The Ethical Trading Initiative (ETI) orchestrated five side sessions and moderated a Forum session on living wages at the OECD event that took place in Paris.
The ETI says the OECD event served as a focal point on the challenges and opportunities faced by the sector for over 600 in-person stakeholders and more than 750 participants who joined virtually.
Despite this the initiative couldn’t help thinking more would benefit from taking part, especially in the face of emerging legislation. It reflected on what it had taken from the event.
Here are the ETI’s top five takeaways:
1. “Fashion is becoming a regulated industry”
The looming spectre of regulation hovers over the fashion industry, ushering in compliance that goes beyond collecting certifications and completing audits. With forthcoming legislation from multiple jurisdictions including the UK, France, Germany, Norway, and Switzerland, companies are compelled to undertake mandatory human rights and environmental due diligence and extend responsibilities around greenwashing. This shift necessitates a re-evaluation of supply chains to effect meaningful structural changes. Notably, brands must not only adapt to new regulations but also facilitate their implementation across their supply networks.
2. “Alternatives to social auditing are on the up”
While social audits offer valuable insights into global supply chains, they alone cannot suffice as the entirety of a company’s due diligence strategies. Industry players are increasingly recognising the limitations of audits in capturing nuanced issues like exploitative practices, sexual harassment and restrictions on freedom of movement and association. However, to make improvements we can begin embracing a diversified toolkit comprising supply chain disclosure, independent grievance mechanisms, community engagement strategies, responsible purchasing practices and clear policies for remediation, all designed in consultation with workers and trade unions. Such an approach underscores a shift towards proactive improvement rather than mere data collection.
3. “Legally binding agreements with unions work”
Legally binding agreements with unions foster collaboration and ensure the representation of workers' voices. Examples such as the Dindigul agreement and agreements tackling gender-based violence and harassment in Lesotho agreements can lead to positive change for workers. ETI member, Tesco signed an agreement with the IUF to better protect workers in its supply chain, demonstrating that the success of these agreements hinges upon meaningful engagement and commitment from all stakeholders, including brands, retailers, suppliers, trade unions, and workers alike.
4. “Meaningful engagement is targeting and ongoing process”
As the spotlight intensifies on human rights due diligence, stakeholders are grappling with the imperative of meaningful engagement as outlined in OECD guidelines. Central to this endeavour is the active involvement of workers and their legitimate representatives, notably trade unions. While progress has been made, fostering trust and establishing a two-way communication channel remains paramount, especially the role of supplier and manufacturer engagement. Additionally, transparency across all stakeholders is key and hopefully, legislation on mandatory HRDD can help drive this forward.
5. “Climate change impacts on workers need to be better understood”
As extreme weather events become increasingly prevalent, workers bear the brunt of adverse conditions, accentuating the urgency for adaptation strategies. Recognising workers as critical stakeholders is imperative, with their inclusion in decision-making processes vital for crafting sustainable solutions. ETI Bangladesh's involvement is an example of this, spotlighted during our discussion on Green Social Dialogue. According to ETI the cost of inaction far outweighs the financial burden of taking practical steps now. Many improvements are shown to have an almost immediate return on investment. Worker-management dialogue is essential to identifying and implementing these improvements efficiently and is fundamental to calls for a just transition.
