Clothing the Loop: Exploring Design Features of Circular Performance Indicators and their Application among Textile Retailers

Sammanfattning: This thesis addresses business performance indicators in the context of the Circular Economy (CE) and the textile industry. Its purpose is to explore possible design features of Circular Performance Indicators (CPIs) in the textile industry, to examine the application of such metrics among retailers and to define potential indicators for the Swedish fashion retailer MQ. The research design is exploratory and follows a triangulation approach. A literature analysis on the concept of CE, best practices for designing CPIs and selection criteria for performance indicators is conducted. This is complemented by qualitative content analysis of 19 interviews with experts from textile retailers and other institutions. Qualitative content analysis of 19 sustainability reports and interviews with ten retail representatives examines the implementation of CPIs among textile retailers. Finally, a framework for selecting CPIs in the textile industry is proposed. This framework is applied in a focus group session with the Swedish fashion retailer MQ, resulting in a set of 16 applicable metrics. Findings suggest that CPIs mainly focus on environmental aspects and material flows. Metrics can be defined for every lifecycle stage of textile products, yet experts’ understanding predominantly refers to manufacturing and the end of life. Based on the analysis of sustainability reports, the current application of CPIs among retailers appears to be in an early stage. Examples found in reports mostly pertain to chemicals, energy, materials consumption, waste and water. Experts from retailers highlighted the need for further organizational development before CPIs could be applied. In this context, data collection was perceived as a barrier to implementation. The MQ focus group session defined indicators for chemicals, energy, material consumption, waste and water. Discussions suggest that the company’s business model impedes the application of indicators which pertain to product reuse and leasing. MQ may consult the findings of this study in preparation of its (prospective) sustainability reports. In the short term, it is recommended to focus on CPIs which are compatible with the company’s business model and core values. For the intermediate future, MQ may use CPIs which deliver a better understanding regarding the company’s environmental impacts and resource consumption. In the long term, MQ may consider assessing the economic feasibility of leasing and reselling activities, e.g. by measuring resell prices of second hand products.