Chris Iggo

Macroscope | If chasing GDP and consumption is bad for the climate, what are the alternative economic models?

When even the fashion industry seeks new metrics, it’s time to look at alternatives – from green growth’s clean energy transition to ‘agnostic’ growth’s ignoring of GDP

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Used clothes on racks in a secondhand shop. For the last 70 years, we have measured the prosperity of countries using gross domestic product – how much the total sales of goods and services has grown, without acknowledging the social or climate impact from economic activities. Photo: Shutterstock

Chris Iggo

Published: 9:30pm, 22 Mar 2023

Fashion is one of the biggest industries in the world, generating around US$2.5 trillion in annual sales. It is also thought to be responsible for a sizeable 10 per cent of annual global carbon emissions – more than all international flights and maritime shipping combined, according to a McKinsey report.

No surprise then that it was high on the agenda at the COP27 UN climate change conference. At the event, the Global Fashion Agenda, a non-profit organisation for sustainability in fashion, launched an industry consultation, together with the United Nations, on climate targets – with one of its aims to create a range of measurable metrics.

Fashion is also one of the many areas where a lot of unnecessary, even wasteful, consumption goes on, making profits for companies and returns for investors – even defining national success. For the last 70 years, we have measured the prosperity of countries using gross domestic product – how much the total sales of goods and services has grown, without acknowledging the social or climate impact from economic activities.

The earth and its resources are finite. If solely chasing GDP growth has been damaging to our planet and threatens our ability to thrive in the future, what could be the alternative economic models?

Green growth is the closest to our current path. And it seeks to align with the warming commitments made in the Paris Agreement.

Green growth is all about transitioning energy to renewable sources and capturing emissions with technology and carbon sinks. It focuses on shifting to less energy-intensive consumption without necessarily seeking to reduce demand.