validate the methodology and refine results.
Version 1.0 will be released in early 2026, transitioning the Benchmark from testing to sector-wide deployment.
Ecosystem & Thought Leadership
In 2025, Aii convened key stakeholders across regions to accelerate alignment and action on decarbonization. This included a supplier-focused activation event in India, where partners co-developed the Deployment Gap Grant and advanced electrification feasibility studies, as well as participation in global platforms such as New York Climate Week, Cascale’s Annual Meeting, and industry forums across the U.S., Europe, and Asia. Aii also hosted targeted convenings, including the Clean by Design Award Ceremony in China and sector-focused events such as Lineapelle in Italy, bringing together brands, suppliers, and solution providers to address implementation challenges and opportunities.
Aii strengthened its thought leadership through the publication of sector roadmaps and country-specific analyses, including the Low-Carbon Thermal Energy Roadmap and decarbonization and finance landscape reports for China and Bangladesh. In parallel, Aii expanded its role in multi-stakeholder initiatives and industry collaborations—such as the Apparel Alliance Working Group and the Apparel and Textile Transformation Initiative—helping align data frameworks, tools, and implementation pathways across the value chain.
Together, these efforts reinforced Aii’s role as a convener and technical leader, driving practical, coordinated action to support industry-wide decarbonization.
Sustainable Finance
Aii’s Sustainable Finance function is designed to unlock decarbonization by addressing the financial barriers that prevent suppliers from investing in low-carbon solutions, including access to capital, risk allocation, and uncertain payback periods.
In 2025, Aii focused on translating decarbonization plans into investable projects. Key milestones included launching the Deployment Gap Grant to address long payback barriers for thermal and electrification technologies, expanding the Future Supplier Initiative into India to advance collective financing models, and developing The Cost of Inaction report with Accenture to highlight the financial risks of delayed action. Aii also strengthened engagement with financial institutions, supported the development of a global debt fund, expanded supplier financial readiness through training, and developed region-specific financing solutions.
In 2026, Aii will continue scaling capital mobilization and strengthening financing pathways to accelerate investment in high-impact decarbonization projects across the value chain.
Our Programs & Process
In 2025, we continued to implement a supplier-centric, data-driven framework to support decarbonization across the apparel value chain. Through three supplier pathways: existing partners, priority suppliers with high reduction potential, and brand-nominated suppliers, we adopted a more flexible, solution-oriented approach to engagement. This is supported by a structured implementation journey, from baseline assessment and action planning to on-the-ground execution and continuous performance monitoring.
Across its programs, Aii advanced key initiatives to drive impact at scale. High Impact Projects (HIPs) were defined and initiated in China and Vietnam to support deep decarbonization in wet processing. Regional and sector-focused efforts expanded, including the Apparel and Textile Transformation Initiative and increased engagement in Italy’s luxury supply chain. In parallel, pilot programs with Made2Flow and RETI in Vietnam strengthened data infrastructure and renewable energy pathways.
Looking ahead to 2026, Aii will continue scaling this integrated model, expanding platform deployment, advancing supplier implementation, and accelerating high-impact decarbonization across key regions and production tiers.
Climate Solutions Portfolio
The Climate Solutions Portfolio (CSP) is the industry’s registry for vetted climate solutions, designed to accelerate the adoption and scale of technologies that deliver measurable CO₂e reductions. Through solution vetting, grant funding, and technical assistance, CSP supports both emerging and mature solutions and connects them with brands and suppliers to enable real-world deployment.
In 2025, we advanced its clean heat strategy, focusing on electrification and thermal load reduction as key pathways for decarbonizing textile manufacturing. Through coordinated workstreams—including renewable energy deployment, heat pump feasibility and implementation, and efficiency-driven load reduction—CSP supported facilities in moving from assessment to execution. Pilot grants for steam-generating heat pumps and other technologies generated early evidence to support broader adoption, and six new solutions were added to the registry.
Looking ahead to 2026, CSP will transition to a supplier-led, electrification-focused approach to accelerate impact and scale.
Our Grants
Aii’s grant programs provide targeted funding to accelerate the development and deployment of low-carbon solutions across the apparel value chain. Through the Climate Solutions Portfolio (CSP) Grants, Supplier Electrification Grants, and the newly launched Deployment Gap Grant (DGG), Aii supports both early-stage innovation and the implementation of proven technologies that face financial or operational barriers.
In 2025, CSP grants supported a cohort of three grantees addressing thermal energy and material innovation, while the Supplier Electrification Grant enabled the installation of the first steam-generating heat pump in Vietnam’s textile sector, demonstrating the viability of fully electrified thermal systems. In parallel, Aii launched the DGG to bridge the gap between short payback expectations and the longer return periods of low-carbon technologies, piloting projects in India focused on renewable thermal energy and electrification readiness.
In 2026, Aii will scale these funding mechanisms to accelerate supplier adoption of electrification and energy-efficient technologies.
Carbon & Energy Benchmark
Aii’s Energy and Carbon Benchmark provides tailored energy and emissions intensity reference values that facilities can use to assess performance at the manufacturing process level. Developed with technical experts and guided by a multi-stakeholder Technical Review Committee, it delivers benchmarks across textile and garment production tiers and process configurations, distinguishing between single-tier and vertical facilities operating multiple processes on site.
In 2025, Aii advanced the Benchmark through technical review, public consultation, and pilot testing. More than 60 submissions were received through surveys and direct feedback during the consultation period, while approximately 400 facilities participated in pilot phases to validate the methodology and refine results.
Version 1.0 will be released in early 2026, transitioning the Benchmark from testing to sector-wide deployment.
Ecosystem & Thought Leadership
In 2025, Aii convened key stakeholders across regions to accelerate alignment and action on decarbonization. This included a supplier-focused activation event in India, where partners co-developed the Deployment Gap Grant and advanced electrification feasibility studies, as well as participation in global platforms such as New York Climate Week, Cascale’s Annual Meeting, and industry forums across the U.S., Europe, and Asia. Aii also hosted targeted convenings, including the Clean by Design Award Ceremony in China and sector-focused events such as Lineapelle in Italy, bringing together brands, suppliers, and solution providers to address implementation challenges and opportunities.
Aii strengthened its thought leadership through the publication of sector roadmaps and country-specific analyses, including the Low-Carbon Thermal Energy Roadmap and decarbonization and finance landscape reports for China and Bangladesh. In parallel, Aii expanded its role in multi-stakeholder initiatives and industry collaborations—such as the Apparel Alliance Working Group and the Apparel and Textile Transformation Initiative—helping align data frameworks, tools, and implementation pathways across the value chain.
Together, these efforts reinforced Aii’s role as a convener and technical leader, driving practical, coordinated action to support industry-wide decarbonization.
Sustainable Finance
Aii’s Sustainable Finance function is designed to unlock decarbonization by addressing the financial barriers that prevent suppliers from investing in low-carbon solutions, including access to capital, risk allocation, and uncertain payback periods.
In 2025, Aii focused on translating decarbonization plans into investable projects. Key milestones included launching the Deployment Gap Grant to address long payback barriers for thermal and electrification technologies, expanding the Future Supplier Initiative into India to advance collective financing models, and developing The Cost of Inaction report with Accenture to highlight the financial risks of delayed action. Aii also strengthened engagement with financial institutions, supported the development of a global debt fund, expanded supplier financial readiness through training, and developed region-specific financing solutions.
In 2026, Aii will continue scaling capital mobilization and strengthening financing pathways to accelerate investment in high-impact decarbonization projects across the value chain.
Transformational impact
2025 in Practice: Building the Foundation
2025, the midpoint of our Roadmap to 2030, marked a year of structural progress. Rather than simply expanding programs, we strengthened the systems required to drive measurable decarbonization at scale. We advanced several foundational pillars: The Carbon and Energy Benchmark established a standardized framework for facilities to assess performance against model processes and industry peers, reinforcing measurement and accountability.
Strategic Shift: Prioritizing Higher Impact Projects (HIP)
Over the past several years, foundational efficiency programs have delivered meaningful progress. However, the scale of emissions reductions required by 2030 demands a more concentrated, high-impact approach rather than incremental gains. In response to this urgency, we are refining our capital allocation strategy to prioritize capital-intensive, technologically advanced interventions that are capable of delivering the most significant carbon reductions — particularly in wet processing.
Forecasting the Path to 2030
Achieving our ambition of 100 Mt CO₂e by 2030 will require sustained investment, capital mobilization beyond grant funding, and the scaling of HIPs across priority regions. To assess this pathway, we developed an Impact Forecasting Model that estimates cumulative GHG reductions based on projected facility completions, capital allocation strategies, and historical program performance.
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Transformational impact
2025 in Practice: Building the Foundation
2025, the midpoint of our Roadmap to 2030, marked a year of structural progress. Rather than simply expanding programs, we strengthened the systems required to drive measurable decarbonization at scale.
Strategic Shift: Prioritizing Higher Impact Projects (HIP)
Over the past several years, foundational efficiency programs have delivered meaningful progress. However, the scale of emissions reductions required by 2030 demands a more concentrated, high-impact approach rather than incremental gains.
Forecasting the Path to 2030
Achieving our ambition of 100 Mt CO₂e by 2030 will require sustained investment, capital mobilization beyond grant funding, and the scaling of HIPs across priority regions.
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