Remake’s “Fashion Accountability Report 2024” shows industry’s need to act on promises

Business

Remake’s Fashion Accountability Report 2024 Credits: Remake

Now in its fourth year, non-profit organisation Remake has published its latest annual “Fashion Accountability Report 2024”. It measured the performance of 52 large fashion companies (more than 100 US dollars in annual revenue) like Fast Retailing, H&M, Inditex, Kering, LVMH and PVH in six key areas: traceability, wages and wellbeing, commercial practices, raw materials, environmental justice and governance. Five new companies were added this year: retail chain C&A, US outdoor brand Cotopaxi, US department store chain Macy’s, US shapewear and clothing brand Skims and Chinese online marketplace Temu.

While companies could score up to 150 points, the average accountability score was only 14 out of those 150 points — the same as last year. By area, the average scores for traceability, wages and wellbeing, commercial practices and governance stayed the same with 1 out of 8, 2 out of 23, 1 out of 15 and 3 out of 42, respectively. Raw materials and environmental justice improved by only one point this year to 3 out of 20 and 5 out of 42.

Key findings

Overproduction

Overproduction is still at the heart of the problem: “Without a conscious reduction of annual product output, even the simultaneous implementation of ‘circularity’ initiatives, improvements in energy efficiency, and use of ‘preferred’ materials will not be enough to sufficiently reduce fashion's overall climate footprint, and, likewise, its adverse labour impacts,” is the sobering conclusion.

“No company can yet demonstrate that it is replacing linear production; they are merely running repair, resale, rental programs in parallel to the production of new goods. The few companies that do disclose their annual production volumes all reported consecutive year-on-year increases”, finds the report.

Insufficient emission reduction

Another problem is that the fashion industry is not meeting its emissions reduction targets: “Few companies have demonstrated that they are financing decarbonisation in their supply chains, and existing investments are not scaling at the speed needed. Likewise, current initiatives do not sufficiently account for the unique needs of each sourcing country and factory,” is the conclusion.

“True partnerships between fashion companies and suppliers are imperative. Manufacturers should be at the table in the co-creation of regionally-specific emissions reduction strategies, and brands and retailers, who are the ones with the resources, need to share in the costs,” advises the report.

The scores of all 52 fashion companies that were evaluated for Remake's Fashion Accountability Report 2024. Credits: Remake

Address climate change

The report highlights the fact that there is a vast difference between climate mitigation, meaning reducing emissions, and climate adaptation, which is helping communities affected by climate change survive and thrive. “Both are crucial, but so far companies have done little to acknowledge, let alone address, the adverse impacts of climate events, like extreme heat and flooding, that garment workers and supplier communities in key production countries are already facing”, states the report.

It advises companies to invest in climate adaptation at the earliest or risk losing out on tens of billions of dollars on the supplier and fashion company side. “Companies thus need to invest in factory, worker and community resilience so that all are equipped to withstand and recover from extreme weather events.”

Fairer commercial practices

A company’s commercial practices include the relationships to sourcing factories and other suppliers with respect to contracting, setting prices, placing and changing orders, addressing conflicts and terminating relationships. “The power and wealth imbalance in fashion’s supply chains enables companies to dictate (self-serving) contract terms, and push all risk onto their manufacturers, who are expected to remain competitive on prices while shouldering all costs related to upholding minimum labor rights and environmental standards,” sums up the report, showing in the chart above that 20 of the companies surveyed did not score in this area at all.

“The highly competitive atmosphere that this creates among suppliers, and between supplier countries, forces them to constantly slash costs, undercutting their ability to not only pay their workers fairly, but also to implement any of the sustainability improvements being asked of them. With zero progress observed on commercial practices this year, it is clear that responsible contracts requiring shared responsibility for preventing, accounting for, and remediating adverse supply chain impacts are necessary,” warns the report.

Living wages

Despite over a decade of living wage promises, garment workers continue to earn wages that do not cover even their basic living costs, pushing them into debt and poverty. In a race to the bottom in terms of prices, “unfair contract terms force suppliers to bear both the responsibility and risks associated with the costs of wage increases. Downward pressure on prices from fashion companies results in political pressures to keep minimum wages far below living wages in order for manufacturing countries to remain competitive,” explains the report. This would explain why ten out of 52 companies surveyed do not score at all in this area.

“Fashion companies have the power to facilitate fair compensation or, conversely, to make it impossible for suppliers to pay and treat their workers fairly. As it stands, companies are still largely avoiding involvement in advocacy for higher minimum wages and freedom of association in their sourcing countries, implementation of fairer commercial practices, and public accountability disclosures, such as regionally-specific wage data and living wage benchmarks. All of these are necessary for the industry to advance pay equity,” according to the report.

Good legislation

Pointing to over three decades of failed voluntary corporate social responsibility efforts, Remake highlights a global economic system that incentivises growth based on overproduction, pollution and exploitation. “For broader, systemic change to actually occur, large and influential brands and retailers need to support legislation and binding agreements that hold fashion companies jointly accountable for human rights and environmental impacts along their supply chains.”

The organisation advises to put workers at the center of developing any proposed legislation and to ensure that upchain accountability mechanisms are built in from the start.

“Remake’s 2024 Fashion Accountability Report provides a universal benchmark against which all companies are mapped. This makes for surprising insights and new directives. It’s time to partner with workers as we build the transition away from new product production and towards cycled textiles/fashion models of all kinds,” agrees Lynda Grose, founding board member, Union of Concerned Researchers in Fashion and professor at the California College of the Arts.  

Traceability

In terms of traceability, it is surprising to see that some of biggest names like Inditex, Burberry, Kering, Primark, Rei, American Eagle Outfitters, Muji, Macy;s, Shein, Chanel, Savage and Fenty, URBN, Kohl’s, Disney, Forever 21, JC Penney, Fashion Nova, Missguided and Skims do not score at all in this key area - 19 companies in total.

While Remake evaluates each company holistically and scores them on their progress rather than promises, not separating social from environmental impacts and is not funded by the fashion industry, as in earlier editions, each company evaluated received the opportunity to review its scoresheet ahead of publication. With 24 companies that engaged, almost half of those mentioned in the report decided to engage; many being able to increase their final scores by putting additional information in the public domain.

The complete report can be viewed and downloaded on the Remake website.