The US Environmental Protection Agency (EPA)’s latest deregulatory moves could have far-reaching consequences for the fashion industry, particularly for companies committed to ambitious sustainability targets. With sweeping rollbacks across emissions, air quality and water pollution regulations, the changes could ease short-term compliance costs for some apparel businesses — but at what long-term price?
The EPA sets the regulatory framework for sustainability in US manufacturing, enforcing policies that curb pollution, manage resource consumption, oversee industrial waste, regulate chemical usage and push industries towards more responsible practices. Manufacturers must comply with EPA standards to ensure their operations do not harm public health or the environment.
Now, under the Trump administration, the EPA is facing mass layoffs, policy rollbacks and a more existential repositioning to focus on making energy cheaper. Among the most pressing concerns is the reconsideration of greenhouse gas reporting requirements, which could weaken oversight of emissions from textile mills and apparel factories. The loosening of mercury and air toxin standards for coal-fired power plants raises further red flags, as many fashion supply chains still rely on energy from these sources.
Meanwhile, proposed changes to air quality standards and regional haze regulations could exacerbate pollution in key textile-production hubs, raising ethical and reputational concerns for brands sourcing from these regions. Water pollution regulations are also under review, with potential impacts on the highly water-intensive dyeing and finishing processes central to fashion production. If restrictions on industrial wastewater disposal are lifted, the risk of harmful run-off into local water supplies could rise, adding another layer of environmental scrutiny.
“EPA deregulations could not only lead to increased pollution and harm ecosystems but also discourage companies from innovating new technologies for more sustainable production,” says Dr Sheng Lu, director of the department of fashion and apparel studies at the University of Delaware. Many US-based textile companies have invested in cleaner dyeing technologies — waterless dyeing, digital printing and bio-based dyes among them — largely in response to strict environmental oversight, he adds. Loosening regulations could stall that progress, just as consumer and investor demand for transparency and greener supply chains is reaching new heights.
As consumers demand greater visibility, brands will need to decide whether short-term cost savings outweigh the reputational risks of appearing to sidestep environmental responsibility. For an industry already navigating shifting trade policies, rising tariffs and supply chain disruptions, the latest EPA rollbacks present yet another challenge. The question now is: will fashion brands stay the course on sustainability, or will deregulation tempt some to step back?
Rachel Van Metre Kibbe, founder and CEO of Circular Services Group (CSG) and American Circular Textiles (ACT), warns that stripping back regulations does little to address fashion’s core sustainability challenges. “Deregulation doesn’t fix the underlying issue; it just shifts the conversation away from what really matters,” she says.
Can market forces keep fashion accountable?
Rather than framing sustainability as a cost burden, Van Metre Kibbe argues for a more strategic approach. “The real challenge isn’t just whether we regulate more or less, but how we create a business environment where circularity, waste reduction and smarter material use drive profitability,” she explains.
The rollback of emissions reporting, air quality protections and wastewater regulations may remove immediate compliance costs for manufacturers, but it also risks discouraging long-term investment in cleaner, more efficient production. Without government enforcement, voluntary frameworks such as the Higg Index could become critical in holding fashion brands accountable.
The Higg Index, developed by Cascale (formerly the Sustainable Apparel Coalition), provides brands with a standardised approach to assessing social and environmental impact. By offering a holistic overview, the tool enables businesses to identify risks, reduce waste and implement more sustainable practices.
“By using standardised tools, companies can identify hotspots, improve sustainability performance, save time and money, and engage with value chain partners to scale systemic change across the industry,” says Colin Browne, CEO of Cascale.
US vs global standards
For US fashion brands, deregulation introduces another layer of complexity. “Right now, US businesses are held to some of the highest sustainability standards in the world, yet we don’t have the right economic structures to make domestic production competitive,” Van Metre Kibbe notes. The American Apparel and Footwear Association (AAFA) is also questioning how these regulatory shifts could affect brands working to align with EPA mandates handed down by the previous administration.
“Many brands have invested significant time and resources in preparing to comply with EPA’s requirement to report on historical uses of PFAS under the Toxic Substances Control Act,” says Chelsea Murtha, AAFA’s senior director of sustainability. “It remains unclear whether EPA will have the ability to take those reports as scheduled due to both budgeting and staffing concerns. However, most of the regulatory changes proposed by the Trump administration would exclusively apply to US manufacturing.”
They risk derailing fashion’s sustainability goals, deepening reliance on fossil fuels and disrupting global supply chains. Can global efforts and private sector resilience prevail?
With the European Union, among other major markets, enforcing strict environmental policies, American brands could find themselves out of step with global trade requirements — particularly as carbon border taxes and extended producer responsibility (EPR) schemes gain traction.
While deregulation may provide some relief for manufacturers, it could put US brands that source domestically at odds with global regulators and conscious consumers alike. The EU’s strict environmental standards and carbon border taxes mean that any perception of backtracking on sustainability could complicate trade relationships. The European Environment Agency (EEA) continues to play a key role in shaping the EU’s environmental policy landscape. While the EEA itself doesn’t enforce laws, its data and insights inform critical initiatives that will impact global fashion supply chains.
One major development is the Nature Restoration Law, which took effect in August 2024. It mandates EU countries to restore degraded ecosystems, setting ambitious targets for habitat recovery through 2050. Fashion brands sourcing natural materials like cotton, leather and wool will need to stay ahead of potential supply chain disruptions and stricter biodiversity regulations.
Meanwhile, the European Commission is pushing to simplify environmental regulations, aiming to cut red tape while maintaining sustainability goals. This could mean a more streamlined approach to compliance for brands operating in the EU, but also a shift in reporting expectations.
All of this ties back to the European Green Deal, the EU’s sweeping strategy to achieve climate neutrality by 2050. From carbon reduction targets to new waste management policies, fashion companies — especially those with European operations — will need to keep a close watch on how these evolving regulations shape manufacturing, sourcing and circularity initiatives.
Smarter economics
With fewer federal sustainability mandates in the US, the fashion industry may need to look beyond regulation to remain accountable. But shifting the burden solely onto brands without the right economic structures in place risks treating sustainability as a compliance cost rather than a competitive advantage.
“Right now, brands are stuck in a framework where sustainability feels like a compliance cost, not a competitive advantage,” Van Metre Kibbe says. “We need policies that make circularity economically smart, like tax incentives for resale and recycling, investment in domestic sorting and processing, and trade structures that level the playing field. Without this shift, we’re just debating the size of the stick rather than designing a better carrot.”
While US regulations fluctuate, global market pressures continue to push brands towards more sustainable models. “Whether or not the US has strong regulations today, the market is moving in this direction globally,” she adds. “Brands that embrace new business models — rental, resale, closed-loop production — will be the ones that aren’t just reacting to regulations, but actually shaping the future of fashion.”
Without strong federal mandates, the question remains: will market incentives and industry-led initiatives be enough to drive lasting change, or will deregulation slow the momentum just as circularity begins to gain traction?
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