Circular fashion has achieved mainstream recognition but remains structurally immature, with 70% of brands scoring in the moderate implementation zone even as regulatory enforcement accelerates across key markets. The industry must pivot from pilot programmes to scalable operational models or face significant compliance and competitive disadvantages as regulatory frameworks shift from voluntary to mandatory compliance.
- The findings are from the fifth edition of Kearney's Circular Fashion Index (CFX 2025), which noted that the global fashion market is maturing with advancements levelling off, indicating difficulties in achieving full-scale impact despite continuous positive movement.
- Average scores rose to 3.40 and median scores to 3.20, but year-on-year progress slowed unevenly by region.
- Only five brands achieved scores above 7.0, while fewer than 20% exceeded the 5.0 threshold.
- Kearney's CFX 2025 analysed 246 brands across 18 countries and five core product categories—fashion, sports, outdoor, underwear/lingerie, and footwear.
WHAT’S AT STAKE: The transition from voluntary sustainability initiatives to mandatory compliance creates existential risks for brands unprepared for Europe's incoming regulatory framework. EU legislation including the Ecodesign for Sustainable Products Regulation and Digital Product Passports will require durability, recycled content, and full traceability by 2027, while France’s Senate has already approved bills targeting ultra-fast fashion with advertising bans.
- EU's ESPR will mandate durability, recycled content, and reparability requirements across all product categories.
- Digital Product Passports become mandatory by 2027, requiring complete supply chain traceability.
- France's ultra-fast fashion legislation targets overproduction through advertising bans and product-level environmental penalties.
- California's Responsible Textile Recovery Act compels brands to take back and recycle used clothing.
STRATEGIC SUBTEXT: The plateauing progress reflects deeper systemic challenges beyond awareness gaps, including scalability constraints, lack of cross-functional integration, unclear business cases, and fragmented infrastructure. Leading brands like Patagonia, Levi's, and Gucci are embedding circularity into core operations, maintaining competitive advantages while others remain constrained by departmental silos and pilot-phase thinking.
- Circular design and closing-the-loop initiatives drove most improvement, with brands shifting from systematic design approaches.
- Major brands including Arc'teryx, H&M Group, and Zalando joined the Ellen MacArthur Foundation's Fashion ReModel project.
- Ganni committed to sourcing 20% of polyester from post-consumer textile waste through Ambercycle.
- Hugo Boss launched Eightyards GmbH in early 2025 as a dedicated circular business unit.
