The fact that fast fashion with its “wear and throw” approach is the most environmentally damaging business model in the fashion industry has arrived. But is anything really being done about it? And what do companies and associations say about this?
Recently, the mayors of more than 30 cities worldwide gathered at ChangeNow, a high-profile event focused on solutions for the planet. The aim of the meeting was to draw attention to the harmful effects of fast fashion on their cities and the environment.
Fashion companies react by not starting with their business model, but by concentrating on areas that, on the surface, give them sustainability points with the same or higher production, often in collaboration with organizations.
Recently, leading apparel companies such as Adidas, Bestseller, C&A, H&M Group, Inditex and VF Corporation have partnered with the Policy Hub, a joint initiative of the Sustainable Apparel Coalition (SAC), the Federation of European Sporting Goods Industries (FESI) and the Global Fashion Agenda. Together they want to put together a set of principles for the most effective waste management system and “enable a smooth transition to a circular economy for textiles in the EU”.
European Parliament approves EU supply chain law
Today, Thursday, the European Parliament also approved a plenary resolution on the EU supply chain law (EU Corporate Sustainability Due Diligence Directive – CSDDD) with a majority; Parliament and the Member States now have to agree on a joint compromise.
“With the approval of a European supply chain law, the European Parliament took an important step towards fairer global supply chains today. MEPs voted in favor of binding rules for companies with a stable majority. The message is clear: Human rights, the climate and the environment must be effectively protected against negative influences from global business activity in the future,” comments Michelle Trimborn, spokeswoman for the Supply Chain Act initiative.
“The new rules require companies to prevent, end or mitigate the negative impacts of their operations on human rights and the environment, such as child labour, slavery, pollution or biodiversity loss. They must also assess the human rights and environmental impacts of their partners in the value chain, including suppliers, transport, distribution and sales,” according to the new EU law.
This would go beyond the German supply chain law, which has been covering large companies with more than 3,000 employees since January 1 of this year and then, from 2024, companies with more than 1,000 employees. The new EU law would apply to EU-based companies with more than 250 employees and a turnover of over €40 million and parent companies with more than 500 employees and a turnover of over €150 million.
SMEs “completely overwhelmed”
SMEs are opposed to this: “The planned guideline is simply not affordable for SMEs and represents an excessive bureaucratic burden. We therefore call on the federal government to advocate a general exception for small and medium-sized enterprises (SMEs) in the upcoming trilogue negotiations. , maximum harmonization of national guidelines and a limitation of civil liability,” demands Dirk Jandura, President of the Federal Association of Wholesale, Foreign Trade, Services (BGA) in a statement.
He also criticizes the fact that the European Parliament wants to extend due diligence to the entire value chain of companies. They are thus obliged to check how the products sold are deployed and used.
“Medium-sized companies should then comply with 23 environmental and human rights conventions, 29 human rights conventions and declarations, and 15 environmental and climate protection conventions and monitor all of their products. Who is supposed to do that? In the end, there is a risk of civil liability in the event of omissions. This is how we regulate ourselves from the competition. This directive is a real stimulus package for all non-European competitors,” comments Jandura.
The German Chamber of Industry and Commerce (DIHK) also agrees that SMEs are “completely overwhelmed” by the planned directive. She criticizes that the draft law lacks “practicability, proportionality and legal certainty”. “The supply chain law burdens companies with a new and incalculable liability risk: They are expected to carry out checks that are beyond their own scope of influence,” says DIHK President Peter Adrian.
Large corporations are involved
The fashion group s.Oliver, which employs over 7,000 people worldwide, supports the regulatory approach to corporate due diligence at EU level. “Ambitious and binding sustainability standards strengthen responsible companies and create a level playing field for European corporations,” the company said in a statement.
It clearly sees that voluntary measures by companies are not enough: “Voluntary measures by companies and international guidelines for social and environmental standards have helped to create a framework and set priorities. However, they are not sufficient to meet necessary targets such as those set out in the United Nations Sustainable Development Goals or the Paris Agreement on climate change.”
“The s.Oliver Group is convinced that guidelines like the CSDDD can be an important driver for positive change: They create added value for our customers: inside, employees: inside and our planet and can help the EU in the coming decades Position the forefront of sustainable corporate innovation. For this reason, the s.Oliver Group supports the EU Commission’s proposal for the introduction of a European supply chain directive aimed at anchoring human and environmental rights in the business decisions and management structures of European companies,” says s.Oliver.
In any case, the new EU supply chain law remains a compromise, because while trade and companies fear major restrictions and unfulfillable bureaucratic requirements, it is not fast and binding enough for others: “Nevertheless, the compromise decided today is far from our demands as civil society. When it comes to access to justice, we welcome the basic regulation on the subject of liability, but also see massive weaknesses: those affected have no chance because they usually have little means and no access to internal company information. They can hardly prove in court that companies are not fulfilling their duty of care. That is why we demand a fair distribution of the burden of proof. Of course, comprehensive due diligence obligations must also apply to the financial sector. This is the only way we can ensure that European banks and investors do not finance human rights violations and environmental destruction,” Trimborn concludes.