Introduction
The fashion industry is one of the biggest contributors to the climate crisis, due to this fact, many countries are introducing mandatory due diligence legislatives that would hold brands accountable for their impact on the environment. Sustainability has become a top priority for leaders and consumers, and brands must adapt to be successful.
Impact of the Fashion Industry on Climate
The fashion industry plays a big role in the climate crisis as the sector produces a large amount of waste, pollution, and carbon emissions. The industry is known to generate 10% of humanity’s carbon emissions and the number is expected to rise if no changes are made. Out of the billions of garments that are manufactured each year, a large majority end up being dumped or burned. The industry is also one of the largest consumers of energy and water. The process of textile dyeing contributes to 25% of industrial water pollution and leaves freshwater sources contaminated.
Consumers are also placing more importance on sustainability and social responsibility which is impacting their behavior. Consumers are more likely to purchase from brands that encourage sustainability and the use of sustainable materials.
Businesses can no longer ignore the adverse impact they have on social and environmental sustainability. Brands are under increased pressure to reshape processes as leaders and consumers are demanding change and transparency.
The New York Fashion Act
Due to the severe adverse effects of the fashion industry on climate, New York is set to make history as the first state to introduce a mandatory directive concerning sustainability and human rights. The law would apply to large apparel and footwear brands, including luxury brands such as Prada and fast-fashion brands BooHoo and Shein, operating out of New York with a revenue of over $100 million.
The directive would require these large corporations to outline at least 50% of their supply-chain processes from start to finish and create a standardized way of reporting for all companies. This can be challenging for the industry as the supply-chain spread over various countries and even continents. Businesses that fall under the directive will be required to disclose important information, including wages paid to their laborers and where they source their materials from. These details would be available online for their consumers to see.
Large corporations will also be required to examine the negative impact on greenhouse gas emissions and energy consumptions and work to reduce their emissions to meet terms set in the Paris Agreement. Brands will need to identify areas of improvement concerning sustainability and human rights and work to make changes.
If the act passes, businesses will be required to make changes according to the guidelines set within a year. Additionally, after 18 months, companies will be required to share their findings on their effects on the environment. Companies that neglect to follow the directive will face consequences such as a hefty fine amounting up to 2% of their annual revenue. The money would then go towards environmental justice projects and groups. Non-compliant organizations would face additional repercussions such as decreased profits as their names would be disclosed in a list by the New York attorney general.
Other regions are also introducing similar directives, such as the EU supply-chain act, which aims to ensure that companies have a supply-chain due diligence strategy in place.
Future Outlook
As New York moves towards passing the Fashion Act, apparel and footwear brands that fall under the directive must start reinventing their supply-chains to meet the requirements and reduce their impact on the environment. Digitizing processes can enable businesses to have end-to-end visibility and real-time insights to make better, more informed decisions and take corrective action promptly.
Triple Tree’s CSR solutions, VeRA and VMAN, enables businesses to get a seamless insight into a factory’s environmental, social, and economic position in real-time on one holistic and easy-to-use platform. ColordesQ, our color management, conformity, and validation solution can also help businesses achieve sustainability initiatives by accelerating the color approval process and eliminating the back-and-forth shipment of lab dips. Learn more here