As a fast fashion giant, H&M Group has faced significant challenges related to the environmental impacts of its traditional business model. The fashion industry is known for its heavy reliance on virgin materials, excessive water and energy consumption, and chemical use in production processes, particularly in dyeing and finishing. Additionally, fast fashion’s business model generates large amounts of textile waste, as garments often have short lifespans before being discarded.

As one of the best-known fast fashion retailers, H&M Group is now aiming for 100% of their materials to be recycled or sustainably sourced by 2030, with a target of 50% recycled materials. To achieve this, they invest in and scale innovative materials and production processes through various channels such as the Circular Innovation Lab, H&M Group Ventures, and green investments.

They have partnered with Infinited Fiber Company, TreeToTextile, Colorifix, and Alchemie Technology to reduce water, energy, and chemical usage in production processes like dyeing and finishing.

Additionally, they provide resources and services across their brands to prolong product lifespan such as COS Full Circle and H&M Take Care.

Furthermore, H&M Group actively explores customer-facing circular business models like resale and rental through partnerships with Sellpy, H&M Rental, and in-store second-hand options at Weekday and Monki.

In 2021, H&M worked with several partners on Keeping Workers in the Loop, a report focused on the employment impacts of shifting to a circular fashion system with recommendations on how to create a just, fair, and inclusive fashion industry. 

H&M's production of clothing, particularly from virgin materials like conventional cotton and polyester, contributes significantly to greenhouse gas emissions and therefore damaging planetary boundaries such as climate change. By aiming for 100% recycled or sustainably sourced materials by 2030, H&M is reducing emissions associated with the extraction, production, and processing of raw materials.

Through its initiatives, H&M is aiming to reduce its reliance on virgin resources, water, energy, and chemical use. The group also works on prolonging product life, notably by implementing circular business models.

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