NRF | Retailers’ new era of eco-diversity

Oct 16, 2024

Bowles Farming Company, a sixth-generation family-owned farm in central California, receives support from J.Crew's regenerative agriculture program.

A few years ago, J.Crew Group decided to embrace regenerative agriculture, a farming approach that focuses on soil health, water quality and biodiversity. There was just one problem: Few farmers were producing goods this way, leaving cotton and other products in short supply.

So the company took a step back, expanded its vision and invested in helping farmers transition to this approach.

Sponsored by Deloitte, the NRF Center for Retail Sustainability supports retailers’ commitments to create net positive environmental, social and community benefits while generating economic value.

“We knew that we couldn’t ask for it without doing something proactive,” says Katie O’Hare, J.Crew’s vice president of sustainability. To build a supply of sustainable products, J.Crew has invested in 35 farms in America “specifically to give them financial incentives to convert to regenerative agriculture.”

In practice, J.Crew farmers agree to minimize tilling and anything that disrupts the soil unnecessarily, sowing cover crops and diverse crop rotation, and integrating livestock to improve soil biodiversity.

While regenerative agriculture may be a new concept, other retailers also are on board. For Macy’s, it offers an opportunity to marry care for both people and products.

“When we think about our sustainability strategy, we’re trying to do a few things: caring for the people who are making our products while caring for the environment and making it come alive for the customer,” says Keelin Evans, Macy’s vice president of sustainability and responsible sourcing.

Macy’s initiatives are largely focused on cotton, working through the U.S. Cotton Trust Protocol, which provides supply chain transparency.

“They had done the work to set up a system that allowed for supply chain mapping and all the handoff that happened,” Evans says. “They’re sourcing it from farms that are sharing that data where we can understand and learn — what does it mean about water use, how do they keep soil healthy?”

Macy’s goal is to have 40% of its products using preferred materials like cotton produced using these healthier methods.

J.Crew also is working with partners to verify its actions. It has collaborated with 5 Loc Cotton LLC to help the farmers directly, and supported adoption of the regenagri standard, a regenerative agriculture program designed to ensure land health and prosperity for the people who live on it. J.Crew also has expanded its efforts, sourcing regenagri certified cotton in some of its men’s flannel and J.Crew Factory’s poplin.

Goals to transform farming and to provide full supply chain transparency are lofty, to be sure. But with cotton in particular, there is a long and hard history. To be fully successful, J.Crew felt it also needed to address equity.

“We wanted to be really conscious of the history of cotton farming and the challenge that farmers faced,” O’Hare says. “We wanted to positively impact farmers in the U.S. and ensure that impact was spread equitably.”

J.Crew worked with the Federation of Southern Cooperatives, an association of Black farmers, landowners and cooperatives across the southern United States. FSC farmers were able to participate in the partnership, with J.Crew directly investing in those farms. “We know that what these farmers learn, they share,” O’Hare says.

“We’re hoping to see a multiplier effect and to continue to invest in the FSC to address their specific needs and scale regenerative agriculture.”

Given the importance of fibers to J.Crew’s business — some 84% come from land-based sources and about 65%-70% of that is cotton — it makes sense that the investment would generate cotton that is used in J.Crew and Madewell products. But to O’Hare, the stronger business case is in transforming the industry. The farmers whose regenerative agriculture transformation is funded by J.Crew can sell their products to other brands, too.

“The thing that has pleasantly surprised me is, it’s really more to me a human story than a farmer story: Seeing how the changes that we’re making in farmers are really benefiting their livelihoods. We thought this was going to be an investment in soil health — the upside was the investment in the farmers and these people’s livelihoods, which has been really rewarding.”

Incorporating diversity, equity, inclusion and belonging into sustainability fits with the goal of the National Retail Federation’s work. “The goal with sustainability is to create net positive benefits on both the environmental and social side,” says Scot Case, NRF’s vice president of corporate social responsibility and sustainability and executive director of NRF’s Center for Retail Sustainability.

“When it comes to regenerative agriculture, it is focused on the broader sustainability issues, but what is beautiful is that it looks at both the environmental and social dimension.”

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“Various retailers are at different places in their journey, both as it relates to sustainability and DEI,” says Ceara Flake, NRF’s deputy general counsel and DEI strategist at NRF. “Even if folks are not necessarily engaging in regenerative agriculture, they’re beginning to talk about these issues in a broad-based way and in a way that touches on every aspect of the business. We’re beginning to see retailers pay more attention to the intersectionality of sustainability and DEI.”

J.Crew and Macy’s are far from the only retailers working in this space. Case points to Kellogg’s, which has “a very aggressive regenerative agriculture program.” Flake notes that Timberland has been also involved in regenerative agriculture, developing sustainably sourced cotton, rubber and leather.

J.Crew also would like to expand beyond cotton, but has found leather and wool “trickier,” O’Hare says. “The sources are still small. The leather supply chain is so much more complicated because of its ties to food and agriculture.”

Given that leather is a relatively small portion of the value of a cow, “we have very small leverage in driving more sustainable practices,” O’Hare says. “But I’m seeing that food and ag are paying attention to this.”

As for wool, the company has incorporated regenerative sources of wool in Madewell products as a way of “dipping our toe in the regenerative wool water,” O’Hare says. “We’re working with teams to scale and maybe even someday come up with a similar program.”

Macy’s also is exploring what natural materials it would like to tackle next to help the company reach that 2025 goal of 40% preferred materials for its market brands.

Some of its ongoing work is in addressing animal welfare in its wool, cashmere and down, and chemicals and techniques in tanneries for its wool. It also works to influence national brands that sell their products in Macy’s to adopt more sustainable aspects.

“We believe this is a team sport,” Evans says. To that end, Macy’s hosts Market Brand Sustainability Summits for its market brand partners to “collaborate and share,” Evans says. “We feel the more we can learn, the better we can take collective action.”

J.Crew also believes in collaborating throughout the retail ecosystem. A few years ago, the company began working with the Textile Exchange to host monthly calls where retailers could “get together and talk about what we were doing in the regenerative agriculture space,” O’Hare says. “We could share practices and challenges.”

While J.Crew and Macy’s have been doing the work for a few years, there remains plenty of room at the table for others to join.

Flake suggests starting with an understanding of what regenerative agriculture is and “not just understanding the technicality but gaining insight from other retailers who are already working in this space.” It might mean participating in an NRF council or committee to “begin to learn and benchmark with retailers already involved in regenerative agriculture and other eco-diversity initiatives.”

Macy’s and J.Crew have both learned the value of building their own ecosystems through partnerships. That, Flake says, can be another way to get started. So too can working with suppliers to “assess where regenerative practices can be integrated.”

Just asking the question can be powerful, Case says. “Suppliers should understand, if their retailers are asking about it, it’s probably something they should be paying attention to.”

Finally, understand that regenerative agriculture is not just about the products that end up on the store shelves but the people who touch them along the way. “If your sustainability is only focusing on environmental issues,” Case says, “you’re missing at least half the story.”