Last month, Tapestry, the global parent company of iconic brands Coach and Kate Spade, announced a significant ten-year partnership with Climeworks, a Swiss startup specializing in carbon removal technology. This ambitious agreement marks a bold commitment to addressing the fashion industry’s environmental footprint, a move that stands in stark contrast to the current landscape of climate policy in the United States. The long-term nature of this collaboration is particularly noteworthy, offering a level of sustained support that many nascent climate solutions can only aspire to.
The fashion industry, like many global sectors, is under increasing pressure to demonstrate tangible progress on sustainability. This is amplified in the U.S. by a regulatory environment that has, in recent years, presented significant headwinds for businesses publicly committed to climate action. The Trump administration’s approach included rolling back environmental regulations, purging climate data, and reducing funding for scientific research, fostering an atmosphere of uncertainty and potential reprisal for corporate environmental initiatives.
Logan Duran, Tapestry’s Global Head of ESG and Sustainability, articulated the strategic rationale behind the Climeworks partnership in an exclusive interview with Vogue Business. "This was an opportunity for us to establish a long-term partnership and send market signals that this type of innovation is needed," Duran stated. He further elaborated, "There are going to be emissions that we’re unable to address through direct reduction, and we need credible, long-term, durable carbon removal solutions to address them." This highlights a pragmatic approach, acknowledging that while emission reduction is paramount, residual emissions will necessitate robust offsetting strategies.
However, it is crucial to acknowledge that this partnership, while progressive, is not a singular panacea for Tapestry’s environmental impact. The agreement is primarily designed to offset Tapestry’s Scope 1 emissions, which are direct emissions from owned or controlled sources. The vast majority of fashion’s emissions, however, fall under Scope 3, encompassing indirect emissions from the value chain, including raw material extraction, manufacturing, transportation, and end-of-life disposal. Furthermore, carbon removal itself is a relatively new and sometimes debated approach to climate mitigation. While promising, its scalability, permanence, and cost-effectiveness are still subjects of ongoing research and discussion within the scientific and environmental communities. Carbon offsetting, in general, is often viewed as a last resort, employed only after all feasible emission reduction measures have been exhausted.
Despite these caveats, Tapestry’s proactive stance is a rare and commendable development for a U.S.-based fashion company operating in the current climate. Duran attributes the company’s ability to make such investments to a strategic doubling-down on the business case for sustainability. This approach involves a multifaceted strategy to quantify climate risks and demonstrate the profound financial implications of inaction. A recent report by the Apparel Impact Institute underscored the escalating costs associated with delayed climate action, reinforcing Tapestry’s perspective that sustainability is not merely an ethical imperative but a fundamental component of present and future business resilience.
Mapping the Landscape of Climate Risks
A cornerstone of Tapestry’s sustainability strategy is its comprehensive climate risk scenario analysis, a process initiated in 2022. This dynamic undertaking aims to provide the company with a clear understanding of how climate change will impact its operations and value chain in the years to come. The accuracy and depth of this analysis have evolved significantly since its inception.
The second iteration of this analysis, completed at the close of 2025, focused on two critical categories of risk: physical risks and transition risks. Duran explained that physical risks, such as the potential for extreme weather events, are generally more straightforward to assess. "We identify around 250 sites across the organization, from corporate offices and retail stores to fulfillment centers and suppliers across Tier 1 and Tier 2," he noted. "We’re looking for risks like the potential for flooding or droughts and extreme heat, and how those issues might impact the organization in the long run." This meticulous mapping of vulnerable assets and operational hubs allows for targeted adaptation strategies.
Transition risks, conversely, present a more complex analytical challenge. This involves modeling how various climate-related factors – including evolving regulations, shifts in consumer preferences, and the emergence of new technologies – will affect Tapestry’s financial performance. The analysis contrasts scenarios of rapid and comprehensive industry action towards sustainability targets with those where progress continues to lag. Key considerations include the potential for carbon pricing mechanisms, the fluctuating costs of raw materials influenced by climate impacts, and the revenue generation opportunities presented by circular economy models, such as upcycling. Tapestry’s own sub-brand, Coachtopia, has demonstrated the commercial viability of upcycled materials, offering a tangible example of circularity’s potential.
The scenario analysis revealed that the most material risks for Tapestry are the escalating costs associated with regulatory compliance and the direct consequences of climate-induced weather changes. While suppliers often bear the brunt of compliance costs, brands like Tapestry are increasingly recognizing their role in supporting these transitions. The impact of weather events is a multifaceted challenge. On one hand, supply chain workers face increasing threats from extreme heat in manufacturing facilities, impacting their health and the quality of their work. On the other hand, the heightened frequency and intensity of extreme weather events, such as hurricanes and floods, disrupt logistics, affect worker access to facilities, and jeopardize the global transportation of goods.
"There is a significant cost of inaction, and we will continue to see that play out," Duran emphasized. "For Tapestry, this is something we don’t want to wait on. We have to continue to invest in finding solutions, and prepare ourselves and our suppliers to face these challenges." This forward-looking perspective underscores a commitment to proactive risk management rather than reactive crisis response.
Integrating Sustainability into Strategic Decision-Making
Beyond the meticulous mapping of climate risks, Duran stressed the critical importance of effectively communicating these findings to internal stakeholders. Securing buy-in from executive leadership and the board of directors is paramount to ensuring that the insights derived from the scenario analysis translate into actionable strategies that extend beyond the sustainability department.
"The scenario analysis is an opportunity for us to showcase the fact that ESG, climate resilience, and managing climate risk are deeply connected to the value creation of the organization, as well as strong management of the company," Duran explained. "What’s exciting and important is that we have actually integrated the scenario analysis into our broader enterprise risk management, which means it has broader buy-in and we bring that information to our board. It allows us to make strategic decisions about our supply chains, not just for the next year or two, but 10 or 15 years into the future." This integration signifies a fundamental shift, embedding sustainability considerations into the core of Tapestry’s long-term business planning and governance.
The scenario analysis serves as a powerful tool for internal education, framing climate change not as a distant future concern but as a present-day reality with tangible business implications. This heightened awareness is also being driven by external pressures. The Financial Stability Board’s Task Force on Climate-Related Financial Disclosures (TCFD), though disbanded in 2023, laid the groundwork for standardized climate-related financial reporting. Its recommendations are now influencing global regulations, including California’s Climate-Related Financial Risk Act (SB261), which mandates climate risk disclosures for large corporations operating within the state. Investors, too, are increasingly scrutinizing companies’ climate resilience, seeking assurances that their investments are protected from climate-related financial shocks.
Looking ahead, Tapestry is embarking on a comprehensive exercise in true cost accounting. This initiative aims to move beyond the immediate cost of goods to incorporate hidden externalities, such as regulatory compliance costs, the expenses associated with overproduction, potential environmental degradation, and social impacts. "We’re having more conversations internally to understand how all of this will impact the total cost of a product," Duran elaborated. "For example, if we transition to a preferred material, could that mean we pay a lower extended producer responsibility (EPR) fee down the line? How can we look at the total financial impact a product has on our business throughout its entire lifecycle, and not just the cost of goods?" This holistic approach to costing promises to provide a more accurate picture of product profitability and inform more sustainable sourcing and design decisions.
Cultivating Deeper Supplier Partnerships
The success of rigorous analysis and strategic integration hinges on the ability to foster robust and trusting relationships with suppliers. Duran highlighted that Tapestry’s strategic repositioning of its sustainability team three years ago, moving it from legal to the supply chain function and with Duran reporting directly to the Chief Supply Chain Officer, has been instrumental.
"That does a couple of things," Duran explained. "It gets me into the broader conversations happening at a strategic leadership level, sitting on the supply chain leadership team, which allows me to introduce topics around environmental and social responsibility. It also means our team is based in Singapore, directly connected to the sourcing office in Asia, and working with our teams on the ground, who are in the factories day in and day out. That level of engagement has allowed us to integrate social and environmental responsibility into the broader supply chain much faster." This proximity and direct engagement facilitate more agile problem-solving and a deeper understanding of on-the-ground realities.
Tapestry’s commitment to supplier collaboration is further exemplified by its annual supplier summit, which alternates between China and Southeast Asia. The most recent summit dedicated significant time to the climate risk scenario analysis, fostering dialogue on its implications for suppliers and collaborative mitigation strategies. A critical aspect of Tapestry’s approach is its willingness to fund these initiatives, addressing a major barrier to scaling sustainability transformations within supply chains. The company recently concluded the second cohort of its year-long supplier decarbonization program, which provides in-depth energy audits and tailored action plans for its top Tier 1 and Tier 2 suppliers.
Concrete examples illustrate the impact of these programs. Pungkook Ben Tre (PK), a strategic Tier 1 supplier in Vietnam, began installing a rooftop solar system last year, with Tapestry providing partial funding. The objective is to increase solar capacity to 1,200 MWh annually, sufficient to cover approximately 30% of the facility’s energy needs. Similarly, Simone, another key Tier 1 supplier in Vietnam, implemented a rainwater recycling system designed to reduce its total water consumption by over 20% in 2025, following an onsite assessment funded by Tapestry. Tapestry continues to offer ongoing support throughout the implementation phases of these projects.
To further incentivize and acknowledge these investments, Tapestry has integrated sustainability metrics into its supplier scorecard. This alongside traditional Key Performance Indicators (KPIs) such as on-time delivery, cost, and quality. "A portion of their score now comes from social compliance, and another from environmental performance," Duran stated. "It really connects the value we create from a broader sustainability perspective with the value the business creates from a strategic differentiation in the supply chain." This strategic alignment ensures that environmental and social performance are recognized and rewarded, driving continuous improvement throughout Tapestry’s global supply network.