Our Responsabilty to act

Facing our Greatest Immediate Challenge – The Role of Philanthropy

Magazine article

The Laudes Foundation (formerly C&A Foundation): Moving beyond the fashion industry towards supporting the transition to a just and regenerative economy.

We are living in a fragile world. The Covid-19 pandemic has resulted in the disproportionate suffering of vulnerable communities across the globe, exposing deep inequalities and discrimination in our global economic system. And as thousands take to the streets to demand justice in the wake of the killing of George Floyd and countless innocent black men, women and children, never has this systemic inequality and injustice been more apparent. Economies are sliding into recession; according to the World Bank, the global economy will shrink by 5.2 per cent this year. The already profound economic disparities between the haves and the have nots are widening. All of this is happening while we are alsofacing an existential climate crisis.

We, as foundation leaders and social impact investors – must step up. We need to step up to tackle the root causes of the deep inequality and climate breakdown that we are allexperiencing. We need to step up to influence the emerging policies, stimulus packages, and bailouts to ensure we can build back better. We need to step up to nudge business and industry to be a force for good. Not simply “less bad.”

Only six years ago, we launched a corporate foundation – C&A Foundation – which was focused on transforming the global apparel industry. I am proud to share that we have had many successes, from founding the world’s first collaborative platform for innovation in sustainable fashion (Fashion for Good) to accelerating the uptake of sustainable cotton by the industry, thus improving lives and livelihoods for tens of thousands of farmers. Our KPIs tracked beautifully (e.g. increase in collective bargaining agreements, number of forced and child labourers freed, uptake of circular business models by the industry, etc.) and our closing Annual Report, made compelling reading, showing a positive trend in our results.

But did we succeed in changing the global fashion system? No. In fact, in January 2019, the Union of Concerned Researchers in Fashion issued a manifesto berating the fashionindustry for doing too little, too slowly. Specifically, they said: “Planetary systems are under threat. Fashion and clothing products and activities contribute to the destruction of these systems. They also contribute to the increasing disconnection between humans and Earth. We, the Union of Concerned Researchers in Fashion, recognise that the response of the fashion sector to the intensifying ecological crisis has been – and continues to be – oversimplified, fragmented and obstructed by the growth logic of capitalist business models as they are currently realised and practiced.”

The growth logic of capitalist business models was – and continues to be – the issue. One cannot transform the fashion  industry without tackling what appears to be a flawed framework for economic development. Specifically, we need to question whether the market – and neoliberal capitalism, which has created so much wealth, creativity and opportunity in the world – can get us to a place where people are valued, and nature is respected. As it is currently designed, the answer is no. For that reason, we made the difficult decision to retire C&A Foundation and launch a new foundation with a bolder and broader mission: one that aims to tackle the dual crisis of inequality and climate breakdown through the lens of industry. Laudes Foundation launched in January to join others in accelerating the transition to a just and regenerative economy. With our lessons learned from C&A Foundation as well as the six generations of entrepreneurial and business experience of our founding family, we want to help transform our global economic system so that it values people and respects nature. We can do this by leveraging the market power of business and industry. Specifically, we aim to support brave action to inspire and challenge industry to harness its power for good. We believe that combining the philanthropic purpose of  philanthropy with the scale and reach of business can help industry tackle its most pressing issues.

But we have not abandoned the fashion industry. Rather, Laudes Foundation works both via specific industries (fashion and the recently added built environment) and via capital markets to influence the flow of capital throughout the system for good. And what excites and motivates me personally is that we are not the first to take this approach. Many excellent organisations and funders have been working towards a new economy, and we want to contribute and accelerate their efforts. In fact, in the wake of the devastating impact of Covid-19 and growing social unrest, we see an increasing number of leaders – in policy, business, civil society and philanthropy – willing to use their resources and power to “step up, not step back.” This is part of a call to action by the Ellen MacArthur Foundation that we have proudly supported to embrace the circular economy as a solution to “build back better.” Despite the vast, systemic challenges before us, I remain optimistic that positive change is possible.