Inditex, the parent company of Zara, is backing a new fund targeting up to US$400 million to support the decarbonisation of textile, apparel and footwear supply chains in emerging markets. Launched by the International Finance Corporation (IFC), a member of the World Bank Group, and investment manager Social Investment Managers & Advisors (SIMA), the Decarbonisation of Textile, Apparel & Footwear Suppliers (D-TAFS) Fund will provide long-term financing directly to manufacturers and energy developers. Investments will support projects including renewable energy installations, machinery upgrades, water conservation and wastewater treatment. Inditex and IFC are the fund’s largest investors, committing up to US$50 million and US$60 million, respectively, alongside development finance institutions and other investors.
The initiative seeks to address a major barrier to supply chain decarbonisation: limited access to affordable capital, particularly for smaller manufacturers that face financial constraints in adopting cleaner technologies. Combining commercial and development capital, the fund will offer loans on preferential terms alongside technical assistance, targeting suppliers across Asia, the Middle East, North Africa and Latin America. The fund aims to raise US$225 million in its first funding round, with further fundraising planned to reach its US$400 million target. The initiative adds to broader industry efforts to mobilise capital for fashion’s climate transition, highlighting the growing importance of financing mechanisms that enable manufacturers to implement emissions-reduction measures at the factory level.
