In August, 32 fashion businesses signed the G7 Fashion Pact to reduce the industry's environmental impact. A sustainability coalition with representation from luxury brands and high street retailers, the Fashion Pact outlines commitments at both group and individual level to meet science-based targets in three key areas: climate change, biodiversity, and the protection of the oceans.
Significant among the joint initiatives outlined in the document is the requirement to work towards greater transparency and accountability in the supply chain, including the traceability of materials and impacts. This comes at a time when the eyes of the world are focused on the rapid deforestation of the Amazon, and cattle ranching for beef - of which leather is a key by-product for the fashion industry - has been a contributing factor in the now record levels of forest clearance. This brings with it the risk that the supply chains of fashion brands could be linked back to and tainted by association with the devastating environmental consequences of the deforestation.
The outcry - from media, NGOs, and consumers - in response to recent coverage, and the ensuing focus on sourcing practices is a timely reminder of why an intimate knowledge of supply chains is no longer a nice-to-have for fashion brands, but an essential part of doing business. It also underlines why greater transparency is the first of the joint initiatives listed by the G7 Fashion Pact - everything else stems from this. Without traceability, a business cannot begin to address sustainability in a meaningful way. If you don't understand your supply chain, if you don't know where the impacts are from your products, how can you make informed decisions or take action in a targeted way?
Supply chain traceability is not a new concept, but it is one that has grown steadily in importance over the last decade across all industries, not just fashion. However, the complexity of fashion's supply chains, and the array of sustainability challenges facing the industry, means that getting to grips with every step along the way for every product is no easy task.
The softlines and leather division of Eurofins is in a unique position to help thanks to its network of laboratories around the world and a service offer that includes a supply chain mapping service.
Peter Hughes, sustainability lead at Eurofins | BLC, which manages Eurofins' global supply chain mapping service, describes traceability as a combination of risk management, good commercial sense, and being informed, all of which put brands in a position of strength, not only to take positive action but also to respond confidently to questions, whether these come from consumers via social media or from third party investigations. Social media offers brands a huge opportunity to engage with consumers, but it carries commensurate risks. 'If a brand says something on social media that is not true, it can do even greater damage.'
It's not just about brand image, however, or a consumer-driven imperative to address the social and environmental impacts of the fashion industry. Peter argues that traceability is underpinned by strong commercial arguments. 'Businesses are increasingly recognising that sustainability is important, regardless of what the consumer thinks. Vertically-integrated supply chains can deliver efficiencies. Through a better understanding of the supply chain - and in some cases by reducing its size - organisations can achieve better buying percentages and by doing so not only realise better prices but also influence quality, ethical, and environmental issues. If you go from being a 10% to a 35% purchaser, that supplier has a greater incentive to listen to and adhere to your requirements.'
The growing awareness of the need for traceability is also making its way up the supply chain, thanks in part to the power of big brands. One of the historical challenges for the fashion industry was that supply chains weren't transparent. Who manufacturers purchased from was considered commercially sensitive information. That is changing. 'Disclosure of this information is now common, and manufacturers are recognising that adherence to traceability is an effective means of compliance and increasing market share,' says Peter. 'Prominent brands know that they have the power to demand it, and they are using it.'
But how to achieve traceability when modern supply chains can stretch around the world and take in multiple actors? Supply chain mapping, part of the Eurofins global portfolio, offers three key advantages to fashion businesses: greater insight into their supply chains, a clear output on sustainability, and a way to manage risk.
A three-part service, it begins with the generation of supply chain data through a consultative process with the client that aims to establish and then build on their existing understanding of their supply chain. 'We generate the data through targeted questions that can identify risks further up the supply chain that they may not be aware of,' explains Peter. 'The process generates data that is additional to what they already have. We then verify this data and use mapping software to produce a geographical map of the supply chain, which we can use for risk assessment and management. Once a brand has a good understanding of their materials supply chain, we can overlay the issues and identify the risk hotspots and the areas to focus on first.'
The current focus on Amazon deforestation is an example of a story, like the Rana Plaza collapse of 2013, that can focus consumer attention on what goes on behind the scenes in the fashion industry. Businesses that want to manage risk effectively know that they need to be ahead of these stories, and that the only way to do that is to know the route that products take on their way to the shelves. Because, in an increasingly connected world, where news is instant and information available to anyone with Internet access, there is nowhere to hide, and no excuse for not knowing. Sustainability is today's buzzword, but it starts with traceability.