Pulling the thread: responsibility in the supply chain of the textile and fashion industry

In the last decade, the supply chains of organizations have undergone a major transformation due to globalization and different business strategies, such as outsourcing, just-in-time delivery and lean inventories, in the interests of greater competitiveness.

The risks associated with an organization’s supply chain include the so-called ESG (Environmental, Social and Governance) risks.

The textile and fashion industry, as in many other industries, has understood the need to manage its suppliers in a sustainable manner and minimize environmental risks (such as emissions, waste and discharge of toxic substances) and social risks (employment of low-wage workers in developing countries, particularly with respect to working hours and safety, as well as the use of child labor).

The signature of framework agreements such as the Bangladesh Accord, Better Cotton Initiative and ZDHC (Zero discharge of hazardous chemicals).

There is also a need to focus on reducing the ESG risks associated with the supply chain, as highlighted by the OECD, covering at least the following steps:

1. Identification and evaluation of the environmental and social risks inherent in the business activity pursued by suppliers and in the country such activity is pursued.
2. Integration of environmental and social aspects in the initial selection and certification of suppliers.
3. Action plan to ensure suppliers comply with basic environmental and social management requirements, offering training and awareness programs in line with their needs.
4. Environmental and social monitoring and audits of critical or high-risk suppliers.