The ‘Irony’ of the Higg MSI Controversy
Jeremy Lardeau, vice president of the Higg Index at the Sustainable Apparel Coalition (SAC), still bristles at criticism of the Higg Materials Sustainability Index (MSI), the environmental impact measurement tool that was thrust into the center of a green claims maelstrom last year.
Speaking from a suite at the Revere Hotel Boston Common during a break in the influential trade group’s annual meeting last week, Lardeau said that much of the negative commentary denouncing the platform as unfit for consumer-facing marketing felt unfair on “multiple levels.”
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“??It felt like this was a critique of LCA, rather than of our tools specifically,” he said, using an acronym for life cycle assessment, the process of evaluating a product’s effects on the environment over its lifetime. “And so we were being singled out for a practice that is used in much less careful and transparent ways.”
But in the months since the Norwegian Consumer Authority ruled that Norr?na was “breaking the law” by touting some of its products as better for the planet based on Higg MSI data—something that triggered a third-party review of the module’s methodology that summer—Lardeau has taken a more expansive view, one that sees the contentious debate as a “really good” opportunity to reassess the value of the MSI, the intended purpose of LCAs and how to publicly communicate data. Most of all, it questioned if the SAC should be involved in consumer labels in the first place.
It was, after all, the ??Higg Index Transparency Program, which the SAC introduced in 2021 with the goal of providing “unprecedented visibility” into a product’s “real” impact vis-à-vis water, chemicals and climate emissions, that Norwegian regulators flagged last June for making what they described as “misleading“ sustainability assertions through the use of global averages and outdated data sets. That might not just be an SAC problem, but a fashion problem, too.
“I think in a way, we’re putting too much focus on this idea of product consumer labeling and how much of an impact that’s going to have on good consumer purchasing decisions,” Lardeau said. “I think we’ve overestimated that bit. Whether or not a label is even effective at driving different consumer behaviors is questionable.”
The Transparency Program itself is on an indefinite “pause,” at least for the foreseeable future, he said. Instead, the SAC is taking a different tack—a rebrand, almost, that is moving from “measurement to impact,” as one panel participant described it.
”We’re at this point where we feel like we’ve spent enough time and resources in developing tools that are good enough and we’ve amassed a ton of data,” Lardeau said. “And I don’t think that we’ve made enough of a concerted effort to use this data in support of our impact reduction strategies. It’s about moving from saying, ‘Here’s your score,’ to saying, ‘Well, here’s your score and based on your context and your situation as a facility or as a brand, here are paths toward improvement.‘”
Earlier in the day, Amina Razvi, the SAC’s CEO, formally unveiled the organization’s “evolved” strategy to a packed audience of industry bigwigs, including executives from Nike, H&M Group and Zara owner Inditex. The theme of the conference was, aptly enough, “Evolution for Impact.” Transformative shifts are needed, she said, to attack the converging challenges of climate change, social injustice and economic inequality that are “being felt today, from Libya to Hawaii.”
“The question is no longer about intent, it’s about tangible results,” she said. “What is the real-world impact of our actions, both individually as companies, as well as a collective? In today’s landscape, our initiatives and our narratives must firmly be anchored in measurable, substantive impact.”
Though it struck a blow at the credibility of impact measurement tools, the Higg MSI controversy helped inform some of the SAC’s new approach.
“This whole development has caused us to say alright, what we’re after here is chain improving environmental outcomes in the supply chain: adoption of better practices, use of better materials, right?” Lardeau said. “And where we see the SAC’s strengths playing into that is really in influencing decision-making within the supply chain. And not necessarily from a consumer standpoint.”
While a reevaluation of the Higg MSI was always due—the last review was in 2017— the dispute sped up the timeline. For the task, the SAC tapped accounting giant KPMG, which would make its 56-page report available for publication later that evening. The result was “neither a clean sheet nor a complete rebuke,” with a lack of full consensus among the 10 experts who were consulted, Lardeau said.
If there was one majority opinion, however, it was the fact that the MSI should not be used as a stand-alone tool but rather in tandem with other Higg platforms that can provide a more holistic view based on primary and even real-time data. Another common piece of feedback was the need for warnings about the limitations of certain data sets and where they should not be compared.
Lardeau said that he didn’t want to describe his first read as “unsatisfactory.” After struggling to find the right word, he settled for saying that there was “a lot of nuance,” reflecting the complexity of the subject. Critically, he found plenty of good recommendations that will help the SAC prioritize the tool’s development. Where they’re simple, such as linking facility-level data from the Higg Facility Environmental Module (FEM), the trade group will figure out how to implement them in the coming months. Where they’re less straightforward, for instance, the inclusion of additional impact categories, such as biodiversity and microplastics, they will require a longer timeframe.
The important thing, Lardeau said, is ensuring that there is no room for misinterpretation or misuse of the data, “which was a big concern.” The work is “already in flight,” he added, noting the SAC’s partnership with the ??Sustainability and Health Initiative for NetPositive Enterprise, a.k.a. SHINE, a program at the Massachusetts Institute of Technology and the Harvard T.H. Chan School of Public Health, to decide how “to surface some of that information around the uncertainty and the inherent variability of this data,” including when working with global averages.
The SAC has its work cut out for it, he said. So far, Lardeau’s team has classified all of KPMG’s recommendations and how best to implement them, but this will be ongoing work.
“We’re going to keep coming back to these recommendations to inform our product development roadmap,” he said. “And we will make the changes to the tools over the next few months to a year to address, to the best of our capabilities, the recommendations.”
Reviews for other platforms are on their way: The Higg Brand and Retailer Module is due for a check-up later this year and the Higg FEM in early 2024. But the Higg MSI is the one tool that has triggered a “lot of passion,” Lardeau said.
The module’s detractors loom large in his thoughts. They’ll want to know, he said, why KPMG didn’t ask the experts whether the tools are appropriate for consumer-facing claims, given last year’s brouhaha. The reason is that the review is a technical one that looks only at internal and B2B use cases, meaning that the experts involved specialize in LCA methodology.
“The discussion around what is and isn’t appropriate [a] good consumer-facing claim is a different debate,” Lardeau said. “It’s almost a societal decision around what is good and not good marketing practices, and there are important regulations being developed about it.”
These include the European Union’s Product Environmental Footprint, better known as the PEF, which has also come under similar scrutiny. The SAC will continue to be part of the PEF’s technical secretariat, Lardeau said, but in a way that contributes to discussions about consumer-facing claims rather than driving them
Still, he’s looking forward to sharing KPMG’s report openly and contributing to the wider discussion, “not just the controversy from last year, but just the broader conversation right around what is LCA? What do these numbers say? How do we use them?” Tackling these questions in an open and transparent way, he said, is as important as the findings themselves.
Echoing Razvi’s words, Lardeau said that this is a “journey.” In the end, however, the Higg MSI is a “rather technical tool to serve a pretty technical niche use case.”
“The irony of all this heated debate is that this one tool is not the Higg Index tool that is most used in the industry by far,” he said. Those would be the Higg FEM and the Higg Facility Social & Labor Module.
“What we need to figure out is how do we leverage these tools to better inform product sourcing decisions at brands and manufacturers,” Lardeau said. “And that means looking at the tools from a slightly broader perspective than just an LCA calculator.”
Lardeau said that the reality is that brands today don’t typically have the necessary level of data at a product level.
“So what we need to figure out is how we bridge that gap between the reality of where the brands are today in product-level data and where we need to be if we’re going to have proper product LCAs,” he said. “And bridging that gap is what we see we have an opportunity.”
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