Consumers have always cared about quality, but until recent years, they took this on trust by buying from brands with a reputation that rested on only a few characteristics, such as style, color and hardwearing fabrics. While these remain the primary purchase motivations, we must now add many more, almost all of which relate to how the brand treats its customers, its workers, suppliers and, ultimately, the planet.
It is no longer enough for brands to value signal and greenwash their sustainability credentials on the Corporate and Social Responsibility page of their website, they are now expected by a growing cohort of customers to demonstrate HOW they are sustainable. They don’t just want the evidence of words, they want to see action – put simply, fashion brands can no longer be ‘all talk and no trousers’.
The cost of not doing so backfired on a number of brands between 2018 and 2020, as they were forced to deal with criticism over working conditions, air freight and environmental impact of goods being dumped into landfill sites. This backlash has been amplified by the growth of social media that enables consumers to share images and insights with each across the globe.
Any doubts as to how seriously many consumers take these issues are dispelled by the growth of the second-hand market, with more and more people preferring to cut down on how many garments they buy new, and shop from online markets, such as Depop, Vinted and Thredup.
Dedagroup Stealth has partnered with industry bodies on the development of sustainability indices that will enable brands to demonstrate how sustainable they are to customers, shareholders, customs and regulators. And Dedagroup Stealth is providing the technology that will enable brands to gather, store and report on the data that underpins these activities.
Fortunately, many brands are showing the way ahead, as the Fashion Transparency Index from Fashion Revolution shows, and now in its fifth year. In 2020, it reviewed 250 of the world’s largest fashion brands and retailers and ranked them according to how much they disclose about their social and environmental policies, practices and impacts. This year, an update on this report will show what progress has been made and how that will have been affected by Covid.
The Transparency Index Report emphasizes that complete transparency even in the most upstream areas of the Supply Chain is the best way to ensure good relations with the various stakeholders, resolve conflicts and guarantee a direct benefit to the brands themselves.
While in 2019 in Biarritz in France, around 20% of the world fashion industry made a firm commitment to sustainability by signing the Fashion Pact. As a foundation, they used the “Sustainable Development Goals” set during a United Nations conference, which it was agreed were essential to offset the consequences of ignoring the damage the industry was causing to the environment. In particular, it identified three main areas where protective action was necessary: Climate, Biodiversity and Oceans.
Measuring sustainability so that it can be demonstrated to the public and other stakeholders is hard and getting harder, as the breadth of measures increases, soon to include things like diversity in senior management and the wider workforce as well as traditional ‘green’ credentials. Consider also the challenges of documenting things that may not have been covered in the past, such as the source of raw materials, particularly challenging to retailers that buy direct from manufactures and have no involvement in production.
Fortunately, tools developed by the Sustainable Apparel Coalition (SAC), as part of the Higg Index enables fashion brands of all sizes to accurately measure and evaluate their sustainability performance. Both qualitative and quantitative measures and analysis mean brands can create a Materiality Assessment that defines their competitive advantage as well as sustainability engagement.
SAC was founded in 2009 by Walmart and Patagonia to bring together suppliers and producers from the fashion world to develop a single universal approach for measuring sustainability indices. Today it has more than 200 participants from 35 countries with a combined turnover from fashion of $500 billion.
Technology is therefore central to interpreting and enabling these new needs to be put in action, working at the very heart of the brand to manage the entire supply chain in harmony with data so that brands can increase their competitive advantage whilst knowing that their social and environmental commitments meet the needs of all stakeholders.
Sustainability performance, if it is well integrated into company IT systems, can dictate new rules and allow the company to take precise actions, monitor them through timely feedback and consequently achieve the desired shared value concretely. Digital transformation of the entire supply chain allows the creation of these new models and extends the benefits to the entire community.
Senior Managing Partner