Investing in data and transparency in anticipation of disclosure demands will give brands and retailers greater visibility into their supply chains, so they will be better positioned to weather the changing regulatory landscape.
Fashion is being tested as new transparency requirements go into effect, marking the start of a new wave of sustainability regulation.
On January 1, 2023, a French law went into effect that made it mandatory for brands and retailers to give consumers detailed information about the environmental characteristics of their products via a label detailing precise climate impact — including the country where the weaving and confectioning have been conducted, what was used to color the garment, and how far it traveled must now be presented to consumers. In addition to information disclosure obligations, the law prohibits the use of the claim “biodegradable,” “environmentally friendly” or any other similar claim for new products. This law could be seen as a preview of what’s to come in Europe and the US, as the mood around access to data is reflective of both developments in the regulatory landscape and the broader shift in consumer sentiment towards greater transparency.
Access to verified data leads to greater efficiencies, which is needed to help unravel fashion’s opaque supply chain. One of the ways brands and retailers are addressing data needs is through partnerships or membership in sustainability programs that can help drive visibility. And as regulation expands and interest grows in regenerative agriculture practices, more brands are looking to receive information about their tier 3 suppliers.
One such sustainability program is the U.S. Cotton Trust Protocol, which delivers quantifiable, verifiable goals and measurements to the key sustainability metrics of US cotton production to its 1000+ members across the fashion supply chain. It is the only system that provides measurable, verified data on land use, soil carbon, water management, soil loss, greenhouse gas emissions, and energy efficiency; and the world’s first sustainable cotton fiber program to offer article-level supply chain transparency to all its members.
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In November 2022, the Trust Protocol published its annual report that highlighted aggregate farm-level data received from 624 growers across 17 cotton-growing states on more than 1.1 million acres. The program saw improvements across all six key sustainability metrics it measures — fueled by agriculture innovations and technology. In 2021/22, 89 percent of Trust Protocol growers utilized precision ag technologies including GPS receivers, multi-spectral images and ground-based sensors — which gather field-specific parameters including soil conditions, nutrients and water availability. They assess the data to deploy site-specific crop management practices to maximize yields and minimize crop inputs. Real-time weather radar allows growers to avoid activities affected by storms, such as run-off from nutrient and herbicide applications. Yield maps show how areas within fields may need different management.
The 2021/22 Trust Protocol aggregate data showed a 13 percent increase in yield and land use efficiency, a 14 percent increase in irrigated water efficiency, a 25 percent reduction in energy use, and a 21 percent reduction of GHG emissions.
Implementing regenerative practices positively influences the entire bio sequestration and the storing of carbon, which is directly helping to reduce greenhouse gas emissions while fostering biodiversity. Soil health and soil carbon are high priorities as healthy soils aid in retaining more water, carbon storage and crop productivity. In 2021/22, Trust Protocol growers reported a 78 percent reduction of soil loss, while 70 percent reported a positive soil-conditioning index.
Brand and retail members gain access to US-grown cotton with sustainability credentials proven via Field to Market: The Alliance for Sustainable Agriculture, measured via the Fieldprint Calculator, and verified with Control Union Certifications. Members also experience full supply chain transparency through the Protocol Consumption Management Solution — which utilizes blockchain technology to record and verify the movement of US cotton fiber along the supply chain, beginning at the gin.
What lies ahead for the fashion industry
Planned regulations in the EU include requirements to make products more durable, reduce their environmental footprint and to provide more transparency for consumers about items’ impact on the climate. The proposed New York Fashion Act combines due diligence and transparency requirements which, if passed, could impose penalties for brands and retailers up to 2 percent of their global revenue.
Making strategic partnerships and investing in data and transparency in anticipation of disclosure demands will help brands and retailers have greater visibility into their supply chains, so that they will be better positioned to weather the changing regulatory landscape.