For eight years, the Baptist World Aid Ethical Fashion Report has been driving improvement in the labour rights and environmental protection systems of Australian and New Zealand fashion companies.
The fashion industry is often synonymous with exploitation – both of people, and the planet. When companies lack sufficient systems to protect their workers and ecosystems, we know that injustices such as modern slavery, worker exploitation, and environmental degradation occur. But with more than 50 million garment workers employed globally—the majority of whom are women in low-to-middle income countries—the fashion industry can also be a major driver for good in developing nations. It can catalyse change through provision of jobs, growth, and export revenue. It has huge potential to bring people out of poverty and provide economic dignity to these millions of workers.
Fast fashion brands are the world’s largest employers of garment workers – both directly, through company owned factories, and indirectly through engagement of third-party garment suppliers. As a result, they can influence lasting change for the greatest number of people.
Every year when our Ethical Fashion Report grades are released, several commentators flag concern that Baptist World Aid is letting purveyors of fast fashion off the hook far too easily. So, let us take you through exactly how fast fashion brands can score an A.
First things first – what’s the issue with fast fashion?
Fast fashion is frequently criticised for contributing to a culture that demands cheaper clothing, in more styles, on a regular basis. These clothes are rotated through stores at breakneck speed, with turnaround now as condensed as weekly.
Consumers purchase four times the amount of clothing they were just two decades ago. With approximately 80 billion garments purchased annually around the globe, and one in four Aussies stating they’ve thrown away a garment after just one wear, this contributes to the eye-watering 800,000 tonnes of textiles rotting in landfill in Australia alone each year.
In many cases, fast fashion has been bad news for workers as well. The fixation on cheaper prices puts significant downward pressure on wages. The speed of changing trends puts enormous pressure on factories to deliver on short lead times and contributes to ongoing issues of excessive and forced overtime.
Knowing all of this, how then can the Ethical Fashion Report give an A to brands like fast fashion pioneers H&M and Zara, and a B to masters of Aussie budget buys Cotton On and Kmart?
How we come to a grade
All companies are assessed on the same 46 questions covering 18 different indicators of supply chain practice. These questions are grouped into five sections including Policies and Governance, Tracing and Risk, Supplier Relationships and Human Rights Monitoring, Worker Empowerment, and Environmental Sustainability – so it’s a very comprehensive analysis of what companies are doing across their supply chain regarding ethics and sustainability. Each of the five sections is graded separately, so whilst a company may receive an overall A grade, they may receive lower grades in individual sections. You can see these grades by using our Brand Finder and clicking on the brand you wish to view.
For each of the 46 questions, we have strong validation and evidence requirements that must be met. You can view the requirements for each of our 46 questions by downloading our Ethical Fashion Report Appendix which comes with the report itself.
We assess companies based on both publicly available information (things like Modern Slavery Statements and annual reports) and information and evidence disclosed to us directly. In total, our research team spend nine months on the assessment including multiple rounds of review and feedback before the grades are finalised.
How are we addressing the issues fast fashion perpetuates?
We recognise the environmental and social issues the fast fashion system has contributed to, and continually work to address these within our survey through the introduction of new questions and stronger validations. For example, 2021 saw the introduction of a new question focused specifically on overproduction. Companies were assessed on their efforts towards sustainable production planning and forecasting, and their strategy for addressing disposal of unsold goods. Further to this, we introduced a suite of questions on circular business models that address the in-use and end-of-life impacts of clothing – specifically through a company-responsibility lens. These questions assessed what companies are doing to not only assess the impact of clothing once sold, but to design clothing in more responsible and less-impactful ways while engaging with consumers to provide them with strategies for reducing impact, such as providing take-back schemes for used items.
The responsible purchasing practices of companies is another area that we’ve assessed for several years. This question had its validation criteria significantly strengthened in 2021 to recognise the impact that factors like lead times, pricing negotiations, and production planning have on the lived experience of garment workers. We also added a new question examining whether companies track data related to their payment of orders. The credit that companies received for each individual question can be accessed in the Appendix.
It’s important to note that each of the five survey sections are weighted differently. Currently, the Environmental Sustainability section—which encompasses the overproduction and circularity questions—accounts for 20 per cent of a company’s overall grade. The Supplier Relationships section—which includes responsible purchasing practices—accounts for 34 per cent. So whilst large companies may not score well on specific questions, if they’re covering a significant amount of the remainder of our survey sections they can still grade well overall.
So, with all of this said – how can fast fashion companies get an A?
Our report is designed to address a very specific concept: ‘How strong are the systems that companies have in place to mitigate the risks of worker exploitation and environmental degradation?’
It may be true that the likes of H&M and Zara have contributed to a destructive cultural change, but that’s not what the report is seeking to address. The truth is: these companies are doing better than most at mitigating worker exploitation in their supply chains. Their size and scale give them resources to invest in systems to prevent modern slavery – things like tracing their suppliers, effective monitoring, building relationships of influence with suppliers, and working with unions and governments. It also gives them resources to invest in innovative technologies and processes that can reduce environmental harm in specific indicators such as water pollution and emissions reduction. They’re far from perfect, but when we compare them to their peers, their systems rank amongst the best – which is what this research focuses on.
It’s also important to note that for the first time this year, Baptist World Aid has published the numeric score brackets that show what companies must achieve to be graded accordingly. It shows that for a company to receive an A grade, they must score between 50—75 per cent on the survey. This is likely to shock many consumers. But one of our key drivers for publishing this information is that we want consumers to understand that even companies who are grading highly still have a long way to go. While they may be sitting ahead of their industry peers and the overall average (a startling 33.6 per cent), it does not suggest that their supply chain is close to perfect. The purpose of the Ethical Fashion Report is to continually push for improvement across the entire industry, and to do so, we raise the bar every year.
We know that there are larger, systemic issues facing the fashion industry that will not be fully addressed by one report or guide alone. These can only be successfully approached through genuine collaboration between fashion companies, NGOs, civil society, governments, and of course, the push of consumer demand. At the heart of the Ethical Fashion Report is a desire to see the industry changed. We want to see the 50 million garment workers around the world empowered to live their lives with dignity, and in a healthy environment. The Ethical Fashion Report plays a small part in this puzzle.
This article was originally published on 7 May 2018 by Gershon Nimbalker and has been adapted for the 2021 Ethical Fashion Report and Guide launch.