“When I ask our Asian customers why they come all the way to Finland, sometimes three or four times a year, to buy from the Saga Furs auctions,” Asia Business Director, Samantha Vesala says, “the answer is always the same.”
“It’s not for the Finnish weather,” she laughs. “The reason they give is for the consistent quality of our products.”
For Charles Ross, Saga Furs Head of Sustainability, this quest for quality is inextricably linked to his company’s industry-leading commitment to sustainable sourcing.
“Quality for us has two definitions, Ross explains, “one is the quality of the pelt and the other is the quality of our supply chain.”
Buying sustainability adds value
Over the last decade, Saga Furs has worked together with Finnish farmer suppliers to develop a unique and comprehensive farm certification program, which Saga Furs has further developed with farmers abroad. This certification program is really starting to pay off now in terms of product price premiums.
“And this is excellent news for the farmers who participate,” Ross enthuses.
At the company’s most recent March 2018 auction, Saga Furs saw a premium of more than 5% on sales of its 100%-certified mink lots. “Now farmers can see a return on their investment, giving Saga a competitive advantage and our customers a value-add on our products.”
But is sustainability catching on in Asia?
“At certain levels of the Asian fashion industry yes!” says Vesala, particularly those businesses with international dealings.” In China for example, manufacturers at the high-end of fur production are already being required by their international brand customers to start reporting on manufacturing practices, auditing their suppliers, or just generally become more transparent.
McKinsey estimates that Chinese consumers will account for 40% of the global luxury goods market by 2025. It is also worth noting that the vast majority of all fur products purchased globally each year is shipped to Asia.
According to the Jing Daily in a report in October, 2017, Kering group, parent to a number of Asian favourite luxury brands, puts sustainability as a business imperative for its global luxury goods market. The group is actively targeting consumer education on sustainability. This includes launching a tool on its WeChat to measure the environmental impact of products.
“The Chinese government has set the direction for this,” Vesala affirms, “with increasingly stringent environmental legislation.” She cites one recent policy reform related to farm proximity to waterways, which has led some fur farms and fur dressing factories to either shut down their operations or relocate their premises in order to comply.
The Asian market is very important to Saga Furs, which was the first international auction house to establish an office in China already 30 years ago. As the only listed company in the industry, transparency is key to Saga Furs’ sustainability program, which is why a Chinese language version of the annual sustainability report has just been published.
Saga sustainability through education
This attention to transparency is continued through the company’s education programs, including Saga Furs’ work with young fashion designers.
“The cornerstone of Saga Furs’ sustainability program is in our work with design students, where sustainability issues stay front and centre,” says Rebecca Reinkilde, Communications Manager at the Saga Furs Design Centre in Denmark. Last year alone, 24 of a total 97 visitors to the Design Centre (close to 25%) were from Asia.
Reinkilde, herself a Chinese national based in Copenhagen, says all visitors to the Design Centre receive a briefing on sustainability as a mandatory part of the program.
“Asian design students are always happy to hear the Saga Furs story of sustainability, she says. “More and more, they want to know where the products come from, how the animals were treated, and that the environment was taken care of.”
In China, Saga Furs has just launched a new education platform for its sustainability storytelling, becoming a lead partner in a new multi-sector initiative called BIFTPARK-HN. Samantha Vesala, who officiated at the launch, says: “The new partnership is already on its way to being Asia’s top fur training and education academy.”
Still, Vesala concludes that while sustainability as a business topic is gaining strength in the Asian fashion industry, it’s still not at the level of Europe or the US. And with regards Saga Furs Asian customers coming to the auctions in Finland, Vesala says:
“While I definitely wouldn’t say their purchasing decisions are governed by sustainability issues, I do think we’re starting to see at least a recognition from our Asian customers that Saga certification means both high-quality suppliers and high-quality products, and that more and more the two will need to go together.”