Kristen Fanarakis is the founder and creative director of Senza Tempo, a classically inspired, sustainably-minded, luxury brand for women made entirely in downtown Los Angeles. It’s a collection of timeless, no-nonsense wardrobe essentials for busy women driven by a philosophy to create clothing of value rather than volume.
She spent over a decade working on Wall Street on the foreign exchange trading desk in NYC and investment management in Boston prior to launching Senza Tempo. She also is the author of the novel, The Debutante’s Guide to Wall Street. Kristen was able to give us some insights on her love and passion for sustainability and ESG.
- Can you tell me a little bit about your background and what you do?
I am currently the founder of the Los Angeles made sustainably minded, luxury clothing line, Senza Tempo, and a senior consultant at the Center for Financial Policy at the Robert H. Smith School of Business.
Prior to my current positions, I spent over a decade working in foreign exchange investment management and sales-trading in both Boston and New York City. My undergraduate degree is in Economics and Political Science from the University of North Carolina at Chapel Hill, I have an MS in International Economics and I also have my MBA from UNC-CH’s Kenan-Flagler School of Business.
- What drove your passion for sustainability and ESG?
It started as simply an observation and frustration with fashion in that it was harder and harder to find good quality, classic items that could last for many years. That was what planted the seed for Senza Tempo — I was simply trying to solve a problem I saw in the market.
In the midst of my research, the Rana Plaza in Bangladesh collapsed, which led me to really dig into sustainability in the fashion industry, and what I discovered is truly horrific. This was back in 2013, before the idea of sustainable fashion was mainstream or trendy as it seems to be now.
What I ultimately realized was that sustainability and the other factors that go into an ESG analysis work in tandem.
I realized in my research that too many companies in and outside of fashion are quite hypocritical when it comes to ESG. It’s about marketing, not values and much of what goes into ESG is about values.
- What do you see as driving factors to make ESG/sustainability more mainstream as time progresses?
I think it will be investors that will ultimately be the major drivers of change.
Consumers are “forgetful” or more often simply say they want companies to behave more responsibly, but their spending habits don’t line up with their purported values. You see this in fashion with millennials. They are the biggest consumers of fast fashion, which is the dirtiest part of the fashion industry from an environmental or labor abuse perspective.
What you are starting to see in the investment industry is more rigorous analysis of these factors — professional investors with benchmarks and models who track these details daily are going to be harder to fool.
- Out of the E, S, and G factors, which ones do you find the most interest in?
I tend to focus on the environmental and governance factors, because I think if you are focused on those factors, you’ll naturally have a better social outcome. And I believe that many of the social efforts are simply marketing efforts — the best social good we can do for people is give them jobs and pay them (at least) living wages.
By focusing on domestic manufacturing and using as many smaller/regional suppliers as possible, it shortens my supply chain which naturally lowers my carbon footprint. But it also means I can get to know my suppliers in a way that I can’t when they are half way across the world.
- What core problems do you see in the ESG/sustainability space at the moment?
The lack of standardization and data is the biggest hurdle for consumers, investors and regulators. As a consumer, we don’t have an “organic” equivalent in the sustainability space. It means something different to each person, company and industry. That lack of transparency and information makes progress harder than it should be.
- Where do you see the ESG/sustainability space going in the next 5 years?
I think we’re going to continue to see different types of benchmarking to help with the transparency issue, to start to agree on some common definitions of what it means to be sustainable or socially responsible, and get standardization in terms of data provision. The increased focus on ESG factors from investors and regulators will force this change because they need to be able to compare companies. Right now so much time is spent trying to compare apples to oranges, that complication needs to go away or be minimized in order to make meaningful progress.
Hydrus wanted to give Kristen a huge thanks for taking the time to speak to us about ESG. If you are interested in her fashion line or on hearing more from Kristen about sustainability, check out her website Senza Tempo Fashion.