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Supply chain transparency is fundamental to effective human rights due diligence. It enables workers, trade unions and civil society to hold businesses to account for their commitments and obligations. And it enables businesses to collaborate efficiently during times of crisis. Since ETI published its Corporate Transparency Framework in 2021, 71% of ETI’s full members have published their tier one suppliers on Open Supply Hub – an innovative, open and accessible online global supply chain map.
Going circular
The apparel and textiles industry has become notorious for its climate and environmental impacts. The sector is estimated to contribute between 2% and 8% of global greenhouse gas emissions and to extract 4% of all fresh water globally. In response to civil society pressure, consumer demand, and emerging legislation, the industry is searching for ways to transition to the greener future we desperately need. One such area that has been gaining increasing attention is circular supply chains.
For example, increasing numbers of retailers are offering ‘take back schemes’, enabling customers to return their unwanted garments. Others are offering repair services to increase the longevity of items. Some are increasing their in-store second-hand pre-loved ranges or providing the option for consumers to rent garments. Meanwhile, many brands are also increasing the proportion of recycled fibres used in their blends.
Many countries also have a long history of second-hand clothing markets, which play a vital role in supporting circular fashion. In the UK, some of the most well-known names on UK high streets are charity shops, including ETI member NGOs Oxfam and Save the Children.
The various offerings available move us some way in the direction of circularity. None are mutually exclusive, and some are more circular than others, but they all form part of an emerging trend.
One thing in common – Workers
As well as the shared objective of reducing the industry’s environmental footprint, all these circular fashion initiatives have a key thing in common: workers. Our hypothesis is that they all involve some combination of labour intensive tasks, such as sorting, grading, cleaning, repair, re-sale and/or recycling. But when we look at the discourse around circular fashion, the people doing these essential tasks seem to be largely missing. Who are these workers? Where are they based? What do their working lives look like? Who is representing and advocating for their interests? And do these emerging and growing industries offer ‘decent work’ and respect for workers’ rights?
At this point in time, very little is known about these emerging value chains and the workers they depend on.
Transparency in circularity
Just as transparency has enabled better human rights due diligence in ‘upstream’ stages of apparel and textiles supply chains, we are keen to explore how transparency could help answer the questions posed above about ‘downstream’ stages of emerging circular fashion value chains. Some actors have already begun sharing information about waste recycling industries on Open Supply Hub. We believe there is scope to do the same with the key actors in circular fashion supply chains, and that doing so is an important step towards undertaking human rights due diligence in this emerging space.
Increasing transparency to bring circular industries into our systemic understanding of the sector enables us to recognise the important contributions these industries make towards a greener future – and their limitations within that as well. Workers play a critical role in these emerging chains and the importance of these livelihood options should not be understated. But we know from experience that it takes deliberate effort and collaborative working to ensure human rights and decent work are upheld throughout.
Risks and unintended consequences
As brands seek transparency and conduct human rights due diligence in emerging circular supply chains, there is a risk of unintentionally harming the most vulnerable workers. From warehouse workers sorting and grading returned clothing, to tailors fixing and upcycling items, to those feeding low-quality garments into shredding machines to be deconstructed back into fibre - many workers in circular systems are likely to be informally employed.
This in and of itself is not a problem. In many of the world’s emerging economies, informal work represents a significant share of overall employment. In India, for example, almost 90% of workers are informally employed. The informal economy generates livelihood opportunities for millions of workers, including workers from marginalised sections of society for who may be prevented from participating in the formal economy due a multitude of structural factors, such as discrimination, limited access to formal education and training, or a lack of identity documents. Any moves to increase transparency and undertake human rights due diligence at emerging circular stages of supply chains must work to improve working conditions, not to close down vital livelihood opportunities for vulnerable workers or inadvertently enable more powerful segments of the workforce to take over. This requires careful navigation, with guidance from trade unions, NGOs and workers themselves. ETI’s tripartite membership includes NGOs who are specialists in working with informal economy workers, for example Homeworkers Worldwide and Transform Trade, to mention just two.
Challenge and opportunity
If we’re genuinely serious as a sector about the potential of circular fashion, we must ensure this isn’t a smokescreen to dodge challenging and systemic issues. Fashion’s outsized environmental footprint and contribution to the climate crisis comes down largely to volumes – sheer overconsumption and overproduction. In 2017, Ellen MacArthur Foundation published research showing clothing production had doubled between 2000 and 2015, whilst the average times a garment is worn had shrunk by 36%. Meanwhile, 73% of clothing ends up incinerated or in landfill, with 12% recycled for lower value use and less than 1% used to produce items of similar quality.
Circular fashion is a growing trend with welcome initiatives that rapidly need to scale-up to offer an alternative to the wasteful linear model for which the fashion industry has been criticised. In addition to its excessive use of resources, waste and pollution, the industry is also notorious for low wages and widespread human rights abuses. While these abuses remain, huge progress has been made in increased awareness and understanding across apparel and textiles. Thanks in part to the UNGPs and a growing body of legislation around the world, human rights due diligence is increasingly seen as central to responsible business practice. As more circular initiatives emerge, now is pivotal time to deploy expertise, resources and commitments to ensure respect for human rights is integrated from the outset.
Just transition is about understanding the integral linkages between the human and the environment, and not letting one become an afterthought of the other; these are two sides of the same coin. Transparency is key to unlocking the vital role circularity can play in a just transition in the apparel and textiles sector. Please do get in touch to discuss further.