Background: The clothing industry is a significant contributor to Earth’s pollution, depletion, and exploitation. Businesses need to become sustainable, to find long-lasting solutions where economic, social, and environmental value is created. This has birthed a new form of leadership, sustainable leadership, that puts ethical behavior and the common good above the untrammeled pursuit of profit. Business leaders must transform the way they do business, which requires changes in leadership.

Purpose: The purpose of this study is to, from a leadership perspective, describe and create an understanding of how Swedish fashion brands are changing their business to become sustainable and remain competitive, and of sustainable leadership. Specifically, by exploring how business leaders work with sustainability and the challenges they face.

Method: This study follows a qualitative research method and an abductive approach. Semi-structured interviews were conducted with CEOs and sustainability managers. Secondary data was gathered from sustainability reports.

Findings: The organizations have made changes to their business models. Business leaders face several challenges, such as issues of maintaining quality, consumer behavior discrepancy, lack of control over suppliers, and insufficient technology. Leaders were found to show practices of sustainable leadership to remain competitive and sustainable.

Conclusion: This study concludes that organizations take different strategical approaches to remain sustainable and competitive. Business models Leaders must create long-lasting stakeholder relationships, a supportive company culture, set clear goals, and develop employees to be successful in sustainability work. New developments in recycling technology and increased consumer awareness are called for to further drive an increased sustainable development in the industry.