The global garment and footwear industry is at a crossroads. Faced with growing economic uncertainty linked to global trade trends, the industry must also urgently become more sustainable and face up to its responsibility for the climate crisis. Total greenhouse gas emissions from textiles production amount to 1.2 billion tonnes annually, which is more than the emissions of all international flights and maritime shipping combined. This situation will get even worse unless the industry takes bold action and develops sustainable and innovative solutions.
Nowadays, on average a person buys 60% more items of clothing in comparison to 15 years ago, and overall the global rate of clothing items consumed reaches 100 billion items per year. At this rate, the fashion industry will use up a quarter of the world’s carbon budget by 2050.
Another major trend affecting the sector is the digital revolution, with fashion sales increasingly taking place online – accounting for some 27% of total fashion sales yearly, according to OECD. Moreover, supply chain management is going digital, which reduces lead times and shift production sites at a quick pace and makes it increasingly difficult for companies to anchor a circular economy approach to their business.
Faced with these challenges, some key priorities have emerged to keep due diligence in the garment and footwear industry moving forward. One of them – detailed in a UNECE Policy Paper – is strengthening the role of policy and regulatory approaches to drive traceability, sustainability and circularity. For an effective traceability system, there is a need for supporting rules and regulations, consensus on the benefits of a single system, and dedicated and cost-effective technologies to implement such a system.
Moreover, business models which support circular economy are more and more appealing to the consumers, who increasingly pay attention to the carbon footprint of the clothing they wear, reassessing their behaviour and leveraging their purchasing power for more sustainable production and consumption patterns (as enshrined in Sustainable Development Goal 12). This sets the scene for the why transparency and traceability have become a key priority. In fact, to be robust, sustainability claims need to be supported by reliable data and information from all the actors intervening at different stages of the value chain and are a prerequisite to overcome the information asymmetry and achieve accountability.
With financial support from the European Union, and now, with a network of 150 experts from key industry players, the UNECE-UN/CEFACT project ‘Enhancing Transparency and Traceability of Sustainable Value Chains in the Garment and Footwear Sector’ is developing the architecture of a single and complete transparency and traceability system. The aim is to enable companies and key actors to share information on compliance with sustainability requirements, in a standardised format, using a common language.
At the 2020 OECD Forum on Due Diligence, on 11-13 February, UNECE held project sessions to: deep dive into relevant cross-industry, policy and regulatory approaches to advance transparency and traceability for due diligence and circularity along the entire value chain; take stock of progress in the mapping of the stakeholders’ ecosystem and focus countries for the project (more than 40 stakeholder groups across 12 regions and countries); discuss the key elements of the policy recommendation and regulation model based on a wide consultation process with the industry; brainstorm on the approach for the development of the technical standards for information exchange based on a common taxonomy on sustainability in the industry.
Building upon a wide range of UN/CEFACT standards, the purpose of the ongoing data and value chain modelling is to gather and standardize all the product information (both physical and sustainability-related) required for the manufacturing of a garment piece.
The Forum also offered the opportunity to present the “seed to shelf “cotton blockchain pilot, which has already aligned partners Hugo Boss, Vivienne Westwood, Stella McCartney, Burberry, Alba Gruppe, Filmar, Albini Group, ZDHC, OEKO-TEX, GOTS, Farmer Cooperatives in Egypt, the start-up Haelixa. The sessions sparked a great deal of interest from the industry.
The next project meeting will take place over the 35th UN/CEFACT Forum in Geneva on 27-28 April 2020.