Essec Business School

Sustainability used to be a key part of the corporate conversation, between ESG committees, net-zero pledges, and green premiums. Today, political pushback, corporate fatigue and public skepticism are changing the conversation. So where does this leave luxury, an industry built on beauty and excess? Dr. Ashok Som, Professor of Management at ESSEC Business School, and co-authors Hannes Gurzki (Senior Research Fellow at the Technical University of Braunschweig, external lecturer at ESSEC) and Patricia Tawk (data and analytics specialist and ESSEC alumna) explored how sustainability and luxury intertwine in an article published in California Management Review.

They interviewed luxury brand leaders and analyzed more than 200 sustainability claims from 36 brands. Their main finding is that sustainability has moved from being a way to stand out to being a condition of legitimacy. Brands that merely "adopt" sustainability lingo will struggle. Those that build it into their operations, symbolism and governance will be more resilient.

From counterintuitive to key concern

Luxury has long seemed to contradict sustainability: one celebrates abundance, the other asks for restraint. That tension is fading. The key shift is in meaning. Sustainability is no longer seen as limiting but as the ultimate form of care: for the object, the craftsperson and the ecosystem that makes creation possible. At Hermès, the idea is that luxury is what you want to repair. At Kering, sustainability is considered part of quality, which is the cornerstone of French luxury.

Three decades, three "dialects"

This view took almost 30 years to emerge, and each period left its mark:

• The 2000s: initiatives. Brands addressed criticism on labor, sourcing and conspicuous consumption with ethical sourcing. Their actions were well-intentioned, but often disconnected from core strategy.

• The 2010s: compliance. Sustainability became a profession, with governance structures, carbon KPIs and environmental profit-and-loss accounts. Transparency became a source of legitimacy.

• The 2020s: transformation. ESG reports alone no longer set brands apart. Ambition shifted to regenerative agriculture, circular design and social partnerships, a change accelerated by digital tools and by younger consumers who demand environmental responsibility.

These three layers now coexist. This is why luxury's sustainability message can sound fragmented: it is spoken in three dialects at once. Managers must speak with one voice that links operational excellence, social responsibility and cultural value.

Two choices shaping every strategy

Dr. Som and his co-authors found that brands tend to make two decisions: on scope and on mode.

1. The scope: where does sustainability live? It can be intrinsic, changing how the company operates (materials, sourcing, craftsmanship, circular economy practices). Sustainability practices can also be extrinsic, extending the brand's responsibility outward (community empowerment, preserving biodiversity).

2. The mode: how does it earn credibility? It can be functional, led by proof such as metrics, certifications and audits. Alternatively, it can be symbolic, with sustainability rooted in heritage, craft and long-term philosophy. In plain terms: does trust come from the data or from the DNA?

How can managers show that their brands aren’t just all talk?

Combining the two choices gives four ways to build credibility:

1. Authority (extrinsic and symbolic): "We must be seen as a force for good." Ocean clean-ups and NGO partnerships build reputation, but without a link to operations they invite skepticism.

2. Accountability (extrinsic and functional): "We must demonstrate compliance." Hard targets give a license to operate, but risk sounding technocratic and uninspiring.

3. Integrity (intrinsic and functional): "We build products that last." Durable materials and worker well-being are hard metrics for mass-market players to replicate – but risk going unnoticed by the consumer.

4. Legitimacy (intrinsic and symbolic): "This is who we are." Sustainability is interwoven with the brand’s identity, but it can look like greenwashing without hard facts underscoring the practice.

No posture is "right". Each has a strength and a blind spot.

How can sustainability help brands be more resilient?

The most resilient brands blend all four elements. They translate internal integrity into external legitimacy, back symbolic commitments with proof and numbers, and align advocacy with operations. The result is a blend: credibility strengthens desirability, desirability justifies investment, and investment deepens operational excellence.

How does this play out in the real world? The researchers identified several best practices in the luxury industry:

• Zegna combines math and history. CEO Gildo Zegna cites hard data, such as 46% of raw materials being traceable, and links it to his grandfather's 1929 vision for Oasi Zegna.

• Ferrari anchors authority in integrity. It reduces internal carbon emissions while increasing production, and supports local energy communities that power both its factory and the municipality.

• Hermès turns internal functionality into legitimacy. Local French production and low-carbon artisanal models become part of a "pre-industrial" brand story, in the words of CEO Axel Dumas.

• Rolex frames sustainability as a "long-haul journey", matching the durability of its movements with the durability of the environment.

• H&M and Stella McCartney show collaboration at scale, combining high-end material innovation with fast-fashion reach.

What can managers do to make sustainability a key part of their brand’s story?

• Identify your center of gravity. Is sustainability mainly changing how you operate, or how you contribute?

• Pair proof with meaning. Back every story with evidence, and give every metric a narrative.

• Think structure, not campaign. The next step is not a new communication campaign or a longer ESG report. It means redesigning supply chains, retraining creative teams, rethinking sourcing and defining success over the long term.

• Build a cohesive narrative across operations, advocacy and brand identity.

Luxury has always thrived by turning cultural shifts into cultural leadership. Sustainability is the next chapter in that tradition. Brands that treat it as the foundation of resilience, not a compliance exercise, will turn it into their future competitive advantage.

About the authors:

Ashok Som is Professor of Management at ESSEC Business School and author of The Road to Luxury. Hannes Gurzki is Senior Research Fellow at the Technical University of Braunschweig and external lecturer at ESSEC. Patricia Tawk is a data and analytics specialist with a Master's in Digital Transformation from ESSEC.

References

Kapferer, J.-N., & Michaut-Denizeau, A. (2017). Is luxury compatible with sustainability? Advances in Luxury Brand Management.

Som, A., Gurzki, H., & Tawk, P. (2026). Building business resilience: How luxury can reclaim sustainability’s meaning. California Management Review Insights.https://cmr.berkeley.edu

Suchman, M. C. (1995). Managing legitimacy: Strategic and institutional approaches. Academy of Management Review, 20(3), 571–610.https://doi.org/10.5465/amr.1995.9508082211