Why Swiss Watches Need to Become “Greener”

Watch parts waiting to be sorted, crushed and recycled. swissinfo.ch/Céline Stegmüller

Even though it claims to sell watches designed for “eternity”, the Swiss watch industry still has a long way to go to improve the transparency and traceability of its products. SWI swissinfo.ch spoke to Robert Schacherbauer, an economics graduate, who argues that sustainability should become a key part of the Swiss Made label.

This content was published on September 1, 2022 – 09:00

Robert Schacherbauer, a twenty-two-year-old economics student at Zeppelin University in Germany, devoted his bachelor’s thesis to sustainability in the Swiss watch industry. His research spanned over 8 months during which he met many industry experts and insiders, including several trips to Switzerland.

One of its main conclusions was the lack of reflection of Swiss watchmakers on sustainability. He argues that the industry is only at the beginning of a great metamorphosis that will redefine its value proposition and what quality really means.

Robert Schacherbauer is a German student interested in sustainability issues in the luxury and design sectors Copyright 2021 Nicolas Buehringer [email protected]

SWI swissinfo.ch: Luxury watches are made to last. Why should Swiss watchmakers care about sustainability?

Robert Schacherbauer: Indeed, there are factors that make a luxury wristwatch inherently sustainable: it is not powered by fossil fuels, built to survive generations, and derives its energy from a turn of the crown of the watch or a movement of the wrist. Nevertheless, we have to ask ourselves if he is doing enough. The industry embraces an avant-garde aesthetic by fusing precious metals and gemstones with centuries-old techniques to create luxury timepieces tied to centuries-old horological history.

The concrete environmental footprint of their production is still unknown and the industry lacks transparency and traceability of its raw materials. Consumer demands and the pressure of climate change are an opportunity to rethink the industry status quo.

SWI: Why don’t big brands put more emphasis on the topic of climate change and environmental protection in their marketing?

RS: The luxury watch industry is built around the promise of international travel, exclusive sports and hedonistic values. Protecting the environment and sourcing from recycled products is – to put it simply – not fashionable.

Beyond that, the industry is slowly shifting its corporate strategy towards greater sustainability. The same applies to how they communicate on the subject. Their communication strategy is still in its infancy. This is also one of the downsides of the luxury industry: it can be seen as slow to adapt to trends while relying on old success factors. I personally see the future of luxury in the reconciliation of luxury and sustainability; a redefinition of luxury and heritage.

Forecasts indicate that by 2025, Millennials and Gen Z will account for 70% of the global personal luxury market. With their appearance on the agenda, the industry needs to rethink its value proposition and the sustainability of its products.

SWI: At the end of 2018, the World Wide Fund for Nature (WWF) published a devastating report for the industry stating that “most companies do not seem to care about the environment and are not transparent”. Have things changed since?

RS: Things have definitely changed over the past four years, but I can’t say if that’s a consequence of the devastating report. Circumstances and especially the awareness of watchmakers and consumers have changed considerably. Recently, some brands have made greater efforts to incorporate environmental sustainability into their products, but it remains difficult to change well-oiled industrial circuits.

SWI: In which areas should the Swiss watch industry make the most efforts in this regard?

RS: The most critical issues are responsible sourcing of raw materials – especially precious metals – and supply chain transparency. Efforts in this area are crucial because many manufacturers are still unable – or unwilling – to communicate on this subject. Many do not trace the origin of their raw materials and blindly trust their suppliers to operate according to the brand’s sustainability principles.

In general, the industry lacks transparency. It often operates in secrecy and seeks to preserve its competitive advantage by not disclosing its suppliers and partnerships.

SWI: According to a Deloitte study on the Swiss watch industry published in 2021, 72% of brands invest in sustainable solutions to reduce their carbon footprint and meet consumer demands. Is there also an important part of greenwashing in these different initiatives?

RS: Greenwashing is definitely an issue – as it is in many industries right now. In the watch industry, it often appears unconsciously. Brands lack relevant awareness of the impact of their initiatives. This can also be seen in the impossible assessment of the environmental impact of a mechanical wristwatch.

Currently, most initiatives focus on making wristbands from recycled materials. The idea of ​​recycling waste is good in principle but if the environmental cost of recycling is higher than producing a canvas strap, the brand should consider whether it benefits the intention.

SWI: Many start-ups offer innovative products and processes to reduce the environmental impact of their products. Can they serve as catalysts for the rest of the industry?

RS: The ecosystem of start-ups in the Swiss watch industry is booming. New watchmakers are explicitly embracing the circular economy and consciously developing their value proposition around sustainability. But they have yet to demonstrate that consciously building that value proposition pays off in the long run, both in terms of competitive advantage and business scale. Their first products show that the orientation towards sustainable production has positive effects on reducing costs and increasing efficiency. This promotes the future viability of brands.

SWI: In conclusion of your research, you propose an adaptation of the Swiss Made label, which would include the notion of sustainability. Why?

RS: About 95% of all luxury watches are stamped Swiss Made.
Today, the time display function has been replaced by the smartphone, which means that the technical quality convention is no longer essential. Today, the Swiss Made label is mainly intended for consumer perception. There is an opportunity for the industry to redefine the notion of label and enrich it with sustainability criteria. Integrating sustainability requirements from a governmental perspective solves the current lack of policies regarding value creation and the origin of materials.

SWI: What could that mean concretely?

Here are already some proposals on how sustainability could be integrated into the Swiss Made label: instead of requiring that 60% of the added value be made in Switzerland, production should be limited to Central Europe, for example to support relocation and limit the consumption and waste of resources.

The origin and extraction process of raw materials must be traceable, and transparency must be a requirement throughout the value chain. Other options include regulatory requirements for carbon-free production, such as using energy from solar panels and recycling heat, a by-product of manufacturing.

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About Robert L. Thomas

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