Billions of articles of clothing are produced worldwide every year, and more than ever, conscious consumers are asking brands, “How was the environment impacted? How were your workers treated? Were all the appropriate laws followed?”
Environmental, Social and Governance, or ESG, doesn’t necessarily start with the brands, although it ultimately ends there. And with such brand reputation on the line, it’s up to manufacturers to help their brands get a clean supply chain sustainability bill of health when it comes to ESG.
Now in its 40th year of business, Korea-based apparel manufacturer Hansae sees the industry on a new trajectory for change, with “ESG management” as a major long-term strategy.
“By prioritizing environmental sustainability, we believe we can influence and promote our supply chains to actively participate in environmental initiatives, and to help establish industrywide standards and practices,” said Daymond Ik-Whan Kim, CEO and Vice Chairman of Hansae, which exported more than 400 million pieces of clothing in 2021 through its global facilities and includes clients such as Hanes, Gap and Walmart. “This is not only to improve our own sustainability, but also to drive positive changes across the industry.”
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Hansae is addressing ESG as a three-pillar project:
Starting with the “E” in ESG, Hansae’s “Green Management” initiative focuses on improving its own environmental impact, from increasing usage of biomass fuel to reduce greenhouse gas emissions to deploying major solar-panel installations in Nicaragua and Myanmar to generate renewable energy. To further boost its renewables commitment, Hansae has also procured RECS Energy Certificate Association in Indonesia.
“We regard these endeavors as foundational steps towards our 2050 Net Zero plan, with plans to further expand such investments in the future,” said Ik-Whan Kim.
Color is so essential in fashion, and Hansae has focused on chemical management for more sustainable ways to achieve variety. In fact, its subsidiary facility C&T Vina has enacted a Zero Discharge of Hazardous Chemicals (ZDHC) to eliminate 14 priority hazardous chemicals.
Reducing water is also a major initiative, as fashion is one of the most notorious water-guzzling industries in the world. From growing cotton to dyeing and finishing fibers and textiles, fashion’s intense water usage puts the world’s fragile water reserves at risk. In addition, waters are polluted further by microfiber shedding of clothing at the post-consumer washing stage.
Hansae aims to lower its total water consumption by 20 percent by 2030. To hit that goal, it created three initiatives—it upgraded a dyeing machine to reduce water usage, it installed a system to harvest rainwater, and it installed a wastewater pre-treatment and recycling system. Together, those saved Hansae 333,045 m3 of water in 2022, and 397,605 m3 in 2023.
To boost environmental commitment beyond the reach of its own company, Hansae also launched a ‘10% for Good’ campaign in 2019. This pledge encourages third-party collaboration on everything from reducing water to investing in R&D for more sustainable materials, hardware upgrades and sustainability retrofits. The pledge also takes income from sustainable orders and donates a portion to environmental organizations and future sustainability initiatives.
Moving onto social responsibility—also known as the “S” in ESG—Hansae is focusing on “Expanding Diversity, Equity and Inclusion,” and has taken steps to improve the lives of its employees and their families. After all, a company is only as good as its employees, especially in fashion where loyal, committed, skilled labor is the key to a competitive advantage.
“ESG management begins with prioritizing employees within the company. A healthy and motivated workforce is a fundamental component of long-term business sustainability,” said Ik-Whan Kim.
To that end, in 2014, the company created the Hansae Yes24 Foundation (with a personal donation from Dong-Nyung Kim, chairman of Hansae Yes24 Holdings Company). Overall, the foundation aims to expand international relationships beyond just economic cooperation but to “foster, encourage and expand cultural exchanges” with Korea and other Asian countries. From translating books into Korean to sponsoring university student overseas volunteer programs, the concept goes a long way to cultural enrichment and personal fulfillment.
Lastly, for the “G” in ESG, Hansae is “Building Sustainable Governance” and has created a compliance team to “oversee, report and enhance” ESG activities, making sure everything is compliant.
“Following a thorough analysis of the collected data, the compliance team compiles comprehensive reports illustrating the company’s progress in ESG initiatives,” said said Ik-Whan Kim. “These reports encompass key performance indicators (KPIs), benchmarks, comparisons with previous periods and pertinent industry standards. They provide a clear assessment of the company’s ESG performance, pinpointing areas that require attention to the management.”
For more information on Hansae’s sustainability efforts, download their Sustainability Report here. To learn more about the company, click here.