In this guest blog, Shein Han, director, compliance and sustainability, GG International Manufacturing, describes why manufacturers need the right financial incentives to decarbonize effectively.
The question comes up again and again: What should governments and industry stakeholders prioritize first for decarbonization?
As a fashion manufacturer based in Seoul, South Korea, I see how policy, financing, and implementation challenges come together in real time. In the APAC region, each country is taking a unique approach to a greener economy. These are encouraging signals, but manufacturers across the region are still facing major barriers to action.
As an Editorial Member of Cascale’s APAC Policy Member Expert Team, contributing specifically to the incentives agenda, I see a number of overlapping challenges. Fragmentation, limited interoperability, insufficient incentives, and underrepresentation of decent work issues – Cascale’s recent APAC Policy Priorities paper captures all of these issues.
Amid competing customer demands and faster turnaround times, there is little leeway for manufacturers to invest the time, energy, or resources to decarbonize their facilities. The reality is that decarbonization is simply too expensive for APAC manufacturers, especially SMEs, to tackle alone. For many SMEs, decarbonization is not a strategic choice but a financial constraint, where even well-intentioned efforts are limited by access to capital. That is exactly why incentives are critical.
Decarbonization is not a willingness issue. It is a financing issue.
Without a support mechanism such as loans or blended financing, companies cannot invest in renewable energy or low-carbon equipment.
This is one of the reasons why decarbonization incentives are a key priority in the APAC Policy Priorities Paper. The paper recognizes that many suppliers and SMEs face significant barriers due to high costs and limited access to finance, and calls for targeted support mechanisms, including subsidies, preferential financing, and investment in renewable energy and low-carbon technologies. The stated goal is to make the transition more practical, more scalable, and more inclusive across the supply chain.
Also, most decarbonization efforts today are still project-based. What we need is a system-based approach across the supply chain from now on. This is why we need to invest in expanding infrastructure, more coordinated support, and policy conditions that help solutions scale.
Incentives are also very critical. However, incentives without execution or without reliable data or without verified data are not enough on their own. We need a clear implementation framework to scale the incentives.
If I had to choose one action item for decarbonization, it would be linking financial incentives directly to the verified data. This could include preferential financing for facilities with verified emissions data, tax incentives tied to measurable reductions, or blended finance mechanisms that reduce upfront capital investment for renewable energy adoption. For example, factories with verified Scope 1 and 2 emissions data could access preferential financing rates or performance-based incentives tied to demonstrated reductions. This creates both accountability and motivation. Without such incentive mechanisms, scaling will be difficult.
If we want decarbonization to move faster across APAC, we need policies and financing approaches that reflect how manufacturers actually operate. That starts with making support accessible, practical, and tied to real progress.
Curious to learn more? Explore the full APAC Policy Priorities Paper and, for members, continue the conversation through the recent webinar featuring insights from APAC Policy MET members.
Facilities are improving energy efficiency and reporting is more consistent, yet policy remains a critical unlock for embedding climate performance into operational decision-making.
Cascale’s latest “Decarbonization Progress in the Apparel, Footwear, and Textiles Industry” report is grounded in verified, facility-level data from thousands of manufacturing sites globally. That matters. It means the insights reflect operational reality, not projections or pledges.
Results show us that there is progress in the system: facilities are improving energy efficiency and reporting is more consistent. Climate performance is increasingly embedded into operational decision-making.
But the overall trajectory is not yet aligned with a 1.5°C pathway. That is not a failure of intent, it is a signal that we have reached the limits of what incremental, company-level improvements can deliver on their own.
One of the clearest findings from the report is the continued reliance on fossil fuels in key sourcing regions. Renewable penetration remains low in many markets, and coal continues to play a significant role in industrial energy systems.
This is not simply a procurement issue nor something brands or manufacturers can solve independently. Already, evolving European regulation coupled with existing grid challenges creates a “confusing” landscape for Asia-Pacific suppliers looking to decarbonize, as a recent Cascale policy workshop revealed. Efficiency gains help, but they cannot compensate for structural energy realities. If we want emissions reductions at scale, industrial decarbonization and energy policy must move in parallel.
And for that to happen, we cannot overlook the necessity of collaboration, data readiness, and proactive industry engagement. That’s where Cascale has a convening role to play.
The report reinforces something many in the industry already recognize: climate ambition in global supply chains is inseparable from national policy frameworks. Grid decarbonization, renewable access for industrial users, electrification strategies, and financing mechanisms are not abstract policy debates. They are direct determinants of whether climate targets in our sector are achievable.
This is where Cascale’s role becomes more assertive.
We are not simply publishing data. We are providing an evidence base that can inform smarter, more implementable policy. Verified facility-level data gives policymakers insight into where emissions are concentrated, where barriers exist, and where intervention can be most effective.
Regulation that reflects operational reality is more likely to drive impact. Regulation layered on top of fragmented reporting systems risks adding burden without accelerating emissions reductions.
Alignment matters.
The data also highlights the opportunity in greater coherence. As climate-related disclosure and due diligence frameworks evolve globally, there is a risk of increasing complexity for manufacturers and brands.
At the same time, there is an opportunity to align regulatory expectations with credible, existing data systems. When policy frameworks and industry tools move in the same direction, implementation becomes more efficient and more scalable.
Cascale is uniquely positioned at that intersection: between brands and manufacturers, between data and policy, between ambition and implementation. We see firsthand where the barriers lie. That perspective is invaluable in informing how policy evolves. From callouts at COP30 to mentions by the European Financial Reporting Advisory Group (EFRAG) in a recent report, our team is grateful to see our contributions increasingly recognized where it counts for industry-wide change
The industry is not standing still. The report shows real effort and measurable improvement, but progress at the current pace will not close the gap on its own.
The next phase of decarbonization in apparel and textiles will depend on coordinated action across industry, governments, and finance. Energy systems must transition faster and industrial users need clearer pathways and incentives. Policy must be designed with operational feasibility in mind. It must understand the realities on the ground.
Today, the data gives us a shared reference point. The responsibility now is to use it to shape the conditions that enable faster change. That is not just a sustainability challenge. It is a policy one.
Read the latest APAC political priorities paper to further understand the state of play for industry decarbonization.
The virtual summit celebrated Hirdaramani engagement with their suppliers on decarbonization.
At the virtual Hirdaramani 2026 Supplier Summit, Cascale played a key role in supplier on-boarding and support for decarbonization.
Hiradaramani has a long-term vision of decarbonization; they are the first apparel manufacturing company in Sri Lanka to secure Net-Zero Standard approval by the Science-Based Targets Initiative (SBTi) in 2024. They have committed to reach net-zero greenhouse gas emissions across the value chain by 2050.
With more than 150 virtual attendees, the summit celebrated Hirdaramani’s leveling up of its climate commitments, including the development of its Scope 3 Greenhouse Gas (GHG) Emissions Reduction Program. Already, they are committed to a near-term science-based target to reduce absolute Scope 1 and 2 GHG emissions 54.6 percent by 2033 from a 2022 base year under SBTi. Now, the manufacturer aims to additionally reduce its absolute Scope 3 GHG emissions from purchased goods and services by 32.5 percent. Aligned with SBTi, this program focuses on supplier engagement, understanding and reducing emissions across the group’s full value chain, particularly emissions arising from materials, goods, and services purchased from suppliers.
Hirdaramani Apparel’s managing director Mr. Madhawa Atapattu gave the welcome address, followed by the group’s general manager of sustainability Leonie Vaas, who introduced the Scope 3 session.
Cascale’s senior director of decarbonization Joyce Tsoi and senior member of manufacturing engagement Betty Li gave a presentation on decarbonization. The technical session covered industry decarbonization trends, data requirements, onboarding process, timelines, and support mechanisms for programs such as the Manufacturer Climate Action Program (MCAP).
Explaining the urgency of the climate crisis, Tsoi and Li stressed the importance of Hirdaramani’s supplier collaboration to drive industry decarbonization upstream. They explained the role of Cascale as a global industry convenor, with the Higg Index acting as a best-in-class industry harmonized measurement tool in measuring carbon emission across tier 1 to 3 manufacturing facilities. Relying on data aggregation Cascale leverages the data and produces useful industry insights to inform necessary actions required to accelerate decarbonization actions. They emphasized the shared goal in driving collective action at scale.
Headquartered in Kahathuduwa, Hirdaramani Exports International Ltd. is a major apparel manufacturer that operates 20 facilities across Sri Lanka. The manufacturer plays a key role in shaping Cascale’s upcoming Cascale Forum: Colombo March 30 to April 1.
Interested suppliers can find more information on joining MCAP on Cascale.org.
Cascale’s State of the Industry 2026 report shares new analysis of verified facility data, shows emissions rising as coal dependence and limited renewable energy adoption slow progress.
Amsterdam, Hong Kong, Oakland (CA) – January 28, 2026: Cascale today released the State of the Industry 2026: Decarbonization Progress in the Apparel, Footwear & Textiles Industry report, finding the sector is not decarbonizing at the pace or scale required to meet global climate targets. The report analyzes verified 2023 and 2024 energy data from the Higg Facility Environmental Module (Higg FEM), with a focus on Tier 1 finished product manufacturing and Tier 2 material manufacturing. Using Cascale’s new Effective Energy Carbon Intensity (EECI) metric, the analysis assesses how effectively the industry is decarbonizing energy use, which remains the dominant source of Scope 1 and 2 emissions.
“This report makes clear that there are no shortcuts to decarbonization,” said Jeremy Lardeau, Senior Vice President, Higg Index at Cascale. “Real progress depends on true value chain collaboration, not sourcing shifts by the brands. The level of investment required to achieve the deep decarbonization measures at facility level means brands will have to step up in a meaningful way. The climate agenda must be seen as an imperative to change the legacy sourcing dynamics of this industry.”
Key Findings
The findings align with broader global assessments, including recent analysis from the United Nations Environment Programme, which underscores that current policies remain insufficient to limit warming to 1.5°C.
Cascale’s report cautions against relocating production based on country averages and emphasizes long-term, collaborative engagement with manufacturers, particularly in Tier 2; to achieve this, supply chain engagement is essential. On March 4 , Cascale will host a member-only webinar that includes a deep dive into the report and a discussion on how EECI can be used by organizations to analyze their supply chains; Cascale members can register on Cascale Connect.
Cascale will publish this State of the Industry report annually to track progress and support collective action. The organization will continue expanding access to data and analytics for members and advancing programs such as the Manufacturer Climate Action Program to support science-aligned targets and measurable emissions reductions.
Cascale’s State of the Industry 2026 report shares new analysis of verified facility data, shows emissions rising as coal dependence and limited renewable energy adoption slow progress.
Bureau Veritas Manufacturer Decarbonization Playbook includes Cascale contributions, featured at COP30 discussions and webinar.
At COP30, Bureau Veritas launched its Manufacturer Decarbonization Strategy Playbook.
This practical resource, developed with key contributions from Cascale, supports manufacturers, including SMEs, in setting and advancing decarbonization targets. The Paris Committee on Capacity-Building (PCCB) recently included the playbook in a small-to-medium enterprise discussion at COP30, where Cascale also participated in an associated Bureau Veritas member webinar.
At the “Decarbonization Playbook for Manufacturers” webinar, speakers included Cascale’s senior director of decarbonization Joyce Tsoi; Apparel Impact Institute’s senior director of sustainable finance and engagement Kristina Elinder Lijas; Deutsche Gesellschaft für Internationale Zusammenarbeit’s head of project (GIZ) Gundolf Klaehn; Gokaldas Exports Limited’s deputy general manager Mahantesh Bangari; and Bureau Veritas’ senior program specialist Hailey Wang, as well as head of decarbonization and cleaner production, Rakesh Vazirani.
The webinar laid the foundation for the decarbonization business case, with an inclusive focus on manufacturer perspectives and cultural nuance. It convened more than 500 participants, with over 40 percent reporting that they are either just beginning their decarbonization journey or are in the early stages of data collection and target-setting.
Participants highlighted the Higg Facility Environmental Module (Higg FEM) as a common industry tool for measuring carbon and greenhouse gas emissions, and noted key barriers to decarbonization including high costs, limited in-house expertise and resources, and the challenge of securing customer support to cover decarbonization investments.
Tsoi offered insights into how Cascale’s Manufacturer Climate Action Program (MCAP) accelerates climate action. Welcoming Cascale members and non-members alike, the 18-month MCAP program helps manufacturers across the consumer goods industry develop and validate Science-Aligned Targets (SATs) to reduce Scope 1 and 2 greenhouse gas emissions. To date, MCAP has engaged 70 manufacturers with a collective CO2 reduction potential of over 419,000 tCO2e from 16 validated participants.
At a high-level, Tsoi explored the steps manufacturers and suppliers can take today to make progress on decarbonization goals, starting with measurement and baseline setting. She encouraged attendees to understand their current energy usage, fuel types, and carbon footprints in their owned operations and supply chain.
Next, she explored the target-setting approach in greater detail. Her advice: Use standardized, science-based frameworks like those developed for MCAP or by the Science Based Targets Initiative (SBTi) For successful implementation, Tsoi recommended manufacturers prioritize and plan impactful, cost-effective actions, and delegate out further responsibilities.
Bangari, representing Gokaldas, a Cascale manufacturer member based in India India, described how participating in MCAP helped the company set science-aligned targets for their Scope 1 and 2 emissions. He described Gokaldas’ sustainability achievements, which include procuring 75 percent renewable energy, improving machinery efficiency, and increasing waste and water recycling rates, among others. Showcased among the certifications in the company’s recent investor report, Gokaldas’ average Higg FEM score was 89 percent.
Cascale centers decarbonization, policy leadership at STAR Annual Meeting in China and Asia-Pacific Sports and Outdoor Fashion Forum in Singapore.
Cascale played a leading role at the recent Asia-Pacific Sports and Outdoor Fashion Forum in Singapore and the Sustainable Textiles of the Asian Region (STAR) Annual Meeting in China, highlighting vast collaboration opportunities in decarbonization and policymaking.
At the 2025 STAR Annual Meeting in Humen, Guangdong Province, China, policy and industry leaders from across Asia’s textile and apparel sector convened to exchange best practices. Howard Kwong, senior manager, public affairs APAC, was invited by STAR to join a peer-to-peer learning and knowledge exchange session to present Cascale’s global policy and public affairs strategy.
In his remarks, Kwong outlined how Cascale works to advance smart, globally harmonized policy that enables credible sustainability action, while equipping members with the tools, data, and guidance they need to navigate fast-evolving regulation. He highlighted recent insights from the Manufacturer Interview Group — a project co-led by Cascale and the International Apparel Federation (IAF) — as well as Cascale’s APAC policy deep dive on corporate supply chain responsibility trends and the newly-established APAC Policy Member Expert Team (MET). Sovichea Saron, STAR’s head of secretariat, is a MET member, reflecting how manufacturer perspectives are integrated into Cascale’s global public affairs work.
Meaningful engagement was key. Throughout the event, Kwong met with the STAR board members and association leaders from China National Textile and Apparel Council (CNTAC), Bangladesh, Pakistan, Cambodia, Vietnam, Myanmar to explore deeper collaboration.
In a separate event at the Asia-Pacific Outdoor & Sports Fashion Forum, Joyce Tsoi, Cascale’s senior director, decarbonization program, gave a virtual keynote presentation on the decarbonization and collaboration potential in the outdoor and sporting goods supply chain.
This event is part of the wider programming under the Asia-Pacific Textile & Supply Chain Summit & Expo (APTEXPO). Representing an extensive collaboration, the ASEAN Federation of Textile Industries (AFTEX) and the China National Textile and Apparel Council (CNTAC) jointly sponsored the event, with ECV International, and The Sub-Council of Textile Industry (CCPIT TEX) as co-organizers. The Singapore Fashion Council (SFC) also supported as a host association. Speakers joined from across Cascale’s membership, among them Mammut Sports Group AG, Puma, and New Balance.
Based in London and joining remotely, Tsoi’s virtual opening remarks began with a playful connection between an individual’s fitness commitments and a company’s decarbonization targets – pointing out that both require diligence, consistency, and commitment to succeed. Then she highlighted the top three systematic industry challenges that stop us from moving at the pace and scale necessary to combat climate change. The first was stalled engagement of Tier 2 materials production facilities, followed by few commitments from brands and retailers. This ultimately creates a lack of true business partnership. With that, Tsoi underscored the need for brands and manufacturers to have shared goals, vision, and responsibilities.
Her presentation then moved into hard-hitting industry carbon emission data, infused with actionable and regional insights from the Higg Facility Environmental Module (Higg FEM). Her final points offered a hopeful resolution, highlighting the successes of manufacturers, reflecting eight sponsoring brands, that were achieved through participating in Cascale’s Manufacturers Climate Action Program (MCAP): To date, MCAP has engaged 85 manufacturers in 19 countries with a collective CO2 reduction potential of over 1,429,087 tCO2e from 38 validated participants. She ended with a call for collaboration, highlighting Cascale’s membership, including the Outdoor Industry Association (OIA) and the European Outdoor Group (EOG).
Cascale’s Joyce Tsoi shares how the Manufacturer Climate Action Program (MCAP) is driving collective action at scale and highlights Cascale’s commitment to scaling MCAP globally — empowering manufacturers to accelerate their decarbonization journeys and take swift, impactful climate action.
With 2030 just a short five years away, manufacturers are looking for support and resources to scale up their ambitions to decarbonize while meeting ever-changing brand requests.
There isn’t enough time in the day to answer the myriad of data and auditing requests, or order inquiries, and yet they are tasked with making step changes in CO2 reduction. Where does one even begin?
As part of a convening force for fashion and consumer goods with a variety of manufacturer members, Cascale decisively launched its Decarbonization Program in 2021, as part of a serious approach towards combatting climate change. When I first joined Cascale three years ago, I knew the task at hand would require significant attention and a more open and educational approach not unlike the environmental management and auditing courses I am used to teaching at the University of Hong Kong.
With that in mind, we got to work in building the Decarbonization Program and the basis of it was beginning with manufacturers first – not last. We launched our Manufacturer Climate Action Program (or MCAP) in 2023, not long after.
MCAP is an important part of Cascale’s Decarbonization Program – driving collective action at scale by supporting decarbonization efforts together, directly, with member and non-member manufacturers in reducing emission 45 percent by 2030. We know that more than 76 percent of the value chain emissions come from manufacturing. This is what we are focusing on. Out of that 76 percent figure, nine percent comes from Tier 1 product assembly units, while Tier 2 material production mills account for more than 50 percent of the emissions, and Tier 3 materials processing accounts for 15 percent. By pinpointing emissions hotspots in the value chain and working hand-in-hand with manufacturers, we find the most effective outcomes, and hope to build on the program even more from the 70 participating manufacturers engaged in 2025.
In its essence, MCAP represents a cornerstone of decarbonization, helping manufacturers establish, measure, and refine their greenhouse gas emissions baseline in order to set reduction targets and track their progress. It’s a step-by-step process, MCAP facilitators provide guidance direction for manufacturers’ decarbonization roadmaps so that both short-term needs and long-term ambitions are realized. Since launching, MCAP has grown to over 70 participants, in 2025, and garnered unique and lasting sustainability use cases for our manufacturers. According to our analysis of the MCAP program using data from program participants, the CO2 reduction potential is an estimated 419,607.92 tCO2e from 16 validated companies.
It’s about putting this data into action. We have a mission here at Cascale to continue scaling MCAP to support manufacturers globally to accelerate their science-aligned targets and support and encourage them to take swift climate action. Additionally, MCAP provides manufacturers with the tools and resources to meet growing expectations from brands and regulators, offering third-party validation, climate risk assessments, and best practices to ensure measurable progress. But more than that, it’s about what our manufacturer participants are saying.
And they are sharing more and more about their positive experiences in the program. At the Cascale Forum: Ho Chi Minh City, My Nga Trade Co. Ltd.’s director of events, Cherry Liu, offered a glimpse behind the scenes as an MCAP participant.
“Our team gained valuable training on sustainability best practices and carbon accounting standards.One of the most valuable [features] in MCAP was gaining guidance and support throughout our emissions reduction journey. The program helped us move from intention to action, goals into a clear, data-driven plan. Cascale’s support in setting and validating emissions targets, through training, provided necessary knowledge… The training was helping our team to get knowledge in identifying and analyzing climate-related risks, clearly identifying heat-related physical risks as a top concern for our facilities – such as roof insulation and improved ventilation. These are now part of our ongoing resilience strategy,” said Liu. “If you are just beginning your sustainability journey the most important advice is start small, stay consistent, and focus on data. Here is what we’ve learned: Don’t wait for perfection, you don’t need all the answers to begin with, start with what you can measure now – such as energy use, water, or material waste – and build from there. Invest in awareness education across your team. A shared understanding for sustainability goals helps drive change from the ground up, using available tools such as the Higg Index for tracking.”
–Cherry Liu, Director of Events, My Nga Trade Co. Ltd.
It will take all value chain players to scale up MCAP and wider decarbonization aims – including brands.
Brands can be involved in various ways: they can nominate their manufacturers to join MCAP as well as directly sponsor their suppliers to be part of MCAP. We do have multiple brands that are co-investing and cosharing the program cost with their shared manufacturers.
One thing is certain. Ultimately, and for the industry to reach its ambitious goals, we have to recognize the cost burden can’t fall on any one group. We must support manufacturers’ ambitions to decarbonize because it’s often their communities and their facilities on the front lines of the climate crisis.
Those eager to explore MCAP can submit their interest to join the next cohort, kicking off in October 2025. Learn more about MCAP’s role in driving sustainable change by registering for the next MCAP Information Session, and learn more about MCAP on our website.
“Source of Good” interviews experts – including Lewis Perkins of Aii – on sustainable transformation to a low-carbon economy.
Amsterdam, Hong Kong, Oakland (CA) – April 22, 2025: With a thematic focus on consumer goods supply chain decarbonization, the new season of Cascale’s “Source of Good” podcast reflects the nonprofit organization’s commitment to combat climate change. Kicking off with Lewis Perkins of Apparel Impact Institute (Aii), released today, “Source of Good” will share actionable insights and inspiring stories that drive the urgent transformation needed in the consumer goods industry. Across 10 bi-weekly, 20-minute episodes, listeners will discover how innovative companies – including Tapestry, Primaloft, ITL, and more – use Cascale’s Higg Index tools and other pioneering practices with the aim to achieve a 45% reduction in GHG emissions by 2030, ultimately aligning with a 1.5°C future.
“Our work with Cascale is about more than metrics – it’s about building momentum for real, lasting change,” said Lewis Perkins, president at Aii. “Together, we’re shaping a shared roadmap to help our industry cut emissions. I’m inspired by what’s possible when we align around bold action and collective responsibility for a better industry and healthier planet.”
Building on the inaugural season successes – including a conversation with Rick Ridgeway, legendary mountaineer, environmentalist, writer, and Cascale co-founder – “Source of Good” set the standard for industry dialogue on sustainable practices. With subscribers in over 50 countries, listeners can find the podcast on all major streaming platforms and follow the journey of industry change through each insightful episode.
“By spotlighting supply chain decarbonization, we’re addressing one of today’s most urgent challenges—while sharing powerful stories of transformation. These episodes showcase tangible strategies that inspire collective action and demonstrate how our industry can unite for a sustainable future,” said Lee Green, vice president of Marketing & Communications at Cascale.
“Source of Good” is produced by Hueman Group Media, a Webby-winning media company that produces high-caliber podcasts for social change and impact. The show is hosted by Rachel Lincoln Sarnoff, Cascale’s communications director and a former journalist. “Source of Good” is available on multiple platforms, including Apple Podcasts, Spotify, iHeart Radio, Amazon Music, and more.
For more information about Cascale and to listen to the Source of Good podcast, visit cascale.org/resources/podcast/ or join our email mailing list.
Revisit Source of Good Season 1
Andrew Xeni, founder & chairman of Nobody’s Child and founder & CEO of Fabacus, joins us for season 1, episode 10 of our Source of Good podcast.
Jean Hegedus, Director Of Sustainability at The LYCRA Company, joins us for season 1, episode 9 of our Source of Good podcast.
Lisa Ly, Senior Sustainability Manager at Dunelm, one of the UK’s largest home furnishings retailers, joins us for season 1, episode 8 of our Source of Good podcast.
Did you know that eucalyptus trees grow more than six feet in a single year? It’s true! And it’s one of the reasons Sappi Verve uses them to make its dissolving pulp, which is transformed into viscose and other products. On today’s episode, Krelyne Andrew, Sappi Verve’s General Manager of Sustainability, explains the many benefits of eucalyptus trees and the company’s other responsible practices.
The timeless style Eileen Fisher is known for isn’t just a product of its creative design. It’s also linked to the brand’s sustainable sourcing and practices. In this episode, Susan Scow, Sustainability Specialist at Eileen Fisher, breaks down the steps to produce one iconic piece.
Trees are more than just bark, branches, and leaves. They contain a secret ingredient that is critical to a more sustainable fashion industry. In this episode, Thomas Matiz, Product Sustainability Specialist at Lenzing Group, takes us into a fairy tale world where responsibly managed forests become fabric. Except, it’s not magic. It’s science.
Vietnam is emerging as a critical player in the global shift to low-carbon manufacturing—and new insights from Cascale’s Higg FEM show why.
Industry Decarbonization Roadmap (IDR) could help deliver on sustainability goals as consumer goods manufacturing continues to drive GDP growth, projected at 6.5% in 2025.
Amsterdam, Hong Kong, Oakland (CA) – April 17, 2025: Issued today, the “Vietnam Country Report: Macroeconomic, Socioeconomic, and Industry Analysis” report, developed by Cascale with support from the Apparel Impact Institute (Aii), highlights the evolving macroeconomic landscape, sustainability challenges facing apparel and footwear manufacturing, and the rapid expansion of the consumer goods market in Vietnam. A strong economic outlook coupled with bold sustainability initiatives reveals a country poised to play a crucial role in global decarbonization efforts, even as tariffs threaten to put 5.5% of Vietnam’s GDP at risk and raise prices for American consumers (New York Times, April 6). Tariffs and other key topics impacting Vietnam will be on the agenda at the Cascale Forum: Ho Chi Minh City on May 14-15, as Cascale members and non-members alike – including manufacturers, leading brands, service providers, and supply chain partners – come together for an immersive event to address urgent sustainability challenges and opportunities. The report includes critical analysis of data from Cascale’s Higg Facility Environment Module (FEM) tool, exclusively available on Worldly. It is the first in a series of actionable reports filtering Higg FEM insights through a regional lens.
In 2023, over 1,200 verified Higg FEM submissions showed coal exacerbates carbon emissions in the region: 12% of apparel and footwear facilities use coal for energy, while 94% rely on electricity purchased from Vietnam’s coal-dependent grid. Although renewable energy accounts for less than 2% of the sector’s energy use, the analysis underscores opportunities for transformation to a low-carbon economy, including through the Industry Decarbonization Roadmap (IDR) developed by Cascale and Aii.
The report shows Vietnam can couple growth with sustainable manufacturing. Vietnam’s economy is expected to grow by 6.5% in 2025, outpacing regional peers. The manufacturing sector continues to be a key driver, contributing 23.88% to GDP in 2023. Additionally, Foreign Direct Investment (FDI) remains robust, reaching US$31.4 billion in the first 11 months of 2024, signaling investor confidence in Vietnam’s economic resilience. Employing around three million workers and generating an estimated US$71 billion in export revenues for 2024, the apparel and footwear sector is a vital component of Vietnam’s economy but faces significant sustainability challenges, including high energy consumption and carbon emissions. With commitments in place for a 65-70% increase in renewable energy by 2045 – reducing greenhouse gas emissions by a projected 70-80% – Vietnam is committed to supply chain decarbonization, in line with the IDR.
The report brings Cascale and Aii’s IDR into focus as a potential solution. By uniting manufacturers, brands, retailers, and stakeholders around shared goals, the IDR emphasizes collective accountability and pre-competitive collaboration to accelerate systemic change across the supply chain. With a science-based target of reducing supply chain emissions by 45% by 2030, the IDR drives measurable progress through various interventions, solutions, and programs. The IDR ensures resources are targeted, so low-carbon sourcing and other benefits can be realized. This means prioritizing action in the 10% of facilities across the textile and apparel supply chain – including some in Vietnam – that account for over 80% of global manufacturing emissions. By aligning with these initiatives, facilities in Vietnam can play a pivotal role in the global transition to a low-carbon economy
“This isn’t merely about compliance—it’s about long-term competitiveness,” said Colin Browne, Cascale CEO. “Brands increasingly prefer suppliers who meet robust sustainability standards. Manufacturers investing in sustainability today will secure long-term brand partnerships tomorrow.”
