Many Australian fashion brands need to do more to make supply chains ethical despite recent improvements.
A study by international aid and development charity Baptist World Aid Australia, examined what 59 apparel companies, covering 219 major global and domestic fashion brands, have been doing to ensure workers in their supply chains are being protected from exploitation.
The 2015 Australian Fashion report found that the vast majority of companies do not have full knowledge of where their cotton is coming from. The study also found that more than 85 per cent of companies are not paying their workers enough to meet basic needs.
Companies were graded on their policies, supply chain traceability, monitoring programs and worker rights. The report also assessed whether companies are paying a wage that meets workers’ basic needs. It found that only 9 per cent were paying workers a living wage.
Baptist World Aid Australia said that many of the lowest scorers were iconic Australian fashion brands such as the Just Group, fast retail brands like Ally, Valley Girl, Temt and Industrie, and low-cost suppliers like Lowes and Best & Less.
However, some Australian companies have made significant improvements and engaged deeply with the research process, the report said. Since 2013, Kmart and Cotton On have improved their traceability of suppliers throughout their supply chains and Country Road and the Sussan Group have improved worker wages.
Of the companies that were also examined in the organisation’s last publication in 2013, two thirds have improved their labour rights management systems and 100 per cent now have codes of conduct, up from 85 per cent. The number of companies that actively engaged with the research process has increased from 54 per cent to 94 per cent.
The highest overall scores were for fairtrade brand Etiko, which has traced its entire supply chain and taken action to ensure workers are being paid a living wage, and Audrey Blue, which shares Etiko’s supply chain.
The Cotton On Group was the highest rated, non-fairtrade Australian retailer, while H&M and Inditex, the two biggest fashion retailers in the world, are amongst the best rated international brands. They have also taken action to ensure workers at the final stage of production are being paid above the minimum wage. Hanesbrands received a higher grade overall, but has yet to demonstrate action on improving worker wages, Baptist World Aid Australia said.
The brands were evaluated using a mixture of independent reports, third party audit findings and NGO publications, as well as the brands own publications and responses to a questionnaire. Many of the lowest scoring companies were “non-responsive” companies.
Gershon Nimbalker, advocacy manager at Baptist World Aid, said: “It doesn’t take much for the end-consumer to make a difference to the lives of those making our clothes. Research shows an additional 30c per t-shirt would ensure living wages are met in Bangladesh."
"While an increased number of companies know the factories where their final manufacturing takes place, only nine per cent have traced down to the people picking their cotton,” explained Nimbalker.
“If companies don’t know or don’t care who is producing their products, it’s much harder to know whether workers are being exploited or even enslaved.”
The 2015 Australian Fashion report is the third report in Baptist World Aid’s Behind the Barcode research and also includes an Ethical Fashion Guide.
Other findings from the report included:
• 71 per cent of companies have a code of conduct that covers core International Labour Organization principles.
• 52 per cent have fully traced their final stage manufacturers, but only 9 per cent have fully traced down to raw materials.
• 75 per cent use some kind of external monitoring system. Only 10 per cent of companies regularly conduct monitoring audits unannounced and consult workers.
• Only 14 per cent of companies are paying some form of living wage and only 34 per cent of companies have a functioning grievance mechanism for overseas workers.