# Get inspired: H&M

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## Funding the Transition to Low Carbon Suppliers

The ChallengeH&M Group recognized that many suppliers in the apparel sector are struggling with decarbonization due to a lack of funding and adequate technology implementation support.The SolutionH&M Group has therefore set up a Green Fashion Initiative which supports the company in reducing greenhouse gas emissions across its supply chain. The Initiative makes funding available to supplying factories to invest in the technologies and processes needed to reduce energy demand and replace fossil fuels across the fashion industry. As of January 2023, 17 projects have been financed, with a potential annual reduction of 50,000 tonnes CO2 emissions in H&M Group’s supply chain, and an additional reduction of approximately 140,000 tonnes beyond their own value chain, for other brands purchasing from these facilities.As further development of the Green Fashion Initiative, suppliers can also get access to financing from H&M Group via a collaborative finance tool set up through DBS with highly favorable terms for specific GHG emission reduction activities, as approved by H&M Group. In 2023, the collaborative finance tool completed the first successful transaction with a manufacturer in India to fund capital expenditures to reduce scope 3 emissions. With the support of the loan, supplier Raj Woollen financed the installation of solar panels, energy-efficient motors, as well as water conservation technologies to conserve resources and reduce carbon emissions.H&M Group  is a lead partner of the Aii Fashion Climate Fund, which is designed to drive collective action to tackle the fashion industry’s supply chain emissions. The Fund will help execute foundational supply chain improvements, including transitioning to renewable electricity, improving energy efficiency, eliminating coal in manufacturing, scaling more sustainable materials and practices, and accelerating next-gen materials.Explore more here.