How Tapestry Makes the Business Case for Sustainability

Last month, Coach and Kate Spade parent company Tapestry inked a 10-year partnership with Swiss carbon removal startup Climeworks.

It’s a bold move. A decade-long partnership is the kind of long-term support most climate solutions can only dream of. And sustainability is an increasingly flammable topic for US businesses. The Trump administration is rolling out a systemic crackdown on climate action, rewriting and removing critical climate databases, cutting funding for scientific research, and creating a culture of fear for corporations publicly committed to the cause.

“This was an opportunity for us to establish a long-term partnership and send market signals that this type of innovation is needed,” says Tapestry’s global head of ESG and sustainability, Logan Duran, in an exclusive interview with Vogue Business. “There are going to be emissions that we’re unable to address, and we need credible, long-term, durable carbon removal solutions to address them.”

There are several reasons why this is not a silver bullet: the partnership was designed to offset Tapestry’s Scope 1 emissions, but the majority of fashion’s emissions lie in Scope 3. Likewise, carbon removal is a nascent and relatively controversial approach to offsetting carbon emissions, and carbon offsetting itself is generally considered a last resort.

But it’s still rare progress for a US fashion company in the current climate. And the reason Tapestry is able to make investments like this is because Duran and his team have doubled down on the business case for sustainability, he explains. It’s a complex process, and every brand seems to have a different approach. Tapestry’s is focused on figuring out how to quantify climate risks, presenting the cost of inaction — the subject of a recent Apparel Impact Institute report — and positioning sustainability as central to both present and future business resilience. Here’s how they did it.

Mapping climate risks

In 2022, Duran’s team completed its first climate risk scenario analysis — a technical name for a dynamic process, designed to help Tapestry understand how climate change will impact its business moving forward. It’s a multi-year undertaking, the accuracy of which has evolved over time.

For the second iteration, completed at the end of 2025, Duran’s team focused on two different types of risk: physical risks and transition risks. “The physical risks are generally a little more straightforward,” he explains. “We identify around 250 sites across the organization, from corporate offices and retail stores to fulfilment centers and suppliers across Tier 1 and Tier 2. We’re looking for risks like the potential for flooding or droughts and extreme heat, and how those issues might impact the organization in the long run.”

Measuring transition risks is more complicated. Rather than simply identifying climate risks, the team has to model how certain challenges and opportunities will impact Tapestry’s bottom line in a low-carbon economy (assuming the industry acts quickly and comprehensively to meet its sustainability targets), versus a high-carbon economy (assuming progress continues to lag). These could include regulation, the cost of raw materials, and the revenue potential of circular solutions such as upcycling, which has delivered strong results for Tapestry’s Coachtopia sub-brand.

Based on the analysis, the most material risks are the cost of compliance with incoming regulation — generally borne by suppliers, despite how frequently they are squeezed by brands — as well as the consequences of weather changes. The latter risk is a double-edged sword. On one hand, supply chain workers face creeping threats such as extreme heat in factories, which can affect both worker well-being and the quality of craftsmanship. On the other hand, the increased frequency and intensity of extreme weather like hurricanes and floods affect everything from how safely workers can access factories and retail stores, to how efficiently products can be transported globally.

“There is a significant cost of inaction, and we will continue to see that play out,” says Duran. “For Tapestry, this is something we don’t want to wait on. We have to continue to invest in finding solutions, and prepare ourselves and our suppliers to face these challenges.”

Embedding sustainability into strategic decisions

Mapping the risks is step one, says Duran. Just as important is communicating this to the right internal stakeholders, securing executive and board-level buy-in, and using the analysis to guide strategic decisions beyond the sustainability team.

“The scenario analysis is an opportunity for us to showcase the fact that ESG, climate resilience, and managing climate risk are deeply connected to the value creation of the organization, as well as strong management of the company,” says Duran. “What’s exciting and important is that we have actually integrated the scenario analysis into our broader enterprise risk management, which means it has broader buy-in and we bring that information to our board. It allows us to make strategic decisions about our supply chains, not just for the next year or two, but 10 or 15 years into the future.”

For people outside the sustainability team, Duran says the scenario analysis is helping to communicate that climate change is not a “future problem”, but is happening “right now”.

There is a broader impetus for boards to consider climate risks, too, he adds. In 2015, the Financial Stability Board established the Task Force on Climate-Related Financial Disclosures (TCFD) to improve and standardize the way companies report on climate risks. The task force disbanded in 2023, but its recommendations for climate-related financial disclosures now guide several global regulations, and California’s Climate-Related Financial Risk Act (SB261), which will require companies doing business in California with over $500 million in annual revenue to biannually report climate-adjacent financial risks. The subject is also of rising interest to investors, who want to know how climate change is going to impact companies’ bottom lines.

Next on Duran’s agenda is a comprehensive exercise in true cost accounting, which makes space for hidden externalities like the cost of regulation, overproduction, potential environmental degradation, and social issues alongside the upfront cost of goods. “We’re having more conversations internally to understand how all of this will impact the total cost of a product,” he explains. “For example, if we transition to a preferred material, could that mean we pay a lower extended producer responsibility (EPR) fee down the line? How can we look at the total financial impact a product has on our business throughout its entire lifecycle, and not just the cost of goods?”

Closer partnerships with suppliers

Analysis like this is only possible when a company has mapped its supply chain and formed trust-based relationships with its suppliers, says Duran. Three years ago, Tapestry moved its sustainability team out of legal and into the supply chain function. Duran now reports to chief supply chain officer Peter Charles.

“That does a couple of things,” says Duran. “It gets me into the broader conversations happening at a strategic leadership level, sitting on the supply chain leadership team, which allows me to introduce topics around environmental and social responsibility. It also means our team is based in Singapore, directly connected to the sourcing office in Asia, and working with our teams on the ground, who are in the factories day in and day out. That level of engagement has allowed us to integrate social and environmental responsibility into the broader supply chain much faster.”

Alongside closer daily interactions with suppliers, Tapestry hosts an annual supplier summit, alternating between China and Southeast Asia. At the most recent event last fall, Duran’s team dedicated a fair amount of time to the climate risk scenario analysis, running through what it means for suppliers and how they can work together to mitigate and adapt to each risk. Crucially, says Duran, Tapestry funds a lot of this work, overcoming one of the major barriers to scale for supply chain sustainability transformations. It just wrapped the second cohort of its year-long supplier decarbonization program, which takes the top 40 Tier 1 and Tier 2 suppliers through a deep-dive energy audit and personalized action plan.

For example, Pungkook Ben Tre (PK), one of Tapestry’s strategic Tier 1 suppliers, began the process of installing a rooftop solar system last year at their facility in Vietnam, says Duran. The goal was to increase its solar capacity to 1,200 MWh annually, enough to cover around 30% of the facility’s total energy consumption, partially funded by Tapestry. Likewise, Simone, another strategic Tier 1 supplier in Vietnam, installed a rainwater recycling system designed to recycle over 20% of the facility’s total water usage in 2025, following an onsite assessment funded by Tapestry. Tapestry says it has continued to provide ongoing support throughout the implementation phase.

To incentivize and reward such investments, Tapestry has also integrated sustainability metrics into its supplier scorecard, alongside typical KPIs such as on-time delivery, cost, and quality, adds Duran. “A portion of their score now comes from social compliance, and another from environmental performance,” he says. “It really connects the value we create from a broader sustainability perspective with the value the business creates from a strategic differentiation in the supply chain.”