The international fashion network Fashion Revolution has launched its seventh annual Fashion Transparency Index, which highlights the transparency efforts of major fashion companies worldwide.
As in previous years, 250 of the largest fashion brands and retail companies were scrutinized for the Fashion Transparency Index 2023. They were ranked in several areas including supply chain traceability, purchasing policy, waste and overproduction, transition to circular economy, efforts on deforestation, climate, living wages and freedom of association, as well as due diligence, water and chemical management and materials used.
Conclusion
The result this year is that progress is still too slow: Compared to the previous year, the average total score rose by just 2 percent to just 26 percent. However, in the Fashion Transparency Index 2023, two brands achieved a percentage of more than 80 percent for the first time (see below). More than a quarter (28 percent), or 70 out of 250 companies, are still between 0 and 10 percent, but that’s a slight improvement from last year’s 32 percent.
Luxury brands performed better in 2023, spurred by the fact that more of them than ever are disclosing their manufacturing facility lists. For the first time, a luxury brand is also among the top performers with an average overall score of 80 percent. In addition, five luxury brands were able to increase their score by up to 21 percent compared to last year.
“As an activist, it’s maddening to constantly insist on what is ultimately the bare minimum of what we should expect from big fashion brands. The inconspicuous progress in this area is alarming in the face of growing social inequality, environmental degradation and several new laws. We are happy that a minority of brands are finally reaching 80 percent or more, but even 100 percent transparency is just the beginning and it seems that many big fashion brands are not even participating in the competition,” comments Liv Simpliciano, Policy and Research Manager at Fashion Revolution.
A look at the individual areas:
Supply chain traceability
For the first time, more than half (52 percent) of major fashion brands have disclosed lists of their Tier 1 manufacturing facilities. However, the average overall score in this area is 23 percent, with nearly half (45 percent) of brands scoring between 0 and 1 percent, reporting almost nothing at all.
“After years of working alongside our allies to increase supply chain transparency, it is a huge achievement to finally be able to report that more than half of the major fashion brands (52%) in the Index now have their Tier 1 suppliers :reveal internal lists. This is a significant improvement considering that in 2017, when we were just beginning this work, only 32 out of 100 brands (32 percent) disclosed a list of Tier 1 factories where their clothing is made and now 129 out of 250 brands (52 percent) do so,” the report praises.
Tax and Purchasing Policy
Less than half (45 percent) of companies publish their responsible tax strategy and only 18 percent disclose the percentage of their managers’ salaries that are linked to sustainability goals.
Only 12 percent publish a code of conduct for responsible purchasing, and even fewer (4 percent) report the number of orders where they made retrospective changes to previously agreed payment terms. Only a minority (11 percent) also disclose their practice of paying suppliers within 60 days.
Waste, overproduction and circular economy
A majority (88 percent) of the brands surveyed still do not disclose their annual production volumes, which obscures the extent and fact of the overproduction. Unsurprisingly, most (99%) do not commit to taking the most sustainable action of all and reducing the number of new items they produce.
Accordingly, the transition to more circular production is also falling by the wayside: 95 percent of companies are not transparent about how they intend to enable a transition to a circular economy.
deforestation and climate
Just 12 percent of major fashion brands released a time-limited, measurable commitment to end deforestation this year; 3 percent less than last year. In addition, only 7 percent publish measurable progress on this path.
Clouds are still looming on the climate front, with just 9% of brands sharing action they are taking to help their suppliers transition to renewable energy. A majority (94 percent) still do not share what fuels are used in the manufacture of their clothing. Only two brands (Armani and Benetton) have the foresight to commit to degrowth.
Living wages and freedom of association
When it comes to living wages, most fashion and retail companies don’t seem to care how workers along their supply chain make ends meet financially: just 1 percent of them reported that workers in their supply chains earn a living receive wages. For Fashion Revolution, this underscores the urgent need for living wage legislation, which the organization is actively promoting as part of Good Clothes and Fair Pay.
Although a majority (85 percent) of the companies surveyed publish policies outlining their commitment to freedom of association, the right to unionize and collective bargaining at the supply chain level, just over a third (39 percent) say how put them into practice.
Only 1 percent of them disclose the number of collective agreements that provide for higher wages than legally required, and only 15 percent the number or percentage of their suppliers that have independent, democratically elected unions.
Water and chemical management
Although studies show that clothing still contains dangerous chemicals, only 7 percent of major fashion brands publish the results of their suppliers’ wastewater tests.
While almost a third (32 percent) publish their own water footprint, only 24 percent do so for their manufacturing operations, or just 4 percent at the fiber and raw material level. Additionally, only 23 percent disclose their process for conducting water-related risk assessments.
due diligence
A good two-thirds (68 percent) of the companies surveyed disclose how they conduct human rights due diligence, and a good third (37 percent) how they consult affected stakeholders in this process.
Almost half (49 percent) disclose their approach to conducting environmental due diligence, and 37 percent disclose the key environmental risks, impacts and violations identified in the process.
used material
When it comes to materials and sustainability, things get vague: Although more than half (51 percent) of the participating brands and retailers publish goals for sustainable materials, only 44 percent also define what they mean by “sustainable”.
Only 42 percent disclose progress towards these goals, and only 29 percent disclose the breakdown of fibers procured each year.
risers and fallers
Italian brand OVS again achieved the highest score this year with 83 percent, followed by Italian luxury brand Gucci with 80 percent and Australian retailers Kmart Australia and Target Australia with 76 percent. While the latter and OVS have each increased by 2 and 5 percentage points respectively since last year, Gucci has risen an impressive 21 percentage points. Also improving were Armani (up 19 percentage points), Jil Sander, Miu Miu and Prada, each up 17 percentage points since 2022.
“Jil Sander had previously consistently scored zero percent in the Index so it is encouraging that after many years the company has returned and improved its value. This shows that great strides in transparency are possible if the will is there. The participation of luxury brands shows that there has been a fundamental change in the level of transparency in the luxury sector when it comes to who and where our clothes are made,” says the report.
The number of companies that achieved zero percentage points increased from 17 to 18 in 2023, namely Anta, Belle, Big Bazaar, Bosideng, Fashion Nova, K-Way, Koovs, Max Mara, Metersbonwe, Mexx, New Yorker, Heilan Home, Savage x Fenty, Semir, Splash, Tom Ford, Van Heusen and Youngor.
“Persistent lack of transparency at nearly half of the major fashion brands surveyed, even in the face of the deepening climate crisis and a spate of new legislation mandating transparency, maintaining the status quo appears to be a deliberate tactic, which in turn begs the question: what is hidden?” is the conclusion of the Fashion Transparency Index 2023.