Future-proof and fashion forward: how Daniel Ervér is evolving H&M Group
Daniel Ervé, CEO of H&M Group, discusses how the company balances fast fashion with sustainability, leveraging its long-term family ownership to invest in innovations like lab-grown cotton, circular fashion ventures (Selpy, Looper), and brand elevation through digital platforms and cultural experiences like fashion shows and concerts.
Summary
In this Monocle Radio episode, Daniel Ervé, CEO of H&M Group (managing €20 billion across brands including H&M, COS, Weekday, and Arket), outlines the company's dual approach to fashion retail. H&M aims to be "fast fashion" in terms of trend responsiveness and market agility, but designs garments for longevity rather than disposability. The company's core mission remains making fashion accessible across price points through unbeatable value for money.
Ervé emphasizes that H&M's sustainability strategy operates across three pillars: social sustainability (supporting 800,000 workers in supply chains across Bangladesh, Vietnam, and other regions through union building and fair employment practices); carbon emissions reduction (targeting 56% reduction by 2030 and 90% by 2040, currently 34% achieved and on track); and waste management (the most challenging area). For waste, H&M has established ventures including Selpy (a secondhand platform majority-owned by H&M) and Looper (a joint venture with German waste management companies for textile sorting and upcycling). Ervé acknowledges these are early-stage solutions to an industry-wide problem.
On innovation, H&M invests heavily in fabric development, including lab-grown cotton requiring no arable land, viewing this as crucial for circular fashion and competitive advantage. The company's 500-strong in-house design team in Stockholm demonstrates meticulous attention to detail, exemplified by specialists perfecting aspects like black pigmentation.
Brand elevation is occurring through multiple channels: digital transformation (H&M.com now better represents brand aspirations), physical store gradual refresh (time-intensive across 4,000 locations), and cultural experiences including fashion week debuts (returning to London Fashion Week, established presence in New York for COS), concerts (Charlie XCX at Copperbox, Anita and Gilberto Gil in São Paulo), and talks addressing industry development. These experiences aim to express brand energy and challenge perceptions that fashion must be exclusive or expensive.
Ervé attributes H&M's survival and relevance over 80 years to continuous evolution. The company's portfolio strategy differentiates brands by audience while maintaining the core mission: H&M challenges fast fashion conventions, COS disrupts luxury accessibility, and Arket emphasizes Scandinavian beauty in everyday life. Long-term ownership by the founding family enables investment in innovation and sustainability targets that might seem unrealistic to purely quarterly-focused shareholders.
About this episode
<p>Daniel Ervér, the CEO of H&M Group, explains how he’s working to ensure the relevance of its brands for new generations – without compromising the group’s sustainability and long-term responsibility.</p><p>See <a href="https://omnystudio.com/listener">omnystudio.com/listener</a> for privacy information.</p>
Key Insights
- Ervé argues that H&M's ability to sustain its business over 80 years stems directly from its capacity to evolve with industry changes, requiring continuous transformation in how the brand is perceived and presented despite maintaining its core accessibility mission.
- H&M views waste management as the industry's largest unsolved challenge, distinguishing it from carbon and social sustainability where measurable progress has been made, and deliberately establishes partnerships rather than sole ownership (Looper joint venture, Selpy majority stake) to bring external expertise from other industries.
- The company has decoupled growth from CO2 emissions—achieving 34% reduction toward a 56% target by 2030 while maintaining business growth—which Ervé characterizes as the critical requirement for ambitious sustainability targets to remain realistic long-term.
- Ervé argues that physical experiences like concerts and fashion shows are irreplaceable for expressing brand energy and challenging industry perceptions, particularly that fashion credibility requires exclusivity and high price points, which digital channels cannot fully accomplish.
- The founding family's continued majority ownership of the publicly-traded H&M Group enables the company to pursue sustainability investments and innovation timelines (20+ years into sustainability work) that would be difficult or impossible for quarterly-focused shareholders, providing competitive advantage.
Topics
Transcript
Hello and welcome to the Entrepreneurs on Monocle Radio, the show all about inspiring people, innovative companies and fresh ideas in global business. This week we're off to Stockholm to sit down with the leader of one of the world's most recognisable names in fashion retail H&M Group. We'll hear how he and his teams are working to ensure their various brands' relevance for new generations of customers. And how alongside that evolution, he's ensuring that the group adheres to the foundational values of sustainability and long-term responsibility that have defined its story so far. We want to be fast fashion in the sense of being quick in adapting to trends, quick of changing so that we are relevant and…
Full transcript available for MurmurCast members
Sign Up to Access