There is cotton duck, such as what
Carradice use for their bags, and it can be re-proofed with wax. Cotton in itself isn't particularly environmentally friendly, but as Bacciagalup pointed out, neither is most of the competition.
Jesper, what kind of environmentally friendliness are you looking for? An Ortlieb PVC bag can be argued to be environmentally friendly in the sense that it's very durable and doesn't need to be replaced every 5 years or so.
--J