Adidas and Gap top sustainable fashion supply chain rankings

Planet Tracker is urging financial institutions to include water risk in investment decisions.

Released on Monday (7 January) by anti-modern slavery charity Know The Chain, the 2018 apparel and footwear benchmark assesses big-name fashion firms on the actions they are taking to remove forced labour from their supply chain and avoid human rights breaches in garment factories.

Brands are assessed based on their contribution to social sustainability across seven key areas: commitment and governance; traceability and risk assessment; purchasing practices; recruitment practices; listening to worker voices; supply chain monitoring and remedial policies for breaches of human rights laws. They are then given an overall score out of 100.

Sportswear giant Adidas topped the rankings for the second year running, achieving an overall score of 92%. Canadian athletic wear brand Lululemon, meanwhile, scored 89% to rank second.

The top five was completed by Gap (75%), Primark (72%) and Inditex (70%), which owns brands such as Zara, Barshka and Pull&Bear. Know The Chain praised these firms for taking strong action to address risks associated with recruitment processes for migrant workers, who are often forced to pay a fee in exchange for a job.

Nonetheless, progress from the wider fashion sector has remained slow, according to Know The Chain, with the average firm receiving a score of just 37%.

Brands are proving particularly slow to act in regards to their recruitment processes, worker voice policies and supply chain traceability, according to the benchmark. Of the 43 companies listed, only Adidas and Lululemon could provide evidence that workers below the first tier of their supply chains had used their grievance mechanisms during 2018.

Asian brands were among the worst performers, with China’s largest childrenswear retailer Zhejiang Semir Garment and Japanese ladieswear firm Shimamura both given a score of 0%. US-based footwear firms including Foot Locker (12%) and Sketchers (7%) were also found to be making slow progress towards socially sustainable supply chains.

“For the apparel and footwear sector, forced labour is real, and the impact on worker lives is too important to ignore,” Know The Chain’s director Killian Moote said.

“Companies lagging behind need to learn from their peers and, with good practice examples available, should strive to progress quickly. Leading companies need to remain vigilant and address evolving risks but also play a role in leading the industry forward. Likewise, investors should engage with investee companies and ensure those in their portfolio commit to time-bound and measurable improvements.”

Sector-wide struggles

Fashion is one of the largest industries in the world, employing around 75 million people worldwide and producing 100 billion garments every year.

But for all of its benefits to the global economy, the sector is believed to be the second highest-risk industry for modern slavery after technology and employs thousands of people below their nations’ living wage.

Modern slavery in fashion supply chains has long been a concern for the industry, with one BBC expose having revealed that Syrian refugees earning as little as £1 per hour were working in third-party suppliers in Turkey, linked to a number of high-profile fashion retailers.

Indeed, businesses have been stung be various high-profile scandals in recent years; from Zara and ASOS being linked to sourcing viscose from factories which dumped toxic waste in rivers, to the collapse of the Rana Plaza garment factory in Bangladesh, which killed more than 1,000 people.

More recently, H&M was accused by green campaigners of failing to fulfil a commitment to pay all garment workers enough to keep them above the poverty line.  

In response to the issue, several of the UK’s largest fashion retailers, including John Lewis and Marks & Spencer (M&S), recently partnered with the Gangmasters and Labour Abuse Authority and UK Government’s Modern Slavery Taskforce to help reduce forced labour risks in the sector.

The move came shortly after the Environmental Audit Committee heard evidence that garment workers in some UK factories were being paid as little as £3.50 per hour to produce clothing for online fashion retailers.

Sarah George