Global fashion brands' transparency score rises only 2%

In another important milestone, a luxury brand is among the top scoring brands for the first time. Italian luxury fashion house Gucci ranked second out of 250 brands, with an overall average score of 80 per cent. After years of the luxury fashion sector dragging its feet on transparency, the five biggest movers this year are all luxury brands (Gucci, Armani, Jil Sander, Miu Miu, and Prada), with the biggest increase being Gucci by 21 percentage points. This demonstrates that big strides in transparency are achievable if there is the will, according to the Fashion Transparency Index by Fashion Revolution.

Liv Simpliciano, Fashion Revolution’s policy and research manager, said: “As activists, it is maddening to have to continually push for what ultimately is the bare minimum of what we should expect from major fashion brands. The unimpressive progress here is worrisome in the face of deepening social inequality, environmental destruction, and various incoming legislations. We are pleased that a minority of brands are finally scoring 80 per cent or higher but even 100 per cent transparency is only the starting point and it seems many major fashion brands have yet to even show up to the race. Time is running out and yet the majority of the fashion industry continues to dig their heels in and refuse to change. We cannot shop our way out of the climate crisis, we cannot recycle our way out of overproduction and frankly, there is no fashion on a dead planet.”

The overwhelming majority or 99 per cent of major fashion brands do not disclose the number of workers in their supply chains being paid a living wage rate. Fashion Revolution, alongside allies, is campaigning for groundbreaking legislation at the European Union (EU) level on living wages for garment workers worldwide. Hundreds of thousands of EU citizens have already signed, but 1 million signatures in total are needed from EU citizens before July 19, 2023, for the EU to take action.

The climate crisis is growing in intensity and urgency but 94 per cent of major fashion brands still don't disclose what fuel is used in the manufacturing of their clothes. The need to transition away from coal entirely to cleaner forms of energy is urgent if the climate crisis is to be mitigated. A new indicator has been added this year to understand major brands’ reliance on coal. Despite this, few brands—6 per cent—disclose the proportion of their supply chain that is powered by coal and which geographic regions are still reliant on fossil fuels. Visibility of fossil fuel reliance in the supply chains is critical for brands to take adequate measures to support their suppliers in a green transition and advocate that governments of countries they source in increase accessibility to high-quality renewable energy like wind and solar.

Despite upcoming legislation to mitigate fashion waste, mounting evidence of overproduction remains the big elephant in the room as most major brands do not disclose their annual production volumes nor do they commit to reducing the number of new items they produce. Inspite of the indisputable fact that clothing waste reaches all facets of life, from microplastic particles in the Mariana Trench to piles of discarded clothes visible from space, 88 per cent of brands still do not disclose their annual production volumes. This is a disappointing increase from last year’s 85 per cent. Brands absolutely know how much they are producing; what business can survive without this information? The continued lack of transparency begs the question, what’s being hidden?

Clothes are produced by guzzling water in regions where it is scarce and by using thousands of toxic chemicals. Yet only 23 per cent of major brands and retailers disclose their methodology to identify these risks. Given the worldwide impacts of hazardous chemicals on people and the planet, it is concerning that only 7 per cent of major brands and retailers publish their supplier wastewater test results. Brands must trace their entire supply chain to address long-lasting social and environmental impacts of water pollution on garment workers, local communities, and the surrounding natural environments.

Major fashion brands continue to shirk responsibilities like tax and purchasing practices driving inequalities within the industry, while only 18 per cent of major brands disclose the percentage of executive bonus or pay tied to sustainability targets. With less than half or 45 per cent of major fashion brands publishing their responsible tax strategy, it is crucial for governments to implement a tax system to address current loopholes and ensure that multinational companies pay their share. Additionally, fashion brands are increasingly adopting direct-to-consumer (D2C) on-demand models in the way they order their clothes, typically placing very small order quantities with suppliers upfront. Purchasing in this volatile, unpredictable way places suppliers under risk and workers under immense pressure. D2C models also help fashion brands avoid tax and evade forced labour regulations.

Few major fashion brands have published commitments to zero deforestation despite accelerating biodiversity loss globally. Materials used to make clothes such as cotton, viscose, and leather are associated with deforestation. Brazil, for example, the second largest global cotton exporter is now reaching record-levels of deforestation and hundreds of fashion brands have supply-chain links to Brazilian leather exporters, despite some of them having explicit policies about deforestation. Given the fashion industry’s role in contributing to global deforestation, it is alarming to see the absence of transparency on targets. Just 12 per cent of brands published a time-bound, measurable commitment to zero deforestation this year. This is 3 per cent less than last year. In addition, only 7 per cent publish measurable progress towards achieving zero deforestation.

With due diligence legislation on the horizon, led by the EU, fashion brands have increased disclosure on their social and environmental due diligence. Performance on every human rights and environmental due diligence indicator has increased compared to last year. In human rights due diligence, the most significant increases have been in disclosing how brands consult affected stakeholders (37 per cent up from 26 per cent last year). In environmental due diligence, the biggest increase was observed in disclosure of the salient environmental risks, impacts, and violations identified (37 per cent, up from 26 per cent in 2022). Upcoming legislation on due diligence, within the EU, which is the largest importer of clothes in the world has contributed to this uplift, as have similar efforts in Japan, Germany, the US, and more.

In seven consecutive years of publishing this Index, for the first time in 2023, two brands scored 80 per cent or higher. Italian brand OVS scored highest again this year with 83 per cent, followed by Gucci at 80 per cent and then Kmart Australia and Target Australia at 76 per cent. OVS has increased its score by 5 percentage points since last year, Gucci by 21 percentage points and Kmart and Target Australia’s scores are lower by two percentage points.

Alongside record highs this year, 18 major brands score a 0 per cent rating, up from 15 brands last year. All in all, 71 out of 250 brands or 28 per cent score in the 0-10 per cent range. This is a slight improvement from 31 per cent last year.

Fibre2Fashion News Desk (NB)