Burberry is to stop burning unwanted clothes and bags in a "bonfire of the vanities" to prevent them from being sold cheaply and harming the brand.
The British fashion house is also dropping the use of real fur after anti-cruelty campaigns by animal welfare groups.
The company destroyed $56million of unsold clothes, bags and accessories in 2017, taking the value of burned items to more than $205million over the past five years. The practice is common among designer labels which do not want their brand to be devalued by products being discounted in unofficial outlets.
But after a customer backlash, Burberry announced yesterday that it will cease with immediate effect. The move is part of its five-year project to operate to higher ethical standards, which includes reducing waste.
The company, whose brand ambassadors have included actress and model Cara Delevingne and former Doctor Who Matt Smith, now says it will reuse, repair, donate or recycle all unsaleable products.
Greenpeace welcomed the move as a "much-needed sign of a change of mind in the fashion industry".
Kirsten Brodde, who leads Greenpeace's Detox My Fashion campaign, said: "Because fashion is a high-volume business with more than 100billion garments produced each year, consumers" closets are already overflowing with unworn clothes, creating an overstock problem for many companies.
"It's high time for the whole fashion industry to start dealing with overstock at its source – by slowing down production and rethinking the way it does business." Burberry is thought to be the first major company to publicly end the practice of destroying unwanted products. Chief executive Marco Gobbetti said he hoped others will follow suit.
He insisted: "Modern luxury means being socially and environmentally responsible. This belief is core to us at Burberry and key to our long-term success. We are committed to applying the same creativity to all parts of Burberry as we do to our products."
The company is a member of the Make Fashion Circular initiative, designed to encourage the collection and recycling of materials. It has also formed a partnership with sustainable luxury firm Elvis & Kresse, who will transform 120 tons of leather off-cuts into new products over the next five years.
Burberry has previously used fur from rabbits, foxes, mink and raccoons. However, these and Angora wool will be banned from future collections. There will be no real fur in Riccardo Tisci's debut collection for the brand later this month, and it will also phase out existing fur products.
The move was welcomed by Wendy Higgins, of Humane Society International UK, who said: 'We first met with Burberry almost a decade ago to urge the brand to drop fur, so we are delighted that this iconic British fashion giant is finally going fur-free.
"Most British consumers don't want anything to do with the cruelty of fur and so this is absolutely the right decision. Burberry's compassionate stance couldn't have come at a better time, sending a strong message to designers like Prada still using fur who are looking more and more isolated and outdated by the day."
She added: "Countless investigations have revealed appalling welfare issues on fur farms including obesity, deformed feet, diseased eyes and even missing limbs.
"Burberry is very wise to be ending its association with fur and it joins the ranks of an ever-increasing number of top designers like Gucci, Michael Kors, DKNY and Versace, who have also realised real fur has no future in fashion."