Entrepreneurs

With New Sustainability Commitments, Allbirds Accelerates A ‘Cradle-To-Grave Approach’ That Incorporates Consumers And Supply Chain

As a large collective source of carbon emissions, businesses have a key role to play in addressing the climate crisis. The accelerating threats to the planet have more companies pledging action to reduce their environmental impact, including some goals aligned with the Paris Agreement that incorporates a net zero emissions target for 2050. But other businesses see a more urgent need and are accelerating their climate work to go beyond reduced emissions and establish methods and materials that enhance the environment — taking responsibility to ensure our planet’s health for future generations. 

One business leading through regenerative innovation and a commitment to sustainability is Allbirds, a footwear and apparel company known for its innovative materials and carbon neutral commitment. The company recently announced new, aggressive sustainability commitments for 2025 and 2030, including a 50% reduction in its per-product carbon footprint in 2025 that expands to a near-zero per-unit carbon footprint by 2030. These goals translate to a science-based target to reduce absolute scope 1, 2, and 3 emissions by 42% by 2030 — and Allbirds aims to bring others along to amplify this impact.

Hana Kajimura, Head of Sustainability at Allbirds, says the company will focus on regenerative agriculture, renewable materials, and responsible energy use to meet 10 quantitative commitments for its materials and practices by 2025. These include getting 100% of its wool from regenerative sources, reducing the use of raw materials by 25%, sourcing 100% renewable energy at facilities it owns and operates, as well as educating consumers on lower-impact ways to clean footwear and apparel.

We really took the cradle-to-grave approach to our footprint, which includes product use, end of life, and corporate emissions,” she says. “We think we should be accountable to the impact of our product even after it leaves our door. For example, on customer use, there are a few things that we have control over and then there are a few things that we can do our best to influence.” 

In announcing the new commitments, Kajimura and others at Allbirds acknowledge the significant challenge — and that the company’s individual impact has its limits. So, as it has done with product development and as a member of the Certified B Corporation community, Allbirds will share information about the quantitative process behind its new climate goals through open collaboration and assist companies and growers in its supply chain with transitions to clean energy or regenerative practices. 

Our ambition is to reverse climate change through better business,” Kajimura says. “Targets for 2050 are beyond the scope of any one sustainability person’s career or the public’s attention span. Those goals are important to set that long-term ambition, but so is near-term accountability, and that’s why we have 2025 as the focus.”

Kajimura shared more about the importance of science-based climate goals and how the company has become a sustainability leader in only five years during our recent conversation as part of my research on purpose-driven business. Excerpts from our conversation follow.

Chris Marquis: How did Allbirds develop these new sustainability commitments — with many of the targets for 2025 as well as some in 2030?

Hana Kajimura: I’ve been at Allbirds now for almost four years of our five-year history. We’ve done a lot of amazing work, but this is the first time that we’re making forward-facing commitments, which I think we can only do because we’ve demonstrated such a strong track record over the last few years. As we neared our fifth birthday, which was just this March, we started to think about what the next five years would look like and felt ready to make commitments toward that future.

This work really logically built off our initiative to label all of our products with their carbon footprint, because in large part that was done to hold ourselves accountable to showing that number come down over time. Now we are committing to reduce our per-unit or per-product carbon footprint by 50% by the end of 2025 and by 95% by 2030 — that’s all relative to what that per-product number would have been in 2025 without further action to limit the emissions. 

We have really anchored the message and storytelling around that per-product footprint, because it aligns with that label you see on our product. What that means quite practically is that in 2030 that label on our product will be less than 1 kilogram of CO2 per product. As the world conversation really shifts toward this idea of true zero emissions — take offsets off the table and take action to reduce our impact — we wanted to see how much we could reduce our emissions.  

Marquis: In pursuit of that goal, how do you consider how individual components of footwear or apparel contribute to emissions?  

Kajimura: Most companies set the target in line with science-based targets, which is what are needed to keep warming below 1.5 or 2 degrees C, and then they work backward on how to get there. That takes a long time; you put the target out there and it takes years to figure out how you’re actually going to achieve it. It leaves you with this big question mark — an innovation gap. 

We actually did the opposite and looked at that stacked bar of our product’s carbon footprint broken down across the phases of materials, manufacturing, transportation, product use, end of life, offices and retail stores, and even our growth rate. We just started shaving that bar down by saying: What if our wool was all regenerative agriculture? What if our factories ran on 100% renewables? What if our customers were washing and drying our product less often? How much would each of those things contribute to a reduction in our carbon footprint? 

That’s how we arrived at the 50% by 2025 and 95% by 2030. We can only do that because we’ve built such an infrastructure around data collection and really knowing the impact of each of our products. We were helped by the fact that we have a relatively limited number of products and a relatively contained supply chain to really have our arms around the exact impact — truly down to the lace level.

Existing materials can always be better. We have this target now to do 100% of our wool farmed regeneratively. Wool today actually has a pretty high carbon footprint, although it’s a renewable and natural material. But through regenerative practices we could imagine it will become carbon negative, so that’s one bucket of innovation. Others are around increasing bio content while maintaining performance. That’s the real unlock for the whole footwear industry, honestly, is how do we increase the level of bio content in our foams — whether it’s the sole of the shoe or the insole — without degrading performance, without making it like a stiff, heavy product. 

Marquis: The goals incorporate some broad shifts across very different types of activities. For example, moving to all regenerative agriculture for your wool is very different than getting consumers to wash their shoes less frequently — a consumer education issue. Across those different areas, what do you see as most challenging and how do you plan to address those challenges? 

Kajimura: They do take different approaches. Regenerative agriculture requires working directly with farmers on the ground in New Zealand to have specific conversations about what it would take to get you to where you need to be. Similarly, it requires conversations with our manufacturing partners to ask if they have looked into on-site solar and suggesting some financing mechanisms to help them get there.

The 10 specific targets for 2025 collectively contribute to that 50% reduction. The hardest one of all is material innovation because effectively we’re committing to 75% of our total material use being from sustainably sourced natural or recycled materials, as well as about a 25% reduction in the carbon intensity of the materials that we’re using. Achieving those targets is going to take inventing materials that currently do not exist. We have a track record of that; SweetFoam is a great example, because it led to a pretty substantial reduction in our per-unit carbon footprint. But we have to do that again and again over the next five years. 

A big part of getting to this point where we’re ready to make these commitments public was doing a very detailed feasibility assessment to understand the investment required. The rhetoric of sustainability being more expensive is certainly true to an extent. Because when we looked at the numbers, something like material innovation, the “green premium” that’s associated with recycled materials or natural materials is real and it is a significant investment. But other initiatives that also help with sustainability — like shipping predominantly through ocean versus air or just using fewer materials and minimizing waste and becoming more efficient — save so much money that this whole strategy taken together saves us money on a per-product basis. Yes, sustainability can be expensive and it can take longer and it’s harder and newer. But when you look at it holistically, it can actually be good for business as well. 

Marquis: You mentioned factors like people like washing less and also accounting for end of use. It seems to be a big challenge to control those items which happen after the product leaves your possession.  Can you say more about how you will address those issues?  

Kajimura:  We really took the cradle-to-grave approach quite seriously because we think we should be accountable for the impact even after it leaves our door. So on customer use, there are a few things that we have control over and then there are a few things where we can do our best to influence them. 

In terms of what we have control over, we can create products that require less care such as materials that reduce odor so maybe you don’t have to wash your T-shirt as often.  Secondly, we can provide education on how to do this. Some of our apparel hang tags now give recommendations for low-impact care, and we plan to ramp that up. We also can incentivize consumers to switch to renewable energy sources where that’s an option.

We’re really looking at end of life through the perspective of carbon. So we are doing things like increasing the lifetime of our products or minimizing and recycling scrap and waste, as well as exploring business models for e-commerce to keep our product in use for longer.

Marquis:  How does the company plan to drive their pursuit throughout the organization and supply chain — the workers who are important stakeholders and crucial for the company’s success? 

Kajimura: While the 10 goals are going to be managed by the sustainability team, we have direct authority and accountability over none of them. It’s our product teams, material teams, supply chain teams. In creating the goals, we wanted to make sure the whole process was as inclusive and stakeholder based as possible. It started with outreach and interviews to our employees, our investors, our suppliers, our customers and asking them what we should do, what we are doing well, what we could do better. When we reached out to our strategic suppliers, they thanked us for asking because they said changes are usually just pushed on them.  

Once we have the strategy created, we have to determine how we’re going to hold ourselves accountable. It starts at the highest level with our public benefit corporation status and B Corp status. They help ensure that there’s a certain level of employee buy-in because almost all of our employees came to work at Allbirds to work on this mission. They’re excited to have part of their day-to-day role be so explicitly tied to sustainability. On the legal side it ensures that the business has a legal mandate to be looking out for all stakeholders, including the environment.

We still have to make the business case and show that pursuing these sustainability goals also helps with margins and financial performance. Our employee bonus is tied to achieving reductions in our carbon target. We have an internal carbon tax that decisions are evaluated against. We have accountability with the customer through labeling on our products that holds all of us internally accountable as well. 

We also hope our existing supply base will be in support of us achieving these goals and we will do everything in our power to make sure that that happens. But also in the future, we’ll be looking for vendors that align with our values and goals and those will be the companies we give the business to.

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