Will Fairtrade’s textile scheme leave it a fashion victim?

In June, Fairtrade International’s new Textile Standard comes into play to improve working conditions across the textile supply chain – but the Clean Clothes Campaign says it targets...

In June, Fairtrade International’s new Textile Standard comes into play to improve working conditions across the textile supply chain – but the Clean Clothes Campaign says it targets the wrong organisations and does not go far enough. 

The textile industry has been under pressure to regulate working conditions since the collapse of the Rana Plaza building in Bangladesh in 2013. The building housed several clothing factories and the disaster killed more than 1,100 people and injured over 2,500.

The Textile Standard is the first step in the larger Fairtrade Textile Programme which assesses all stages of production. If all measures are met along the chain, the product can carry a Fairtrade Textile Production Mark on its packaging.

Martin Hill, interim CEO at Fairtrade International, said: “We’re inviting all textile companies to work together with their staff and with Fairtrade to create a fairer production process for textiles.”

The Rana Plaza building collapsed in April 2013
The Rana Plaza building collapsed in April 2013

A 64 page document outlines the criteria including freedom from discrimination, working hours and conditions, environmental responsibility and the sourcing of products, with the demands on companies increasing over time.

It also stipulates that workers should be made fully aware of their rights, and every employee must be paid the living wage within six years – the first time a specific time limit has been placed on implementation.

But the Clean Clothes Campaign – a labour rights group from 16 European countries which includes unions and non-governmental organisations – is unconvinced.

The criticisms

  • The Standard does not cover entire business activities. It is limited to certain supply chains of companies. Brands can pick and choose – create one Fairtrade product in one supply chain, while carrying on as usual in another
  • The burden of costly changes is put on the factory owners, but the brands are not forced to commit to real change in operating or purchasing practices
  • It relies on inspections of factories by independent auditors, which is not an adequate method
  • The six-year period for the living wage is too long. Marking clothes as ‘Fairtrade’ before they are paying everybody a living wage is misleading. The burden of implementing the living wage is on the supplier, and with no guarantee the buyer will stay, few factory managements will comply.

The response

Fairtrade says the move goes far beyond any existing standards, and Subindu Garkhel, product manager for cotton at Fairtrade, said it would not rely solely on audits, “with an onsite programme to support workers and factories”.

The six-year implementation time for living wage was described as a “realistic approach”. Factories must show improvement from year one, then again in year four, and at the end of year six. If the living wage was in place immediately, it would punish the companies willing to take it up by making them uncompetitive.

Mr Garkhel added: “Brand owners will also be contractually responsible for fair and long-term purchasing practices – essential for implementing wage increases.”

Messaging on the product increases transparency and is only allowed when an entire supply chain is certified. The messaging will include whether the living wage has been achieved, or how far along it is.

The Fashion Transparency Index
The Fashion Transparency Index

Under scrutiny

From 18 to 24 April, Fashion Revolution Week commemorated the third anniversary of Rana Plaza.

Tying in with the week, not-for-profit organisation Fashion Revolution and research co-op Ethical Consumer published the Fashion Transparency Index, which labels (with an annual turnover of at least £36m) on how clear they are at reporting their social and environmental standards.

Levi Strauss, Inditex (Zara), H&M, Primark and Adidas were ranked among the most transparent for their “significant efforts … and making some or most of their information publicly available”. But Chanel, Hermes, Prada, Claire’s Accessories and Forever 21 were among the lowest, “making little effort towards being transparent about their supply chain practices”.

“We’ve rated 40 of the biggest brands,” says Bryony Moore, research associate for Ethical Consumer. “So all of them have a huge turnover, and therefore should in theory be doing the most to ensure their supply chains are transparent – because they can afford it! However, this is unfortunately not the case.”

Ms Moore adds that small, ethical companies who only use a handful of suppliers are, by their nature, going to find it easier to demonstrate transparency in their supply chains. “But the big brands have money and influence on their side,” she says. “The size and complexity of their supply chains is not an excuse.”

In theory, a co-operative structure could improve fashion sourcing, believes Ms Moore. “A co-op model could allow smaller suppliers to club together and take on large orders, and also bring together buyers and suppliers to introduce a bit more fairness into the buying process.

“What happens a lot in the clothing supply chain is that one Cut Make Trim supplier takes on an order which is over their own capacity, and then out-sources that to a number of sub-suppliers. At this point, it’s difficult to keep track of where products are being made. A co-operative model could potentially formalise this process a bit more.”

Fairtrade Fortnight 2016: What are co-ops doing?

At the moment it is the brands making the purchases that hold all the power, says Ms Moore, with the financial impacts of last minute order changes or cancellations being shouldered by the supplier.

“The never-ending churn of fast fashion means garment suppliers have to react quickly, taking on orders which have doubled in size overnight, or responding when a huge order is cancelled at the last minute. This results in mass outsourcing or sudden factory closures. A co-operative competing within this fast fashion world would be difficult to manage – though it could definitely help to shift the balance of power somewhat.”

Ikea's MANGSIDIG collection, made by social entrepreneurs in India
Ikea’s MANGSIDIG collection, made by social entrepreneurs in India

The same week as Fashion Revolution Week, H&M launched World Recycle Week, aiming to collect 1,000 tons of unwanted or worn out clothes worldwide.

On its website, Fashion Revolution asked why H&M had chosen that week for the launch. “The focus on recycling during such a crucial week seems like a way of diverting attention from the fact that not enough is being done to protect the people who make H&M’s clothes – workers helping fuel over 3,900 H&M stores and $28bn in sales.”

It also criticised H&M for not being upfront about the fact that only a small fraction of the collected material will be turned into new textile fibres, citing a study by the World Economic Forum in 2014 which reports that between 40-60% of the clothing H&M recycles is sold second-hand – controversially, perhaps, to developing countries.

However Fashion Revolution did concede that H&M was doing more than most fashion retailers to tackle social and environmental issues.

Fairtrade International has always acknowledged that it cannot be a sort of global policeman in respect of factory working conditions. It has to be the responsibility of the brands

On a smaller scale, Koolskools aims to provide a transparent, Fairtrade alternative for cotton clothing and school uniforms.

“It is good that the new Fairtrade Textile Standard encourages the big brands to take some action, particularly in respect of fair pay for their clothing factory workers,” said Andy Ashcroft, co-founder of Koolskools. “That said, the big brands could do more themselves to insist on better working conditions.

Koolskools provides ethical cotton uniforms
Koolskools provides ethical cotton uniforms

“Fairtrade International has always acknowledged that it cannot be a sort of global policeman in respect of factory working conditions. It has to be the responsibility of the brands.”

Around the world, factory workers have been seizing back control by taking action themselves. Argentina’s economic crash in 2001 sparked a wave of ‘recovered factories’ (fabricas recuperadas).

The Justicialist Party took power following the crash and began encouraging growth of co-ops. For example, it gave public service contracts to co-ops – including the production of security bibs for police.

And some leading brands are responding to pressure. Last year, for example, IKEA launched a range of products from women’s co-ops in rural India. The STADIGT collection included cushion covers, throws, and bags. All profits go towards partnerships between IKEA and the social entrepreneurs.

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