More firms hushing up their ESG efforts, but Uniqlo is taking the lead in walking the talk

TOKYO - At a Uniqlo store in Setagaya City, a 45-minute drive away from the Japanese fashion brand’s flagship store in Ginza, Tokyo, a unique section has been set up.

Opposite the usual displays of sweaters, jackets and Heattech innerwear for the autumn-winter season are a number of racks advertising clothes at very affordable prices.

Most items are priced under $20. For example, a pair of men’s shorts costs 790 yen (S$6.55) while a women’s parka retails for 1,990 yen. This is not Uniqlo’s bargain bin, nor is it its foray into a lower-priced fast-fashion space like that of its sister brand Gu.

It is, in fact, the company’s dedicated second-hand clothes section, reselling Uniqlo clothing that has been collected from customer donations at their stores. A number of items in this collection date back to around 20 years ago, with their labels containing an older version of the Uniqlo logo that I have never seen before.

The mix of modern and dated clothing designs is somewhat reminiscent of a thrift store, the ones you would typically find in the hipster districts of Tokyo. Above the racks, a sign in English says “Washed with care”, a statement of quality assurance from one of the world’s most popular casual wear brands.

This pre-owned project is part of Uniqlo’s Re.Uniqlo programme launched in 2020 to expand its sustainability efforts through extending the lifecycle of its products.

Started in March 2024 as an in-store trial and currently running in three Japan stores, Uniqlo said it is assessing the viability of stable procurement and selling a mixed range of clothes, before possibly launching in other cities in Japan as well as international markets.

Next to the pre-owned clothing section at the Setagaya store is a counter which Uniqlo calls its Re.Uniqlo Studio. Here, in addition to basic repair services, customers can have their damaged garments repaired via a traditional Japanese stitching method called sashiko, which uses simple stitches to create beautiful geometric patterns. Other kinds of patches featuring animal and flower designs are also available.

According to Uniqlo, its repair studios can be found at 66 stores across 23 countries and regions, including the global flagship store at Orchard Central. The sashiko service, however, is currently available only in Japan.

Uniqlo sees these upcycling initiatives as the foundation of its move towards “circular fashion” – a sustainability push within the fashion industry to operate a closed-loop cycle, reducing wastage and therefore environmental damage.

This industry shift became prominent with Patagonia, the California-based outdoor clothing brand, which has become synonymous with the sustainability movement through its transparent communication with consumers, amid a trend of greenwashing and dubious green marketing.

It launched its Worn Wear programme in 2012, beginning with clothing swops and pop-up repair events around the world, before setting up its own resale store online and subsequently a physical store in Colorado in 2019.

With consumer awareness about the fashion industry’s role in environmental damage growing, leading to boycotts in some cases, brands are driving initiatives aimed at reducing their environmental impact.

Inditex – the world’s largest fast-fashion conglomerate which owns brands such as Zara and Massimo Dutti – and Shein are some of the fast-fashion names that have also launched their own upcycling initiatives.

But critics say some of these measures are merely greenwashing tactics that do not move the needle in the industry’s sustainability movement, as there is no significant change in their wider business models that have frequently raised environmental concerns.

The new trend of greenhushing

In the face of increased scrutiny from consumers and the media, more and more companies are choosing to communicate less about their environmental, social and governance (ESG)-related initiatives to avoid backlash.

Given the risks of being accused of making “false” or “misleading” sustainability claims, companies would rather not say more than they absolutely have to.

Dubbed “greenhushing”, it is a complete reversal of the greenwashing trend in the past, when companies would jump at the chance to shout about their flashy green projects and targets.

According to a 2024 report by sustainability consultancy firm South Pole which described greenhushing as the “new normal”, 58 per cent of respondents said they were reducing their level of external communication. Of these, 57 per cent cited changing regulation and more demanding industry requirements on environmental reporting and communications as the main reasons.

Heightened scrutiny from customers and lack of sufficient data to support claims were also factors that led to more companies engaging in greenhushing.

In the US, federal policy has also quickly changed from pro-ESG to anti-ESG as President Donald Trump pledges to dismantle climate-focused policies implemented by his predecessors. As a result, companies and financial institutions are choosing to distance themselves from the ESG space out of fear of any potential repercussions.

This phenomenon does not simply point to companies keeping totally mum on their environmental reporting. Rather, they are shifting the narrative or downplaying their shortfalls in their communication.

For example, Inditex in its 2024 annual report only stated a 5 per cent emissions cut from 2018. It did not outrightly frame this figure against its 20 per cent emissions target by 2027, nor the 53 per cent absolute emissions target by 2030.

Its Zara clothing collection programme, first launched in European markets in 2022, had been slated to launch in “all key markets” by 2025, but the 2024 report did not mention any progress on a global roll-out and also indicated a 3.8 per cent drop from 2023.

Overall, even though on paper the report is still largely transparent on most of its figures reported, including emissions and recycled materials, there seems to be a shift in its tone. Inditex is seemingly less focused on addressing its short-term gaps against its long-term climate goals, while opting to focus more on governance and processes, spotlighting one or two key goals.

That does not necessarily mean that Inditex and other companies are wrong to greenhush, but it definitely raises questions on whether the ESG movement can continue to be sustained in today’s climate.

“There are so many shades of green. It is a real challenge to be fully green, and companies would rather not expose themselves to potential litigation for misrepresentation in their ESG communication,” said Professor Lawrence Loh, director of the Centre for Governance and Sustainability at the NUS Business School.

There could be a negative impact on the global ESG movement if the greenhushing trend continues.

Prof Loh noted that companies may not feel the need to ensure transparent reporting if they observe that their competitors are not doing the same. Stakeholders may also not be privy to ESG information that is not disclosed, further reducing the pressure on companies.

Uniqlo’s ESG objectives

When I visited Uniqlo’s Tokyo headquarters in October, initial signs suggested that the Japanese company is making the right moves in its environmental and sustainability commitments.

“LifeWear” – a philosophy coined by Uniqlo’s parent company Fast Retailing – is mentioned in almost every key message by the company. In a nutshell, it guides the company on making everyone’s life better through clothing.

This entails making clothing affordable, comfortable and useful for all, via a “double-loop” business model which focuses on sustainable production methods and extending the lifespan of customers’ clothes to reduce environmental impact.

Fast Retailing aims to reduce its Scope 1 and 2 emissions by 90 per cent; and Scope 3 emissions by 30 per cent by 2030. Scope 1 emissions refer to those from owned sources, Scope 2 to those caused indirectly by purchased energy and Scope 3 to those occurring in its value chain.

Uniqlo’s ESG initiatives stretch beyond environmental protection. They also encompass social contribution activities, including monetary contributions to the UN Refugee Agency and clothing donations to refugees and vulnerable communities around the world. From 2006 to 2024, it donated more than 58 million clothing items to people in need across 81 countries and regions.

This included the migrant worker community in Singapore, which has received 15,000 brand-new and 5,000 pre-owned clothing items to date, said Ms Hwee Lee, senior sustainability director at Uniqlo Singapore. The company aims to donate 10,000 new items to support essential workers in the social sector in 2026.

In September, Uniqlo announced it would deliver 500,000 pieces of Heattech – about half of the newly donated items collected in 2025 – to returning refugees in Syria.

Mr Koji Yanai, Uniqlo’s group senior executive officer and the son of Fast Retailing’s founder Tadashi Yanai, told me that he aims to create a new kind of industry that balances sustainability and business growth. “Our intention is to demonstrate a new kind of apparel industry and to be a leader in our industry.”

Uniqlo said it is also taking steps to apply its ESG standards to its supply chain – for example, verifying the origin of materials sourced by its manufacturing partners – to better achieve its sustainability goals.

“It’s not an easy thing. But once we know all of those steps in the supply chain, we can build relationships with those downstream or upstream suppliers, and we can begin to apply our own standards,” said a Uniqlo spokesman.

He added that a significant number of its manufacturing partners, accounting for 80 per cent of Uniqlo’s production volume, have been with the company for over 20 years. This long-term business relationship has fostered a great deal of trust and makes it easier for Uniqlo to convince its partners to invest in their own facilities to achieve their sustainability targets, the company said.

One such partner is Toray, a Japanese advanced materials manufacturer specialising in synthetic fibres and carbon fibre composites, the latter primarily used in the aerospace and automotive industries.

Its relationship with Uniqlo began in 1999 when it started supplying the clothing company with material for its fleece range; and in 2006, the two companies signed a strategic partnership agreement to develop Uniqlo’s Heattech products.

Since 2019, Toray has been a key part of the Re:Uniqlo project. It recycles down feather from used jackets collected from customers, to be used as filling for Uniqlo’s new down jackets that are currently available only in European Union markets.

The facility, located just outside of Kyoto, is equipped with a fully automated system that cuts the jackets and sorts the down with a 90 per cent collection rate. According to Toray, 10kg of down can be collected in just an hour, with over 900kg collected from around 80,000 jackets in a month.

As at March 2025, it has already collected 1.5 million jackets from Uniqlo. The company also develops recycled polyester from recycled PET bottles, which are used in Uniqlo’s Airism and Heattech range of products.

While Toray did not specify the environmental impact of its partnership with Uniqlo, its ESG report notes that the group recorded a 43 per cent emissions reduction in the financial year 2024, relative to its 2013 levels – on track to hitting its 50 per cent target by 2030.

Uniqlo has also been making good progress on its sustainability efforts. In Fast Retailing’s recent ESG report released on Nov 19, Scope 1 and 2 emissions have gone down by 83.3 per cent in the financial year 2024, and Scope 3 emissions were reduced by 18.6 per cent.

It aims to achieve 100 per cent renewable energy use at its offices and stores by 2030, and is already on track at 84.7 per cent.

However, the company is still some ways off its target of incorporating 50 per cent materials with lower greenhouse gas emissions by 2030, with financial year 2025’s figure standing at 19.4 per cent – a 22 per cent increase from a year ago.

The cost of sustainability in Uniqlo’s business remains a question mark too – how would the company be able to protect its bottom line if producing sustainable clothing becomes more expensive?

Mr Yanai believes technological improvements would make sustainable materials more accessible and hopefully bring down costs. In addition to recycled down and polyester, it is also looking at sourcing wool from designated farms in Australia that do not violate animal safety and human rights.

Sticking to its mission

It is unclear how much Uniqlo has invested in its ESG initiatives as it does not include the breakdown in its financial reports.

For the financial year 2025 ended Aug 31, it posted a business profit of 486.6 billion yen, up 13.1 per cent from 2024.

The company has also set a target of implementing 10 billion yen’s worth of social contribution activities each year through the group and its foundation, as well as donations from the Yanai family. It met this target for the financial year 2025, with expenses rising 50 per cent from a year ago to 12.3 billion yen.

Uniqlo did not provide specifics on its investments in its ESG initiatives when asked. “Our opportunity is to continue developing profitable products and services that meet the evolving sustainability needs of customers everywhere,” Mr Yanai said in response to my queries.

“We believe the more we grow our business, the more profits we can reinvest to contribute back to the community. That’s our basic way of thinking,” he added in a group interview with journalists.

Good ESG reporting is a combination of breadth and depth that “almost leaves no stone unturned”, said NUS’ Prof Loh. Companies that engage in such reporting have also demonstrated their ability to integrate ESG initiatives with their strategy and value chain.

City Developments, CapitaLand and the three Singapore banks are “leaders of the pack” among local companies, while Keppel and Sembcorp are also notable names despite being in sectors that are quite difficult to be sustainable in, he noted.

How does Uniqlo fare then? Somewhere between A- and B+, rates the university professor.

He said: “Sometimes it’s so difficult to go into the nitty-gritty of sustainability reporting. Many companies fail to look at the bigger picture by presenting so much data without a coherent narrative or story.

“They go into the trees and miss the forest.”

Perhaps it is for this reason that Uniqlo remains confident about its greater mission, despite its reluctance to share certain finer details of its ESG initiatives.

If it continues to reinvest its profits to contribute to the wider community, while meeting its ESG ambitions, then it would have also given the world a little more hope that corporations can actually do some good.

Customers are more perceptive now to discern genuine businesses, and Uniqlo’s commitment should win over even the most cynical of critics.

In the meantime, I guess I will be joining its cause by picking out a few pieces of old Uniqlo clothes during the upcoming spring clean to donate.