Can H&M Prove Sustainability is a Growth Engine?

Apr 8, 2026

Shiza Waleed, a Business of Fashion reporter who covers sustainability and corporate strategy in fashion, digs into H&M’s claim that green progress can drive growth. She explores the tension between emission cuts and slipping sales. Short takes cover brand perception, whether sustainability signals quality, resale experiments, and the challenge of overproduction. The conversation weighs commercial reality against environmental ambition.

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INSIGHT

Designer Collabs Used To Elevate Perception

H&M is perceived between Shein and Zara, attempting brand elevation via designer collabs like Stella McCartney.
Shiza highlights these collaborations as deliberate moves to shift perception away from 'cheap occasion wear.'

INSIGHT

Corporate Portfolio Perception Gap

Consumers usually think only of the H&M namesake brand, not the wider group (COS, Weekday) that houses more elevated offerings.
That disconnect limits H&M group's ability to transfer premium perceptions to the core H&M label.

ADVICE

Pitch Sustainability As Product Quality

Use sustainability as a quality signal at point of purchase rather than asking consumers to care about emissions metrics.
Leila Artur and H&M emphasize customers care about the product they buy, not Scope 3 emissions reductions.

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In March, H&M released financial results alongside its annual sustainability report, presenting two seemingly contrasting narratives. The company reported a 34.6 percent reduction in emissions from 2019 levels and also noted that 91 percent of its materials are now sustainably sourced. However, this environmental progress occurred alongside a 1 percent dip in sales, raising questions about the commercial viability of its green strategy.

While many industry peers are backing away from environmental messaging to focus on the bottom line, H&M is arguing that sustainability is not in tension with profit, but is rather a "core driver of future growth".

On The Debrief, we examine whether this decoupling of growth from environmental impact can truly resonate with consumers, or if it remains a purely internal metric.

Key Insights:

As a fast fashion brand, H&M understands that sustainability alone is not going to win back shoppers. Instead, Walid says the company is trying to translate its recent efforts into something more tangible at the point of purchase. The pitch is not that consumers care about emissions reporting in itself, but that sustainability can function as a marker of quality. As Leyla Ertur, H&M’s Head of Sustainability, told Walid during their conversation, “Our customers don’t care about our Scope 3 emissions going down. What they care about is what they’re buying.”

Walid suggests that one of H&M’s biggest challenges is the disconnect between how the company sees itself and how customers perceive it. “When we say H&M, I think people are thinking of H&M, the brand … But when H&M talks about itself, they’re talking [about] the whole conglomerate,” she says, pointing to brands like COS and Weekday, which occupy a more elevated position. While those labels may successfully compete with higher-end high street players, that distinction is largely invisible to consumers, who still associate H&M with “fast fashion … something cheap for an occasion.” As a result, while the group may understand how to build more premium propositions across its portfolio, Walid argues that the core H&M brand itself has not yet meaningfully shifted perception.

For all the company’s investments and emissions reductions, the core contradiction remains that H&M is still producing and selling huge volumes of clothing. Waleed is explicit about that limitation: “They’re not addressing the overconsumption and overproduction problem in fashion.” At the same time, she notes that H&M is one of the few large players still investing at scale in decarbonisation, water reduction and supply chain upgrades.

H&M is investing across sustainability, brand elevation and new channels like resale, but Waleed cautions that it is still too early to judge whether these efforts are working. “They use all these different levers that don’t come into one … There needs to be a way to bring that together,” she says. Initiatives like fashion week shows, collaborations and younger-facing campaigns are designed to re-engage consumers, but “I don’t think people have caught traction … just yet.” For now, the strategy remains a long-term bet rather than a proven turnaround.

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