FASHION INDEX 2021 EDITION A review of 50 of the biggest fashion brands and retailers in Brazil ranked according to how much they disclose about their social and environmental policies, practices and impacts.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
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CONTENTS
02 03 04 05 06
EXECUTIVE SUMMARY About Fashion Revolution Introduction How The Index Has Changed This Year Key Findings
17 18 19 20 21
ABOUT THE INDEX Our theory of change The role of transparency in achieving change The role & aims of the Fashion Transparency Index Case studies: Transparency in Action
24 25 26 27 28 29 30 31 31 32 32 33 34
METHODOLOGY AND SCOPE OF THE RESEARCH How brands and retailers are selected The 50 brands selected The scope of the research About the research process About the methodology Methodology advisory committee About annual review of the index Adapting the methodology to the brazilian context Limitations of the research How we calculate the findings Weighting of the scores A guide to the final scoring
35 36 37 38 39 49 55 56 63 64 65 74 84 92 96 103
FULL RESULTS The final scores Quick overall findings Average scores across the sections POLICY & COMMITMENTS GOVERNANCE Viewpoint: Veronica Tavares, Sebrae TRACEABILITY Viewpoint: Yamê Reis, author and fashion consultant Interview: Andrea Souza, Esplar KNOW, SHOW & FIX SPOTLIGHT ISSUES Viewpoint: Marina Novaes, Business & Human Rights Resource Centre Viewpoint: Beto Bina, Farfarm Viewpoint: Liz Ricketts, OR Foundation Viewpoint: Pauline Op de Beeck, Carbon Trust
104 105 107 109 113
FINAL RECOMMENDATIONS Take action on transparency: What needs to happen next? Thank you! References Disclaimer
The content of this publication can in no way be taken to reflect the views of any of the funders of Fashion Revolution CIC or Instituto Fashion Revolution Brasil © Fashion Revolution CIC 2021. All rights reserved. This document is not to be copied or adapted without permission from Fashion Revolution CIC.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
EXECUTIVE SUMMARY
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
EXECUTIVE SUMMARY
ABOUT FASHION REVOLUTION
ABOUT THE FASHION TRANSPARENCY INDEX
Fashion Revolution works towards a vision of a fashion industry that conserves and restores the environment and values people over growth and profit.
The Fashion Transparency Index Brazil is an annual review of the largest Brazilian fashion brands and retailers ranked according to their level of public disclosure on human rights and environmental policies, practices and impacts in their own operations and in their supply chains.
The Fashion Transparency Index Brazil reviews brands’ public disclosure on human rights and environmental issues across 245 indicators in 5 key areas:
We focus on the largest and most profitable brands and retailers because they have the biggest negative impacts on workers and the environment and therefore have the greatest responsibility to change.
3. Supply Chain Traceability
Founded in the wake of the Rana Plaza disaster in Bangladesh, Fashion Revolution has become the world’s largest fashion activism movement, mobilising citizens, industry and policy makers through research, education, and advocacy work. The issues in the fashion industry never fall on any single person, brand, or company. That’s why we focus on using our voices to transform the entire system. With systemic and structural change, the fashion industry can lift millions of people out of poverty and provide them with decent and dignified livelihoods. It can conserve and restore our living planet. It can bring people together and be a great source of joy, creativity and expression for individuals and communities. In Brazil, this movement has been active since 2014. It develops projects, carries out activities and fosters the union of a network of people, initiatives, and organisations in the sector. In 2018, it became the Instituto Fashion Revolution Brasil, a non-profit and non-governmental organisation.
Transparency is foundational to achieving systemic change in the global fashion industry, which is why we have been campaigning for it since 2014 and why we created this tool. Transparency underpins transformative change but unfortunately much of the fashion value chain remains opaque while exploitation thrives with impunity. However, transparency is not to be confused with sustainability. Transparency is a first step; it is not radical, but it is necessary. Without transparency, achieving a sustainable, accountable, and fair fashion industry will be impossible.
1. Policy & Commitments 2. Governance
4. Know, Show & Fix 5. Spotlight Issues, which this year are: •
Decent work, covering forced and bonded labour, Covid-19 response, living wages, purchasing practises, unionisation, and collective bargaining
•
Gender and racial equality
•
Sustainable sourcing and materials
•
Overconsumption, waste, and circularity
•
Water and chemicals
•
Climate change and biodiversity
To read more in-depth about how this Index works, why transparency matters and the methodology, please see chapters About this Index and Methodology & Scope of Research below.
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
EXECUTIVE SUMMARY
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INTRODUCTION Brief context of the pandemic in Brazil in 2021 For almost two years now, the fashion industry (and the world) has been feeling the impacts and consequences of the COVID-19 pandemic. Since then, unfortunately, the industry has moved backwards on many issues related to human rights and the environment. In addition to the issues already covered in the 2020 Index, this year, we have researched the strategies of major brands in response to the pandemic, both in relation to their own employees and suppliers. Examples of strategies would be wage cuts, late wage payments, layoffs, or contract suspensions as well as implementing protective measures in workplaces or making homeworking arrangements available to employees as a way to reduce the chances of contracting COVID-19. In Brazil, unemployment rates reached record highs in the first quarter of 2021. Furthermore, according to a survey conducted with migrant garment workers in São Paulo, there was a reduction in the price paid per produced garment in 78% of cases. The same survey showed that, among the workers
interviewed, 61% were forced to reduce their daily food intake. All this amid rising prices of food and commodities, such as gas, across the country.
The climate emergency Meanwhile, the climate emergency still looms. Several new studies have been published indicating that the planet is reaching various climate-related tipping points faster than expected. For example, the Arctic Sea ice is thinning twice as fast as previously thought. Oxygen levels in lakes are declining at rates between three and nine times faster than 40 years ago. The publication of the first part of the Sixth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC) sounds an alarm on the climate crisis, substantiated by 234 authors from 65 countries, about how climate change is rapidly intensifying and how it is the result of human actions. According to the report, global temperatures will continue to rise until at least mid-century under all the emissions scenarios considered. Global warming of 1.5°C and 2°C will be exceeded during the 21st century unless profound reductions in carbon dioxide (CO2) and other greenhouse gas (GHG) emissions occur in the coming decades.
The global fashion industry considerably contributes to this issue. According to estimates, if no additional action is taken in the next decade, beyond the measures already in place, the industry’s GHG emissions will likely rise to around 2.7 billion tonnes a year by 2030. To avoid the 1.5ºC increase, the fashion sector will have to reduce annual emissions to around 1.1 billion tonnes. This information is valuable as it brings clarity and transparency. What we need now is action. Globally, there are initiatives to encourage public commitment from large fashion companies such as, for example, the UN Fashion Industry Charter for Climate Action, signed by some of the brands reviewed here. However, there needs to be active and collective participation as well as the creation of time-bound, measurable targets so that the change really happens in the desired way. It is important to see similar joint efforts happening at the national level, including in Brazil.
The fashion industry in Brazil and worldwide This report shows that the fashion industry, in Brazil and worldwide, needs to be bolder - and more transparent - about
what it is doing to address the challenges regarding the climate crisis, along with the other environmental impacts present in the supply chain as well as other consequences of unsustainable production and consumption. There are several new laws and regulations coming through in Europe that will require the fashion industry to do more about human rights and the environment. For example, the expected announcement by the European Commission on mandatory human rights and environmental due diligence legislation (mHREDD) will apply to the value chains of all companies selling their products in the European Union. Another ongoing initiative is the Sustainable Products Initiative, which will review and propose additional legislative measures to make products placed on the EU market more sustainable. There is also the EU strategy for sustainable textiles, which will help the EU shift to circular economy model where products are designed to be more durable, reusable, repairable, recyclable and energy-efficient. Unfortunately, we are not yet aware of any ongoing regulatory proposal such as this legislation in Brazil.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
EXECUTIVE SUMMARY
HOW THE INDEX HAS CHANGED THIS YEAR
Against this backdrop, over the past year we have conducted a detailed review of the Global Index. This review was based on stakeholder interviews, social media feedback and media review. As a result, we have taken a range of steps to strengthen the methodology and push brands and retailers to go above and beyond policies and commitments towards more public disclosure on the implementation and outcomes of their efforts. Given the precarious situation that supply chain workers faced during the COVID-19 pandemic, we also added in six indicators specifically looking at what information major brands disclose about the pandemic’s responses. Find out more details about the review in Methodology & Scope of the Research. In About this Index, we explain the motivations and objectives of our research as well as the key role of transparency in triggering corporate accountability and systemic change.
WELCOMING YOUR FEEDBACK We recognise that the Index is not perfect and can always be improved. We welcome any feedback or questions on the Index to educacional.brasil@fashionrevolution.org
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
EXECUTIVE SUMMARY
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KEY RESULTS
KEY RESULTS AVERAGE SCORE IN EACH SECTION
18% 21%
TRACEABILITY
KNOW, SHOW & FIX
SPOTLIGHT ISSUES
30%
20%
21%
15%
12%
overall average score across 39 brands reviewed in 2020
overall average score across 29 brands reviewed in 2019
Up 5 points compared to the overall average in 2019
30%
GOVERNANCE
overall average score across the 50 brands reviewed in 2021
No increase compared to the overall the average in 2020
22%
POLICY & COMMITMENTS
overall average score across 20 brands reviewed in 2018
Up 13 points compared to the overall average in 2018
17 BRANDS HAD NO SCORE
TOP 5 SCORES C&A
70%
Besni
0
Leader
0
Malwee
66%
Brooksfield
0
Lojas Avenida
0
Renner
57%
Caedu
0
Lojas Pompéia
0
Youcom
57%
Carmen Steffens 0
Marisol
0
Adidas
53%
Cia. Marítima
0
Moleca
0
Colcci
0
Nike
0
Di Santinni
0
Sawary
0
Fórum
0
TNG
0
Kyly
0
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
TOP 5 HIGHEST INCREASE IN SCORES SINCE 2020 (IN PERCENTAGE POINTS)
EXECUTIVE SUMMARY
NON-MOVERS (0%)
TOP 5 HIGHEST DECREASE IN SCORES SINCE 2020
Brooksfield
(IN PERCENTAGE POINTS)
Carmen Steffens Riachuelo Arezzo
+13 +9
Hering
Cia. Marítima
-17
John John
Colcci Di Santinni
-9
Fórum Dafiti
+9
Osklen
-9
Ipanema
+7
Le Lis Blanc
-8
Melissa
+7
Pernambucanas
-6
Leader Lojas Avenida Lojas Pompéia Moleca TNG
Percentage of brands publishing suppliers lists
Processing facilities
First-tier manufacturers
2021 (50 brands)
40%
2020 (40 brands)
28%
33%
33% 25%
8% 20%
33%
43%
2019 (30 brands) 2018 (20 brands)
Raw material suppliers*
25%
17% 15%
*The decrease in 2021 was due to the fine-tuning of the research methodology compared to previous years. In it, in addition to searching for a map or list that represents a significant proportion of suppliers, we started to reject lists that did not include fibre, leather or any other type of main material used in the products but rather only those materials used in processes such as chemicals.
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
EXECUTIVE SUMMARY
SPOTLIGHT ISSUES COVID-19
PURCHASING PRACTICES
4%
20%
0%
48%
2%
2%
brands disclose % of workers in their supply chain who received late wage payments or had their contracts put on hold
brands disclose % or # of workers who had a wage reduction or were laid off
none disclose % or # of workers in their supply chain who were laid off
brands disclose which safety measures were implemented at their workplaces
brands disclose their method for ring-fencing labour costs in price negotiations
brands disclose a policy on % of orders paid to suppliers before starting production to cover costs such as raw materials
LIVING WAGES
GENDER EQUALITY
RACIAL EQUALITY
10%
2%
12%
0%
0%
0%
brands disclose their commitment to ensure the payment of a living wage for workers in their entire supply chain
brands disclose % above the legal minimum wage that supply chain workers are paid
brands publish the gender pay gap within their company, considering breakdown of job roles
no one publishes the gender pay gap for their suppliers, considering breakdown of job roles
no one publishes the race pay gap, considering breakdown of job roles
no one publishes the race pay gap for their suppliers, considering breakdown of job roles
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
EXECUTIVE SUMMARY
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SPOTLIGHT ISSUES PRODUCT VOLUME & BUSINESS MODEL
SUSTAINABLE MATERIALS
32%
4%
18%
20%
20%
14%
brands disclose data on the quantity or % of products made annually in Brazil
brands disclose if they offer product repair services seeking to extend the clothes' product life
brands disclose the new business models supporting clothing longevity such as renting and reselling
brands publish the number of different types of fibres they use annually
brands publish a time-bound, measurable, and sustainable strategy for material management
brands publish information on how they define what they consider sustainable raw materials
CLIMATE IMPACTS
CHEMICALS
22%
32%
10%
0%
30%
14%
brands publish science-based goals covering climate and/or other environmental topics
brands publish annual carbon footprint in their own operations
brands publish annual carbon footprint at a raw material level
none publishes a time-bound, measurable commitment to zero deforestation
brands disclose a list of restricted substances
brands disclose measurable progress towards eliminating the use of hazardous chemicals
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
EXECUTIVE SUMMARY
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KEY FINDINGS
Progress on transparency in the Brazilian fashion industry is still too slow. Among 50 of the largest fashion brands and retailers in the domestic market reviewed in this Index, the overall average score achieved was only 18%. This represents a decrease of 3 percentage points compared to 2020. Although the Fashion Transparency Index has pushed many major brands to disclose vital supply chain data information since it was first published in 2016 (since 2018 in Brazil), the progress on transparency on key issues for human rights and the environmental issues has proven to fall short in face of the challenges facing the industry. The decrease in the overall average and in the individual performances of brands may have occurred in part due to the annual review of the methodology, which is based on updating and strengthening the search for more detailed and
relevant information each year. In 2021, the changes were mainly aimed at driving greater disclosure on concrete actions rather than policies as well as the publication of more accurate supplier lists at the raw material level. However, it is noteworthy that the same methodology review has not affected the results of brands in the Global Index as it did in Brazil. The 250 brands globally reviewed this year scored an overall average of 23%, keeping the same 2020 score. In our survey, C&A had the highest score this year, at 70% (down 4% from 2020), followed by Malwee, at 66% (down 2% from 2020), Renner and Youcom, both at 57% (down 2% from 2020), Adidas, which is debuting in the Brazilian review, at 53%, and Havaianas, at 52% (down 3% from 2020). Meanwhile, 17 brands scored zero: Besni, Brooksfield, Caedu, Carmen Steffens, Cia. Marítima, Colcci, Di Santinni, Fórum, Kyly, Leader, Lojas Avenida, Lojas Pompéia, Marisol, Moleca, Nike, Sawary, and TNG. In yet another edition, we have noticed that these major brands and retailers publicly disclose more information about their policies and commitments on human rights and environmental issues (30%) and significantly less about the processes, outcomes and impacts of their
actions. Examples of such low disclosure would be due diligence processes and supplier assessments (15%), corporate governance information (20%) and publication of detailed supplier lists (21%). Regarding topics related to fighting forced and bonded labour, the COVID-19 response, paying living wages, purchasing practices, unionisation, gender and racial equality, sustainable materials, overconsumption, waste, circularity, water, chemicals, deforestation, regeneration, carbon emissions and energy use, the average is even lower (12%). These are urgent and important issues that need faster progress if we are to collectively “build back better” in response to the intersecting crises of climate change, systemic racism and economic inequality. Despite these declines, it is noteworthy that the sections "Know, Show and Fix", which covers due diligence processes and supplier assessments, and "Spotlight Issues", which covers the urgent topics listed above, saw a very slight increase of 1% each compared to 2020, being the only sections that showed improvement in this period.
Less than half of brands (40%) disclose data on their first-tier suppliers (cutting, sewing, finishing, assembly, finished product, packaging facilities). Major brands have a clear responsibility to look at their supply chain, identify human rights and environmental risks and impacts and address them. A lack of visibility of supply chains can allow exploitative, unsafe working conditions and environmental damage to thrive. As a first step, brands and retailers need to understand and disclose their own supply chain – for this, we need greater traceability and transparency in the supply chains. Although only 20 out of the 50 brands reviewed publish their first-tier supplier lists, having public access to this kind of data seemed impossible a decade ago for many trade unions and organisations working to defend workers’ rights. However, as we move along the chain, we see that the disclosure of information has decreased: 28% of brands publish data on their processing facilities and 8% of raw material suppliers. Even so, the overall
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
average for the traceability section of the Brazilian Index is slightly above the Global Index, at 21% and 19%, respectively. This is the only section where the Brazilian survey is ahead of the global one.
chain traceability and encourage more brands to disclose, and for those that already do, to accelerate their progress towards a deeper level of traceability and more comprehensive disclosure.
On the other hand, we have noticed that many brands began to disclose a greater level of detail about their suppliers’ facilities, in addition to their names and addresses. Examples of information that started to be disclosed are the number of workers in the facilities, type of product or service, gender breakdown, and existing certifications.
Almost half of companies (48%) publish information on the protective actions implemented in their own facilities as a result of the pandemic.
In addition, brands have also started to disclose their supplier lists in a searchable format (machine-readable table or spreadsheet) so that trade unions and NGOs can better use this information. Having access to machine-readable lists means that the information is much more usable by a wider range of stakeholders. That's why we need to support transparency tools like this Index, organisations like the Transparency Pledge and the Open Apparel Registry, and our own #WhoMadeMyClothes campaign, which encourage big brands and retailers to map their supply chains and show what they are doing publicly. We welcome the progress that has been made on supply
Among the 50 reviewed brands, 30% disclosed how they used the emergency financial aid made available by the government to face the crisis triggered by the pandemic, and 20% disclosed the percentage or number of their own employees who had wage cuts or were laid off as a consequence of COVID-19.
Very few brands disclose data on how workers in their supply chains were affected by the pandemic, which makes it impossible to identify the true social and economic impacts as consequences of the crisis.
EXECUTIVE SUMMARY
The people who make our clothes ended up bearing the heaviest burden of the pandemic, despite being the most vulnerable to its impacts. However, we know very little about what companies have done to deal with the crisis in their supply facilities, as only 2 brands (4%) disclose how many workers in their chains have received late wage payments or had contracts suspended, and none publish how many workers were laid off. This suggests that these brands may have very limited knowledge about workers' payments and the general situation during this period. While brands may be tracking this information, the lack of transparency leaves the public without a perspective on the size of the impact suffered by workers during the pandemic. Brands and retailers need to make an effort to monitor and disclose this data, and must be held accountable for their supply chains, especially in a context like this.
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If the purchasing practices of major brands and retailers are inadequate, they bring risks to human rights in the supply chain. Despite this, there is almost no transparency on how companies establish their business relationships with their suppliers. Better Buying data and extensive research from Human Rights Watch show that poor purchasing practices, including lastminute changes to orders or payment terms, can lead to devastating results for workers, including illegally low wages and unpaid benefits, excessive and even forced overtime, and temporary, precarious jobs. Despite these risks, no brand publishes an example of a standard supplier agreement, establishing order types and terms and conditions for payments. This information is necessary to know their purchasing practices and hold brands accountable for upholding their commitments to their suppliers and workers.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
Ring-fencing labour costs (overtime, social charges, sick leave, holiday and leaves, indirect labour cost and wage increases) from production orders is important to ensure that workers' wages are not up for negotiation. However, only 1 company (2%) disclosed the number of orders they have placed where labour costs have been ring-fenced.
supplier surveys) compared to 1 brand (2.5%) in 2020 and 3% in the Global Index. This information is necessary to scrutinise their purchasing practices and hold brands accountable for upholding their commitments to their suppliers and workers.
Only 10% of brands disclose their commitment to guarantee a wage which covers basic living costs of workers in their supply chain and none publish the number of workers in the supply chain who are actually paid living wages.
In addition, the vast majority of major brands expect suppliers to pay for the costs of production upfront, with suppliers typically purchasing materials for orders on credit, while they’re not paid by brands until many months later. These payment structures are underpinned by imbalanced power dynamics between major brands, suppliers and workers. Only 1 company (2%) discloses a policy on the percentage of orders that are normally paid in advance to suppliers before they start production, and 4 brands (8%) disclose the average number of days that purchase orders are paid in full to suppliers after orders are delivered. Not surprisingly, clothes are often being worn by consumers before brands pay the factories that made them.
Legal minimum wages in most production countries, including Brazil, fall woefully below a living wage rate. That is, an income that would enable workers to afford a decent standard of living including food, water, housing, education, health care, transportation, clothing and provision for unexpected events.
Only 2 brands (4%) disclose annual supplier feedback about their purchasing practices through a formal process (e.g. meetings/events or internal
While collective bargaining agreements do not necessarily ensure what would be a fair living wage, wage increases are more likely when workers are free and
EXECUTIVE SUMMARY
independent to join trade unions and work together to collectively bargain with their employers for better wages and working conditions. The fundamental right to freedom of association, organisation and collective bargaining is provided for in 42% of the supplier codes of conduct publicly available by the brands reviewed (compared to 84% in the global survey). However, fewer brands (16%) publish the number of supplier facilities that have independent trade unions and 14% disclose the number of facilities that are covered by collective bargaining agreements. No company publicly discloses that that the collective bargaining agreements in place in their supplier facilities provide workers with wages that are higher than the legal minimum. Just like last year, no brand publishes a measurable, time-bound strategy to ensure a living wage for all workers across their supply chain. In the global survey this result corresponds to 4% of the 250 brands reviewed. Unfortunately, this data shows that the people who make our clothes seem destined to receive with poverty pay for a very long time unless brands and governments do more to ensure that workers are paid fairly.
Major brands and retailers must go beyond saying that combatting racism is a top priority – and evidence this by addressing racial and ethnic inequality in their operations and supply chains. Recently, many fashion brands have been speaking out to support about supporting racial and ethnic equality – particularly in response to the Black Lives Matter movement that have gained global momentum in the past year. In the mid-2020s, the #BlackoutTuesday campaign started by the US music industry was quickly adopted by other sectors, including the fashion industry as many brands and professionals made an anti-racist commitment. However, a survey by The New York Times found that when it comes to the power structure of major global fashion brands, the representation of black people is incredibly small. Only 1 of the 64 companies reviewed had a black CEO. Among the 69 designers or creative directors of these brands, only 4 were black. The research also showed that,
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
of the 5 senior designer job openings at the time, 4 were filled by white men and 1 by a Latina stylist. Among the 15 listed companies in this group, 7 have boards with at least one black director. In Brazil, an article in Elle magazine found that racism is still evident in much of Brazilian fashion, despite the engaged discourse on social media. Luana Génot, founder and executive director of the Instituto Identidades do Brasil (ID_BR), one of the interviewees in the article, points out that there have been changes. However, there is still a lot of work to be done. Simply publishing a little black square (symbol of the#BlackoutTuesday campaign) is not enough. There has to be a series of commitments as well as understanding the fight against racism as a journey. Almost a year and a half after #BlackoutTuesday on social media, little has changed. Our research shows that 24% of the reviewed brands publish their actions focused on promoting racial equality among their employees, a slight increase compared to 2020 (18%). Only 3 brands (6%) disclose information on career development programmes aimed at reducing racial and ethnic inequality and promoting growth opportunities for black employees. This year, 12% of
companies disclose the breakdown of job roles by ethnicity in their own operations, which is an increase of 2 percentage points from 2020. Similar to last year, no brand publishes ethnicity pay gap data within their own facilities. Nor do they disclose the pay gaps and breakdown by job roles, from a racial perspective, at its supplier level. Solidarity and public support for racial equality, which can be a valuable PR tool for brands, must translate to direct action to address racial and ethnic inequality in their own operations and supply chains.
Despite the fact that women represent 72% of the workforce in Brazil's apparel sector, transparency on gender equality in the fashion industry decreased over the last year. There was a significant drop in publicly available information on the gender breakdown by job roles in companyowned facilities, from 35% in 2020 to 24% in 2021. Data on the gender pay gap within companies have decreased by 3 percentage points in that same period, coming in at 12% in 2021.
EXECUTIVE SUMMARY
In the Global Index, 55% of major brands publish the annual gender breakdown of job roles within their direct operations. This higher score may be partially due to the legal requirement to report the gender pay gap in countries where this issue is more evolved. An example would be UK legislation, which mandates such disclosure by companies with more than 250 employees. This shows the importance of public policies and regulations, not only to encourage transparency, but mainly to highlight the need to prioritise the fight against gender-related structural injustices. Regarding the supply chain, only 3 companies (6%) publish data on the prevalence of gender-based labour violations at supplier facilities. No brand discloses the gender pay gap at its suppliers’ sites. On the other hand, there was a significant increase in the disclosure of procedures implemented by companies to put their pay equity policies into practice, from 8% in 2020 to 20% in 2021. This shows that there are policies being enforced, even if we cannot see their outcomes. In addition, considering the brands' progress since our first analysis in 2018, there has been a 14-point increase in the number of companies disclosing
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policies for their own employees on the rights related to maternity and parental leave, totalling 34% in 2021. Regarding the number of brands disclosing their practices to combat harassment and violence, there has been an increase from 10% in 2018 to 30% in 2021.
When it comes to the climate crisis, there are still few brands and retailers that disclose data on important environmental issues, such as their carbon footprint. Environmental data collection is standard practice in many industries and, given the social and environmental ramifications of the climate crisis, this is an urgent issue for the global fashion industry. Brands cannot demonstrably reduce their environmental impacts if they do not track this data across their whole supply chain. This includes sharing this data to enable a better understanding among all stakeholders on what work is being done and where more effort is needed. We have noticed that 32% of brands publish a company policy on energy and greenhouse gas emissions for
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
their own operations, 30% disclose a supplier policy on this issue and 22% disclose a measurable and time-bound commitment on decarbonisation. Although the results are low, there has been an increase in the disclosure of the annual carbon footprint and greenhouse gas (GHG) emissions of Scope 1 and 2 (the company's own operations and the energy procurement), from 25% in 2020 to 32% in 2021. However, up to 80% of the sector’s emissions are in Scope 3: those produced by the rest of the value chain. In this case, we see a more significant increase in the publication of the annual carbon footprint of companies' supply chains, from 2 brands in 2020 (5%) to 9 (18%) in 2021. However, as we move along the chain, the annual emissions disclosure decreases to 10% at the raw material level, where the greatest environmental impacts occur during the lifecycle of a garment according to a report by the Global Fashion Agenda (GFA) and McKinsey. In addition, only one brand (2%) publishes data on absolute energy reduction in the supply chain, which is fundamental to reducing the industry’s emissions.
Contrary to the world, Brazil has possibly been the only major emitter worldwide to increase its emissions during the pandemic, mainly due to deforestation. Recently, the Greenhouse Gas Emission and Removal Estimating System (SEEG) released the report "Analysis of Brazilian greenhouse gas emissions and its implications for Brazil's climate targets". According to it, the increase in gross emissions of greenhouse gases in Brazil in 2020 was 9.5% while the pandemic stopped the world economy and caused a reduction of almost 7% in global emissions. According to the analysis, the main factor contributing to this increase was deforestation, mainly in the Amazon and Cerrado areas. The greenhouse gases released into the atmosphere by land use change in these regions increased by 23.6% in this period. The Carbon Brief research points out that deforestation, driven by cattle ranching, soybean production and logging, has major implications for the carbon dioxide balance in the global atmosphere. Other studies show that the amount of carbon
EXECUTIVE SUMMARY
that the Amazon rainforest absorbs and stores each year has been falling and that large carbon losses in Brazil and elsewhere in the world are contributing to tropical forests changing from a carbon sink to a global source of emissions. Against this backdrop, it is surprising that no brand has published a measurable and time-bound commitment to zero deforestation. Only 3 companies (6%) disclose evidence of the implementation of regenerative agricultural practices in one or more raw material sources in their chain. Only 14% of brands publish whether they are tracing the source of one or more specific raw materials. Meanwhile, the indigenous peoples, who are extremely vulnerable to climate change, suffer a major setback in their rights to land demarcations (already paralysed by the Federal Government) through Bill 490/2007. One of the most critical points of Bill 490 is the Temporal Framework, which requires proof of possession and occupation of the territory claimed by traditional peoples before 5 October 1988 (date of promulgation of the Federal Constitution). This shows a clear move against the well-being of the planet and humanity given that indigenous peoples and traditional communities are invaluable agents
against climate change and the best guardians of forests, as a new UN report shows. The study shows that 45% of the intact forests of the Amazon Basin are in indigenous territories and, therefore, ensuring their ownership by indigenous peoples and traditional communities, in addition to revitalising cultures and traditional knowledge, can reduce the deforestation rates and biodiversity loss, avoiding carbon dioxide emissions and strengthening the fight against poverty, hunger and malnutrition.
Overproduction and overconsumption are damaging to the planet and communities, yet big fashion brands and retailers still fail to publish information on this issue. Discussions about sustainability in the fashion industry often end up revolving around innovation in design, new materials and, mainly, the belief that conscious consumption is an escape to the climate crisis. However, there is a big issue behind all this that needs to be brought to the centre of the debates: the business models themselves,
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
which aim to produce more and more. Although precise statistics cannot be obtained, it is estimated that the fashion industry produces and sells somewhere between 80 billion and 150 billion garments each year in the world. There was a visible increase in the number of brands disclosing the total volume of pieces produced annually, from 18% in 2020 to 30% in 2021. However, only 18% of brands disclose investments in circular solutions that enable textile-to-textile recycling beyond reuse and downcycling (only a 3-point increase compared to 2020). Although there has been an increase in disclosure relating to permanent takeback schemes of permanent in-store take-back schemes, from 20% in 2020 to 24% this year, there are still only a few brands (22%) that disclose what happens to the clothes received through these systems. In addition, only 18% of companies offer new business models that support longevity and reduce the consumption of new clothes. Only 4% of brands offer repair services in order to increase clothing longevity and slow down the consumption of new products. While it may be good news that more brands appear to be investing in circularity and textile recycling initiatives,
this alone will not solve the industry’s overproduction and overconsumption problems. Slowing down, making fewer and higher quality products as well as extending the life of existing clothes and materials will be essential to reducing greenhouse gas emissions, curbing disposal rates, and mitigating environmental degradation, thus ensuring a better future for fashion and the planet.
One in five brands reviewed discloses a measurable and time-bound strategy for sustainable materials management. Only 20% of brands disclose a strategy for managing sustainable materials and 14% publish information about the tool or process they use to define what they consider to be sustainable raw materials. This indicates a clear need for fashion industry regulations to set standards on what can be considered 'sustainable' materials. Brands need to measure and have access to reliable data which accounts for all the potential environmental impacts of a fibre. However, the research conducted by an interdisciplinary
EXECUTIVE SUMMARY
research programme Mistra suggests that there is a clear lack of environmental data proving the sustainable attributes of certain materials and that the currently available data only covers a limited set of environmental impacts. This lack of credible and comparable information about what ‘sustainable’ material choices mean makes it difficult for consumers to make informed choices about the clothes they choose to buy, how best to care for the clothes they own and for brands to make informed decisions on what materials they should use.
To make further progress towards transparency, the fashion industry needs better laws and regulations demanding greater accountability from major brands and retailers on their impacts on human rights and the environment. Over the past ten years there have been a number of new laws and regulations coming into play across several countries that place human rights and
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environmental related requirements on companies. For instance, even though the Modern Slavery Act 2015 in the UK has not been impactful in rooting out forced labour from apparel supply chains, this legislation has meant that companies who disclosed virtually nothing about their efforts on responsible sourcing now do publish some information which can be scrutinised by their stakeholders. As commented earlier, in the UK, companies are also required to publish annual gender pay gap data. Going against this transparency effort - and the fight against inequalities - in France and Germany, the two largest EU economies, for historical reasons, it is not allowed to collect any racial/ethnic demographic data, with rare exceptions, usually scientific in nature and evaluated on a case-by-case basis. This means that no French or German companies disclose this information for the Global Index. This certainly makes it difficult to meaningfully address racial equity in the hiring practices of companies in our society. In the latter part of 2021, we are expecting a range of different regulations and policies to be proposed by the European Commission that have the potential to create significant systemic change in how European companies address
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
human rights and environmental impacts across their value chains, from supply chain to product endof- life. For example, a mandatory human rights and environmental due diligence legislation at EU level which applies across suppy chains.
The format of information disclosure remains problematic among major brands and retailers. Some brands communicate their human rights and environmental efforts in a way that is overwhelming, impenetrable, repetitive and difficult to find, with no regard to the organisation, format, location or even quality of what is being disclosed. All this makes it virtually impossible for their customers and stakeholders to decipher information that is meaningful and actionable. Sometimes crucial pieces of data are hidden in annexes and footnotes of long technical reports or buried dozens of clicks away from the homepage of brands’ websites. Even for some of the higher scoring brands in this Index, it takes our experienced researchers many days and countless hours to read through all their communications to uncover what is relevant and actionable.
At other times, brands publish a vast amount of information to read through, from woolly statements about the brand's values or stories about pilot projects which relate to a tiny fraction of their supply chain and can ultimately seem like a deliberate strategy to avoid disclosing any concrete and impactful information. Recent research reveals a mere 18% of consumers would trust sustainability information provided directly by brands themselves and that 77% agree they find it difficult to research or understand sustainability claims. This mistrust may stem from some brands’ tendency to feature inspiring or fluffy story-telling more often than reporting on actual systemic impacts and outcomes of their efforts. Recommendations on accountability point out that, regardless of the format chosen, the information should be accessible to any interested party; have clear and adequate language that does not put the parties involved at risk; be disclosed in an appropriate and detailed manner to show how companies identify and treat their impacts; and have an independent mechanism to verify their content in order to increase its credibility. Standardisation of credible, comparable disclosure of human rights and environmental impacts by major
EXECUTIVE SUMMARY
brands and retailers would be most welcome, and we hope that some progress will be made on this issue at a legislative level in the coming years.
Greater transparency is only the first step towards making change in the fashion industry. Our call to action – do not use this Index to inform your shopping choices but please do use these findings to inform your activism. While we have seen many brands increase their level of transparency yearon- year, and we know that the Fashion Transparency Index has influenced brands to share more information about what they are doing on human rights and environmental issues, this is not nearly enough. Human rights and environmental abuses are still rife in this industry. Over half of the world’s largest brands and retailers still do not disclose their suppliers. With an average score of just 18% in this Index (and 23% in this Global Index), many big profitable brands remain largely opaque
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about their efforts to address human rights and environmental issues. We urge readers to use these findings to speak up and challenge the big profitable brands and retailers on their claims, urging them to be more accountable and prove that they are making changes in reality and not just on paper. Please also use these findings to contact lawmakers where you live to demand better laws that make big brands accountable for their human rights and environmental impacts. To read more about what you can do with these findings – whether you are an individual, brand or retailer, policymaker, investor, NGO or trade union – please see Final Thoughts & Recommendations on this report.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
ABOUT THIS INDEX
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
ABOUT THIS INDEX
OUR THEORY OF CHANGE
THE CHANGES WE WANT TO SEE
OUR ROLE WITHIN AND OUTSIDE THE INDUSTRY
At every level, from field to factory, fashion supply chains are both a major contributor to, and impacted by, the climate crisis. The global fashion industry currently relies on extracting finite natural resources, and this contributes significantly to environmental degradation and biodiversity loss.
A systemic overhaul of the global fashion industry
Fashion Revolution is uniquely positioned both ‘within’ and ‘outside’ the fashion industry. We work to achieve change in three main ways: policy change, cultural change, and industry change.
The fashion industry is also a major driver of human rights abuses around the world, affecting workers and their communities throughout global value chains. The imbalance of power between global buyers, their suppliers and their workers is deeply entrenched in the industry and often threatens working conditions, livelihoods and health of the people who make our clothes. Fashion supply chains are highly globalised, deregulated, complex and opaque, and lack proper regulations. Business relationships are murky, and subcontracting is common. This obscures responsibility and accountability when things go wrong, as they so often do. The lack of transparency means we cannot easily see and take swift and appropriate action on environmental and human rights abuses. Without transparency, we cannot protect vulnerable people and the planet. Therefore, transparency underpins systemic change.
At Fashion Revolution, we campaign for a global fashion industry that conserves and restores the environment and values people over growth and profit. We are working towards an industry-wide culture of transparency and accountability across the value chain; a global fashion industry where brands take responsibility for their social and environmental impacts. The Fashion Transparency Index is one tool in achieving this vision, and feeds into our manifesto point #8.
Working ‘within’ the system means engaging in a system that is deeply unsustainable, extractive, and unjust. However, engaging within a system we disagree with is not to condone it. In fact, it is precisely the opposite. That is, it is an attempt to fundamentally disrupt and dismantle the structures that uphold injustice and exploitation in the industry supply chains.
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We engage within this unjust system because doing so is effective in driving change, although it can sometimes be frustratingly slow. To achieve transparency and accountability across the industry, we need to engage the industry's biggest players, such as brands and retailers analysed in this Index. These are the companies responsible for the biggest negative impacts and, therefore, have the greatest responsibility to address and change the problems they have caused and continue to perpetuate. Therefore, we see this industry change as working 'within' the system, while cultural and political changes are ways of working 'outside' the system, where we focus on educating and mobilising citizens as well as advocate for policy changes at governmental and legislative levelsn. Transparency is fundamental to achieving all these changes.
Learn more about how we work by clicking here.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
ABOUT THIS INDEX
THE ROLE OF TRANSPARENCY IN ACHIEVING CHANGE
The public disclosure of credible, comprehensive, and comparable information about fashion’s supply chains enables investors, lawmakers, journalists, NGOs, trade unions, workers, and their representatives to hold brands and retailers accountable. This transparency enables such actors to: •
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Scrutinise what companies say they are doing to address human rights and protect the environment. Hold brands and retailers accountable for their policies and practices, which is especially important when things go wrong, like they did when Rana Plaza collapsed, in Bangladesh in 2013.
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Collaborate to cease, mitigate, prevent and remedy environmental and human rights abuses.
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Collaborate to share strategies and best practice on these issues.
Therefore, we understand transparency as a tool for change, not the end goal. Transparency alone will not solve all of the complex and deeply systemic problems in the global fashion industry. However, it is a baseline, without which we cannot meaningfully move towards real improvements. By shining a light on the places and conditions in which our clothes are being made, we are able to address them more quickly and collaboratively. Examples of this are presented ahead in Case Studies: Transparency in action. Fortunately, we are not alone in calling for transparency. We are one voice of many across civil society, including NGOs and trade unions representing supply chain workers. Please read this letter published in April 2021 and signed by 33 NGOs, including Fashion Revolution, calling for full supply chain transparency in the clothing sector:
“The time for full supply chain transparency is now. As civil society organisations, we call upon all clothing brands and retailers to disclose all the facilities in their supply chain. We welcome the steps taken by those companies who are already disclosing part of their supply chain and encourage them to accelerate their progress towards full transparency. We ask regulators to provide for a level playing field, by setting harmonised legislation for such public disclosure and to ensure every clothing brand commits to the same level of transparency.”
transparency scrutiny accountability change
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
THE ROLE & AIMS OF THE FASHION TRANSPARENCY INDEX
The Fashion Transparency Index was created to: •
Incentivise major brands and retailers to disclose a greater level of detailed and comparable data and information year-on-year.
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Analyse trends and compare the level of transparency on human rights and environmental issues among the world’s largest and most influential fashion brands and retailers.
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Create a tool that helps a wide set of stakeholders to better understand what data and information is being disclosed by the world’s largest brands and use the findings to take further action.
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Shape our ongoing efforts to raise public awareness and educate people about the social and environmental challenges facing the global fashion industry, using this research to inform people’s activism.
We have heard from many in our community who feel frustrated by the speed of change in the fashion industry. Given the climate emergency and persistence of human rights abuses in the industry, many people are calling for urgent and systemic transformation now. We hear you, and we share your frustrations. This is why we have made some notable changes to the methodology this year, moving our focus away from policies and commitments to implementation and outcomes. See more details in Methodology & Scope of the Research.
ABOUT THIS INDEX
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HOW THE FASHION TRANSPARENCY INDEX DRIVES CHANGE The Fashion Transparency Index has driven change in large part by helping to normalise the concept of transparency within the industry and make public disclosure of social and environmental efforts more commonplace. For brands that have been reviewed year-on-year since 2017, and in Brazil since 2018, we have seen their average scores progressively increase. When we started conducting this research in Brazil back in 2018, very few brands published lists of first-tier manufacturers and beyond. They were only 25% (5 out of 20), while in 2021, this number grew to 40%, with 20 brands out of the 50 reviewed. We have made this important industry shift happen by pushing hard for increased transparency in tandem with like-minded ally organisations.
We have also forged partnerships with several other organisations around the world not just to push for greater transparency but also to enable the Index methodology and research to be used more widely, putting the findings into tangible action. For example, our partnership with WikiRate enables the data we collect about brands to be freely accessible, easily comparable, machinereadable, and crucially, actionable. This is valuable to investors and civil society organisations, including trade unions that represent garment workers, that make use of transparency data.
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CASE STUDIES
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CASE STUDIES: TRANSPARENCY IN ACTION
Cotton from Xinjianj Uyghur Autonomous Region, China Since early 2017, allegations have been made that the Chinese government is facilitating the mass transfer of Uyghur and other ethnic minority citizens from the far-western Xinjiang Uyghur Autonomous Region (XUAR). A report by the Australian Strategic Policy Institute (ASPI) estimates over one million people have been detained in detention camps designed to force minority groups to abandon their cultural traditions, which the Chinese government has characterised as “re-education centres”. Between 2017 and 2019, reports suggest that the statesponsored labour transfer programme has moved more than an estimated 80,000 Uyghur people out of XUAR to work in factories across China, though this figure is likely much higher.
ASPI’s research relied heavily on transparency information such as publicly disclosed supplier lists, which ASPI used to establish that the forced labour of Uyghur people can be linked to 83 major global brands and retailers selling apparel, technology and automotives - many of whom are included in this Index. ASPI was able to reach out to the implicated brands to confirm their supplier details and alert them of their links to allegations of state-sponsored forced labour in the region. ASPI called for brands to conduct immediate and thorough investigations into allegations of forced labour in factories across the region and the country. Most companies implicated in the report issued a statement in response, with some verifying whether or not they source from facilities implicated in the use of Uyghur forced labour. Some brands committed to stop sourcing cotton from XUAR entirely as a result.
In 2020 the U.S. Government issued sanctions on Chinese firms and in 2021 banned all cotton imports from XUAR. Scott Nova, the executive director of the Workers’ Rights Consortium, viewed the decision as a “high-decibel wake-up call to any brand that continues to deny the prevalence and problem of forced-labour produced cotton” and estimates that American brands import more than 1.5 billion garments using materials made in XUAR annually -- representing more than $20bn in retail sales. Without the public disclosure of supplier lists, it is difficult to prove the links between global brands and their suppliers in order to hold them accountable for their links to serious human rights violations.
Image: Getty Images/BBC
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
CASE STUDIES: TRANSPARENCY IN ACTION
Brazilian cotton The bancada ruralista (the large landowners' lobby and agribusiness advocates) in the Brazilian Congress wants to weaken the pesticide regulation policy, which was initiated by the Bolsonaro administration in 2018. It is currently trying to approve bill 6299/02, which is known as the Poison Bill. The bill aims to streamline the approval process for new pesticides by changing the evaluation criteria and banning the term “pesticides” from packaging in order to approve products that the current legislation prohibits. Having been proposed by a cross-party political caucus of federal deputies and senators who promote the interests of agribusinesses in congress, the bill directly impacts the lives of the population. Its main arguments in favour of the bill have already been disproved by a number of specialists, such as Brazilian Health Regulatory Agency (ANVISA), National Human Rights Council, Brazilian Association of Collective Health (ABRASCO), and Oswaldo Cruz Foundation (FIOCRUZ), among others. However, the bill was built unilaterally without any dialogue with civil society.
Brazil is the largest pesticide market on the planet, and cotton ranks fourth among the crops with the highest pesticide consumption. About 10% of all pesticides in the country are used in cotton crops. Glyphosate, among the most used pesticides, can cause several health effects, such as miscarriage and cancer. Brazil is also a large exporter of soluble cellulose, which is a raw material used in viscose production. Eucalyptus and cotton crops use 7-10 types of pesticide in Brazil, respectively. Acephate, fourth in the list of the most used pesticides, has a high carcinogen potential, while imidacloprid, in the seventh position, is considered one of the most lethal for bees. Considering the importance of bees as pollinators, this is a cause for concern due to both economic and socio-environmental issues. Moreover, pesticide use does not only impact nearby communities. We should also consider our cumulative exposure to pesticides, as some widely used compounds can remain in organisms, water, and soil for many years.
CASE STUDIES
In addition, the lack of transparency regarding the consequences of approving such a bill impacts the fashion industry. By altering how information on hazardous components is presented on packaging and changing the name from “pesticides” to misleading terms, such as “agricultural defensives” or “phytosanitary products”, it spreads misinformation to consumers. This is also bad news for businesses, as in the short term, the legislation change can impact the exports of Brazilian commodities such as cotton. Europe and the US are moving towards pesticide reduction and most of the best-selling products here are prohibited there. Thus, transparency is of utmost importance to ensure the well-being not only of workers and local communities, but also food security, ecosystems preservation and consumer rights. The sector movement Moda Sem Veneno (Poison-free Fashion) was created as a result of the partnership between Fashion Revolution Brazil, Modefica and Rio Ethical Fashion, with the support of
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many organisations in the industry. The first action was creating a petition that could highlight society's concern with the topic and pressure congress representatives to vote against the bill. The organising group has gathered over 42,000 signatures to provide to the members of Frente Parlamentar Ambientalista (Environmentalist Parliamentary Front, a cross-party alliance with representatives in both houses of Congress advocating for environmental protection and fierce opposition to bancada ruralista). This volume of engagement highlights the social and political capital in favour of transparency and a fashion industry free of poison. Learn more by visiting the petition here.
Image: Jan Amiss by Pixabay
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
NELSA INES FABIAN NESPOLO PRESIDENT AND DIRECTOR OF JUSTA TRAMA
VIEWPOINT
"Truly sustainable development includes people and improves their lives, while also caring for the environment and respecting end consumers. These are key elements in building a different society. For fair and transparent trade to exist, we need to know where the cotton came from, who was part of that process and who sewed our clothes. Acknowledging this whole journey is a way of valuing everyone involved, from the farmer who works under the sun to the seamstress who spends the day sitting at her sewing machine. Special attention must also be paid to fair income distribution and to the environment as well as resisting the unequal society and the concentration of income in which we currently live. It is possible to produce, agree to pay fair prices and share the value generated equally among all parts involved. Going against the traditional system, which relies on poisons that contaminate the soil and water, being able to claim that their cotton is free from the use of pesticides and does not contaminate the environment (or people) and, therefore, will not contaminate you, is very powerful!"
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
METHODOLOGY AND SCOPE OF THE RESEARCH
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
METHODOLOGY AND SCOPE OF THE RESEARCH 25
HOW BRANDS AND RETAILERS ARE SELECTED
Fashion Revolution Brasil and ABC Associados jointly selected the brands1 to be reviewed based on the decision that the fourth edition of the Fashion Transparency Index Brazil would review 50 brands. We understand that the size of the sample of brands selected is not enough to represent the Brazilian fashion market as a whole. Therefore, we tried to select brands from different segments to address the diversity of the industry. The selected brands covered the following markets/ segments: retailers; denim, casual wear; footwear; sportswear, beachwear; underwear; and childrenswear. Brands and retailers were selected based on three main factors:
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Annual turnover;
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Spread of market segments;
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The position as top of mind2.
Regarding turnover, we reviewed publicly disclosed information about the financial performance of brands and retailers on their websites. In the case of private companies that do not disclose their financial performance, we relied on third-party publications, widely available nationally and internationally, that presented their revenue and turnover estimates. When the information found related to a parent company that controls different brands, we selected the brand (or brands) identified as the most significant in terms of turnover and brand recognition. We have purposely listed brands and not the parent companys because the public will be most familiar with the brands. 39 of the 40 brands and retailers reviewed in 2020 were reviewed again for the 2021 index. The excluded brand is Colombo because it no longer fits the criteria listed above. We also added 11 brands and retailers to our research. For 2022, we aim to continue expanding the number of companies reviewed.
1. We may only use the term “brands” to indicate brands and retailers. 2. Top of mind is a term used to qualify brands that are the most popular among consumers.
This year, 48% of the brands took part in the second phase of the review process by returning a completed questionnaire. Brands are included in the Index whether they returned the completed questionnaires or not. We treat every brand the same regardless of whether they choose to participate. However, brands that participate in this second phase typically receive higher scores because they are able to identify relevant disclosure information that our researchers may have missed in their initial research.
H OW M A N Y B R A N D S PA R T I C I PAT E D I N 2021
38%
48%
Did not respond
Completed the questionnaire:
14%
Declined the opportunity to participate
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
METHODOLOGY AND SCOPE OF THE RESEARCH
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THE 50 BRANDS SELECTED
= brands that completed the questionnaire
Adidas (Adidas Group)
Dumond (Grupo Paquetá)
Marisol (Marisol S.A.)
Animale (Grupo Soma)
Ellus (InBrands)
Melissa (Grendene)
Aramis
Farm (Grupo Soma)
Moleca (Calçados Beira Rio S. A.)
Arezzo (Arezzo&Co)
Forum (AMC Têxtil)
Netshoes (Magazine Luiza)
Besni
Havaianas (Alpargatas)
Nike
Brooksfield (Grupo Via Veneto)
Hering (Cia Hering)
Olympikus (Vulcabrás)
Caedu
Hope (Grupo Hope)
Osklen (Alpargatas)
Carmen Steffens (Carmen Steffens)
Ipanema (Grendene)
Pernambucanas
C&A
John John (Restoque)
Puket
Centauro (Grupo SBF)
Kyly (Grupo Kyly)
Renner (Lojas Renner S.A.)
Cia. Marítima (Grupo Rosset)
Le Lis Blanc Deux (Restoque)
Colcci (AMC Têxtil)
Leader
• • •
•
Dafiti (GFG LatAm)
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• • • • • • •
•
•
• • • •
Riachuelo (Grupo Guararapes) Sawary
Lojas Avenida (Grupo Avenida)
TNG
Dakota (Universo Dakota)
Lojas Pompéia (Grupo Lins Ferrão)
Torra
Decathlon (Association Familiale Mulliez)
Lupo
Youcom (Lojas Renner S.A.)
DeMillus
Malwee (Grupo Malwee)
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Di Santinni
• •
Marisa
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Zara (Inditex)
•
•
•
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
METHODOLOGY AND SCOPE OF THE RESEARCH
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THE SCOPE OF THE RESEARCH The Fashion Transparency Index ranks the largest brands and retailers according to the amount of information publicly available on their social and environmental impacts throughout their supply chain and their own operations. We have deliberately chosen to focus on transparency by means of public disclosure. If the information and data disclosed by brands is publicly available, detailed and specific enough, it can be used by multiple stakeholders – including worker representatives, environmental groups, investors, consumers and brands themselves – to drive positive change on human rights and environmental issues. As public disclosure drives public accountability, limited and inwardfacing disclosure aimed only at specific stakeholders limits the scope for transformative, positive impact. For this reason, the Index purposely excludes everything that brands and retailers may be doing internally and behindthe-scenes across their companies and supply chains. This is why we are looking for public disclosure not only on brands’ policies, procedures and governance, which are less risky to share, but also meaningful disclosure of results, progress, outcomes and impacts across the business and its value chain.
It is important to highlight that the Fashion Transparency Index is not a shopping guide. We do not recommend or endorse any of the brands and retailers reviewed, regardless of their scores. The aim is to understand the amount of information about social and environmental aspects are shared by the largest brands in Brazil, so we can push for greater public disclosure of this information and use it to hold them accountable, when needed.
The information / data should be publicly available from one of the following places: On the brand/retailer website; On parent company website (provided there is a direct web link to it from the main brand website);
In annual reports on sustainability or social responsibility published by the brand (provided there is a direct link to it from the main brand website and is dated January 2019 or later);
Investors reports or Sustainability/ CSR websites (provided there is a direct web link to it from the main brand website);
In any other documents which are publicly available and can be downloaded freely from the brand/retailer's website(s); On third party websites when there is a direct link from the brand website.
We do not count the following information sources: Clothing labels and hang tags on products; In-store or at other physical locations; Smartphone apps; Social media channels;
Third party websites or documents where there is no weblink from the brand’s own website, including press articles; Downloadable documents where the weblink cannot be found on the brand’s website.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
METHODOLOGY AND SCOPE OF THE RESEARCH
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ABOUT THE RESEARCH PROCESS August – November 2020 Global methodology updates: industry research and stakeholder consultation process for annual review of the methodology, including adjustments and inclusion of new indicators, when needed, as well as selection of new topics for the Spotlight Issues section.
February - March 2021 Brazilian methodology updates: rannual review, considering the adjustments made in the global methodology and the need for specific adaptations to the Brazilian context. The selection of the new companies to be included in the research.
July-August 2021 Final review of the questionnaires: after approximately one month, brands return the completed questionnaires. Our research team reviews each indicator and awards additional points, provided that the new information presents enough evidence for what we are looking for. The Brazilian and global teams conduct several rounds of peer review data quality assurance checks before finalising each brand's score.
June 2021 Brands receive questionnaires to complete: brands are invited to complete the questionnaires with data that our research team might not have found and/or with more up-to-date public information.
September-November 2021 Data is compiled, analysis completed and report prepared: data from all brand questionnaires is transferred to a joint-analysis tool for the complete dataset. This dataset is the baseline for creating this final report.
End of November 2021 Fashion Transparency Index Brazil is released: the 2021 edition is released in an online event.
April-May 2021 Research and engagement with the selected brands and retailers: the research team reviews each brand and pre-populates their Index questionnaire with all the public information found. A review round is then carried out to verify the accuracy of the answers found. In parallel, two meetings are held with the brand representatives to present the initiative, promote reflections on the importance of greater transparency for the sector and detail the methodology and process of analysis of the Index.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
METHODOLOGY AND SCOPE OF THE RESEARCH
ABOUT THE METHODOLOGY The Fashion Transparency Index reviews brands’ public disclosure across 5 key areas:
1. POLICY & COMMITMENTS 2. GOVERNANCE 3. SUPPLY CHAIN TRACEABILITY 4. KNOW, SHOW & FIX 5. SPOTLIGHT ISSUES Which this year covers: •
Decent work, covering combating forced and bonded labour, COVID-19 response, living wages, purchasing practices, unionisation, and collective bargaining
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Gender and racial equality
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Sustainable sourcing and materials
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Overconsumption, waste and circularity
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Water and chemicals
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Climate change and biodiversity
Brazilian questionnaire
The 2021 Index covers 245 individual indicators across 50 brands, comprising 12,250 data points. For more details, visit this link to view the 2021 Brand Questionnaire template sent to companies in Brazil.
''The Fashion Transparency Index does not give you the low-down on where to shop. What it does do, is help you to hold brands and retailers to account for their claims. Use this information to charge your activism, not your credit card.'' Carry Somers, Co-founder, Fashion Revolution
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METHODOLOGY ADVISORY COMMITTEE
The methodology was designed in 2017 through a four-month consultative process. We had contributions from a variety of industry experts and stakeholders from academia, the trade union movement, civil society organisations, socially responsible investment, business consulting and journalism. This year we have made significant updates to the methodology in consultation with our advisory committee, which included more than 20 experts and organisations, such as: Dr Mark Anner, Associate Professor & Director of the Center for Global Workers’ Rights at Penn State University
Maddy Cobbing, Detox My Fashion Campaign at Greenpeace
Hester Le Roux, Senior Economic Advisor, Policy & Advocacy at CARE International
Gary Cook, Global Climate Campaigns Director at Stand.earth
Emily MacIntosh, Policy Officer for Textiles at European Environmental Bureau
Subindu Garkhel, Cotton and Textiles Lead at The Fairtrade Foundation
Maya Rommwatt, Fashion Climate Campaigner at Stand.earth
Fiona Gooch, Senior Private Sector Policy Advisor at Traidcraft Exchange
Francois Souchet, Make Fashion Circular Lead at Ellen MacArthur Foundation
Christina Hajagos-Clausen, Textile and Garment Industry Director at IndustriALL Global Union
Joe Sutcliffe, Senior Advisor, Dignified Work at CARE International
Kristian Hardiman, Head of Ratings at Good On You
Eloisa Artuso, Lead of Fashion Transparency Index Brazil
Aruna Kashyap, Senior Counsel at Human Rights Watch
Neil Brown, Head of Equities at GIB Asset Management
Kate Larsen, Business & Human Rights Consultant
Urksa Trunk, Campaign advisor at Changing Markets Ben Vanpeperstraete, Supply Chain Consultant
We have also strived to align the methodology, so far as possible, with existing international standards and frameworks such as Global Reporting Initiative (GRI), Open Data Standard, UN Guiding Principles, Sustainable Development Goals (SDGs), OECD Due Diligence Guidelines and the relevant International Labour Organization (ILO) conventions, as well as other industry initiatives including Act on Living Wages, Corporate Human Rights Benchmark, Know The Chain, Transparency Pledge, and several others.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
METHODOLOGY AND SCOPE OF THE RESEARCH
ABOUT ANNUAL REVIEW OF THE INDEX
ADAPTING THE METHODOLOGY TO THE BRAZILIAN CONTEXT
Over the past year, we have conducted detailed analysis and review of the Index, with stakeholder interviews, social media feedback and media review. We have taken a range of steps to strengthen the methodology and push brands and retailers to go above and beyond policies and commitments towards more public disclosure on the implementation and outcomes of their efforts.
For the first edition of the Fashion Transparency Index Brazil in 2018, Fashion Revolution Brazil established a technical partnership with FGVces (Centre for Sustainability Studies at Getulio Vargas) for adapting the methodology to the Brazilian context and conducting the research.
We understand that policies do not always accurately reflect how a business is run, and this year we wanted to put greater emphasis on business action. To do this, we halved the weighting of the scores in section 1 - Policy & Commitments - and gave more weight to indicators which focus on implementation and outcomes on issues such as supplier audits, living wages, purchasing practices, gender and racial equality, and climate and water data in the supply chain. We added 24 indicators compared to last year. The weighting of the scores1 is designed to incentivise detailed and granular public disclosure and to put the greatest emphasis on results, outcomes, impacts and the most actionable data that can be used by external stakeholders to hold brands accountable. 1. Learn more on “Weighting of the scores” section
We have also added and improved guidelines to help our researchers during the search for information disclosed by brands. An example is Section 3.3 where, in addition to searching for a map or list that represents a significant proportion of raw materials suppliers, we started to reject lists that disclosed only material suppliers used in production processes such as chemicals. In this subsection, we searched for fibre, leather or any other type of main material used in the products. When analysing and comparing the results of this version of the Fashion Transparency Index with those of previous years, it is important to highlight that the 2021 review of the questionnaire may have impacted brands' final scores and, consequently, this year's overall average score.
On that occasion, we consulted different experts from the Brazilian industry for our research. We decided that it would be important to address issues related to race equality and to the working conditions of foreign migrant workers in the supply chain. Only a few adjustments were made, meaning that the processes of analysis were kept strictly the same, without damaging to the comparability of the results with the global methodology. Since 2019, we carried on reviewing the questionnaire's content and structure with the same technical partner team, which now operates by ABC Associados consultancy. Similarly to 2018, this team has supported us in the stages of identifying and reviewing the brands presented in this Index.
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This year, during the review and adaptation of the indicators to the local context, we listed urgent topics for the Brazilian context that are not present in the Global Fashion Transparency Index in the Spotlight Issues section. For the Brazilian edition, we kept the subsection covering actions to combat forced and bounded labour, which is no longer present in the 2021 global Index, and we selected different indicators for the subsection covering COVID-19 response in order to reflect the national reality. This is why it is possible that there are differences in the final scores of the brands included in both global and Brazil Indices . These differences may occur due to the period of the year in which the survey was conducted for each report, the variation of indicators according to the local context as well as the fact that global brands are controlled by different groups in Brazil and worldwide. Each review used the latest available information at the time it was performed.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
LIMITATIONS OF THE RESEARCH •
The survey relies on the available information within a certain time frame, and brands and retailers may withdraw or disclose new information at any time. Data is only as current as of August 31st, 2021.
•
Changes to the methodology in 2021 may affect year-on-year comparability of the results, so please make annual comparisons with that in mind.
•
On desk-based research, human error is a possibility. Although our research team is committed to conducting the review in the most complete, accurate and impartial manner possible, there is the possibility of errors.
•
Verification of brands’ claims are beyond the scope of this research. The Fashion Transparency Index does not provide a detailed review of content, quality, or precision of brands’ policies, procedures, performance, and progress in any particular area. Therefore, we encourage other stakeholders and experts to access and evaluate the information found.
METHODOLOGY AND SCOPE OF THE RESEARCH
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HOW WE CALCULATE THE FINDINGS We are confident that the methodology is comprehensive and robust when it comes to the public disclosure of information by major brands. However, we acknowledge that it can always be improved and, therefore, we welcome your comments or feedback on how to make it even better. You can email us at educacional.brasil@fashionrevolution.org.
All scores have been calculated to two decimal places (in the complete dataset) and then rounded to the nearest whole percentage point (what you will read in this report). The questionnaire awards a total of 250 points. To calculate the total score of for each brand, we add the score awarded to the brand for the 5 different sections. Each section has the following maximum scores:
• • • • •
Section 1 is worth 33 points Section 2 is worth 13 points Section 3 is worth 75 points Section 4 is worth 47 points Section 5 is worth 82 points
The overall average score across all 50 brands is calculated by each brand’s individual final score. For the most part, year-on-year differences in scores are described as the change in percentage points,
which means the actual amount of change, rather than the percent, which means the rate of change (unless explicitly stated otherwise). For instance, if a brand scored 30% in one year and 45% in the next, we are usually reporting that the brand increased by 15 percentage points (45-30=15) rather than saying the brand increased by a 50% its performance (45/30=1.5). Where a score may have been rounded to the nearest percentage point in previous editions, we are calculating the yearon-year difference according to the rounded figures rather than to the exact decimal points. For example, where the average score in a particular section is 17.74%, we have rounded this up to 18%. If in a previous year’s report the average score in that section was 12.41%, we rounded it down to 12% in the report. Therefore, the year-on-year difference is technically 5.33 percentage points, but if we go by the nearest rounded figures it is 6 percentage points.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
METHODOLOGY AND SCOPE OF THE RESEARCH
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WEIGHTING OF THE SCORES
1.
2.
3.
4.
5.
POLICY & COMMITMENTS
GOVERNANCE
TRACEABILITY
KNOW, SHOW & FIX
SPOTLIGHT ISSUES
This section explores brands’ human rights and environmental policies for both their own employees and workers in their supply chain, how these policies are implemented, if brands have relevant goals and targets in place and if brands are reporting annual progress against these targets. For this year’s Index, available points in this section were halved to place more emphasis on outcomes and impacts.
Here we look at who on the executive board has responsibility for human rights and environmental issues, how this is implemented, whether the relevant department can be easily contacted by the public, and how human rights and environmental improvements are linked to employee, CEO and supplier performance. This year we also looked to see whether there is worker representation on the board.
In this section we expect brands to publish supplier lists at three levels: manufacturing, processing facilities and mills, and raw materials. We also look for additional information such as supplier address, number of workers, gender and race breakdown, number of migrant workers, union representation and when the list was last updated.
Here we review what brands disclose about their due diligence processes regarding human rights and environmental issues, what the company is doing to remedy any problems identified in these processes, how it assesses the implementation of its policies in their supply chain, and how it ensures that human rights and environment issues complaints made by their own employees and the supply chain workers are heard and addressed.
In this final section, we look at what brands are doing to deal with issues such as combating forced and bonded labour, COVID-19 response, gender and race equality, living wages, purchasing practices, unionisation, overproduction, waste and circularity, sustainable materials, water and chemical usage, deforestation and climate change. We have increased the weighting significantly compared to previous editions (up from 19.6% last year) in an effort to push harder for disclosure of information on the most urgent and difficult problems faced in the industry.
WEIGHTING (%)
13.2%
5.2%
30%
18.8%
33.8%
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX 2021
METHODOLOGY AND SCOPE OF THE RESEARCH
A GUIDE TO THE FINAL SCORING
0—5%
6—10%
We have intentionally grouped brands in percentage ranges so readers can focus on the emerging patterns and trends for disclosing information by the companies rather than focusing on their individual scores.
11—20%
21—30%
31—40%
41—50%
51—60%
61—70%
71—80%
81—90%
91—100%
TRANSPARENCY Brands scoring between 0-5% are disclosing nothing at all or a very limited number of policies, which tend to be related to the brand’s hiring practices or local community engagement activities.
Brands scoring between 6-10% are likely to be publishing some policies for both their employees and suppliers. Those closer to 10% are more likely to be publishing a basic supplier code of conduct, some information about their procedures and limited information about their supplier assessment process.
Brands scoring between 11-20% are likely to be publishing many policies for both employees and suppliers, some procedures and some information about their relationship with suppliers. These brands usually disclose a list of first-tier suppliers only but not of other levels nor other more specific aspects, such as those found in the Spotlight Issues section.
Brands scoring between 21-30% are likely to be publishing much more detailed information about their policies, procedures, governance, social and environmental goals and supplier assessment and remediation processes. These brands may be publishing their list of suppliers, mainly first-tier manufacturers, and some information about their grievance channels regarding human rights and environmental issues. These brands are usually not disclosing extensive information about Spotlight Issues.
Brands scoring between 31-40% are typically disclosing their first-tier manufacturers as well as some information on their governance policies. They may also disclose detailed information about their policies, procedures, social and environmental goals, supplier assessment and remediation processes. These brands are also more likely to be disclosing partial information on a few of the Spotlight Issues, such forced and bonded labour, solutions for textile waste, and data on the carbon footprint of their own facilities.
Brands scoring 41-50% are likely to be publishing more detailed first-tier supplier lists and processing facilities as well as some information on supplier assessment findings. In addition, they are usually disclosing their policies, procedures, social and environmental goals, governance, and remediation processes. These brands are also more likely to be addressing some Spotlight Issues, such as collective bargaining, sustainable materials, textile waste, carbon footprint, and water usage in their own facilities.
Brands scoring 51-60% are disclosing all the information already described in the other ranges as well as detailed supplier lists for first-tier manufacturers and processing facilities, with more complete information about their governance practices. These brands are likely to be publishing findings of their supplier assessments, describing their due diligence processes, and addressing many of the Spotlight Issues, such as combating forced and bonded labour, gender and racial equality, sustainable materials, waste and circularity, water and chemicals, and carbon footprint.
Brands scoring 61-70% are disclosing all the information already described in the other ranges and will be publishing detailed supplier lists, which include manufacturers, processing facilities and suppliers of raw materials. These brands will also be providing relatively more information on topics related to the Spotlight Issues section. In 2021, only 2 brands were ranked in this range.
No brands scored above 70%, but if any had done so, they would be disclosing all the information already described before as well as detailed information on their due diligence processes, more comprehensive findings from their supplier assessments and complete lists for at least 95% of all their suppliers, from manufacturing right down to raw materials. In addition, they would be disclosing more comprehensive data on the use of sustainable materials, issues related to gender and race in their supply chains, their approach to purchasing practices, and their progress towards paying living wages for supply chain workers. These brands would also be disclosing the carbon emissions, renewable energy use and water footprint from their own operations to the facilities down to their raw material level.
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
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FULL RESULTS To download the complete dataset, please visit here
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
FULL RESULTS
THE FINAL SCORES
CENTAURO
3%
LUPO
10%
JOHN JOHN
13%
MARISA
29%
HERING
40%
DAFITI
50%
RENNER
57%
C&A
70%
DEMILLUS
3%
OLYMPIKUS
6%
LE LIS BLANC
13%
FARM
28%
ZARA
38%
IPANEMA
45%
YOUCOM
57%
MALWEE
66%
NETSHOES
3%
HOPE
12%
ARAMIS
27%
PERNAMBUCANAS
32%
MELISSA
45%
ADIDAS
53%
DAKOTA
2%
ANIMALE
25%
OSKLEN
43%
HAVAIANAS
52%
DUMOND
2%
DECATHLON
22%
RIACHUELO
43%
ELLUS
2%
AREZZO
21%
TORRA
2%
PUKET
1%
BESNI
0%
BROOKSFIELD
0%
CAEDU
0%
CARMEN STEFFENS
0%
CIA. MARÍTIMA
0%
COLCCI
0%
DI SANTINNI
0%
FÓRUM
0%
KYLY
0%
LEADER
0%
LOJAS AVENIDA
0%
LOJAS POMPÉIA
0%
MARISOL
0%
MOLECA
0%
NIKE
0%
SAWARY
0%
TNG
0%
* The brands are ranked in numerical order out of a score of 250, but they are shown here as a rounded-up percentage. If any brands have the same score, they are listed in alphabetical order.
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
FULL RESULTS
QUICK OVERALL FINDINGS
17 brands (34%) scored 0%
Not a single brand scored above 70%
50
Overall average score was 46 out of 250 points (18%)
40
Only two brands scored higher than 60%
Nº OF BRANDS
30
20
10
0-5
6-10
11-20
21-30
31-40
41-50
51-60
61-70
71-80
81-90
FINAL SCORE (%)
TRANSPARENCY
91-100
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
FULL RESULTS
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AVERAGE SCORES ACROSS THE SECTIONS
1.
30%
POLICY & COMMITMENTS The Policy & Commitments is the section where major brands are the most transparent again this year. C&A at 95% and Adidas and Zara both at 92% each, scored the highest in this section. Almost half of the companies (48%) scored at the lowest range (0-10%), with 15 brands receiving the score zero. This means that most brands disclose little or no information on their policies for their own employees and their suppliers as well as their human rights practices or environmental impact goals.
2.
20%
3.
21%
4.
15%
GOVERNANCE
TRACEABILITY
KNOW, SHOW & FIX
Malwee scored the highest in this section, at 85%. C&A, Renner and Youcom had the second best score, all at 77% each.
The highest scores in this section were Havaianas at 96% and C&A at 81%. In addition, 24% of the brands scored in the 51-70% range.
In total, 26 brands received a score of zero in this section. This indicates that more than half of the companies are not disclosing any information on their governance practices, such as contact information from the responsible department for human rights and environmental issues; data on board and team composition (in addition to the sustainability team); how suppliers are encouraged to improve their social and environmental performance; or how much the company invested in sustainability and corporate responsibility actions.
When compared to the Global Index, this is the only section in which Brazil is slightly ahead, considering the local average of 21% compared to 19% of the global score. Despite that, a large number of brands (56%) do not disclose any information on their supplier lists.
Over half of the brands (54%) are in the 0-10% range in this section, disclosing very little or nothing about their due diligence processes, assessment and remediation of human rights and environmental issues in their supply chain. Despite this, there was a mild one-point increase in relation to last year’s score, going from 14% in 2020 to 15% in 2021. Malwee scored the highest in this section at 74%, while C&A was second highest at 60%. A considerable share of the brands (32%) scored between 11% and 40%.
5.
12%
SPOTLIGHT ISSUES Although the average score in this section increased by 1 percentage point compared to the 2020 score (from 11% to 12%), this section has the lowest average score in the Index for the third year in a row. C&A scored the highest at 55%. The rest of the brands (98%) scored less than 50%, highlighting the lack of widespread transparency among most companies regarding critical issues, such as their COVID-19 response, purchasing practices, living wages, trade unionisation, gender and race equality, sustainable materials, waste and circularity, water and chemicals, climate change, and deforestation. This scenario is even more alarming for the 28 brands (56%) that scored in the 0-5% range, thereby showing that they disclose none or very little information on these urgent, important issues.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
POLICY & COMMITMENTS
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
POLICY & COMMITMENTS
40
1. POLICY & COMMITMENTS APPROACH Which human rights and environmental policies and procedures do major brands and retailers publicly disclose?
In this section we reviewed the policies and procedures brands disclosed both at company level (such as the company’s own operations in head offices, stores, warehouses, and owned production facilities) and at supplier level (Code of Conduct or supplier guidance document).
We looked at the following issues:
•
Animal Welfare
•
Forced & Bonded Labour
•
Annual leave & Public Holidays
•
Foreign & Migrant Labour
•
Anti-bribery, Corruption & Presentation of False Information
•
Freedom of Association, Right to Organise & Collective Bargaining
•
Harassment & Violence
•
Biodiversity & Conservation
•
Health & Safety
•
Child Labour
•
Homeworking
•
Community Engagement
•
Living Conditions/ Dormitories
•
Contracts & Terms of Employment
•
Manufacturing Restricted Substances List (MRSL)
•
Discrimination
•
Maternity Rights / Parental Leave
•
Diversity & Inclusion
•
Mental Health & Wellbeing
•
Energy & Greenhouse Gas Emissions
•
Overtime Pay
•
Equal Pay
•
Restricted Substances List (RSL)
•
Subcontracting
•
Wages & Benefits (including social security, insurance, pension, bonus)
•
Waste & Recycling (Packaging/ Paper)
•
Waste & Recycling (Product/ Textiles)
•
Water Consumption
•
Water Effluents & Treatment
•
Working Hours & Rest Breaks
Social and environmental priorities and measurable, time-bound targets In this section, we have also looked at whether brands and retailers publish strategic goals or roadmaps for improving social and environmental impacts across the supply chain. We specifically looked for clear, measurable, time-bound targets. We also awarded points if brands are reporting on annual progress towards achieving these targets. And finally, we checked to see if the annual report for sustainability or corporate social responsibility was audited by an independent third party.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
POLICY & COMMITMENTS
41
1. POLICY & COMMITMENTS RESULTS
CENTAURO
5%
DEMILLUS
10%
ELLUS
16%
PUKET
3%
DAKOTA
7%
OLYMPIKUS
BESNI
2%
TORRA
7%
DUMOND
CAEDU
2%
HOPE
6%
BROOKSFIELD
0%
NETSHOES
6%
CARMEN STEFFENS
0%
CIA. MARÍTIMA
0%
COLCCI
0%
DI SANTINNI
0%
FÓRUM
0%
KYLY
0%
LEADER
0%
LOJAS AVENIDA
0%
LOJAS POMPÉIA
0%
MARISOL
0%
MOLECA
0%
NIKE
0%
SAWARY
0%
TNG
0%
ARAMIS
FARM
40%
LUPO
47%
IPANEMA
60%
DECATHLON
70%
RENNER
77%
MALWEE
86%
C&A
95%
16%
ANIMALE
36%
AREZZO
42%
MELISSA
60%
HERING
70%
YOUCOM
77%
DAFITI
82%
ADIDAS
92%
12%
JOHN JOHN
34%
RIACHUELO
69%
ZARA
92%
LE LIS BLANC
34%
OSKLEN
67%
MARISA
33%
PERNAMBUCANAS
66%
HAVAIANAS
63%
26%
* The brands are ranked in numerical order out of a score of 33, but they are shown here as a rounded-up percentage. Where brands have the same score, they are listed in alphabetical order.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
POLICY & COMMITMENTS
42
1. POLICY & COMMITMENTS FINDINGS H OW M A N Y B R A N D S P U B L I S H R E L E VA N T P O L I C I E S ?
Anti-bribery, Corruption, & Presentation of False Information Forced & Bonded Labour Child Labour Discrimination Health & Safety Harassment & Violence Freedom of Association, Right to Organise & Collective Bargaining Water Effluents & Treatment Working Hours & Rest Breaks Living Conditions/Dormitories Contracts & Terms of Employment (including notice period, dismissal & disciplinary action) Subcontracting Waste & Recycling (Product/Textiles) Wages & Financial Benefits (e.g. bonuses, insurance, social security, pensions) Energy & Greenhouse Gas Emissions Overtime Pay Waste & Recycling (Packaging/Office/Retail) Annual Leave & Public Holidays Foreign & Migrant Labour Water Consumption Biodiversity & Conservation Equal Pay Manufacturing Restricted Substances List (MRSL) Community Engagement Maternity Rights & Parental Leave Homeworking Supplier policies Company policies Procedures
Animal Welfare Diversity & Inclusion Restricted Substance List (RSL) Mental Health & Wellbein 0
20
40
60
1. Graph order indicated the most common policies applied to suppliers - 2. Policies on living conditions/dormitories, contracts and terms of employment, water effluents and treatment, restricted substance list, foreign and migrant work, overtime pay, subcontracting, homeworking, forced and bonded labour, and child labour are categories that have only been reviewed when applied to suppliers. Meanwhile, animal welfare, diversity and inclusion, restricted substance list, and mental health and wellbeing have been reviewed only regarding policies applied to the brands' own internal processes and/or direct employees.
80
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
POLICY & COMMITMENTS
1. POLICY & COMMITMENTS FINDINGS I M P L E M E N TAT I O N O F P O L I C I E S
COMMUNITY ENGAGEMENT
GENDER EQUAL PAY
FORCED & BONDED LABOUR
40%
22%
18%
20%
50%
16%
disclose policies for their direct employees
disclose policies for their suppliers
disclose policies for their direct employees
disclose how policies are implemented
disclose policies for their suppliers
disclose how policies are implemented
CHILD LABOUR
MENTAL HEALTH & WELLBEING
SUPPLIER CODES OF CONDUCT
50%
38%
14%
36%
36%
24%
disclose policies for their suppliers
disclose how policies are implemented
disclose policies for their direct employees
disclose how policies are implemented
state that Code of Conduct is part of the supplier contract
publish Code of Conduct in languages of key production countries
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
POLICY & COMMITMENTS
1. POLICY & COMMITMENTS FINDINGS I M P L E M E N TAT I O N O F P O L I C I E S
ANIMAL WELFARE
BIODIVERSITY & CONSERVATION
ENERGY & GREENHOUSE GAS EMISSIONS
18%
22%
34%
26%
32%
42%
disclose policies for their direct employees
disclose how policies are implemented
disclose policies for their direct employees
disclose policies for their suppliers
disclose policies for their direct employees
disclose how policies are implemented
RESTRICTED SUBSTANCES LISTS
WATER EFFLUENTS & TREATMENT
PRODUCT/TEXTILE WASTE AND/OR RECYCLING
30%
24%
38%
32%
30%
32%
disclose restricted substances list (RSL)
disclose manufacturing restricted substances list (MRSL)
disclose policies for their suppliers
disclose how policies are implemented
disclose policies for their direct employees
disclose policies for their suppliers
44
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
POLICY & COMMITMENTS
1. POLICY & COMMITMENTS FINDINGS A N N UA L P R O G R E S S
BIODIVERSITY &
PRODUCT/TEXTILE
CONSERVATION
WASTE AND/OR
EQUAL PAY
FOREIGN &
DIVERSITY &
MIGRANT LABOUR
INCLUSION
RECYCLING
40 34
35
33
32
28 25 23
20
8
2020
2021
% of brands disclose policies for guiding their direct employees
2020
2021
% of brands disclose policies for their suppliers
2020
2021
% of brands disclose procedures for equal pay
2020
2021
% of brands disclose policies for their suppliers
2020
2021
% of brands disclose procedures for diversity and inclusion
45
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
POLICY & COMMITMENTS
46
1. POLICY & COMMITMENTS ANALYSIS Stagnation in disclosing policies and commitments The Policies & Commitments section continues to have the highest scores since the first edition of the Index in 2018. Over the past few years, several brands have taken steps to publicly disclose some of their internal company policies for the first time. Relevant information is often found in an Employee Handbook, Company Code of Conduct, Supplier Manual or company websites. However, despite it being the highest scoring section for most brands, the overall average score remains virtually unchanged at around 30% (it was 32% in 2018 with a slight decrease to 30% in 2021). It is important to highlight that, in the Global Index, this section had significantly higher scores than the Brazilian version, with an overall average score of 53% among the 250 brands reviewed. We also note that, of the five brands that scored the highest in the Brazilian Index in this section - C&A at 95%, Adidas and Zara at 92%, Malwee at 86%, and Dafiti at 82% - four are brands that belong to international controlling groups.
This shows that although the Brazilian brands reviewed disclose more information on their policies and commitments than on the other topics covered by the research, there is still a long way to go before achieving the same level of transparency compared to global brands.
Only 38% of the brands publish their internal policies on diversity and inclusion. When compared to the global index scores, there is a major disclosure gap as 83% of global companies disclose their anti-discriminatory policies and 77% disclose their policies on diversity and inclusion.
Despite popular pressure, brands still disclose few policies related to urgent issues
Policies for direct employees were less disclosed by brands regarding mental health and well-being (14%) and gender equal pay (18%). These low results are surprising as they relate to urgent and highly addressed issues nowadays. The indicator on employees’ mental health and well-being policies was added to the research this year as it is essential for the fashion industry to become a more fair, balanced and sustainable environment, mainly taking into account the impacts of pandemic and social distancing on people.
Considering the global scenario of increasing pressure by social movements focused on critical issues such as systemic racism, gender inequality and LGBTQIA+ rights, it is alarming that only just over half of brands (54%) disclose anti-discrimination policies for their employees. Still, this is one of the most disclosed topics by companies. Other policies usually presented by companies for their own employees are about anti-bribery, corruption as well as the presentation of false information and harassment and violence, both topics being disclosed by 54% of the brands.
Animal welfare policies is also one of the least disclosed topics (18%). However, it is interesting to note that the brands reviewed in the Index since 2018 had an 8 percentage point increase in this topic during this period. In general, brands have had the highest progress year-on-year since 2018, disclosing the policies for their own employees on the following topics:
Percentage of brands disclosing policies for their own employees 2021
2020
2019
Annual Leave & Public Holidays 34% 33% 23% 10%
Animal Welfare 18% 10% 13% 10%
Maternity rights and parental leave 34% 33% 30% 20%
Wages and financial benefits 42% 48% 33% 25%
2018
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
POLICY & COMMITMENTS
1. POLICY & COMMITMENTS ANALYSIS Disclosure of policies for the supply chain The most disclosed policies by brands to their supply chain are related to antibribery, corruption and presentation of false information (50%), forced and bonded labour (50%) and child labour (50%). However, considering the severity of these issues, it is worrisome that only half of the brands disclose policies that cover these topics. In addition, companies tend to disclose more information about their policies than how these policies are actually implemented. Only 38% of the brands disclose their actions to ensure the fight against child labour. This number is reduced to 16% for actions to combat forced and bonded labour.
Percentage of brands disclosing policies for suppliers 2021
2020
2019
2018
Energy & Greenhouse Gas Emissions 30% 28% 10% 10%
Annual Leave & Public Holidays 28% 18% 17% 15%
Water Usage 28% 30%
When comparing progress year-on-year, the disclosure of policies by companies to their suppliers that have advanced the most since 2018 was those focusing on environmental impacts, such as energy and greenhouse gas emissions, water usage as well as biodiversity and conservation. The policies for the supply chain that had the highest disclosure growth since the first edition of the Index in Brazil were:
Homeworking
10% 15%
Biodiversity & Conservation 26% 15% 10% 15%
This year, we added a specific indicator on policies for homeworking, considering that suppliers are known to subcontract small homeworking workshops for clothing production. Estimates indicate that there are between 10,000 and 100,000 small workshops working in the clothing sector in Brazil. Many of these employ Bolivian immigrants concentrated in São Paulo City metropolitan area, working in forced and bonded labour conditions. According to the report Masking Misery: The COVID-19 pandemic and migrant workers in the fashion industry in São Paulo, released by the Business & Human Rights Resource Centre, among the 146 migrant workers interviewed, 89% reported they live in the same place they work. Such accommodation houses entire families crammed into difficult living conditions, with no ventilation or natural light and limited space for family interactions. In this subcontracting system, work is carried out under conditions of extreme oppression, low wages, exhaustive journeys and precarious or non-existing safety and health measures.
This data highlights the relevance of this new indicator, as these homeworkers are usually the most vulnerable due to informality and difficulty in traceability. All this poses a barrier to ensuring these employees’ basic labour rights. Only 14% of the brands disclose policies for homeworkers in their supply chain and only 1 brand (2%) publishes its procedures to ensure that such policies are implemented. Limited disclosure on this topic is indicative that brands should be more transparent about their supply policies regarding homework and subcontracting.
Implementation of policies for the environment issues and human rights About half of the brands (52%) disclose community engagement procedures. These practices are usually linked to philanthropic actions and are often the only information found on the brands’ websites regarding social responsibility. In the Global Index, the score for this topic is significantly higher, with 89% of the 250 companies reviewed.
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
POLICY & COMMITMENTS
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1. POLICY & COMMITMENTS ANALYSIS
In addition, 44% of the companies have procedures on health and safety; packaging and paper waste and/or recycling; and product or textile waste and/ or recycling. It is worrisome that the procedures least disclosed by brands are related to sensitive topics in the supply chain, such as: procedures taken beyond prohibiting homeworking (2%); improving living conditions/dormitories (12%); improving subcontracting practices (16%); programmes to eradicate forced and bonded labour (16%); evidence of due diligence, with partnerships or programmes to support migrant workers in their supply chain (18%). In general, brands are taking some steps to publicly disclose information about how they are implementing their company and supplier policies, but we hope to see more progress next year with an expansion to a broader range of actions. Topics seeing the most year-on-year progress since 2018 were:
Percentage of brands disclosing their practices 2021
2020
2019
Harassment & Violence 30% 10% 7% 10%
Animal Welfare 22% 15%
Restricted Substances 2018
Brands disclosing their restricted substance lists is becoming increasingly more common. Between 2018 and 2021, we had a 10-point increase in this indicator (from 20% to 30% of the brands). This year, we also reviewed the manufacturing restricted substances list. Our research has highlighted the lack of understanding from a few major brands and retailers on the difference between RSL and MRSL, with some brands using the terms interchangeably.
10% 10%
Discrimination 32% 28% 20% 15%
Restricted Substances List 32% 25% 23% 15%
According to Zero Discharge of Hazardous Chemicals (ZDHC), the Restricted Substance List (RSL) presents the limits of hazardous chemicals allowed in the finished products. Meanwhile, the Manufacturing Restricted Substances List (MRSL) indicates the limits of allowed chemicals throughout the manufacturing processes, from raw materials down to the end product. MRSLs are more comprehensive than RSLs as they go beyond the restriction of substances found in the end product and ensure that a garment cannot be produced using harmful chemicals at any stage of production.
Targets, Progress & Verification of Information Regarding what information the company publishes about its strategic plan for progressively reducing its impacts on human rights and the environment issues, only 30% of brands publish measurable, time-bound targets to reduce their environmental impacts. This percentage is even lower when it comes to human rights issues, at 14%. This raises questions as to why brands aren’t prioritising socialrelated progress targets as much as environmental impacts. For the annual progress updates towards these targets, 24% of companies disclose their progress towards reducing environmental impacts while only 12% of them indicate their progress related to human rights. By not disclosing their progress, brands risk greenwashing, by promoting their ambitions without evidencing the results and outcomes. It is also noteworthy that only 6 brands (12%) publish an annual sustainability or corporate social responsibility report, audited by an independent third party. This type of verification is key for brands to increase the credibility of the content presented in their reports.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
GOVERNANCE
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
GOVERNANCE
2. GOVERNANCE APPROACH
Who in the company is responsible for social and environmental impacts? In this section, we wanted to understand who in the company is accountable for social and environmental performance and impacts. First, we looked to see if brands publish direct contact details for a relevant department, such as the sustainability or corporate responsibility team. We also looked for the name of a board member, or board committee, that is responsible for social and environmental issues and how this oversight is implemented. This year we have added two new indicators looking at disclosure on: •
Worker representation on the corporate board of directors
•
Financial investments in sustainability efforts as a percentage of total budget or revenue
We looked to see if brands are disclosing how their employees beyond the sustainability team (e.g. designers, buyers, sourcing managers and so on) are incentivised (via performance reviews or bonuses) to achieve improvements in social and environmental impacts. We looked for the same information to be shared linking CEO and executive level pay and incentives to social and environmental impacts. Finally, we also looked at whether suppliers’ incentives are linked to improvements in human rights impacts and environmental management. The types of incentives we were looking for included brands committing to long-term contracts, increased order size, price premiums and reducing the number of audits.
''Be transparent. Let's build a community that allows hard questions and honest conversations so we can stir up transformation in one another." Germany Kent, broadcast journalist
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
GOVERNANCE
2. GOVERNANCE RESULTS
BESNI
0%
ARAMIS
15%
BROOKSFIELD
0%
AREZZO
CAEDU
0%
CARMEN STEFFENS
0%
CENTAURO
LUPO
HAVAIANAS
38%
DAFITI
46%
ANIMALE
54%
OSKLEN
69%
C&A
77%
15%
PERNAMBUCANAS
38%
RIACHUELO
46%
FARM
54%
ADIDAS
62%
RENNER
77%
DECATHLON
15%
HERING
31%
ZARA
62%
YOUCOM
77%
IPANEMA
15%
0%
JOHN JOHN
15%
CIA. MARÍTIMA
0%
LE LIS BLANC
15%
COLCCI
0%
MARISA
15%
DAKOTA
0%
DEMILLUS
0%
MELISSA
15%
DI SANTINNI
0%
OLYMPIKUS
15%
DUMOND
0%
ELLUS
0%
FÓRUM
0%
HOPE
0%
KYLY
0%
LEADER
0%
LOJAS AVENIDA
0%
LOJAS POMPÉIA
0%
MARISOL
0%
MOLECA
0%
NETSHOES
0%
NIKE
0%
PUKET
0%
SAWARY
0%
TNG
0%
TORRA
0%
23%
* The brands are ranked in numerical order out of a score of 13, but they are shown here as a rounded-up percentage. Where brands have the same score, they are listed in alphabetical order.
MALWEE
85%
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
GOVERNANCE
2. GOVERNANCE FINDINGS HOW EASY IS IT TO CONTACT THE BRANDS?
BOARD LEVEL ACCOUNTABILITY
44%
26%
22%
6%
publish direct contact details for the sustainability department
publish board member or committee responsible for human rights and environmental issues
publish how board accountability is implemented
worker representation on the corporate board of directors
HOW MUCH DOES THE BRAND SPEND ON SUSTAINABILITY?
ARE INCENTIVES TIED TO ENVIRONMENTAL AND HUMAN RIGHTS PROGRESS?
8%
20%
18%
10%
disclose amount spent on sustainability efforts as % of overall budget or total revenue
disclose how employee incentives and bonuses are linked to improvement on human rights and environmental issues
disclose executive pay/bonuses linked to improvement on human rights and environmental issues
disclose suppliers’ incentives linked to improvement on working conditions and environmental issues
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
GOVERNANCE
53
2. GOVERNANCE ANALYSIS
Direct contact with the sustainability sector Almost half of the brands (44%) disclose direct contact information to the company's department responsible for sustainability and corporate social responsibility issues. Publishing an e-mail or phone number is a simple act of transparency that brands can adopt to create an open line of communication with customers and other interested parties.
Employee representation on corporate boards Both Brazilian and global indices show that employee representation is very low, at 6% and 7% of brands disclosing this information, respectively. This involvement may occur through participation on the board or on their committees and collegiate bodies. This ensures that boards are well balanced, representing investors, executives as well as employees' interests.
A growing number of brands disclose board level accountability From 2020 to 2021, there was a significant 18-point increase in brands disclosing the board member name or committee responsible for human rights and environmental issues (8% to 26%). Nevertheless, this figure is lower than the global index data, in which more than half of the brands (54%) disclosed information for this indicator. There was also a slight increase of disclosure from 20% to 22% last year on how board accountability is implemented. Establishing board accountability for corporate social and environmental performance shows the incentive for those at the highest level of decision making to consider the positive or negative implications of the company's operations.
However, a study from the NYU Stern Center for Sustainable Business showed that only 29% of Fortune 100 board members have expertise on environmental, social and governance issues. In the current scenario, brands face increasing pressure to act on climate change and on precarious working conditions in their supply chain (which is even more intensified now due to COVID-19). Therefore, it is imperative for executive boards to include professionals who bring sustainability to their organisations' frontline by creating short-term and long-term strategies.
Incentives related to social and environmental improvements Among the brands reviewed, 20% disclose how employee bonuses in areas beyond the sustainability team are linked to improvements in social and environmental impact management.
In addition, 18% disclose how their executive pay and bonuses, at CEO, CFO, and other C-level positions, are linked to progress in human rights and environmental issues management. Very few disclose the weight of achieving these targets as part of their pay or bonuses. Regarding suppliers, only 10% disclose how suppliers’ incentives – such as long-term commitments to purchase or increased volumes purchased – are tied to improvements in working conditions and environmental impacts. The way the company links payment packages and bonuses for employees, executives and suppliers to social and environmental performance should show to stakeholders the company's commitment to improving their practices.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
2. GOVERNANCE ANALYSIS
Many brands do not disclose information on their investments in sustainability Only 8% of brands disclose the amount spent on corporate responsibility and sustainability, including for a dedicated team, as a percentage of their budget or total revenue. Some companies only disclose the amount of money spent on implementing local social projects, donations or expenses on their own institutes, but not the total invested in implementing and managing social and environmental responsibility activities for the organisation. We hope that investors and other stakeholders will push brands to invest more significantly in efforts to improve human rights and environmental impacts and to be more transparent regarding the money spent on these initiatives.
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T R A N S PA R E N C Y
FA I R T R A D E W E L L- B E I N G L I V I N G WAG E S EMPOWERMENT GENDER EQUALITY BUSINESS ACCOUNTABILITY S U S TA I N A B L E L I V E L I H O O D S GOOD WORKING CONDITIONS E N V I R O N M E N TA L S U S TA I N A B I L I T Y
A CLEAN, SAFE AND FAIR FASHION INDUSTRY
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
VIEWPOINT
VIEWPOINT: INFORMATION IS POWER: ONLY THROUGH TRANSPARENCY WILL WE DISCOVER THE INDUSTRY'S CHALLENGES AND FIND THE BEST WAYS TO ADDRESS THEM Transparency is a concept that, at first, is feared by companies of any size. Information is power. The corporate world is not yet used to this kind of scrutiny from civil society. After the initial strangeness, everyone realises the benefits that transparency brings, not only to the business model but also to the world. Through transparency, companies offer information that is, at the very least, a competitive advantage. The ones open to this concept are driven to initiate major changes in their production processes, which impact human lives and the environment (as human lives depend on a living and healthy environment). Transparency is a lever for change in any economic sector. In the fashion industry, there is a lot of opaque information about the supply chain and the impacts generated from its production process, whether human or environmental impacts. We are excellent at communicating our product, but very bad at communicating everything about its process before it's bought by the end consumer. This has become more and more evident, and society has demanded that companies
make a stand. They need to understand that there is another role to be played by corporations in post-modernity. Companies must actively participate by finding solutions to the issues created by their actions. Transparency is the only tool which enables us to discover what these challenges are and how to best address them. Micro and small companies are the largest beneficiaries of transparency. They are the substantial base of most large companies' supply chains - they represent more than 70% of the country's fashion companies - and they are the place where the people who make our clothes are. More processes are carried out within small businesses than in any other link in the supply chain. Yet, that is where the smallest share of the fashion industry's profit is, where workers have less security and their pay is not always guaranteed, and where wages are lower and working conditions are sometimes less than ideal. In general, there is less oversight of the processes that could contribute to reducing the industry's impact on the environment.
In the fashion value chain, micro and small companies are very much driven by the agendas of the large companies. By participating in a large part of the supply chain, they end up having to adapt to the management formats proposed by the large companies. Due to access to information, professional training, technical qualification and opportunities that small businesses are subject to in the Brazilian economic scenario, many mirror the transparency procedures carried out by large companies. The largest opportunities are where the largest challenges are: education about the importance of transparency in disclosing processes and practices. In theory, small companies can implement the necessary changes more quickly than medium and large companies. Nevertheless, they need greater support to bring this practice into action. Similarly, any small change generates important impacts. These impacts bring about immense benefits in the management and production process as well as gains in the revenue and positive impacts on the workforce. Considering that information is
55
VERÔNICA COUTO DE OLIVEIRA TAVARES SEBRAE MARKET INTELLIGENCE ANALYST
power, and how difficult it is for companies to access quality information, the data on transparency which is available to companies through the Fashion Transparency Index may transform their actions, thereby having a positive, definitive influence on the entire supply chain. Important projects are conducted by micro and small companies encouraging and challenging medium and large companies to take a more proactive role. There are companies that are born sustainable, with a genuine and real concern for the social and environmental impacts they cause in the world. These organisations put their business model to the test with the most informed and engaged consumer. They understand that, for the new world which is taking shape, an economically sustainable business is also a socially and environmentally sustainable business which generates positive impacts on people’s lives and the environment.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
TRACEABILITY
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
TRACEABILITY
57
3. TRACEABILITY APPROACH
Are major brands and retailers disclosing their suppliers' lists and how detailed this information is? This section focuses on whether brands are publishing supplier lists from manufacturing to raw material level and the level of detail provided.
Disclosing factories, processing facilities and raw material suppliers
We also checked whether brands disclose information about tracing at least one raw material supply chain such as cotton, leather, viscose or wool.
We looked for supplier lists at three different levels:
We added a new indicator on whether brands disclose what relevant certifications, if any, manufacturers and processing facilities may hold. At the raw material level, we also added an indicator on the name of the specific facility or farm.
1. Are brands disclosing where their clothes are made, in other words, the facilities with which brands have a direct relationship and typically do the cutting, sewing and final trims of products?
2. Are brands disclosing processing facilities, such as weaving and spinning mills, dye-houses, laundries, wet processing, embroidery, printing and finishing for fabrics?
3. Are brands disclosing their suppliers of raw materials, such as fibres, hides, rubber, chemicals and metals?
We looked at information disclosed by brands, including: •
Name of facility
•
•
Address of supplier’s facilities
If the facility has a trade union or an independent worker committee
•
Types of products/services at such • facilities
Certifications the facility holds, if any
•
Name of parent company for each facility
•
•
Approximate number of workers in each facility
% of suppliers facilities published and whether the list corresponds to at least 95% of the total
•
If the list was updated within the past 6 months
•
If the list is in machine-readable format (csv or xls)
•
Gender breakdown of workers
•
Race breakdown of workers
•
% of migrant or contract workers
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
TRACEABILITY
58
3. TRACEABILITY RESULTS
DECATHLON
1%
JOHN JOHN
16%
ANIMALE
29%
PERNAMBUCANAS
33%
IPANEMA
60%
MALWEE
69%
ZARA
1%
LE LIS BLANC
16%
FARM
29%
HOPE
32%
MELISSA
60%
RENNER
68%
AREZZO
0%
BESNI
0%
ARAMIS
56%
YOUCOM
68%
BROOKSFIELD
0%
ADIDAS
55%
DAFITI
67%
CAEDU
0%
HERING
53%
OSKLEN
61%
CARMEN STEFFENS
0%
MARISA
53%
RIACHUELO
61%
CENTAURO
0%
CIA. MARÍTIMA
0%
COLCCI
0%
DAKOTA
0%
DEMILLUS
0%
DI SANTINNI
0%
DUMOND
0%
ELLUS
0%
FÓRUM
0%
KYLY
0%
LEADER
0%
LOJAS AVENIDA
0%
LOJAS POMPÉIA
0%
LUPO
0%
MARISOL
0%
MOLECA
0%
NETSHOES
0%
NIKE
0%
OLYMPIKUS
0%
PUKET
0%
SAWARY
0%
TNG
0%
TORRA
0%
* The brands are ranked in numerical order out of a score of 75, but they are shown here as a rounded-up percentage. Where brands have the same score, they are listed in alphabetical order.
C&A
81%
HAVAIANAS
96%
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
TRACEABILITY
3. TRACEABILITY FINDINGS DISCLOSING FIRST-TIER MANUFACTURER DETAILS
40%
40%
30%
12%
28%
34%
publish a list of their first-tier manufacturers
include the address in the suppliers list
include the gender breakdown of workers in each facility
include the race breakdown in each facility
publish at least 95% of their manufacturers in the list
publish which certifications the facility holds
PUBLISHING PROCESSING FACILITIES LIST
PUBLISHING RAW MATERIAL SUPPLIERS LIST
28%
16%
6%
8%
6%
14%
publish processing facilities list
include the gender breakdown of workers in each facility
include the race breakdown in each facility
publish raw material suppliers list
disclosure a list covering more than one raw material type
disclose that brand is tracing at least one raw material supply chain
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
TRACEABILITY
60
3. TRACEABILITY ANALYSIS
Major brands and retailers have a clear responsibility to look at their supply chain, identify human rights and environmental risks and impacts and address them. A lack of visibility can allow exploitative, unsafe working conditions and environmental damage to thrive while obscuring who has the responsibility and power to redress these issues. As a first step towards transparency, companies need to understand and disclose where their products are made.
rights and environmental issues, allowing to redress issues such as unauthorised subcontracting. Supply chain transparency also enables collaboration with other companies sourcing in the same facilities to work together to solve problems. It can also enhance investor and consumer trust in a brand, showing stakeholders that brands are willing to be open about where their products are being made and to be held to account for what happens in their supply chains.
Publicly disclosed supplier lists are useful to trade unions, worker representatives, activists and civil society organisations to identify and address human rights and environmental abuses within their supply chains faster and more efficiently. See the Study Case on cotton from the Uyghur region in China, an example of how organisations are using publicly available information such as this.
Traceability: Overall average score year-on-year progress
In addition, publishing supplier lists can also benefit brands themselves. This type of transparency enables brands to engage and collaborate with trade unions and civil society organisations on human
2021
2020
2019
12% of 20 brands
17% of 25 brands
25% of 30 brands
21%
2018
Disclosing first-tier manufacturers First-tier manufacturers are the production units responsible for cutting, sewing, and finishing products. These are the suppliers that will then ship products to warehouses ready for the shop floor and our wardrobes. Compared to 2020, there was a slight decrease in the percentage of brands that disclose their first-tier supplier lists (from 43% to 40%). Nevertheless, the companies that disclosed their lists have provided more comprehensive information with a higher level of detail than in previous years. There was an increase in disclosure of several indicators, including gender breakdown of workers (from 23% to 30%), race breakdown of workers (from 8% to 12%), trade union representation or independent worker committee (from 18% to 24%) and the percentage of migrant or contract workers (from 18% to 28%).
of 40 brands
Out of the 50 brands reviewed, 40% publish direct supplier’s facility addresses. Often suppliers will have similar company names
to other suppliers or there may be multiple supplier companies operating in the same facility, so it helps stakeholders to identify the exact geographical location of the supplier. In addition, 30% of companies publish the name of parent company for each facility, 40% disclose which types of products/ services are developed there, and 36% disclose the number of workers in each facility. These pieces of information are useful because they help stakeholders to better understand supply chains and their complexities and prioritise the best course of action to address human rights and environmental risks where required. This year we have added a new indicator for the certifications for each facility. Publicly disclosing certifications at facility level helps to understand what kind of due diligence processes a facility may participate in and how robust the evaluation criteria reviewed during the audits are. The brands reviewed in the Brazilian Index tend to disclose this information more often than the Global Index brands, at 34% of companies versus 5%, respectively.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
TRACEABILITY
61
3. TRACEABILITY ANALYSIS
Certifications are a way for companies to show that they hold certain sustainability and compliance standards, generating greater trust in consumers and other stakeholders. Most Brazilian brands and retailers that disclosed the certifications of their first-tier suppliers’ facility are part of the Abvtex Program. Other certifications recognized by the fashion industry includes the Higg Index, Wrap, Fairtrade Textile Standard, SA 8000, among others. To align with Open Apparel Registry requirements and to make access, research and reviewing of data easier by unions and NGOs, we searched for lists in a machine-readable format such as Excel or CSV documents. This year, 34% of brands disclosed lists in this format and 38% disclose if the list has been updated in the past 6 months. This list update should be made at least every six months because companies start and stop working with suppliers on a frequent basis, which means that their supplier lists quickly become outdated. Finally, it is important to know the percentage of factories that are disclosed by the brands. Among the reviewed
companies, 32% disclose what percentage of their factories are published and 28% report that at least 95% of their suppliers are published.
Disclosing processing facilities Processing facilities include a wide range of activities, such as ginning and spinning yarn, wet processes, embroidering, knitting and weaving fabrics, printing, finishing, leather tanneries, dyeing and laundering. Only 28% disclose their list of suppliers at this level, including the address of these facilities and the type of product or service provided. Only 16% of the brands disclose the gender breakdown of the workers in each facility and this number decreases to 6% for the race breakdown. It is worrisome to note the progressive decrease in disclosure of such important information about the people who make our garments throughout the value chain. Knowing the gender breakdown in each facility allows for gender responsive measures in which policies can be
designed and implemented based on the realities and needs of women workers, such as adopting measures that consider the specific aspects of women's health. Women tend to develop urinary infections resulting from exposure to chemicals without due protection and need specific conditions to practise good menstrual hygiene. This can be achieved by permitting toilet breaks and offering hygiene products such as water and soap, toilet paper and menstrual products. Other important initiatives are having separate entries for men's and women's restrooms, providing individual toilet booths with door locks and hooks or shelves so that people’s belongings do not touch the contaminated floor. Only 14% of companies disclose if processing facilities have some trade union or other type of independent worker committee. Despite the low score, this number is even lower in the Global Index, corresponding to 4% of the global brands. This information is useful because they help worker representatives and even the brands themselves to become aware of the best way to contact a supplier as well as help trade unions understand where they can prioritise their efforts.
Among the brands reviewed, 22% disclose the name of the parent company for each facility, 24% publish the number of workers and 16% the number of migrant or contract workers. In addition, 26% have the list disclosed in a machine-readable format and disclose what percentage of processing facilities are published. Finally, 24% disclose that the list has been updated in the last six months.
Disclosing raw material suppliers These are the suppliers that provide companies with raw materials such as fibres (cotton, wool, viscose, polyester, nylon etc.), hides, rubber, dyes, metals, chemicals, and so on. Only 8% of the brands disclose suppliers’ lists of their main raw materials including the address of these facilities and the type of product or service provided. Information gets scarcer as we move down the supply chain tiers. Thus, the raw material tier is where the data is less disclosed and detailed, having the least visibility and hence where many human rights and environmental abuses often go unseen.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
TRACEABILITY
3. TRACEABILITY ANALYSIS
From the environmental perspective, despite the urgency of the climate crisis, deforestation and pesticide use continue to be linked to the production of several raw materials used in our clothes and shoes, damaging vital sources of carbon sequestration. Supply chain traceability, from first-tier manufacturers down to raw material suppliers, is more important than ever considering the toll the COVID-19 pandemic has had on supply chain workers across the world and the fact that recent research has shown evidence of forced labour within the Chinese cotton supply chain. See more details about these issues in Case Studies: Transparency in action. Only 2% of the brands disclose the name of a specific facility or farm where the raw material is produced and 6% disclose a list that covers more than one raw material type. Regarding the level of detailed information on suppliers lists, only 2% disclose the number of workers in each facility or gender and race breakdown. More than half of the brands reviewed by the Global Index (57%) disclose evidence of tracing the supply chain of at least one
specific raw material. In the Brazilian Index this number is down to 14%. Tools used to do this tracing and mapping may include certification systems (excluding those that use a mass balance system such as Better Cotton), blockchain, DNA tracing and other similar technologies.
Progress on supplier list disclosure is still slow. Although it has been encouraging to see supply chain traceability steadily improving among the major brands and retailers reviewed in the Brazilian Index (from 12% in 2018 to 21% in 2021 of the average score for this section for all brands), progress is still too slow. More than half of the brands (60%) disclose no information about their supplier lists. This makes a strong case for why government regulation is needed, requiring companies to map and publicly disclose their supply chains for the benefit of workers and their representatives, investors, regulators, consumers, and brands themselves.
“Transparency helps us monitor, qualify, and prevent near-slavery work conditions. I call upon the big brands to support those that keep such a rich productive chain.” Carla Aguilar, Social Worker and Adviser from Centro de Apoio e Pastoral do Migrante (CAMI)
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
VIEWPOINT
VIEWPOINT: MATERIALS AND BIODIVERSITY: OUR CLOTHES COME FROM NATURE AND OUR MISSION SHOULD FOCUS ON NATURE CONSERVATION Biodiversity loss has reached an unprecedented level this century, leaving humanity at a crossroads regarding the legacy we are leaving to future generations. Biodiversity means nature is alive: plants and animals, the ecosystems where they live and how they interact with each other. As all elements in our clothes come from nature, our fundamental mission should be nature conservation. We should avoid environmental degradation from deforestation and monoculture practices, especially those that use large amounts of pesticides.
washing and laundry. However, it is not enough to replace polyester with natural fibres cultivated in monocultures that destroy the biome biodiversity such as in the Cerrado, Amazon and Atlantic Forest, which have already been deeply devastated by agribusiness, livestock farming and mining.
Textile materials are responsible for most of the carbon footprint of fashion products. Cotton and viscose have caused devastating impacts by way of deforestation and intensive chemical use. Polyester is something the fashion industry must get rid of because of its fossil fuel sources as well as its spread of microplastics into the oceans from
For instance, cotton production processes, on which our industry is so dependent, must undergo a thorough technological review to meet the global commitments to reduce greenhouse gas emissions. The intensive use of pesticides leads to the contamination of groundwater, it directly affects workers’ health and makes the soil incapable of retaining carbon from the atmosphere.
When we talk about biodiversity, we are also referring to the original populations and guardians of these territories as well as to their traditional knowledge of food cultivation and soil management. Therefore, we must only consider “sustainable” those materials whose production processes contribute to the preservation of ecosystem biodiversity, providing food security, income, and a decent future for the next generations.
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YAMÊ REIS FASHION CONSULTANT, MASTER'S DEGREE IN SOCIOLOGY AND AUTHOR OF THE COTTON AGRIBUSINESS: ENVIRONMENT AND SUSTAINABILITY
We need to propose a transition to natural raw material production models that meet two main commitments: ecosystem biodiversity restoration as well as income and food security generation. The transition must recognise the close relationship between these two commitments as we see in agroecology and agroforestry practices, whose productive processes respect people and the diversity of species that live there. The objectives should be the following: redesigning agricultural systems to improve productivity without negative impacts on biodiversity, making land and water use more efficient as well as redesigning a new cultivation method that rejects the production of export commodities, which generate just a few jobs and cause irreversible environmental damage. The participatory certification systems created in Brazil by family farmers with great potential for application in other countries of the Global South must be promoted. Fashion brands can and should buy cotton directly from these agroecological producers, contributing to true ecosystem regeneration.
The highest poverty indicators in Brazil are in rural and inland areas, and it is there that our greatest natural wealth is located, such as the Amazon and Cerrado biomes. These areas have been the victim of constant socioenvironmental conflicts which are driven by the advance of land grabbing, deforestation, agriculture, and livestock. It is impossible to achieve the United Nations Sustainable Development Goals by 2030 without eradicating poverty and deforestation, which have not been prioritised by public policies so far. We must face the gigantic challenge of keeping global warming between 1.5°C and 2°C so species can continue living in the way we know today. As seen in the Brazil Fashion Transparency Index 2021, only 14% of brands reported the traceability of their materials and none of them have made a commitment to zero deforestation. So it is worth asking this: What can we do to make Brazilian brands understand this sense of urgency for transformation? And what can we expect for 2022?
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
INTERVIEW: WOMEN AND REGENERATIVE AGRICULTURE ANDREA SOUSA LIMA PROJECT COORDINATOR AT ESPLAR - CENTRE FOR RESEARCH AND ADVISORY
ESPLAR IS A NON-GOVERNMENTAL, NON-PROFIT ORGANISATION THAT OPERATES IN THE MUNICIPALITIES OF THE SEMI-ARID REGION OF CEARÁ, DEVELOPING ACTIVITIES FOCUSED ON AGROECOLOGY AND THE SERVICE OF FAMILY FARMING. IT CARRIES OUT ACTIONS FOR DEVELOPING PUBLIC POLICIES, PROMOTING GENDER EQUALITY, ENVIRONMENTAL JUSTICE AND QUALITY OF LIFE AS WELL AS FOR PROCESSING AND MARKETING AGRICULTURAL PRODUCTION FROM THE SOLIDARITY ECONOMY PERSPECTIVE.
Image: Women from the group Abelhas Lutadoras do Sertão, from the community of Irapuá, in Nova Russas, state of Ceará, at the regenerative cotton farm.
TRACEABILITY
Q: Only 3 out of the 50 companies reviewed in this Index disclose evidence of the implementation of regenerative agricultural practices in one or more raw material sources in their chain. Amidst the current climate crisis, what role do women play in maintaining biodiversity (and life on the planet) based on where they live? A: Women farmers play a key role in protecting biodiversity. They maintain and enhance biodiversity by working on regenerative agriculture in their backyards. Their work expands the strategies for coexistence with the land with the semi-arid area in the Northeast region - by exchanging experiences and knowledge as well as by collective action towards the sustainability of their productive agroecosystems. Their regenerative farming practices in their backyard is based on practices such as collecting and reusing water, saving native seeds and maintaining community seed houses as well as maintaining, rescuing and valuing agroecological practices. It also prioritises the maintenance of life for the well-being of the environment and people. We need to shine a light on sustainable solutions to address climate change, such as climate resilient agriculture practices developed by women through agroecology.
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Q: The publicly available information about brands becomes scarcer as we move along the supply chain. In the 2021 Brazilian Index, only 1 brand (2%) disclosed the gender breakdown of workers at the raw material level. What is women's place in regenerative cotton farming for the fashion industry? A: This type of farming in the fashion industry gives visibility to women's labour and income. The inclusion of women in the commercialisation spaces is still a challenge, as the activities considered productive are traditionally attributed to men. We must recognise and value women's strategic contribution to the economy and the income of family agroecosystems. The number of women farmers facing hardships in accessing technical assistance, credit and resources is significant. The selforganisation of women farmers into groups allows for actions to strengthen production, consumption of healthy food and the visibility of collective work. It also strengthens their participation in the associations' decision-making spaces: cultivation, certification and income as well as favouring the feminist economy according to their point of view.
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KNOW, SHOW & FIX
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4. KNOW, SHOW & FIX APPROACH
What do major brands and retailers communicate about their human rights and environmental due diligence processes? How are they assessing suppliers’ actions regarding social-environmental issues in their facilities? This year we strengthened the requirements for indicators on due diligence processes – only allowing points if this covers both human rights and environmental risks, not just one or the other. We did not award any points for disclosures about risks, or actions taken to address risks, unless the due diligence process itself was first disclosed.
KNOW
FIX
We measured disclosure on human rights and environmental due diligence to understand what steps brands are taking to identify human rights and environmental risks, impacts and violations in their supply chains. We also looked for information on how brands assess suppliers to ensure they meet their ethical standards and policies (typically factory audits). For the first time this year, we added an indicator measuring the number of audits which included a trade union representative.
We looked at what brands publish about how they remediate human rights and environmental violations occurring within their supply chain. We also checked to see if brands publish a confidential grievance mechanism for both employees and workers in the supply chain and if brands disclose the results of their efforts to remediate violations and address grievances. This year, we also searched for brand strategies to terminate relationships with suppliers who remain in noncompliance. As an example, the brand's policies should go beyond just dismissing a supplier immediately and also include a proper procedure with an assessment on potential adverse human rights impacts.
SHOW We looked at whether brands disclose the results of their supplier assessments, either as a summary of issues found in factories or at a more granular level (e.g. disclosing findings by individual factories).
In this section, we awarded points if brands disclose information such as:
•
How the brand works to identify and address both human rights and environmental risks, impacts and violations in its supply chain (its approach to conducting due diligence)
•
How workers, unions and other affected stakeholders are involved in the due diligence process
•
How suppliers are assessed against the brand’s policies
•
The process for taking on new suppliers
•
The process for exiting a supplier
•
If brands conduct supplier assessments beyond the first tier
•
If supplier assessments include off-site worker interviews and, if so, how many workers are interviewed
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4. KNOW, SHOW & FIX RESULTS
ARAMIS
4%
DAKOTA DEMILLUS
CENTAURO
ANIMALE
19%
AREZZO
26%
ADIDAS
38%
DAFITI
47%
C&A
60%
4%
RIACHUELO
19%
MARISA
26%
OSKLEN
36%
HAVAIANAS
43%
IPANEMA
51%
4%
FARM
17%
DECATHLON
23%
RENNER
36%
MELISSA
51%
DUMOND
4%
JOHN JOHN
13%
YOUCOM
36%
HOPE
4%
TORRA
4%
LE LIS BLANC
13%
ZARA
36%
BESNI
0%
NETSHOES
11%
HERING
32%
BROOKSFIELD
0%
PERNAMBUCANAS
32%
CAEDU
0%
CARMEN STEFFENS
0%
CIA. MARÍTIMA
0%
COLCCI
0%
DI SANTINNI
0%
ELLUS
0%
FÓRUM
0%
KYLY
0%
LEADER
0%
LOJAS AVENIDA
0%
LOJAS POMPÉIA
0%
LUPO
0%
MARISOL
0%
MOLECA
0%
NIKE
0%
OLYMPIKUS
0%
PUKET
0%
SAWARY
0%
TNG
0%
9%
* The brands are ranked in numerical order out of a score of 47, but they are shown here as a rounded-up percentage. Where brands have the same score, they are listed in alphabetical order.
MALWEE
74%
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4. KNOW, SHOW & FIX FINDINGS KNOW: DUE DILIGENCE PROCESSES
KNOW: SUPPLIER ASSESSMENTS
16%
6%
8%
42%
8%
2%
describe their human rights and environmental due diligence process
disclose how affected stakeholders are involved in their due diligence process
discloses the outcomes of steps taken to address violations
describe the process for assessing conditions in supplier facilities
disclose how many workers interviewed off-site as part of audits
disclose how many audits included a trade union representative
SHOW: PUBLISHING AUDIT RESULTS
FIX: REMEDIATING ISSUES
26%
8%
6%
28%
48%
14%
disclose a summary of findings at the first tier
disclose a summary of findings at raw material level
publish full audit reports by named facility at first tier
disclose the process for supplier remediation
publish a confidential grievance mechanism for supply chain workers
publish data about the number of grievances filed, addressed and resolved in the supply chain
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
KNOW, SHOW & FIX
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4. KNOW, SHOW & FIX ANALYSIS
KNOW Human rights and environmental due diligence The purpose of due diligence is first and foremost to avoid causing or contributing to adverse impacts on people, the environment and society, and to seek to prevent adverse impacts directly linked to operations, products or services through business relationships. When involvement in adverse impacts cannot be avoided, due diligence should enable organisations to mitigate them, prevent their recurrence and, where relevant, remediate them. Therefore, due diligence is preventative, dynamic, involves multiple processes and objectives, is based on stakeholder engagement, entails continuous communication and is risk-based. The measures that an organisation takes to conduct due diligence should be commensurate to the severity and likelihood of the adverse impact.
Why carry out due diligence? The OECD Due Diligence Guidance for Responsible Business Conduct states that some business operations are inherently risky because they are likely to cause, contribute to, or be directly linked to adverse impacts. In some cases, business operations may not be inherently risky, but circumstances may result in risks. In this regard, due diligence
should help organisations decide whether or not to go ahead with or discontinue operations or business relationships as a last resort, because the risk of an adverse impact is too high or because mitigation efforts have not been successful. Effectively preventing and mitigating adverse impacts can help an organisation maximise positive contributions to society, improve stakeholder relationships and protect its reputation. In addition, due diligence can help organisations create more value by identifying opportunities to
reduce costs, improving understanding of markets and strategic sources of supply, strengthening management of companyspecific business and operational risks, decreasing the probability of incidents, and decreasing exposure to systemic risks. However, we have noticed that only 16% of brands disclose a description of their human rights and environmental due diligence processes. It shows an almost imperceptible increase compared to 2020 (15%), and it is far below the Global Index (39%). On the other hand, although only 14% of brands publish the main environmental and human rights risks, impacts and violations identified in the due diligence process, there was an important increase compared to 2020 (5%), but it is still below the global score (26%). The evident improvement in the Global Index score regarding its previous year (as well as the Brazilian Index) may be due to the forthcoming shift from voluntary to mandatory human rights and environmental due diligence reporting
expected from the European Commission. Unfortunately, we have no knowledge of any similar legislative proposal in Brazil at the moment. Only 6% of brands disclose that workers and their representatives (including producers, farmers and trade unions) are involved in their due diligence processes. In 2020, 5% of brands disclosed that information, while the 2021 Global Index score for this indicator is 21%. Women workers face gender-specific risks, socially and environmentally, so brands are expected to disclose how women's organisations, women's rights advocates and gender experts were involved in the human rights due diligence processes. However, no Brazilian brand has published this information. Meanwhile, the Global Index score is low, at only 10%. Given the relevance of this issue, these are alarming findings. Brands are encouraged to ensure that the most affected stakeholders, such as women workers and their representatives, are included in any meaningful due diligence process.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
KNOW, SHOW & FIX
4. KNOW, SHOW & FIX ANALYSIS
Only 12% of brands disclose how they cease, prevent, mitigate, and remedy environmental and human rights risks, impacts and violations identified in their due diligence processes. Only 8% publish the results of these measures in Brazil compared to 17% in the Global Index. Even among the few brands that disclose due diligence outcomes, the information provided usually lacks detail or focuses more on a output (services provided or actions taken), rather than on an actual outcome or impact (considering consequences in practice), which would be far more meaningful and indicative of tangible changes for workers and the environment. Let’s take the example of a brand identifying that workers are at risk of gender-based violence (GBV), and their response is to provide the at-risk workers with a training session which covers what GBV is and how to report it. Brands generally tend to measure the output, such as 10 workers attended the training session, rather than an outcome, such as 50% of workers self-report feeling more confident raising gender grievances since the training session. An even more
meaningful measure would be impact, such as "3 workers having raised a GBV grievance against a supervisor since the training session, which was investigated and consequently the supervisor was removed from the company". A further impact would be that "40% of workers self-report feeling safer since the supervisor’s dismissal, including all 3 workers that raised the grievance".
OUTPUT
IMPACT
OUTCOME
70
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4. KNOW, SHOW & FIX ANALYSIS
Less than half of the brands describe the process for assessing conditions in supplier facilities Among the analysed brands, 42% disclose information on how their supplier's facility audit process works. This is a decrease from last year (50%) and a score far below the global survey (81%). Regarding disclosing the criteria for taking on new facilities before production starts, there has also been a decrease, from 48% in 2020 to 40% in 2021, compared to 68% in the Global Index. Compared to last year, we also noticed a slight decrease in the percentage of brands disclosing whether audits take place on an announced basis, a semiannounced basis, or an unannounced basis, from 33% in 2020 to 30% in 2021. Meanwhile, in the global survey, this score has more than doubled since last year from 13% to 27%.
Transparency is even lower when it comes to the number of workers interviewed offsite during audits (8%), thereby remaining the same as the 2020 index. On the other hand, the Global Index shows an even lower score for this indicator, with only 2% of brands. Off-site interviews can provide safer spaces for workers to openly disclose concerns about their working conditions. Finally, only 2% of brands disclose how many audits include a trade union representative. In the Global Index, only 1% of brands provide this information. As the Ethical Trading Initiative explains, freedom of association can be difficult to capture in ethical audits, “as nuances of threats, harassment and intimidation of workers are easily masked on the production floor and create an environment where workers fear speaking out on issues that concern them.” Although freedom of association is a common practice for Brazilian companies and guaranteed by labour legislation, it is important to remember that many of the brands reviewed in this
Index have suppliers in other countries as well. Thus, collective bargaining through independent trade unions, and consultation with union representatives in the audit process, can help to overcome these challenges.
98%
of brands do not disclose how many audits include a trade union representative
"Brands must stop hiding behind their supply chains. Their clothes are made by real people, in real locations. Consumers deserve to know where, and under what circumstances clothes are produced." Paul Roeland, Clean Clothes Campaign
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
4. KNOW, SHOW & FIX ANALYSIS
KNOW, SHOW & FIX
Major brand disclosure of supply chain audit results First-tier manufacturers Processing facilities
SHOW As you can see in the table, few brands (26%) share general information about the outcomes of their first-tier supplier audits. In the Global Index, the same indicator shows that 46% disclose this information. Brands disclosing summarised audit findings are much less common when you look beyond the first tier, where brands are less likely to audit. Only 24% disclose information regarding processing facilities and 8% regarding raw material suppliers. In general, there remains a widespread lack of transparency on working conditions beyond the first tier of the supply chain – where workers tend to be less visible, more vulnerable and at higher risk of exploitation. This type of data is important as it highlights some of the most pressing labour issues. However, summarised rather than detailed factory-specific audit information is less actionable by external stakeholders who could use this information to drive positive change. Thus, we also looked at whether brands disclose data on overall supplier audits by named facility, selected outcomes by
Raw material level facility and full audit reports by individual named facility. All this information is available in the following graphs. According to Better Work, a joint programme of the International Labour Organization (ILO) and International Finance Corporation (IFC), making audit outcomes available has “the potential to stimulate factory progress, improve working conditions, bolster the competitiveness of the sector and encourage ethical sourcing.” Since the Better Work programme first started disclosing compliance with labour standards in Cambodia in 2014, the number of factories meeting those standards jumped by 57% in three years. Furthermore, public disclosure of the status of corrective action can incentivise brands to take swift and complete remediation which ultimately protects workers.
Summary of audit findings – without naming facility 26% 24% 8%
Facility-level rating by named facility 20% 12% 2%
Selected audit findings by named facility 8% 8% 0%
Full audit reports by named facility 6% 6% 0%
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4. KNOW, SHOW & FIX ANALYSIS
FIX Only 28% of brands describe the remediation process that is put in place when issues are found in their supplier facilities. Examples are corrective action plans, which may include stop-work notices, further training and/or policy review. The 2021 score for this indicator shows a steep decline compared to 2020 (40%), and an even bigger difference compared to the Global Index (66%). Corrective Action Plans (CAPs) are vital because they can save lives. However, they are not enough alone to address all the deeply systemic social and environmental issues at play in the supply chain. Too often Corrective Action Plans become a box-ticking exercise – with the same issues being identified, then later resolved, only to be detected again in the next audit cycle. So we need greater transparency about the outcomes and impacts of remediation processes, allowing stakeholders to examine whether brands are fixing the root-cause of problems or merely fixing the same symptom year after year. Based on this, we looked at whether companies engage workers, producers, farmers,
unions and any other stakeholders in the development and implementation of corrective action plans, and we found that only 8% disclose this information, which is the same score as in 2020 and below the Global Index (21%). In addition, we looked at whether brands disclose their strategies to terminate relationships with suppliers that remain non-compliant. As an example, the brand's policies should not just dismiss a supplier immediately, but rather seek a suitable strategy or procedure for terminating the supply contract. A good strategy includes an assessment on potential adverse human rights impacts and, if identified, an assurance that suppliers will receive reasonable notice of the intention to terminate the relationship. This is important because when brands suddenly terminate a relationship with a supplier, this can lead to devastating impacts on workers. If suppliers are given reasonable notice of the brand’s exit, they can plan ahead in order to avoid suddenly having to lay off workers. Our research found that 16% of brands disclose an
exit strategy, which is a slight increase compared to 2020 (13%) and close to the global score (17%). Finally, 54% of brands and retailers publish a description of their grievance mechanism for their employees on human rights and environmental issues, 54% of the companies disclose it compared to 53% in 2020 and 62% in the Global Index. For supply chain workers, 48% of brands disclose a description of their grievance mechanism, which is a slight decrease compared to last year (50%) and below the Global Index (52%). Confidential and independent grievance mechanisms are important because they enable workers to speak up with a lesser fear of intimidation or retaliation than they would otherwise face by going directly to their supervisors or employers. Furthermore, 18% of brands describe how workers are notified that the grievance mechanism exists. For example, facilities can post grievance mechanisms on their bulletin boards or provide training on the topic. This is important as workers might not be aware how to use to use these mechanisms otherwise.
It is encouraging to see the increase from 10% in 2020 to 14% in 2021 in the disclosure of data on the number of violations or grievances filed, addressed and resolved by workers in their supply chains. In the Global Index, this score corresponds to 25% of brands. Despite the increase, it would be good to see more companies disclosing this data as well as more detailed information about the outcomes of grievances and how they have been resolved. This could provide important learning for the sector as a whole.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
SPOTLIGHT ISSUES
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SPOTLIGHT ISSUES
5. SPOTLIGHT ISSUES APPROACH
75
Each year, the Fashion Transparency Index explores some key pressing issues in the fashion industry in deeper detail. For 2021, our focus covers six strategic areas to align with and support the United Nations’ Sustainable Development Goals (SDGs), which aims to bring nations together to build a better world for people and our planet by 2030. The following topics were formulated based on consultation with industry experts.
Decent work & purchasing practices
Gender & racial equality
Sustainable sourcing & materials
What are major brands and retailers doing to improve conditions for workers within the company and their supply chains? At this point, we look specifically at:
What are major brands doing about gender and racial equality? On this topic, we looked at:
What are brands doing to increase the use of sustainable materials and reduce the use of virgin plastics? Here we looked at:
•
Combating forced and bonded labour and recruitment practices in supply chains
•
COVID-19 pandemic response
•
Paying living wages to workers
•
Purchasing practices and business relations with suppliers
•
•
Gender and race breakdown of their own employees, considering data from different hierarchical levels
•
Information about how to define "sustainable raw materials"
•
Gender pay gap within the company and supplier facilities
•
Strategies and progress for sustainable material management
•
Race pay gap within the company and supplier facilities
•
Strategies and progress on the reduction of using virgin plastics in textile products
•
Actions focusing on promoting racial equality among employees
•
What the brand is doing to minimise the impact of microfibres
•
Information about career development programs aimed at reducing gender and racial inequality
•
Data on gender-related labour violations at supplier facilities
Unionisation and collective bargaining
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SPOTLIGHT ISSUES
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5. SPOTLIGHT ISSUES APPROACH
Overconsumption, waste & circularity
Water & Chemicals
Climate Change & Biodiversity
What are brands and retailers doing to address overproduction, minimise waste and move towards circularity? We specifically looked at:
What are brands and retailers doing to reduce the use of hazardous chemicals and minimise their water footprint? Here we looked at:
What are brands and retailers doing to combat the climate crisis and mitigate their environmental impacts? Here we looked at whether brands publish:
•
How many items were produced in the reporting period
•
Strategies and progress on reducing the use of hazardous chemicals
•
Decarbonisation targets
•
How much textile waste is generated and how much was destroyed or recycled
•
Water footprint in direction operations and in the supply chain
•
Science-based targets
•
Strategies and progress on reducing pre-consumer waste and recycling post-consumer waste
•
Commitments and progress towards zero deforestation
•
Evidence of the implementation of regenerative agricultural practices
•
Carbon footprint in owned facilities and in the supply chain
•
Renewable energy use in owned facilities and in the supply chain
•
Absolute energy reduction in the supply chain
•
•
•
Strategies for permanent take-back schemes for recycling
Water risk assessments
Investments in textile-to-textile circular recycling
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
SPOTLIGHT ISSUES
5. SPOTLIGHT ISSUES RESULTS
HOPE
2%
OLYMPIKUS
10%
ANIMALE
16%
AREZZO
29%
MALWEE
48%
PUKET
2%
MARISA
9%
ARAMIS
16%
RIACHUELO
28%
ZARA
48%
CENTAURO
1%
DEMILLUS
1%
LUPO
7%
PERNAMBUCANAS
16%
MELISSA
27%
RENNER
46%
NETSHOES
1%
HAVAIANAS
15%
DAFITI
26%
YOUCOM
46%
BESNI
0%
OSKLEN
15%
IPANEMA
26%
ADIDAS
44%
BROOKSFIELD
0%
DECATHLON
23% 22% 22%
CAEDU
0%
FARM
CARMEN STEFFENS
0%
HERING
CIA. MARÍTIMA
0%
COLCCI
0%
DAKOTA
0%
DI SANTINNI
0%
DUMOND
0%
ELLUS
0%
FÓRUM
0%
JOHN JOHN
0%
KYLY
0%
LE LIS BLANC
0%
LEADER
0%
LOJAS AVENIDA
0%
LOJAS POMPÉIA
0%
MARISOL
0%
MOLECA
0%
NIKE
0%
SAWARY
0%
TNG
0%
TORRA
0%
* The brands are ranked in numerical order out of a score of 82, but they are shown here as a rounded-up percentage. Where brands have the same score, they are listed in alphabetical order.
C&A
55%
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SPOTLIGHT ISSUES
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5. SPOTLIGHT ISSUES FINDINGS - DECENT WORK & PURCHASING PRACTICES COVID-19 RESPONSE
20%
4%
0%
48%
30%
20%
publish % of employees who had wage cuts or were laid off
publish the % of workers in the supply chain that received late wage payments or had their contracts suspended
no brand publishes no. of laid off workers in brand’s supply chain since COVID-19 outbreak
publish which protective measures were implemented in the workplaces
publish how they used emergency financial aid offered by the government to companies
disclose how they implemented remote work options for their employees
FORCED AND BONDED LABOUR
UNIONISATION AND COLLECTIVE BARGAINING
16%
22%
10%
16%
14%
10%
publish their approach on recruitment fees in the supply chain
publish data on the existence of violations related to forced and bonded labour
publish actions related to regularisation of foreign migrant workers in the supply chain
publish % of supplier facilities that have democratically elected independent trade unions
publish % of workers in the supply chain covered by collective bargaining agreements
publish data on the prevalence of violations related to collective bargaining and freedom of association in supplier facilities
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
SPOTLIGHT ISSUES
5. SPOTLIGHT ISSUES FINDINGS - DECENT WORK & PURCHASING PRACTICES LIVING WAGES
10%
0%
2%
0%
publish their commitment to ensure living wages to workers in the supply chain
no brand publishes a strategy to ensure living wages for all workers in the supply chain
only one brand reports annual progress towards the commitment to pay living wages throughout the supply chain
no brand publishes % of workers in the supply chain being paid a living wage
2%
0%
8%
4%
only one brand discloses the method for calculating and isolating labour costs in price negotiations
no brand publishes an example of a standard supplier agreement, establishing order types and terms and conditions for payments
publish the average number of days suppliers are paid after delivering orders
publish annually the feedback received from suppliers on their purchasing practices
PURCHASING PRACTICES
79
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SPOTLIGHT ISSUES
80
5. SPOTLIGHT ISSUES ANALYSIS - DECENT WORK & PURCHASING PRACTICES COVID-19 RESPONSE In the beginning of 2020, the COVID-19 pandemic was announced and restrictive measures for social isolation were established worldwide. The negative impacts of this crisis, which is not over yet, have impacted most of the workers in the fashion industry in different countries, including Brazil. Here, the lives of workers were severely impacted and approximately 15% of the population was unemployed between January and March 2021, representing a historical record. The effects of the pandemic are unequal and vulnerable workers, who already received a low income and were unable to work remotely or to socially distance, were the ones who suffered the most throughout this period. In several sewing workshops, contracts were cancelled or interrupted. In addition, after stores reopened, the amount paid for each piece sewed was reduced. According to a survey conducted by the Business & Human Rights Resource Centre with 146 migrant workers in the São Paulo fashion industry, 78% reported a reduction in the price paid per garment produced. At a time when workers have had drastic reductions in their incomes, the prices of food, electricity, petrol and natural gas have soared in Brazil.
All this contributes even more to the precarisation of workers' living conditions. During the pandemic, Worker Rights Consortium (WRC) carried out a survey of 396 garment workers, from 158 factories, across nine countries. It was found that 88% of workers reported that diminished income had forced a reduction in the amount of food consumed each day; 77% of workers reported that they or a member of their household had gone hungry; and 75% of workers reported that they had borrowed money or accumulated debt in order to buy food since the beginning of the pandemic. A survey conducted by BHRRC in São Paulo found similar outcomes, in which 61% of the 146 workers interviewed reported difficulty in affording food. People who make our clothes ended up bearing the financial burden of the pandemic. The massive job and income losses due to the crisis will accentuate global poverty and inequality, disproportionately affecting those who no longer have their rights protected, especially in the poorest countries.
For the 2021 Index, we felt it was imperative to address this issue and analyse what information major brands and retailers that operate in Brazil have shared with the public about their efforts to support workers throughout the pandemic. In general, transparency on the COVID-19 response is very low. Few brands shared information about the pandemic’s impact on workers. Only 20% of brands disclose the percentage of their own employees who had wage cuts or were laid off as a consequence of COVID-19. This number is even lower when we look for data regarding workers in the supply chain: only 4% of brands disclose the percentage of workers who have received late wage payments, or had contracts suspended, while no brand publishes the percentage of workers that have been laid off due to the pandemic. The Global Index scores were also unsatisfactory: only 3% of the 250 brands reviewed disclose the percentage of supply chain workers who have received late wage payments or were laid off because of the pandemic. This data may suggest that brands and retailers have not monitored the impact of COVID-19 along their value chains.
We also reviewed how companies used the emergency financial aid given by the government. Among the 30% of brands that disclosed this information, the most common action is Provisional Measure 936 (MP 936/20), which allowed the reduction of working hours and the temporary suspension of employment contracts due to COVID-19. About half of brands (48%) disclosed the protective measures implemented in workplaces. Examples of the protective measures found were the periodical cleaning of workstations, requirement to wear a mask, availability of hand sanitiser, rotation of employees and/or establishment of shifts between different teams. Another protective measure adopted by companies during the pandemic was the establishment of homeworking. However, as homeworking also led to the negative impacts on workers' lives, such as increased workload and too many video conference meetings, we looked at information on how companies promote suitable and fair conditions for employees to work healthily at home. Only 20% of
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
SPOTLIGHT ISSUES
81
5. SPOTLIGHT ISSUES ANALYSIS - DECENT WORK & PURCHASING PRACTICES
brands disclose which practices were adopted to improve the work quality of their employees, such as checking ergonomic conditions in their houses, making chairs, computers, and other work instruments available, establishing adequate demands, and working hours, among other aspects
96%
do not disclose how many supply chain workers have received late wage payments or had their contracts suspended due to COVID-19
FORCED AND BONDED LABOUR Countries' progress in achieving the Sustainable Development Goals (SDGs) to combat forced and bonded labour and eradicate it by 2030 has been slow. The pandemic has further worsened this scenario due to the disruption of several services targeting survivors of forced and bonded labour. In Brazil, the dismantling of labour rights and the cut in the budget for combatting forced and bonded labour highlight the importance of companies' actions on this issue even more. Only 22% of brands publish data on the existence of violations related to forced and bonded labour at supplier facilities. These may include restrictions on the freedom of movement, withholding of passports or other documents, forced overtime, withholding of wages and debt bondage. Although the percentage of brands that disclose this information increased by 7 points compared to 2020, its disclosure is still very low.
Another violation linked to forced and bonded labour is related to recruitment practices. Only 16% of companies disclose their approaches to hiring fee charges in their supply chain, including whether they ensure that possible costs paid by workers are reimbursed to them. To ensure that these recruitment-related fees are not charged, 18% disclose whether they conduct interviews with workers about their hiring processes. According to the Institute for Human Rights and Business (IHRB), low-income migrant workers are amongst the most vulnerable to exploitation and abuse, and they are often the least able to assert their rights. For many, a lack of viable options to sustain a livelihood at home increases their willingness to accept poor working conditions abroad. Only 10% of brands publish actions related to the regularisation of foreign migrant workers in the supply chain that go beyond auditing for compliance.
Only 1 in 10
brands publish actions related to regularisation of foreign migrant workers in the supply chain
UNIONISATION AND COLLECTIVE BARGAINING Freedom of association, including the right to form and join trade unions and collectively bargain, are fundamental labour rights enshrined in a number of international agreements and national laws, including in Brazil. These are considered enabling rights, because when workers can join together to speak out and negotiate with their employers for better working conditions, it means they can address issues that concern them most, such as
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
SPOTLIGHT ISSUES
82
5. SPOTLIGHT ISSUES ANALYSIS - DECENT WORK & PURCHASING PRACTICES
pay, overtime hours, health and safety, maternity rights, discrimination at work, among others. Despite the slight increase of 6 percentage points from last year, it is noteworthy that just 16% of brands disclose the number or percentage of supplier facilities that have independent, democratically elected trade unions. In addition, 14% disclose the number of supply chain workers covered by collective bargaining agreements. Only 10% publish data on the prevalence of collective bargaining and freedom of association related violations in supplier facilities. This year, we have included a new indicator that looks at the number of collective bargaining agreements that pay higher wages than the required by local law for supply chain workers and we found that no brand provides this evidence publicly. This information is relevant because many brands still use collective bargaining as the main tool for ensuring payment of living wages.
The labour laws in Brazil ensure freedom of association and collective bargaining, and so the fact that less than half of the brands reviewed (42%) disclose in their codes of conduct for suppliers the support and recognition of such freedom shows an outcome far below what is expected. Brands should put more effort into providing support for a real guarantee of this right for all workers in their value chain. This commitment is even more necessary if we take into account the part of the brands' production that takes place abroad, in places where, for a number of social, cultural, political and economic reasons, the rights to freedom of association are not guaranteed by law.
LIVING WAGES A living wage is able to afford a worker's basic living costs, such as food, housing, education, health care, transportation, clothing and other essential needs, as well as some savings for unexpected events. It is typically higher than the minimum wage and ensures a decent standard of living for the worker and their family. The estimate of a living wage varies by region, and guidance in this regard is offered by government and international agencies, academic organisations and/or NGOs. Considering the importance of this topic, it is frustrating that, for another year, brands' disclosure on the subject is almost non-existent. Only 10% disclose their commitment to guarantee a living wage that affords the basic living costs of workers in their supply chain and no brand publishes a measurable, time-bound strategy for guaranteeing this payment. In the Global Index, the scores were also low: 27% of brands disclose their commitment to ensuring a living wage for the supply chain and only 4% of brands publish a plan to achieve this goal.
A living wage is a human right that is recognised by the United Nations and anyone anywhere, should be able to maintain a decent standard of living. Living wages have the power to end poverty pay for the millions of people who make our clothes, the vast majority of whom are women. We acknowledge that this issue depends on complex political, social and economic factors and is not simple to address. However, this doesn’t absolve brands from responsibility. Brands would have no products to sell without the people who make them. Yet, most companies' business models privilege maximising profit for shareholders while workers in their value chains struggle to afford life’s basic necessities. Companies can and should do more. The current Brazilian minimum wage (R$1,100) is not enough to afford a healthy and fair lifestyle for workers and their families. Despite this fact, just 2% of brands disclose the percentage above minimum wage that workers in their supply chains receive. Finally, none of the brands reviewed disclose how many workers in their supply chain receive a living wage.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
SPOTLIGHT ISSUES
83
5. SPOTLIGHT ISSUES ANALYSIS - DECENT WORK & PURCHASING PRACTICES
Only 1 in 10
brands publish their commitment to ensure living wages to workers in the supply chain PURCHASING PRACTICES Purchasing practices are defined by the prices that brands negotiate to pay suppliers to make their products and by the terms brands often set for doing business, including order lead times and payment schedules. All of this has an enormous role to play in enabling decent, dignified and safe work across their global supply chains. In the fashion industry, it is usual for suppliers to be paid long after production and delivery of orders. It is not uncommon that suppliers are paid between 60 and 180
days after delivery. This means that clothes are often being worn by customers long before brands pay the factories that made them. Among the companies reviewed, 14% disclose a supplier payment policy with maximum stipulated deadlines and only 8% publish how long after delivery they pay suppliers, on average. It is very common that major brands expect suppliers to ‘front’ the costs of production, with suppliers typically purchasing the raw materials, fabrics and inputs needed for orders on credit. Therefore, this year we included an indicator to find out which brands disclose a policy on the percentage of orders that are paid to suppliers before production starts, and only one brand discloses this policy. As research by the Center for Global Workers’ Rights (CGWR) explains, some payment structures, “under which suppliers bear the up-front cost of production and buyers pay nothing until weeks or months after the factory ships the goods”, are underpinned by imbalanced power dynamics between major brands, suppliers and supply chain workers. A big part of this issue has to do with brands’ standard supplier agreements, with legal experts
frequently expressing concerns about how one-sided contracts are in favour of brands. This issue was brought into the spotlight during the COVID-19 pandemic, where major brands relied on a "force majeure" clause to cancel orders. This is why for 2021 we looked to see if major brands publish a standard supplier agreement template, setting out typical order and payment terms and conditions, and we found that no companies publish this information. Another important issue to be raised is the fact that workers’ labour rights and wages should never be part of the price negotiation process between brands and their suppliers. Ideally, labour costs should include both salary and overtime, and benefits such as sick-pay and other leaves, holidays and planned or potential salary increases. This calculation ensures that labour costs are non-negotiable, allowing suppliers to pay living wages to their workers. However, only one brand discloses the method for ring-fencing labour costs in price negotiations. Only one brand publishes data on the percentage or volume of orders it has placed where labour costs have been isolated and ring-fenced. If major brands do not safeguard labour costs in price negotiations, they risk profiting from
worker exploitation, including poverty level wages, unpaid overtime and unpaid legally mandated benefits. Finally, we look at whether brands publicly share any feedback from suppliers on their purchasing practices, showcasing how brands and suppliers engage with each other. The results were disappointing in both the Brazilian Index, with 4% of brands disclosing this information, and in the Global Index, with 3%. This data highlights what has already been observed during the COVID-19 crisis: brands often do not have an open dialogue channel with their suppliers, turning their backs on their suppliers during a time of great need.
96%
do not disclose supplier feedback on their purchasing practices
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
VIEWPOINT
VIEWPOINT: COVID-19 PANDEMIC AND MIGRANT WORKERS IN THE FASHION INDUSTRY IN SÃO PAULO In early 2020, the COVID-19 pandemic forced countries and companies to take measures to prevent the virus from spreading, while also having to respond to the economic and social consequences brought by the interruption of non-essential commercial activities. These consequences have increased the existing structural and historical issues, which have profoundly impacted the livelihood of many groups of workers, especially those working outside the formal market. In the fashion industry, unprecedented measures were taken in terms of scale and range. In an international context, we at the Business & Human Rights Resource Centre (BHRRC) observed that brands’ actions to protect their profits to the detriment of their workers’ rights had profoundly negative impacts on the most vulnerable people in the garment sector Brands have used their disproportionate power over factory suppliers to cancel orders, pay suppliers substantially reduced prices for placed orders or postpone the payment.
With the fourth largest fashion industry in the world, Brazil experienced similar consequences. However, we also reflected: although the Brazilian fashion industry covers all the different stages in the value chain and is the second largest employer in the country, we wanted to know how the pandemic has affected people who are not formally employed; those who are almost invisible in the supply chain. In order to understand how this specifically impacted the livelihood of migrant workers, BHRRC interviewed 146 migrant workers in July 2020, aged 17 to 65 (average of 34), living in the city of São Paulo or the metropolitan area. The result was published in December 2020 in a report called Masking Misery. Although we cannot state that the research data is representative of this population, it paints a fairly good picture of it. Women represent seven out of ten interviewees. The vast majority (89%) live in the same place where they work, more than half (56%) have school-aged children and 30% of them have no Internet access which would allow for distance learning activities during the pandemic.
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MARINA NOVAES BRAZIL RESEARCHER & REPRESENTATIVE OF THE BUSINESS & HUMAN RIGHTS RESOURCE CENTRE
Regarding their work, 87% are informal workers and 91% reported a decrease in orders at the beginning of the pandemic. Three out of four participants reported that the prices paid per order also decreased, two-thirds (64%) received the government emergency financial aid and 61% had trouble affording food. A significant number of the respondents (84%) were working on sewing masks. Supporting the family they left behind in their home country was also a challenge. About 58% of those who used to send money home before the pandemic were not able to continue to do so. We also wanted to know how the pandemic affected interviewees' mental health. The most prevalent feeling was fear, followed by sadness, despair and anxiety. However, 17.5% felt hopeful.
In conclusion, the circumstances experienced by these workers during the COVID-19 crisis require stronger mechanisms and policies regarding the protection of migrant workers' rights. Both brands and factories as well as the public authorities must be held accountable for this situation. The government needs to strengthen its role in understanding migrant workers’' needs and the conditions they are subjected to. They must be included in the country's social protection network and there is a need for more effective tools to monitor their working conditions. Authorities should also partner with migrant worker groups and civil society organisations (CSOs) in order to achieve these goals. Regarding the responsibility of companies, it is clear that transparency measures are essential for monitoring the conditions within their supply chains. Information about purchasing practices, payment conditions and marking labour costs non-negotiable should be implemented and publicly shared.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
SPOTLIGHT ISSUES
5. SPOTLIGHT ISSUES FINDINGS - GENDER AND RACIAL EQUALITY GENDER EQUALITY
16%
24%
12%
0%
6%
advertise career development programmes and growth opportunities for women
publish gender breakdown of job roles in the company
publish the company’s gender pay gap
no brand publishes the gender pay gap in suppliers’ facilities
publish data on gender-based violations in supplier facilities
24%
6%
12%
0%
0%
publish actions focusing on promoting race equality
publish career development programmes and growth opportunities for black employees
publish the race or colour breakdown of job roles of their own employees
no brand publishes the company’s ethnicity pay gap
no brand publishes the ethnicity pay gap in suppliers’ facilities
RACIAL EQUALITY
85
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
SPOTLIGHT ISSUES
5. SPOTLIGHT ISSUES ANALYSIS - GENDER AND RACIAL EQUALITY
GENDER EQUALITY It is estimated that women represent around 80% of the garment sector workforce worldwide and approximately 72% in Brazil. Despite this, leadership positions tend to be dominated by men, while women are generally employed in lower paid roles. Even when they are employed in jobs at the same level, it is common for women to receive lower salaries than men. Even with the commitment of many companies to increase gender diversity in recent years, progress in promoting gender equality in the fashion industry has been slow. Only 24% of brands publish an annual gender breakdown of the job roles within their own facilities. Our research has shown that some brands only disclose generic data about the number of women in leadership positions or in the company's general staff, but no data covering hierarchical levels, such as the number of women employees working as salespeople, managers, supervisors, and executives. In addition, only 12% of brands publish the gender pay gap within their company on an annual basis.
This lack of transparency about genderrelated data leads to a lack of effective action by brands. A survey of 535 fashion industry professionals in the United States showed that 80% of survey participants were unable to cite a concrete initiative their company had implemented to address gender inequality. In the Fashion Transparency Index Brazil, we found similar data with only 16% of companies disclosing information on career development programmes aimed at reducing gender inequality and promoting growth and development opportunities for women. An example of such initiatives would be a mechanism that ensures an average internal progression time for management/leadership positions which is equal between women and men.
When we look at the supply chain, transparency about data concerning gender equality is even lower: no company discloses the gender pay gap in supplier facilities. Moreover, the women who make our clothes are in a position of high vulnerability. Several reports show that discrimination, harassment, and violence are common throughout the textile and garment supply chain. Despite the importance of this issue, only 6% of brands publish data on gender-related labour violations in the supply chain. As described in the UN Sustainable Development Goals (SDGs), the effort to achieve SDG 5 on gender equality goes along the entire 2030 Agenda and reflects the growing evidence that gender equality has multiplier effects on sustainable development. Brands urgently need to be more transparent regarding gender equality across their value chain and must take action to combat gender-based violence and discrimination.
86
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SPOTLIGHT ISSUES
5. SPOTLIGHT ISSUES ANALYSIS - GENDER AND RACIAL EQUALITY
RACIAL EQUALITY Black people account for more than half of all Brazilians (55%). However, they are the least often hired for leadership positions and, when they do get a job, they receive lower wages. A survey conducted between January and June 2020 in the state of São Paulo showed that only 15% of the leadership positions were filled by black professionals. Furthermore, the average wages were 26% lower than the amount paid to white professionals. Even though the discussion about diversity and racial equality policies is increasingly taking centre stage in companies, we noticed a lack of transparency on this issue within the brands reviewed by the Index. Only 12% of brands publish information on the race and colour breakdown of their employees, looking at data of different hierarchical levels. Moreover, there is no information on the ethnicity pay gap. No brand publishes annual reports on the difference between the salaries paid to employees of different races, neither for their own employees nor those at their suppliers’ facilities.
Studies show that companies that adopt diversity as a value have several competitive advantages, such as better talent retention, innovation stimulus, greater collaboration between employees and the creation of a healthier and more trusting environment. In addition, racially and ethnically diverse brands are 36% more likely to outperform on profitability. Nonetheless, few companies publish their actions focusing on promoting racial equality among employees, both in the Brazilian Index (24%) and in the Global Index (12%). Besides the lack of programmes to promote racial equality, even when there are in fact actions carried out, they tend to focus more on the selection and hiring of talents rather than on their retention and career advancement. Therefore, we included a new indicator this year to find out if brands publish information on career development programmes aimed at reducing racial inequality and promoting growth opportunities for black employees, and we discovered that only 6% of companies disclose this data.
The fashion industry needs to be more transparent and active in tackling racial inequality across the value chain. Beyond the above-mentioned competitive advantages, companies have a moral imperative to move towards historical redress through the dissemination of concrete racial equality goals, the creation of affirmative actions and the promotion of an anti-racist work environment.
“In the Brazilian context, it is impossible to think about inequality without bringing the racial issue to the centre: here, inequality is about race. The black population has historically been neglected.” Viviana Santiago, teacher, columnist and consultant on ethno-racial and gender issues
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
"As a black female fashion creator, I understand that my line of work is completely indissociable from decoding patterns to bridge the gap between current methodologies and the creative processes of knowledge and practices related to our ancestry legacy. It starts when a creative person is understood as a potential inventor of new worlds, thus providing a glimpse of new human, social and cultural landscapes. When we realise our memory and history have been erased and corrupted, we see that most Brazilians lack information about black, indigenous or any other cultural legacy that is not hegemonically white. Therefore, to confront inequality and to contribute to deconstructing power relations, we need higher quality and more in depth research. It is only then that we can build more respectable creative and productive processes. Similarly, it is important to understand that sustainability is not limited to environmental aspects and is, therefore, inseparable from social and cultural issues. Without decent working conditions and living wages as well as the effective participation and valorisation of black women's work, no process can be considered sustainable or respectable. Black women's roles in the fashion supply chain represents how we have always been seen as mere reproducers or executors of other people's creation, only service providers in subaltern conditions. Once we realise that the stereotype is created as a form of control, we must commit to change this logic that affects us directly."
VIEWPOINT
88
CAROL BARRETO CREATOR OF MODATIVISMO PROJECT, VISUAL ARTIST, AUTHORIAL FASHION DESIGNER AND PROFESSOR AT THE DEPARTMENT OF GENDER STUDIES AND FEMINISM AT UFBA
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
SPOTLIGHT ISSUES
5. SPOTLIGHT ISSUES FINDINGS - SUSTAINABLE SOURCING & MATERIALS SUSTAINABLE MATERIALS
20%
20%
18%
14%
disclose data on the types of fibres sourced annually
publish a time-bound, measurable sustainable materials strategy
publish annual progress towards achieving sustainable materials targets
explain how they define so-called 'sustainable' materials
PLASTICS AND SYNTHETIC MATERIALS
8%
8%
8%
14%
publish targets to reduce the use of textiles deriving from virgin fossil fuels
publish targets to reduce the use of textiles deriving from virgin fossil fuels
explain what the brand is doing to minimise the shedding of microfibres
publish targets to reduce the use of packaging deriving from virgin plastics
89
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
SPOTLIGHT ISSUES
90
5. SPOTLIGHT ISSUES ANALYSIS - SUSTAINABLE SOURCING & MATERIALS
SUSTAINABLE MATERIALS Research from Global Fashion Agenda and McKinsey suggests that more than 70% of the carbon emissions of a garment comes from upstream activities, specifically from energy-intensive raw material production, preparation, and processing. The environmental impacts of raw material production are numerous and disproportionately impact the livelihood, health and safety of people working within the supply chain, local communities, and surrounding biodiversity. Garment production has doubled since 2000, and the volume of clothes produced is expected to grow from 62 million tonnes in 2015 to 102 million tonnes by 2030. It stands to reason that with current production processes as they are, the more clothes that are made, requiring a greater number of materials, the greater the risks are that we will see growing carbon emissions, waste, use of hazardous chemicals, water consumption and release of microfibres into our waterways.
However, not all fabrics are created equal. Each fibre choice has a different set of environmental impacts to consider. Conventional cotton crop, for instance, ranks fourth regarding the highest pesticide consumption in Brazil, accounting for approximately 10% of the total volume of pesticides used in the country. This has high potential to damage soil and human health (learn more in Case Studies: Transparency in Action). Meanwhile, the most widely used fibre in the fashion industry is polyester, which is made from a non-renewable fossil fuel, and it releases microplastics when worn and washed. It is important to highlight that, as stated in the introduction of the report Fashion Yarns: A Systemic Perspective Towards Circularity, "there is a massive deficit of open and available sources, both in terms of commercial and economic data, as well as socio-environmental impacts caused by the production of textile fibres." Thus, the lack of reliable and comparable data on raw materials makes
it easier for cases of greenwashing to happen, where materials can be sold as sustainable without their real impacts being considered. Therefore, we have included an indicator this year that looks at the process used by companies in defining what they consider to be a sustainable material. There is a lack of transparency from brands in this regard, with only 14% of brands explaining what tools they use to define materials as sustainable. Some of the methods found are the following: third-party certification, internal studies, use of materials that use less water and produce less waste, products made with renewable energy, organically-sourced materials, and benchmarks such as the Corporate Fiber & Materials Benchmark, Canopy Hot Button Report, and Higg Material Sustainability Index. Scores were also low regarding the other indicators in this section: only 20% of brands publish their strategies for using more sustainable materials and only 18% publish their progress towards
these goals. Furthermore, only 20% of companies disclose data on the types of fibres sourced annually. The lack of transparency on how brands use these materials reinforces the need for creating reliable and comparable studies on the social and environmental impacts of fibres. It is also evident that there is a need for a more stringent regulation in this area, including the need for mandatory industry-wide standards with clear guidance and tools that help companies to mitigate the environmental impacts of the materials they use.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
SPOTLIGHT ISSUES
5. SPOTLIGHT ISSUES ANALYSIS - SUSTAINABLE SOURCING & MATERIALS PLASTICS AND SYNTHETIC MATERIALS More than half of the textile fibres produced worldwide are synthetic, i.e. made from polymers derived from petroleum. This great dependence on synthetic materials makes the textile industry the third largest user of plastic in the world (15%), only ranking behind packaging and construction. Polyester is the most known synthetic fibre as well as the most used by the industry. Its production and use are associated with impacts such as high energy consumption, greenhouse gas emissions, release of microfibres and emission of substances that can damage human health. Despite this, only 8% of brands publish measurable and time-bound targets on reducing the use of synthetic textiles made from virgin fossil fuels and their annual progress towards these targets. Regarding the decrease in the use of virgin plastics in packaging, only 14% of the companies disclose their measurable and time-bound targets. This number drops to 8% when we look for progress towards these targets.
Only 8% of brands explain what the brand is doing to minimise the impact of microfibres. Microfibres are tiny fragments that shed from our clothes into the natural world when we wear, wash and dispose of them. Microfibres have even been found in the placenta of expectant mothers and it is estimated that our clothes release half a million tonnes of microfibres into the ocean each year, the equivalent of more than 50 billion plastic bottles.
"We need to propose a transition to natural raw materials production models that meet two main commitments: restoring the biodiversity of ecosystems and providing income generation and food security." Yamê Reis, fashion consultant and author of The Cotton Agribusiness: Environment and Sustainability
91
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
VIEWPOINT
VIEWPOINT: BEING LESS BAD THAN OTHERS DOES NOT MEAN BEING GOOD: REGENERATIVE FASHION REQUIRES ATTENTION
We live in a world of fleeting attention. We make many decisions by analogy, comparing things without proper reflection and losing sight of the big picture. Let's take the word "sustainable", for example. Rather than understanding its definition, we have decided that, when a product brings about any improvement, whether environmental or social, it is deemed "sustainable". Including a percentage of recycled material or working with natural fibres are examples of products that claim to be sustainable. Hence, opinion is formed by comparison, but not by an actual understanding of the origin of that material
Most recycled PET comes from China, which has an impact on transportation and lacks traceability. Natural fibre, mostly cotton, is the crop that uses the most pesticides in Brazil, closely linked to soybean crops and to an inefficient model of agriculture. If we think about the definition of sustainability, which is understood as "a development that does not exhaust future resources", bringing PET from China, or conventional cotton crops, could never be called sustainable. Sure, recycled PET is better than virgin plastic, while cotton is better than polyester. However, being less bad than others does not mean being good. Let alone sustainable. "Keep your eye on the doughnut, not on the hole," David Lynch said about idea conception. And the idea of sustainability is going down the hole.
92
BETO BINA CO-FOUNDER OF FARFARM
That's why we must talk about the word "Regeneration". It fits our current scenario as it is not enough just to protect or sustain, we must regenerate the damage done. When we talk about regenerative agriculture, the criteria are to look at ecosystem services, i.e. elements that nature provides such as biodiversity, water, carbon and the cultural legacy of traditional peoples or even landscape beauty. To regenerate ecosystem services, we develop practices that start with soil improvement and quality, using mulch with no tilling as well as no pesticides or transgenic seeds. Brazilian farmers have been doing regenerative agriculture for over 30 years within the Agroecology movement, which goes beyond land use. Agroecology has taught us that there is no regeneration without feminism and gender equality, just as there is no sustainability without social justice; otherwise, we are only sustaining inequality.
But the word "regenerative" has also come to be used as analogy, within the "less bad" comparison. One example is that of the large cotton producers that use conventional farming models but that have reduced the use of pesticides (even though they are still applied by aircraft), which have then identified an increase in microorganisms in the soil and, therefore, they claim it to be regenerative. Yes, it is "less bad" to reduce pesticides and I hope the effort will serve as an example. However, in the end, the same industry that generates social inequality and degrades ecosystems is being perpetuated. Our idea of responsible fashion should be built with attention and reflection so that we don't fall into the same hole.
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
SPOTLIGHT ISSUES
93
5. SPOTLIGHT ISSUES FINDINGS - OVERCONSUMPTION, WASTE & CIRCULARITY PRODUCT VOLUME & BUSINESS MODEL
30%
32%
18%
4%
18%
6%
disclose the overall quantity of products made annually
disclose data on the quantity of products made annually in Brazil
offer new business models that slow consumption
offer repair services to increase clothing longevity
offer circular solutions, which allow parts to be recycled (in addition to reuse or downcycling)
disclose % of products designed to enable closed loop or recycling
16%
2%
22%
10%
24%
22%
publish the amount of pre-production textile waste generated in the annual reporting period
disclose the amount of post-production/ pre-consumption waste generated annually
disclose the amount of pre-consumer reused or recycled
disclose the number of items destroyed during the year
disclose whether they provide permanent in-store take-back schemes
disclose what happens to clothes received through the take-back schemes
WASTE AND RECYCLING
FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
SPOTLIGHT ISSUES
94
5. SPOTLIGHT ISSUES ANALYSIS - OVERCONSUMPTION, WASTE & CIRCULARITY
Overproduction, overconsumption, and waste are growing challenges for the global fashion industry. In 2019, the domestic apparel industry produced around 9 billion products and the market trends show that global demand is likely to increase. Currently, most clothing and footwear production follows a linear model: raw materials are extracted, transformed into products, then these products are consumed and discarded. This model has generated an unprecedented amount of textile waste worldwide, with significant social and environmental impacts.
Production volumes Data on annual production volumes, if shared publicly, would give people more detailed insights into the scale of overproduction globally. We have found that just 30% of major brands disclose the quantity of products they make each year. In the Global Index, only 14% of the 250 brands reviewed disclosed this information.
Although they also have international facilities, Brazilian brands often publish lists with only their national suppliers. Thus, to better understand the weight that production in Brazil has in the total amount of each brand, we included an indicator that looks at the number of pieces produced in the country. About 32% of brands disclose this information. Knowing the country of origin of products helps understand, for example, what labour rights workers in the supply chain have and what environmental regulations are in place in each location.
Clothing take-back schemes and reuse We also found that 24% of brands disclose having permanent clothing takeback schemes in place, and 22% disclose what actually happens to clothes received through these schemes. Typically, clothes unwanted by consumers are forwarded to third parties, either through online clothing resale platforms or donations to NGOs, bazaars and vulnerable populations. It is essential that brands
take responsibility for the waste they create and be transparent about where the items go. See the viewpoint from Liz Ricketts at The OR Foundation: "A Lack of Transparency from Major Brands on Overproduction, Circularity and the Second-Hand Clothing Trade" to read more about this issue.
Overconsumption, Waste & Circularity Moving towards more circular processes and business models is essential to tackling fashion’s waste problem. The Ellen MacArthur Foundation defines the circular economy as based on the three following principles: eliminate waste and pollution, keep products and materials in use and regenerate natural systems. Despite the clear need to migrate from a linear to a circular production model, only 18% of brands disclose how they invest in circular solutions that go beyond reuse and downcycling. In addition, only 6% of brands disclose the percentage
of their products that are designed to enable circularity, allowing closed loop or recycling of the items at the end of their shelf life. We looked to see if brands share detailed data on the different types of waste created both before and after production of garments, and only 16% disclose the amount of pre-production waste generated annually (offcuts, scraps, endof-roll fabrics). We also found that 22% disclose the breakdown (in percentage or tonnes) of how this waste is reused (downcycled, upcycled, resold locally or in other markets, recycled and used in new fabrics or used for energy generation). In addition, only 2% disclose the amount of post-production waste, such as excess stock and defective parts, which is generated annually. This suggests that the vast majority of brands have little insight into the types and amounts of waste created in their supply chains, which will hinder the effectiveness and impacts of their circularity initiatives.
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5. SPOTLIGHT ISSUES ANALYSIS - OVERCONSUMPTION, WASTE & CIRCULARITY It is common for companies to destroy their unsold items as a way of retaining exclusivity and brand value. They also destroy unsold items because they have too many unsold goods, production samples they cannot sell or goods that don’t meet safety standards. However, only 10% of brands disclose how many items are destroyed annually. Another crucial way to tackle textile and clothing waste is by investing in efforts to slow consumption and increase clothing longevity. This can be done, for example, by offering repairing services or creating new business models. Only 18% of brands disclose the implementation of new business models or services, such as renting and reselling, which would enable their customers to keep clothes in use for longer. This percentage is even lower when we search for brands that offer repairing services to their customers, at 6%.
There is much more to unpack on the complex issues of overproduction, overconsumption, waste, and the circular economy in the global fashion industry. However, it is clear that greater transparency is a critical first step that most big brands still need to take.
“The - mistaken conception of growth based on inexhaustible natural resources and a market capable of absorbing everything produced has not and will not lead to development. Quite the contrary.” Alberto Acosta, on O Bem Viver (Living Well)
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VIEWPOINT
VIEWPOINT: LACK OF TRANSPARENCY FROM MAJOR BRANDS ON OVERPRODUCTION, CIRCULARITY AND THE SECOND-HAND CLOTHING TRADE The first thing that stands out to me is that more brands offer clothing take-back programs (24%) than repair programs (4%). This isn’t indicative of aligning with true principles of circularity and sustainability which would require companies and citizens alike to take responsibility for their products. Instead, these statistics show that the majority of big fashion brands are simply passing on the responsibility for the products they create and more generally evading accountability for the overconsumption patterns that they actively incentivise and normalise. The oversupply of second-hand goods also undermines sustainability logic and teaches citizens that clothing is disposable thereby seeding linear behaviours in groups that until now may have resisted the lure of disposability culture.
Without further commitments to repair, upcycling, designing for durability and capping production volumes, takeback programs do not require that brands take responsibility for the waste they create. These brands confuse the public by marketing their take-back programs as “recycling” or “circular” while also rewarding customers with incentives to buy more new goods. This is counterproductive and leaves consumers with misguided notions about the state of textile “recycling”. Furthermore, because most brands work with third parties to implement these take-back programs, they fail to create a feedback loop between the postconsumer waste stream and their design teams, missing valuable opportunities to assess wear patterns and to design for durability, repair and upcycling. This is further evidenced by the fact that only 6% of brands, that’s just 3 companies out of 50 surveyed, disclosed the percent of products that are designed for the circular economy. Until these brands
LIZ RICKETTS CO-FOUNDER AND DIRECTOR OF THE OR FOUNDATION
stop overproducing and are accountable to the communities that truly care for their waste, these take-back programs are simply thereby extending the linear economy, not truly closing the loop. From 2020 to 2021, only 8 more brands made efforts to disclose the quantity of clothing that they produce annually, bringing the total to 15 brands or 30% uof those 50 surveyed this year. Yet this is a number that every brand will know. Every company in the world knows how many products it manufactures, so there is really no excuse for not disclosing this information. It speaks volumes to the fact that brands are afraid this will reveal their true impact on the planet and undermine the greenwashing claims that are made in their marketing campaigns. Publishing data on the number of items would also force brands to confront the fact that supply and demand are not as straightforward as they claim. Brands intentionally overproduce because they cannot predict what people will buy and yet these same brands often
claim that they only produce based on demand. This myth that supply and demand are neutral forces has been carried forward into the second-hand trade with brands suggesting that in doing so they would be offering a more sustainable practice to engage people into buying without feeling guilty. Disclosing production volumes would not only allow for more honest dialogue, but it would lead to more meaningful innovation across the value chain.
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5. SPOTLIGHT ISSUES FINDINGS - WATER & CHEMICALS WATER & CHEMICALS
14%
14%
12%
publish time-bound commitment to eliminate hazardous chemicals
publish progress towards eliminating hazardous chemicals
publish wastewater test results from the supply chain
30%
10%
2%
publish annual water footprint in company’s own facilities
publish the water footprint of the processing facilities
publish annual water footprint at raw material level
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5. SPOTLIGHT ISSUES ANALYSIS - WATER & CHEMICALS
Wastewater treatment
Hazardous chemicals
Water consumption
Textile processing and garment manufacturing uses thousands of synthetic chemicals, and, when improperly handled, can cause harm to the health of workers, their communities, and the environment. Data from National Sanitation Information System (SNIS) released by the Trata Brasil Institute indicates that, in 2019, only 49.1% of Brazil's sewage was treated. In 2017, the country discharged approximately 5,622 Olympic-sized pools of untreated sewage into nature.
We can observe a slight increase, from 10% in 2020 to 14% in 2021, in the number of brands that disclose a time-bound measurable commitment to eliminate the use of hazardous chemicals in their production. This type of commitment is in line with international standards such as ZDHC and REACH. The same brands also share data on progress towards eliminating hazardous chemicals.
In general, textile production uses an enormous amount of water at various stages of the supply chain – from cotton cultivation to leather tanning to dyeing, treating, and laundering fabrics. Textile production has been linked not just to water pollution but to exacerbating water scarcity, predominantly in countries in the Global South where the majority of textiles are produced.
In the Global Index the score is slightly higher: 30% of brands disclose timebound measurable targets on this issue and 31% of brands disclose progress towards eliminating hazardous chemicals.
According to the UN Agenda 2030, water is at the heart of sustainable development and is related to poverty eradication, economic growth, and environmental sustainability. Water scarcity affects more than 40% of the world's population and this number could grow further as a result of the climate crisis and inadequate management of natural resources. Therefore it is alarming that the disclosure of data on water consumption along the fashion value chain remains low among the brands reviewed.
A report from CDP outlines how wastewater is discharged or runs off into waterways, which can then harm peoples’ health, create unequal access to clean water and sanitation, and damage soil fertility and the habitats of aquatic life. This, in turn, creates associated socio-economic problems for people dependent on the land and freshwater for food production and livelihoods. We added an indicator to the Index this year looking for disclosure of wastewater tests results in the supply chain and found that only 12% of major brands disclose some relevant data.
There was a slight increase, from 23% in 2020 to 30% in 2021, in the number of brands that annually publish the water footprint from their facilities, such as administrative headquarters, stores, distribution centres, and warehouses. However, significantly fewer brands (10%) publish annual water consumption data at the processing facility level and only 2% of brands disclose the water footprint at the production level of raw materials. Finally, 14% of brands disclose a process or methodology for conducting waterrelated risk assessments, which are essential to understand the threat of water pollution and water scarcity in the supply chain.
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5. SPOTLIGHT ISSUES FINDINGS - CLIMATE AND BIODIVERSITY DECARBONISATION, DEFORESTATION AND REGENERATION
22%
20%
22%
0%
0%
6%
publish a measurable decarbonisation commitment
publish their progress towards decarbonisation
publish science-based targets covering climate and/or other environmental topics
no brand publishes a measurable commitment to zero deforestation
no brand publishes its progress towards zero deforestation
brands disclose evidence of implementing regenerative farming practices
CARBON EMISSIONS
ENERGY USE
32%
18%
10%
2%
30%
6%
publish annual carbon footprint in their own operations
publish annual carbon footprint in the supply chain
publish annual carbon footprint at a raw material level
disclose absolute energy reduction in the supply chain
publish data on renewable energy use in the company’s own facilities
publish data on renewable energy use in the supply chain
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5. SPOTLIGHT ISSUES ANALYSIS - CLIMATE & BIODIVERSITY
The global fashion industry is environmentally damaging on many levels – from the way materials are produced, to how they’re manufactured into clothes, to how they’re shipped around the world, and finally to how we buy, care and dispose of the clothes we wear. Overall, we don’t know quite how big fashion’s carbon footprint is – partially because supply chains are complex. However, research from the Global Fashion Agenda (GFA) and McKinsey estimates the fashion industry accounts for 4% of global greenhouse gas emissions. The effects of climate change are not felt equally across the world, and many production countries are already grappling with the negative impacts of the climate crisis, which includes rising sea levels, deadly heat waves, droughts, fires and storms. Experts report that the climate crisis has worsened global economic inequality and could force 216 million people to migrate by 2050, including 19 million in Latin America.
Besides the social and environmental impacts, the climate crisis may affect the economic results of companies, as the supply of raw materials will be impacted and the productivity in the supply chain may decrease. A CDP report showed that if action is not taken, the 215 largest global companies will lose approximately one trillion dollars in climate change-related costs within the next 5 years. Despite the climate emergency, the majority of reviewed brands show little transparency on topics related to climate and biodiversity. Only 22% of brands publish a measurable and time-bound commitment to decarbonise, and only 20% describe their progress towards meeting this commitment.
Disclosing carbon emissions data According to a report by the Intergovernmental Panel on Climate Change (IPCC), it is clear that human actions have influenced climate change in a way that is unprecedented in the last 2,000 years. The report indicates that each of the last four decades has been successively warmer than the previous decade since 1850. IPCC warns that no solution will be satisfactory unless we cut greenhouse gas emissions immediately. Despite the urgency, the reviewed brands' efforts fall significantly short from the challenge proposed by IPCC. There is a big gap between the number of brands disclosing their carbon footprint between the Brazilian Index and the Global Index. While 62% of global brands disclose the carbon emissions of their own facilities, only 32% of Brazilian brands do so. This difference may result from joint efforts and public commitments which a large number of brands have signed up to sector pledges: the UN Fashion Industry Charter for Climate Action, the G7 Fashion Pact and WRAP's Textiles 2030 Strategy, among others.
Although the Brazilian Index score is low, there is a slight increase compared to 2020, when only 25% of brands published the carbon footprint in their own facilities. As we move along the value chain, the available data becomes even scarcer. Only 18% of brands publish the annual carbon footprint of their first-tier suppliers and beyond (fabrics, processing facilities etc.) and only 10% disclose emissions at a raw material level. There is a similar pattern in indicators on renewable energy use, with 30% of companies disclosing renewable energy usage data for their own facilities, but only 6% disclosing this information for their supply chains. In addition, only 2% of brands disclose data on absolute energy reduction in the supply chain. If big brands do not track carbon emissions across their entire supply chain, from first-tier manufacturers to raw material production, they cannot accurately measure their climate impacts. This information needs to be disclosed annually so that companies can be held accountable for reducing their emissions and progressing towards their targets.
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5. SPOTLIGHT ISSUES ANALYSIS - CLIMATE & BIODIVERSITY
Net-zero carbon, carbon neutrality and carbon offsetting As a growing number of big brands establish targets on decarbonisation, it is important to differentiate between carbon neutrality and net-zero carbon as these terms are often interchangeably used, causing a great deal of confusion. The PAS 2060 standard, established by the British Standards Institution (BSI) and internationally recognised, define the requirements for quantifying, reducing, and offsetting greenhouse gas emissions. According to this standard, carbon neutrality means not adding new greenhouse gas (GHG) emissions to the atmosphere. Achieving this balance may involve eliminating emissions, offsetting them or a combination of both, and should cover Scope 1 and 2 emissions, with an incentive to cover Scope 31. In turn, net-zero carbon comprises all the activities within a value chain (Scopes 1, 2 and 3) and seeks to zero or produce only low GHG emissions, provided
that they are offset by processes that reduce greenhouse gases already in the atmosphere through carbon capture and storage. For example, these processes could be things like planting new forests or drawdown technologies like direct air capture. The more emissions that are produced, the more carbon dioxide we need to remove from the atmosphere (this is called sequestration) to reach net zero. In addition, GHG emission reductions need to be in line with the Paris Agreement, limiting global warming by 1.5°C. However, governments and companies need to show what they are actually doing to reduce their emissions. For example, deforestation in Brazil, driven by cattle ranching, soy production and logging has major implications for the carbon dioxide balance in the global atmosphere. In Brazil, there is not yet a national sector for regulated carbon, just a regulatory framework that is currently being discussed in Congress. Another important aspect to point out is that, for many companies, buying offsets
or carbon credits has become an enabler for companies carrying business as usual. Thus, they can continue emitting the same GHG quantities without having to invest in significant changes to their products, operations and supply chains. For effective change to occur, companies need structural changes along their entire production chain that cut pollution and emissions as well as investments in clean energy development and new technologies.
Science-based targets and financial reports Under the 2015 Paris Agreement, national governments have committed to limiting global temperature increase to 1.5°C. As a result, companies play a key role in meeting these commitments and science-based targets provide companies with a clearly defined pathway to reduce greenhouse gas emissions. Our research has found that a small but growing number of major brands are making public science-based
targets covering climate and/or other environmental topics, (22% this year compared to 13% in 2020). Despite this, no brand publishes a report that directly demonstrates its environmental footprint in its financial statements, following methodologies such as the Environmental Profit & Loss (EP&L).
Lack of brand commitment to regenerative agricultural practices and zero deforestation Forests are home to 80% of the world’s terrestrial biodiversity and provide important ecosystem services such as clean water, carbon sequestration and pollination, among others. Forests are critical habitats that support the livelihoods and cultures of indigenous, riverside, and traditional communities, and they are also crucial in the fight against climate change. Materials such as leather and viscose, which are used widely in clothing, are at risk of being associated with deforestation.
1. Scope 1 are direct emissions from sources owned or controlled by the company - Scope 2 are indirect emissions from energy procurement - Scope 3 are all the indirect emissions (not included in scope 2) that occur along the company's supply chain
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5. SPOTLIGHT ISSUES ANALYSIS - CLIMATE & BIODIVERSITY
Research from Canopy estimates that more than 200 million trees are logged every year and turned into cellulosic fabric (e.g. viscose, rayon, modal and lyocell). The Cerrado biome, the region with the highest concentration of cotton farms in Brazil (93.6%) (CONAB, 2017), has particularly suffered from territorial conflicts and constant deforestation for five decades, losing 50 thousand square kilometres of native vegetation in the last 10 years. Cattle ranching, which produces both meat and leather, is responsible for the majority of deforestation in the Amazon, which has been expanding continuously since the early 1970s. In recent years, Brazil has been breaking deforestation records. In September 2021 alone, the Amazon lost an area of forest larger than 4,000 football pitches per day, recording the worst mark for this month in 10 years. While all this information only reinforces the importance of the fashion industry's commitment to end deforestation, none of the 50 brands reviewed disclose measurable commitments to zero
deforestation. In the Global Index, the results are also disappointing. Only 10% of brands publish commitments in this regard. Another topic that needs greater attention from companies and has been included in this year's Index is regenerative agriculture. It is a system of agricultural principles and practices that recovers organic matter and restores soil biodiversity, while taking into account the ecological and social aspects, rehabilitating the ecosystem and enhancing natural resources rather than depleting them. Even with most fashion brands depending largely on agriculture to source raw materials, only 6% disclose evidence of implementing regenerative agricultural practices for at least one raw material source. Regenerative agricultural practices can help in the transition to using lower impact materials. They also have the potential to create new employment opportunities, to mitigate the socioenvironmental impacts of the climate
crisis, and to support biodiversity. However, it is important to note that regenerative agriculture has been practised in communities all over the world for thousands of years. Its potential must respect ancestral farming practices and local communities. The conversation about shifting to regenerative agricultural models should focus on issues such as land reform and the welfare of rural workers. It should value the knowledge of indigenous communities, which will require deeper reflections on our shared colonial past as an industry and as a global society.
“There is no regeneration without feminism and gender equality, just as there is no sustainability without social justice; otherwise, we are only sustaining inequality. ” Beto Bina, co-founder of FarFarm
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VIEWPOINT: TRANSPARENCY ON CARBON FOOTPRINTS IS KEY TO CREDIBILITY OF BRANDS’ SCIENCE- BASED TARGETS PAULINE OP DE BEECK EU BUSINESS DEVELOPMENT MANAGER AND SUSTAINABLE FASHION LEAD FOR THE CARBON TRUST
The new indicators related to climate and biodiversity that have been added to the Fashion Transparency Index methodology this year are really important. Transparency on carbon is the only way we can be confident that brands are taking the necessary actions to reduce their emissions and set science-based targets.
Once an organisation has set targets, being transparent about the underlying boundaries, assumptions and emissions profile that constitutes them is crucial in order to understand if they are indeed aligned with the requirements of the Paris Agreement and the Science Based Targets initiative. Transparency on carbon is essential because we want to be able to understand how these targets truly reflect a company’s impact and the specific challenges that a company will be addressing. For example, disclosure of Scope 1 and 2 emissions (own operations) and target implementation plans, reveals what proportion of an organisation’s energy procurement is renewable, what action is being taken to increase that and what energy efficiency measures are being taken/planned to reduce energy usage.
Being transparent and reporting on Scope 3 footprints (value chain) is crucial to understanding the scale of change an organisation needs to make, given that these emissions commonly make up 80-90% of a brand’s footprint. Explaining what the most carbon intensive materials and processes are, and how these fit into reduction targets, not only demonstrates an organisation’s willingness to act on these emissions but also helps ensure accountability for year-on-year reductions. Initially, these footprints will often be based largely on estimations due to a lack of supply chain visibility. Supplier engagement for accurate reporting and, ultimately, then achieving these reductions in the supply chain is key. With this data, and an increased focus on accurate material reporting, the industry should move to a lifecycle analysis (LCA) based approach. This is
particularly important so that brands can demonstrate the emissions associated with their specific buying processes and not just the industry average. An LCA approach should also ensure that brands are making informed choices about material switching and process innovation. Improved accuracy and transparency on carbon footprints is key to the credibility of any organisation’s science-based targets and/or net-zero commitments and something that you can find out more about from the Carbon Trust.
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FINAL RECOMMENDATIONS
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TAKE ACTION ON TRANSPARENCY WHAT NEEDS TO HAPPEN NEXT?
Anyone anywhere should be able to find out how, where, by whom and at what social and environmental costs their clothes are made. This requires greater transparency across fashion’s global value chain. By working together, as one collective voice, we must demand that companies become more transparent and that governments must require transparency from the brands we buy. We want to see an industry where transparency and accountability are so deeply embedded across the entire value chain that the Fashion Transparency Index is no longer needed. However, greater transparency is only the first step towards making change in the global fashion industry and, unfortunately, a first step that is still very much needed across much of the industry. Ultimately, transparency will help us to create a global fashion industry that conserves and restores the environment and values people over growth and profits.
So, our call to you is this: do not use this Index to inform your shopping choices but rather use these findings to inform your activism. Scrutinise the major brands and hold them to account on their claims.
FINAL RECOMMENDATIONS
For individuals, this means calling on: Major brands and retailers to be more transparent on all the issues included in the Fashion Transparency Index - get in touch with brands and ask them #WhoMadeMyClothes? #WhatsInMyClothes? and #TheColorOfWhoMadeMyClothes Policymakers to create legislation that holds big brands accountable for human rights and environmental impacts the length of the value chain Shareholders and investors to use their power to influence big brands to be more transparent and do better for the planet and the people who make our clothes Civil society, such as trade unions and NGOs, to ensure that brands’ policies and practices translate into positive outcomes in the places where clothes are made
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For major brands and retailers, this means:
For policymakers, this means:
Publish your supply chain right down to raw material level as soon as possible, doing so in alignment with the Open Data Standard for the Apparel Sector
Support better regulations, laws and government policies that require transparency and corporate accountability on environmental and human rights issues in the global fashion industry
Be completely transparent on all the topics covered in the Fashion Transparency Index, continuously updating public disclosure in response to evolving risks Implement robust due diligence on human rights and environmental risks and publicly evidence the outcomes and impacts of your efforts Work collaboratively on due diligence with your peers, especially when they operate in the same facilities, and with rights holders, especially women workers and trade unions, and then share these efforts publicly Support legislation that requires greater transparency and corporate accountability on environmental and human rights issues in the global fashion industry
Support better enforcement of existing laws, including sanctions, on social and environmental issues that relate to the global fashion industry Be more proactive at responding to ‘red flags’ and risk factors associated with labour exploitation and environmental damage in the global fashion industry Listen to stakeholders, such as workers and communities affected by the fashion industry, to inform their policy-making strategies
FINAL RECOMMENDATIONS
For investors and shareholders, this means: Ask major fashion brands and retailers for clear governance and accountability on human rights and environmental issues Ask for board level accountability on human rights and environmental issues and demand that executive pay is tied to improved impacts on these issues Demand that the board has expertise on the complexities and nuance of human rights and environmental issues Prioritise meaningful and credible environmental, social and governance (ESG) factors into your investment strategies Call for mandatory transparency and corporate accountability legislation on environmental and human rights issues in the global fashion industry
For NGOs, trade unions, journalists and academic institutions this means: Use the data and findings, available in this report, to scrutinise and verify the public claims made by brands and hold them to account Raise the flag when brands make public claims that do not reflect the reality on the ground Use this data to collaborate with other stakeholders and brands themselves to address issues found in supply chains and prevent them in the future Stand together in calling for mandatory transparency and corporate accountability legislation on environmental and human rights issues in the global fashion industry Use this data to create new initiatives, complementary studies or claims for improvements in the fashion industry
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THANK YOU!
The Fashion Transparency Index Brazil 2021 was written by Eloisa Artuso, Isabella Luglio, Sarah Ditty, Ciara Barry, Liv Simpliciano, and Delphine Williot. The project was carried out with the technical partnership of Aron Belinky and Renato Moya from ABC Associados. The report was designed by Emily Sear, Maria Maleh and Ipsa Dhariwal, and adapted by Igor Arthuzo. Sara Ramos from Cooperaminas was responsible for proofreading the Brazilian Portuguese version, while Samira Spolidorio translated the report into English. Our most sincere thank you to our researchers, Elisa Viviani, Eloisa Artuso, Isabella Luglio, Loreny Ielpo and Renato Moya, who have worked carefully and diligently to produce the research underpinning this report. A special thanks to Sarah Ditty, Delphine Willot and Aron Belinky for all their support and immense dedication to the project.
We extend the utmost gratitude to our pro bono consultation committee, who have been instrumental in guiding our team throughout this project: Dr. Mark Anner, Neil Brown, Maddy Cobbing, Gary Cook, Subindu Garkhel, Fiona Gooch, Christina Hajagos-Clausen, Kristian Hardiman, Aruna Kashyap, Kate Larsen, Hester Le Roux, Emily MacIntosh, Maya Rommwatt, François Souchet, Joe Sutcliffe, Urksa Trunk and Ben Vanpeperstraete. And an enormous thank you to all the others who provided informal feedback on the methodology. A very heartfelt thanks to the experts who contributed their additional analysis and viewpoints for the report this year: Andrea Sousa, Beto Bina, Carol Barreto, Liz Ricketts, Marina Novaes, Nelsa Nespolo, Pauline Op de Beeck, Veronica Tavares, and Yamê Reis. Thanks also to Fernanda Simon, Executive Director of Fashion Revolution Brasil; Mariana Chaves, Communication Lead and her team members Julia Teodoro and Taya Nicaccio, responsible for promoting
the project; Dandara Valadares, Press Officer; and Loreny Ielpo, responsible for technical production. We are also grateful to the entire Fashion Revolution Brasil team, who supports this project with remarkable energy and dedication: Ana Fernanda Souza, Carolina Terrão, Elisa Tupiná, Fabrício Vieira, and Paula Leal. Thank you to Laudes Foundation and to Sebrae for the financial support. We also thank the institutional support of Aliança Empreendedora, Associação Brasileira da Indústria Têxtil e de Confecção (Abit), Associação Brasileira do Varejo Têxtil (Abvtex), Instituto de Pós-Graduação e Pesquisa em Administração at Universidade Federal do Rio de Janeiro (COPPEAD - UFRJ) and InPACTO. We are grateful to the brands and their representatives for taking the time to attend our meetings and complete the survey questionnaires. We know that brands receive frequent requests for information from different organisations, and it’s difficult to respond to them all. Your participation is both vital and appreciated.
A huge thank you to our local representatives, ambassador students and teachers, as well as, to all the other volunteers in this movement in the country, who drive and increasingly strengthen Fashion Revolution Brasil’s actions.
And, finally, we would like to thank you for reading this report!
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Supporters/Partners:
Fashion Revolution’s Fashion Transparency Index has led the way in increasing transparency across fashion brands' supply chains, while pushing the industry to be more accountable. With your support, we can continue to promote an even broader conversation about the challenges and opportunities for the Brazilian fashion industry to become fairer, cleaner, safer and more transparent.
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ITM Brasil received financial support from the Laudes Foundation and Sebrae. Our institutional partners are: Abit, Abvtex, Aliança Empreendedora, COPPEAD - UFRJ and InPACTO. Its content is the exclusive responsibility of Fashion Revolution and does not necessarily reflect the opinions of its supporters.
Technical partner: If you can, please consider supporting our work! Thanks!
Fashion Revolution Foundation: Registered Charity in England and Wales under No. 1173421; Company registered in England and Wales under Number 10494997; Fashion Revolution CIC: Company registered in England and Wales under Number 08988812. Registered Address: 19 Dig Street, Ashbourne, Derbyshire DE6 1GF, United Kingdom. Instituto Fashion Revolution Brasil, registered with the Brazilian Corporation Register (CNPJ) under No. CNPJ 30.852.175/0001-98.
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REFERENCES
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ALEGRETTI, Laís. 'Preço de aeroporto'? Inflação dispara em 2021 e deve ser a maior desde governo Dilma, prevê mercado. BBC News, 2021. Available at: https://www.bbc.com/portuguese/ brasil-58304575.
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
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FASHION REVOLUTION | FASHION TRANSPARENCY INDEX BRAZIL 2021
Disclaimer The Fashion Transparency Index Brazil is made available on the express request that it will be used only for general information purposes. Readers are encouraged to form their own views and opinions on each of the brands mentioned in this Index. All content in the Fashion Transparency Index is not to be construed as connected to or relating to any form of legal, governance, regulatory, research or investment advice nor any other specific or general advice on buying, selling or dealing in any way with the brands mentioned in this Index. This Index has not been prepared to any specific or general investment objectives. Before acting on anything inspired by anything contained in this Index, you must consider whether it is suitable to your circumstances and, if necessary, seek professional advice. No representation or warranty is given that the material in this Index is accurate, complete or up-to-date. The material in this Index is based on information that we have found in the public domain and reasonably consider correct at time of publication. Fashion Revolution has not verified, validated or audited the data used to prepare this Index. The assessment of fashion brands has been carried out solely according to the new Fashion Transparency Index methodology and no other assessment models used by any of the project partners or our analyst team. Any statements, opinions, conclusions or recommendations contained in this Index are honestly and reasonably held or made at the time of publication. Any opinions expressed are our current opinions based on detailed research as of the date of the publication of this Index only and may change without notice. Any views expressed in this Index only represent the views of Fashion Revolution CIC and Instituto Fashion Revolution Brasil, unless otherwise expressly noted. The content of this publication can in no way be taken to reflect the views of any of the funders of Fashion Revolution CIC, the Instituto Fashion Revolution Brasil or the Fashion Transparency Index Brazil. While the material contained in this Index has been prepared in good faith, neither Fashion Revolution CIC or the Instituto Fashion Revolution Brasil nor any of its partners, agents, representatives, advisers,
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Attribution
Licences – Creative Commons
This work is owned by Fashion Revolution CIC (Company number: 8988812) and Instituto Fashion Revolution Brasil and has been written by Eloisa Artuso, Isabella Luglio, Sarah Ditty, Ciara Barry, Liv Simpliciano and Delphine Williot.
The Fashion Transparency Index Brazil is licensed under a Creative Commons Attribution NonCommercial No Derivatives 4.0 International Licence. It is not a Free Culture Licence. Please see the link for more information: https:// creativecommons.org/licenses/by-nc-nd/4.0/deed. pt_BR
The research was led between April and August 2021 by Elisa Viviani, Eloisa Artuso, Isabella Luglio, Loreny Ielpo e Renato Moya with further support of Aron Belinky, Sarah Ditty and Delphine Williot. The Laudes Foundation has given support to the Instituto Fashion Revolution Brasil that, in turn, has funded the research for this Index. Part of the project was also sponsored by Sebrae. The content of this publication is the sole and exclusive responsibility of Fashion Revolution.
For the Raw Data File we make available we are not granting any licence for you to use the Raw Data, which we have compiled to produce this Index. You are only permitted to view the Raw Data File. You are free to copy and redistribute the Fashion Transparency Index Brazil in any medium or format provided that you give Fashion Revolution and Fashion Revolution Brasil credit for creating it. This licence does not give you the right to alter, remix, transform, translate or otherwise modify the content in any way. This includes providing it as part of a paid service, nor as part of a consultancy or other service offering. You must contact Fashion Revolution at legal@ fashionrevolution.org to obtain a licence if you want to commercialise the whole or any part of this Index. © Fashion Revolution CIC 2021 Published 30th November 2021
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