An industry-leading research report reveals the fashion brands failing at mitigating the risk of worker exploitation in their global supply chains.
The Baptist World Aid Ethical Fashion Report graded 106 apparel companies (330 brands) from A to F on the levels of visibility and transparency these companies have across their supply chain, alongside worker rights policies and practices.
The report’s key findings include:
- Of the 15 brands awarded an A grade or higher, only three are headquartered in Australia and they are all Fairtrade.
- Only one company, Mighty Good Undies, could prove that they were paying all their workers a living wage.
- Just 7% of companies know where all their cotton, a popular raw material, is coming from.
Baptist World Aid Australia advocacy manager Gershon Nimbalker said that while the industry has certainly made progress since its inaugural 2013 report, more work can and needs to be done, particularly at a local level.
“Beyond niche ethical producers that consistently score the top grade, multinational companies like Patagonia and Zara are trumping Australian fashion brands,” he said.
“There have been a number of Australian companies like Cotton-On Group and Kmart that have made significant headway in this area, but 72% of companies that scored at or below a D+ are headquartered here.”
According to Mr Nimbalker, Australian companies like Valleygirl, TEMT and Lowes can no longer excuse being behind the curve as more multinational brands enter the local market.
Living wage still a major concern
Astonishingly, the research found only one company, Mighty Good Undies, could prove they were paying all workers a living wage.
“Asia Pacific is home to more than 40 million fashion industry workers, yet for the vast majority, wages remain at levels well below what is needed to lift themselves out of poverty, leaving underpaid workers trapped in a cycle of poverty,” said Mr Nimbalker.
The proportion of companies looking to improve wages continued to rise from 11% in 2013 to 42% this year. However, in most cases, wages were still below a living wage level and only applied to a portion of workers.
“Paying workers a living wage is achievable even for high-volume, low-cost operators, and it could transform the lives of millions while driving economic growth in their communities.”
Since 2013, there has been a 30% improvement in companies tracing second tier suppliers, while two and a half times more companies (45%) trace raw materials suppliers. In saying that, just 7% of companies know where their cotton is coming from.
Mr Nimbalker added: “It’s encouraging to see the improvements being made here but more than half of these brands still haven’t started trying to map where their raw materials are coming from.
“Modern-day slavery is a reality. If companies can’t identify, or don’t care, where all their materials are made then how can they be sure workers aren’t being exploited or even enslaved?”
Transparency – if shoppers can’t see, how do they know?
The number of companies publishing full supplier lists has risen from 16% to 26% since last year alone. APG & Co (which owns Saba, JAG and Sportscraft), Big W and the Cotton On Group are among this group, whilst increased openness from General Pants, Gorman, Seed Heritage, Factory X, and Brand Collective about their labour rights systems is commendable.
Brands that were non-responsive to the report, along with those that do not provide any substantive public information, were indicated in this report by an asterisk next to their name.
“We urge brands to share this information because if they don’t disclose these lists or their policies to mitigate worker exploitation, then how do consumers know if a) they know their suppliers and b) they have appropriate policies in place?” commented Nimbalker.
This year, Baptist World Aid created an online grading tool so consumers can easily search for their favourite brands and their related grades.