Beyond the barcode

Have you ever walked into Kmart or Target, seen the low prices of shirts and undies and thought, “I wonder how they make it so cheaply?” Have you ever wanted to take a look behind the barcode and see the journey that item of clothing took to get where it is today? These are exactly the questions that Baptist World Aid (in conjunction with other partners) answer with their insightful Behind the Barcode industry research reports on various industries, including the fashion industry.

In April 2015, Baptist World Aid launched their second annual Ethical Fashion Guide, which we’ve found very helpful in researching companies following best practice in the clothing industry. So much so we couldn’t miss the opportunity to share it with our members as you make your own purchasing decisions. The report provides a peek into the supply chain of the fashion industry and the issues it faces, then grades companies on how engaged they are in dealing with these issues. To view the full report, please visit their website.

The fashion industry’s supply chain can be split up into three key sections

1. Raw Materials (e.g. cotton)
2. Inputs Production (e.g. ginning, spinning, knitting, dying, embroidery)
3. Manufacturing (e.g. cutting, sewing, printing)

Supply Chain Concerns

Raw Materials
Uzbekistan & Cotton – As a major global supplier of cotton, the government of Uzbekistan is infamous for utilising forced labour to meet its cotton production quotas. While the Uzbek government has committed to ceasing the systemic use of child labour, this has only led to a shift to greater dependents on adult forced labour. Human Rights Watch reported that in 2012 the Uzbek government forced over a million of its own citizens – including teachers, doctors, nurses and business people – to work in the cotton fields, under threat of punishment.

Inputs Production
India & Textiles production – In South India, a practice known as the “Sumangali Scheme” has seen an estimated 200,000 girls and women (usually from the lower castes) tricked into living and working under hazardous conditions at textile mills. The Scheme is actually meant to be a marriage assistance program, to help brides and their families pay for their dowry.

Manufacturing
e.g. Cutting, Sewing, Printing – Since the tragic Rana Plaza collapse in 2013, which killed 1,100 workers, some progress has been made in the area of safety improvements, and wage rates. Currently, the Accord on Building Fire and Safety in Bangaldesh has over 190 signatories (including Australian companies such as Cotton On, Forever New, K-mart, Pacific Brands, Target and Woolworths). The Accord legally binds signatories to build a better industry, through independent inspection program, worker empowerment etc. For more information visit bangladeshaccord.org. Bangaldesh has also increased its minimum wage by 75% from $39 to $68 per month, though this does still not meet the living wage of $104 per month.

Company Grades

The report graded 59 companies (representing 219 brands), on 61 separate assessment criteria that looked at:

1. Policies, Traceability & Transparency,
2. Monitoring & Training, and
3. Worker Rights Grade,

Each company received an overall grade between A and F, based on each of the assessed criteria. The report highlights that Kmart, Cotton On, H&M, Zara, Country Road and Sussan have made significant improvements since graded last year. All Fairtrade companies received an A-grade, with Etiko being the best performer. The Cotton On Group was the highest rated non-fairtrade Australian Retailer (A-grade), while H&M and Inditex (Zara), were among the best, as international brands, receiving A-minus grades. Sadly, some Australian retailers were among the worst performers. For more information on how your favourite brand performed, click here for the report from Baptist World Aid.

Reflections
As expected, the report shows how the fashion industry as a whole still has a fair way to go, to address the systemic human rights and labour abuses within their supply chain. However, it also outlines that not all companies are blind or unmoved by the state of their supply chain, and real effort is being made to improve the industry. For our part, Christian Super regularly engages with companies through our service providers, and regularly conducts internal research into the companies that are exposed to supply chain risk – both an ethical and financial risk. Christian Super continues to be committed to investing our members’ retirement savings in companies who are following best practice, not only within the clothing industry but across all industries, for better environmental, social and governance outcomes.

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