Ethical Fashion Market Report 2026

The ethical fashion market size has grown strongly in recent years. It will grow from $9.38 billion in 2025 to $10.17 billion in 2026 at a compound annual growth rate (CAGR) of 8.4%. The growth in the historic period can be attributed to increased awareness of environmental impact of fashion, growth of conscious consumerism, expansion of ethical clothing startups, rising influence of sustainability certifications, adoption of fair labor standards.

The ethical fashion market size is expected to see strong growth in the next few years. It will grow to $14.03 billion in 2030 at a compound annual growth rate (CAGR) of 8.4%. The growth in the forecast period can be attributed to increasing demand for traceable fashion products, expansion of circular fashion models, rising investment in sustainable textiles, growing popularity of ethical luxury brands, increased digital engagement with responsible fashion. Major trends in the forecast period include growing demand for eco-friendly apparel, rising preference for transparent supply chains, expansion of fair-trade fashion brands, increasing adoption of recycled and organic materials, enhanced focus on ethical labor practices.

The expansion of the e-commerce sector is expected to drive the growth of the ethical fashion market going forward. E-commerce involves the electronic buying and selling of products and services through online platforms or over the internet. Online retail platforms make ethical fashion brands more accessible to consumers worldwide and offer a convenient shopping experience from product discovery to checkout, simplifying the purchase of ethically produced clothing and accessories. For example, according to the United States Census Bureau, a US-based government agency, e-commerce sales accounted for 15.4% of total retail sales in the United States in the second quarter of 2023. On a non-adjusted basis, US retail e-commerce sales reached $269.5 billion during this period, reflecting a 6.6% increase compared with the first quarter of 2023. Thus, the growth of e-commerce is contributing significantly to the expansion of the ethical fashion market.

Leading companies operating in the ethical fashion market are increasingly forming strategic partnerships to better meet customer expectations and strengthen sustainability efforts. Such collaborations help ethical fashion brands promote environmentally responsible practices, reduce the fashion industry’s ecological footprint, and establish higher standards for responsible and transparent supply chains. For instance, in June 2023, Sheep Inc., a UK-based ethical fashion brand, introduced the world’s first naturally carbon-negative T-shirt. The product is made from superfine merino wool, which offers year-round temperature regulation and features self-cleansing fibers that require less frequent washing compared with cotton. The company collaborated closely with suppliers and manufacturers to develop the T-shirt, which also includes an NFC-enabled tag to ensure complete transparency. This initiative supports sustainability goals and encourages reduced environmental impact within the fashion industry.

In June 2025, H & M Hennes & Mauritz AB, a Sweden-based global fashion and retail company, entered into a strategic sourcing partnership with Circulose AB focused on advancing circular textile solutions. Through this collaboration, both companies aim to accelerate the large-scale adoption of recycled textile fibers by incorporating Circulose pulp, produced from discarded textiles, into garment manufacturing. This partnership supports circular fashion practices, reduces dependence on virgin raw materials, and promotes sustainable sourcing across the apparel value chain. Circulose AB is a Sweden-based materials company specializing in the production of recycled pulp derived from textile waste for use in new clothing.

Major companies operating in the ethical fashion market are Eileen Fisher, Patagonia Inc., People Tree Ltd, Armed Angels, Thought Clothing, Mud Jeans, Organic Basics, Amour Vert, Kotn, Outerknown, MATE The Label, Whimsy and Row, Encircled, La Causa, Back Beat Co., Finisterre, Beaumont Organic, Bibico, Gudrun Sjoden, Lowie, Mayamiko, SOLEREBELS, Tonlé, Shekudo, Animaná, Ecologyst, Cariuma, Ninety Percent, Fair Indigo, Fair Trade Winds, HOPE Made in the World, Kotn, Hackwith Design House, No Nasties, Hemp Kari, Maati, NEEMIC, Maito.

Asia-Pacific was the largest region in the ethical fashion market in 2025. Western Europe was the second largest region in the global ethical fashion market share. The regions covered in the ethical fashion market report are Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the ethical fashion market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Taiwan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The ethical fashion market includes revenues earned by entities by organic, natural, biodegradable, recycled or repurposed fabrics. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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