The opinions expressed here by Trellis expert contributors are their own, not those of Trellis.​

It’s crunch time for federal clean energy policy — and the consequences for the American economy are enormous.

Last month, the U.S. House of Representatives passed a budget reconciliation bill that would all but eliminate the federal clean energy tax credits that were extended and expanded by Congress in 2022. That legislation — and the long-term certainty it provided the private sector — powered an investment boom to the tune of hundreds of billions of dollars, as businesses quickly got to work building factories to produce clean technologies in the U.S. and new energy infrastructure to affordably and quickly meet the nation’s rising electricity demand.

The goals of domestic manufacturing growth, affordable power and U.S. competitiveness are regularly touted by the Trump administration, yet the legislation passed by the House would undermine all three. By cutting off or overcomplicating most incentives, the bill would increase electricity rates by 10 percent or more, exacerbating inflation by making power more scarce at a time when we need more of it to support AI and other new technologies. It would kneecap U.S. growth and innovation in growing global industries such as electric vehicles, batteries and clean power infrastructure. And it would scrap major industrial projects at risk of hundreds of thousands of jobs.

As Michael Tubman, the federal policy director at the electric vehicle manufacturer Lucid, said at a recent media briefing: “Anyone who has visited our [Arizona] factory can see the evidence plainly in front of them of the jobs — the high quality, high paying jobs that these incentives are supporting.”

Dozens of companies head to Capitol Hill 

With the Senate working on its version of the legislation, companies still have time to make an impact. More than 30 companies are headed to Capitol Hill this week for a series of meetings with Senate Republicans, where they will emphasize the tax credits’ vast economic benefits. 

But companies don’t need to be in D.C. to take action. For sustainability professionals, the tax credits are crucial to meeting company goals, so now is the time for them to work with government affairs and executive teams to get in touch with the senators in states where they operate to make the case that gutting these incentives would be a self-inflicted wound to U.S. economic, energy and geopolitical interests. To prevent that outcome, businesses should press the Senate to fix four major flaws in the House bill:

Tie eligibility to project construction, not completion

The House bill changes the current rules so that projects must be fully completed and operational — rather than merely under construction — to qualify for the credits. But between permitting issues, supply chain disruptions, litigation and other unpredictable factors, the timing of a project is often well beyond a company’s control. The proposed change would therefore create uncertainty about whether even projects that are ready to break ground will qualify for tax credits, especially because the House legislation imposes a shorter timeline before the credits expire.

The likely result: stalled investment, meaning less new energy and higher electricity prices. The Senate should stick with the existing “commence construction” requirement and set a more realistic expiration timeline than the House. 

Make foreign sourcing rules realistic, strategic and precise

The House bill includes overly burdensome restrictions on the use of foreign components for projects claiming tax credits. A major goal of these tax credits is to support U.S. manufacturing and supply chains to reduce reliance on foreign adversaries for critical materials and infrastructure. But the proposed changes are so severe that they’re essentially unworkable. A $50 part, unknowingly sourced through a third-party supplier, could upend a billion-dollar project.

That is a huge amount of risk for any company to take on. To comply, companies would need to immediately hire teams to closely inspect every link on their supply chains instead of hiring American workers to build and install cost-saving technologies. More likely, investment would just freeze up amid all the regulatory uncertainty as they await the final regulations for fear of noncompliance. 

The Senate can take a more clear, practical and simplified approach that applies to the taxpayer entity, company, or project, so that businesses can confidently and quickly invest in high-value domestic manufacturing, supply chains and energy production without ambiguity and red tape. 

Allow tax credits to remain fully transferable

Clean energy tax credits are currently fully transferable — meaning developers that don’t have tax liability can sell them to businesses that do. It’s a win-win for buyers and sellers, creating an efficient and competitive market that ensures the incentives are put to work in the economy.

The House bill would end that system, limiting transfers to a handful of large financial institutions that directly invest in the projects. This would weaken the financial viability of the projects, but it would also deprive companies across the economy of an opportunity to participate in project financing through tax credit transfers. The Senate should preserve transferability to keep the market functioning at its best.

Keep consumer credits to drive American industry

The House’s plan would also hurt consumers’ ability to afford modern and efficient technologies such as electric vehicles, rooftop solar panels and heat pumps by ending tax credits as soon as this year. While that would most immediately harm consumers and the companies selling those products, the consequences wouldn’t end there.

Reduced consumer demand would ripple across the economy, slowing investment in key 21st-century capabilities such as advanced manufacturing, battery production and critical mineral supplies, as well as more foundational sectors such as steel, glass and aluminum. The Senate can recognize that consumer demand is another form of policy certainty that drives investment across the economy and that keeping these credits in place will help maintain our global economic leadership.

The outcome in Congress will have major consequences for businesses across the economy — not just those making or buying clean technologies but all who depend on affordable power, strong domestic supply chains and U.S. global leadership. With those strengths at risk, their voices have never been more important on Capitol Hill.

[Connect with more than 3,500 professionals decarbonizing and future-proofing their organizations and supply chains through climate technologies at VERGE, Oct. 28-30, San Jose.]

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Chanel is looking beyond virgin materials to craft its signature tweed jackets and calfskin handbags. The 115-year-old luxury house shared plans on June 9 to create a new division to recirculate, recreate and repurpose used textiles. Chanel is calling the enterprise Nevold, a merger of the words “never” and “old.”

With purchased goods causing nearly two-thirds of indirect, Scope 3 carbon emissions for the privately owned brand, the launch advances efforts to reduce both its climate footprint and supply chain risks.

In addition, Nevold could help the fashion empire control and elevate the quality of recycled materials, a sticking point for elite brands. In this light, Chanel may be seizing an opportunity to corner a future market of high-end materials.

“We are not trying to replace what nature gives us,” Chanel President of Fashion Bruno Pavlovsky told Vogue Business. “But the ability to get the best quality with full transparency and traceability is becoming more difficult. Nevold is how we explore long-term alternatives — not for next season, but for the next generation.”

‘Strategic material infrastructure’

Sophie Brocart, the former CEO of LVMH’s Jean Patou brand who joined Chanel in January, will lead Nevold independently of the overall group’s fashion division. The effort has three partners so far: leather upcycler Authentic Material, yarn mill Filatures du Parc and materials sorter L’Atelier des Matières. The University of Cambridge and Politecnico de Milano will also be involved.

“The launch of Nevold is a positive signal that circularity is gaining traction in the luxury sector,” said Eva von Alvensleben, executive director of the Fashion Pact in Paris, a network of brands, including Chanel, to advance sustainability. “It reflects a growing recognition that material reuse and recycling must be scaled to meet the industry’s broader sustainability and net zero goals.”

“To me this sounds like the work of a sustainability visionary, less concerned about the luxury image and truly interested in creating impact,” said Cynthia Power, co-host of the Untangling Circularity podcast.

Nevold creates an “open” business-to-business system to manage — and potentially profit from — scrap or post-consumer materials that Chanel was unsure how to handle. (The brand does not incinerate unsold merchandise, according to Pavlovsky.)

“This signals a pivotal shift in how luxury approaches circularity,” said apparel sustainability consultant Liz Alessi. “Not just as a sustainability gesture, but as a strategic material infrastructure.”

Or, as reporter Jill Ettinger wrote in Ethos: “It’s a slow-motion land grab for control of the next generation of luxury inputs.”

How will it work?

Nevold has been several years in the making, according to Chanel Chief Sustainability Officer Kate Wylie. “There are two solutions already underway: a thread blended from end-of-life materials and virgin materials and a recycled leather to create reinforcements inside bags and shoes,” she posted on LinkedIn. Thirty percent of the brand’s handbags and 50 percent of its shoes already have recycled reinforcements, she added.

Indications of how Nevold will take shape may be found in its Paraffection division, a craftsmanship preservation effort that has snapped up at least a dozen artisanal workshops since 1985. These include button maker Desrues; embroiderers Montex, Lesage and Lanel; and glovemaker Causse. The late Karl Lagerfeld debuted the Métiers d’Art fashion show in 2002 to spotlight the work of the ateliers, who in 2019 got their own 84,000 square foot Paris headquarters, Le 19M.

“Whilst most brands are struggling to get a handle of their supply chain, Chanel own their subsidiaries through Chanel Métiers d’Art,” Lydia Brearley, founder of the Sustainable Fashion School in Malmo, Sweden, posted on LinkedIn. “Now, with the introduction of Nevold, they’re positioning themselves as the Maison de la Circularité in luxury fashion.”

Many questions remain, however, including whether Nevold will operate from a centralized location. Chanel describes a distributed “hub” approach that is likely to enjoin its internal R&D and waste materials with outside recyclers and processors.

“Chanel can vet the ecosystem of partners with a trusted company,” said Lauren Fay, founder and principal consultant at BFG Lab in New York City. “That efficiency saves money, builds trust with clientele and puts them at the forefront of the circularity conversation, which is great for their brand equity.”

Exclusivity + sustainability

Nevold’s open approach does not suggest exclusivity, which is one of Chanel’s five key “performance drivers.” But sustainability is another central driver alongside design, engagement, and people and culture.

Although famously buttoned-up about its raw materials suppliers, Chanel claims to source following the Responsible Wool Standard and Good Cashmere Standard. Most of its manufacturing likely centers in Europe, especially France and Italy.

Chanel was one of the last luxury brands to develop a public sustainability strategy, debuting its Mission 1.5° strategy in 2020 to align with the Paris Agreement. The Science-Based Targets initiative validated its net zero targets for 2040 last year. These include cutting all direct and indirect climate emissions by 90 percent by 2040 over a 2021 baseline, and slashing forest, land and agriculture-related emissions within Scope 3 by 72 percent. For the near term, the targets include halving emissions for Scopes 1 and 2 by 2030 and cutting them by 42 percent for Scope 3, with a 30 percent cut for forest and agriculture emissions.

From quiet luxury to loud circularity

Most luxury purveyors, Chanel included, have declined to pursue branded resale, letting third parties capitalize on the value-retention of $5,000 dresses and $10,000 handbags. But the sector is slowly starting to flash circular intentions. LVMH, parent of 75 brands including Christian Dior, Celine and Givenchy, gives second lives to waste materials and unsold goods within its LVMH Circularity strategy. And Kering, which runs more than 13 brands including Bottega Veneta, Gucci and Yves Saint Laurent, features a circularity strategy that features “upcycling, recycling and regeneration.”

And many in the group are investing in next-gen materials, including Hermes, which markets fungus-based handbags.

Still, the launch of Nevold is timed well for Chanel to meet new European Union requirements for apparel brands to take responsibility for their products after use.

“As regulations tighten and resources become scarcer, the brands that can turn yesterday’s inventory into tomorrow’s fabric will set the pace for the next growth cycle in luxury,” Nick Vinckier, VP of corporate innovation at the Dubai-based luxury retailer Chalhoub Group, posted on LinkedIn.

[Join more than 5,000 professionals at Trellis Impact 25 — the center of gravity for doers and leaders focused on action and results, Oct. 28-30, San Jose.]

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Devin Giles, a seven-year veteran of the sustainability team at International Paper, has stepped in as head of sustainability and ESG at home furnishings retailer Wayfair. 

Giles replaces Anna Vinogradova, who left her Wayfair position after four years for a role at another company, as yet undisclosed. Giles started in May and worked alongside her predecessor during a brief transition period. 

The switch was revealed in LinkedIn posts by Vinogradova and Giles, and confirmed by a Wayfair spokesperson. 

“This role brings together the work I love the most: driving sustainability through collaboration and innovation to make it part of how business gets done,” Giles said.

Wayfair, which had revenue of $11.9 billion in 2024, committed in 2021 to a 63 percent reduction in Scope 1 and 2 emissions by 2035 (based on a 2020 baseline). In Wayfair’s 2023 corporate responsibility update published in June 2024, the retailer reported a slight increase in that footprint. It does not have a publicly stated goal for cutting Scope 3 emissions from suppliers, which accounted for close to 99 percent of its footprint in 2023.

“This will require continued collaboration with our suppliers, logistics partners and stakeholders to deliver strategies that reduce emissions beyond our own operations,” Vinogradova said in a 2023 interview.

Other high-profile Wayfair sustainability initiatives include its target of zero waste by 2030 (the figure was 42 percent as of 2023) and the Shop Sustainably program, which the retailer uses to identify more than 33,000 certified sustainable products.

At International Paper, Giles recently managed the company’s renewables strategy — centered on using renewable or recycled sources for product development, and on developing circular manufacturing processes. She joined the company as a graduate intern in May 2017.

[Join more than 5,000 professionals at Trellis Impact 25 — the center of gravity for doers and leaders focused on action and results, Oct. 28-30, San Jose.]

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A new AI-powered study of more than 8,500 listed companies has revealed a “profound” lack of disclosure and governance around climate-related lobbying. One result of the secrecy, argue the report’s authors, is that companies often lobby in a way that undermines their own climate strategies.

The report, produced by climate-tech non-profit Danu Insight, used natural-language processing and AI to examine around 250,000 annual reports, disclosure statements, web pages and other documents. The report identified and rated evidence that each company disclosed specifics of its climate lobbying activity and implemented oversight of it.

Silent majority

A large majority were found to be completely silent: 78 percent provided no public disclosure about their climate lobbying, and 75 percent showed no evidence of a relevant governance process.

At the other end of the spectrum, just 6 percent achieved the top score — four points — on transparency, including disclosure of policies lobbied for or against, lobbying mechanisms used and outcomes sought. On governance, less than 1 percent earned four points on such issues as mechanisms for aligning lobbying with broader goals. 

Companies with top scores for both transparency and governance included BASF, BP, Delta Air Lines, Holcim, Nestlé and Toyota. 

Performance on the ratings varied significantly across industries.

“Companies operating in sectors generally understood to be highly exposed to climate-related policy and transition risks tend to demonstrate higher levels of disclosure,” the report noted. “This suggests that companies facing more climate pressure (e.g., from regulators, transition challenges, or stakeholder scrutiny) are more likely to disclose their lobbying activities and implement governance structures.”

The uncovered level of secrecy is possible in the U.S. because lobbying disclosure laws focus on the amount of money spent rather than on what it is used for, said Thomas O’Neill, founder of Danu Insight. The European Sustainability Reporting Standards, which are followed by companies that report under the region’s Corporate Sustainability Reporting Directive, require disclosure of lobbying that is material to sustainability efforts. Those rules, though, are in the process of being implemented, and the results are not reflected in the report’s data.

Lobbying the lobbyists

One target audience for the report is investors, who can use its information to assess and compare companies’ climate strategies, said O’Neill. 

The report also serves as a useful guide — and cautionary note — for sustainability professionals interested in shaping their company’s lobbying. Government relations units are often siloed, limiting the influence of sustainability teams and allies. One common result is that companies can be relatively passive members of trade groups, such as the U.S. Chamber of Commerce and the Business Roundtable, which have lobbied against climate legislation that is critical to the success of company sustainability goals.

“The government relations people have their agenda, and it’s usually to hold back regulations, to protect the company,” said O’Neill.

Like other advocates for climate lobbying reform, O’Neill argued that companies should work to change the trade groups they are members of rather than leave them. “There are lots of things they could be doing, conversations that could be had,” he said. One template for action is the attempts of Microsoft and others to influence Chamber of Commerce lobbying on climate legislation enacted under President Biden.

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No fashion brand deserves an A for effort to wind down its dependency on fossil fuels for energy and materials, according to activist group Stand.earth.

H&M Group earned a class-leading grade of B+ in the watchdog’s third Fossil-Free Fashion Scorecard of 42 fashion brands, suggesting that even a fast fashion business can make sustainability strides.

That contrasts with seven overall F’s handed down, including one for ultra-fast brand Shein. That company’s Scope 3 indirect emissions are skyrocketing as it continues a heavy dependence on polyester.

The report graded each company in five categories: climate commitments and transparency; renewable energy transition; advocacy; materials and circularity; and clean shipping. (Stand’s methodology included cross-referencing public reports with a survey it sent to businesses. Reviews by independent experts informed its letter grades.)

H&M stood out for financially backing suppliers’ attempt to slash emissions. It also scored an A+ for climate commitments and transparency, as it was the only company with a renewable energy target for emissions from raw material processing, that is, Tier 3 in the supply chain.

Similarly, sportswear and outdoor brands did best with climate commitments and transparency, including seven of the dozen brands with renewable energy targets for their supply chains. Patagonia and Puma each scored a C+. Yves Saint Laurent parent Kering, also with a C+, had the best showing among luxury brands, which tend to be cagey about their supply chain details. Mass market brands such as Eileen Fisher fared better than those in other categories by a full letter grade. They also nabbed better marks for use of low-carbon materials and circularity efforts.

Fossil fuels are woven into every step of apparel manufacturing, which makes up 4 percent of total greenhouse gas emissions, outpacing even the aviation industry, according to Stand’s report. The group advances a vision in which fashion phases out petroleum and coal, supports a “just transition” to a low-carbon economy and better engages the communities within their supply chains.

Stand was founded as ForestEthics in 2000. The San Francisco-based group, which originally targeted companies’ paper sourcing policies, takes credit for influencing 140 apparel businesses to ramp up their demand for renewable energy in manufacturing.

In this year’s report, the nonprofit issued a warning: “Unless brands act now to fund and enable the manufacturers and workers in their supply chain to deliver rapid climate action, building a more equitable model for the industry, this combination could create the perfect storm that sets the industry’s sustainability journey back, while leaving brands open to serious investor and reputational risk.”

Hall of fame — and shame

Eileen Fisher of Irvington, New York, came in second place overall with a B-. The only two A+ grades in one of the five sub-categories that Stand identified were H&M for commitments and transparency and Mammut for clean shipping.

Three companies received a C+ overall, including Gucci parent Kering, Levi Strauss and Patagonia.

At the bottom of the pack, Boohoo of Manchester, England, received Fs across the board. Barely beating it, Aritzia, Shein and Columbia each scored Fs in three categories, with a D- for materials and circularity. 

“Dangerously out of step with climate action,” according to the report, Abercrombie & Fitch, Aritzia and Columbia Clothing have not even set targets for slashing Scope 3 emissions.

Key progress areas

Here are highlights from each of the five categories that Stand analyzed:

“Climate and energy commitments and transparency” — Two-thirds of brands maintain net zero goals, but only five companies revealed near-term, concrete steps to reach that achievement.

“A fair renewable and energy-efficient manufacturing transition” — More than half of the companies are actively helping suppliers decarbonize. But only H&M offers financing beyond loans.

“Climate and renewable energy advocacy” — H&M scored an A, followed by Bs for Eileen Fisher and Nike. H&M, Kering and LVMH were the only brands satisfying U.N. criteria for the integrity of their net zero targets.

“Low-carbon and deforestation-free materials” — Average grades rose to D from F since 2023, and 95 percent of brands offer resale or repair. Nearly one-third of the brands are actively pursuing circular textiles, but only Puma has set a deadline (2030) for using a specific share (30 percent) of textile-to-textile recycled polyester. Only six companies are seriously pursuing a majority of materials without petroleum-based synthetics.

“Greener shipping” — Almost two-thirds work upstream shipping into their Scope 3 emissions targets. However, just nine brands explain the modes of transport they use, and only six pledged to reduce air shipping. Heavy emissions continue, with no end in sight, for Fast Retailing, Inditex, Prada, Puma and Shein.

Recommendations for fashion purveyors

Stand shared seven recommendations for apparel and footwear companies seeking to accelerate decarbonization:

1. Create “just climate transition” plans detailing near-term steps for 2030 and long-term steps for 2050 toward net zero goals.

2. Work with other brands to help smaller companies along the supply chain to ditch coal in favor of efficient and renewable energy technologies.

3. Enhance equity in dealings with suppliers. This includes helping to finance decarbonization efforts, including favorable loan rates and financing that suppliers don’t need to pay back. Stand also advises providing long-term agreements.

4. Focus more on climate adaptation efforts tailored to localities, helping workers “through the impacts of climate breakdown.”

5. In manufacturing centers, boost collaborative advocacy for policy and infrastructure that helps suppliers use more renewables.

6. Stick with a plan to get rid of synthetic materials. The report called out “the limitations of false solutions like recycled polyester.”

7. Use less polluting transportation by creating emissions targets and planning for slower, less-polluting shipping.

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