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Supply Chain
Fashion Transparency Index Reveals Even Top Brands Lagging in Supply Chain Transparency

Four years after the collapse of the Rana Plaza garment factory in which 1,134 people were killed, Fashion Revolution has released its 2017 Fashion Transparency Index, which ranks 100 of the biggest fashion companies on their social and environmental policies, practices and impacts.

Four years after the collapse of the Rana Plaza garment factory in which 1,134 people were killed, Fashion Revolution has released its 2017 Fashion Transparency Index, which ranks 100 of the biggest fashion companies on their social and environmental policies, practices and impacts.

Transparent disclosures make it easier for brands, suppliers and workers and key stakeholders to find the source of human rights and environmental abuses and address them. And despite growing demand from consumers for greater transparency and accountability, many companies still lag behind when it comes to disclosing information about their impact on the environment and the workers in their supply chains.

This year’s Index reveals that the industry has a long way to go towards being transparent — including top-ranking brands. On average, brands achieved scores of 49 out of 250, with none of the companies on the list scoring above 50 percent.

Brands were awarded points based on their level of transparency across 5 categories, including: policy & commitments, governance, traceability, supplier assessment and remediation and spotlight issues which looks at living wages, collective bargaining and business model innovation. Brands were selected to represent a cross-section of market segments including high street, luxury, sportswear, accessories, footwear and denim sectors.

Adidas and Reebok — both of whom released new footwear utilizing groundbreaking technology and plant-based materials earlier this month — achieved the highest score of 121.5 out of 250, followed by Marks & Spencer with 120 points and H&M with 119.5 points. In total, only eight brands scored higher than 40 percent. A further nine brands scored 4 percent or less out of 250 possible points, of which Dior, Heilan Home and s.Oliver scored 0 because they disclose nothing at all.

Out of the premium and luxury brands reviewed for the report, nine scored between 21-30 percent of the total possible points, which was higher than the average. The remaining 10 scored 15 percent or less.

The report noted that 31 brands are now publishing supplier lists — up from last year’s five — including ASOS, Benetton, C&A, Esprit, Gap, Marks & Spencer, Uniqlo and VF Corporation brands since April 2016. This year also sees 14 brands disclosing information about their processing facilities where their clothes are dyed, laundered, printed or treated. However, no brand is publishing its raw material suppliers. Banana Republic, Gap and Old Navy scored highest on traceability (44 percent) because their supplier list includes detailed information such as types of products or services and approximate number of workers in each supplier facility.

Information regarding living wages, collective bargaining and reducing resource consumption was absent for most brands on the list, indicating a need for companies to take a hard look at their own business models and purchasing practices. To date, only 34 brands included in the Transparency Index have made public commitments to paying living wages to workers in the supply chain and only four — H&M, Marks & Spencer, New Look and Puma — are reporting on progress towards achieving this aim. This demonstrates that much more needs to be done and faster by brands to ensure that workers are fairly paid.

“People have the right to know that their money is not supporting exploitation, human rights abuses and environmental destruction,” said Carry Somers, Co-Founder of Fashion Revolution. “There is no way to hold companies and governments to account if we can’t see what is truly happening behind the scenes. This is why transparency is so essential.”

“Through publishing this research, we hope brands will be pushed in a more positive direction towards a fundamental shift in the way the system works, beginning with being more transparent.”

In addition to rating brands’ transparency performance, the report provides recommendations for how consumers, brands and retailers, governments and policy makers, NGOs, unions and workers can use the information contained in the Transparency Index to drive change.

“The time has come for brands and retailers to make their entire supply chains transparent. The time has also come to establish sourcing practices that are conducive to the human development and empowerment of the workers who work so hard every day to make the clothes we wear,” said Dr. Mark Anner, Director of the Center for Global Workers’ Rights at Penn State University.

The recent wage strikes in Bangladesh and the government crackdown that followed have helped call attention to the issue of worker safety and well-being in the garment sector, and driving investors alike into action. A coalition of global investors representing over $4.3 trillion today released a statement highlighting the success of the Bangladesh Accord on Fire and Building Safety — a legally binding framework for factory inspections to identify and remediate fire, electrical and structural issues — which they believe symbolizes what can be accomplished when brands use their collective leverage to resolve supply chain concerns.

With one year left in its mandate, the investors believe more needs to be accomplished, but significant progress has been made, proving the effectiveness of the Accord model and fundamentally changing how apparel brands and retailers view their relationship to, and responsibility for, workers in their extended supply chains.

“There is a pressing need for all stakeholders — including companies and governments — to support alternate opportunities for child tannery workers, to ensure promised job protections, housing and healthcare facilities for adult workers at the new leather industry hub, to improve health and safety conditions in the new factories and to accelerate the completion of the Savar central effluent treatment plant to prevent further harm to the environment,” said David Schilling, senior program director for Human Rights at the Interfaith Center on Corporate Responsibility (ICCR).

“This is precisely the type of crisis that would benefit from a collaborative initiative based on the Accord model. We are heartened to see what can be done when corporations take collective action to correct supply chain problems. The lives and livelihoods of workers, their families and communities are at stake.”