H&M, C&A and Adidas/Reebok top 2020 Fashion Transparency Index

Just in time for the 50th celebration of Earth Day and seen in a whole different light in view of the current coronavirus pandemic, non-profit Fashion Revolution has published the fifth edition of its Fashion Transparency Index that looks at 250 of the world’s biggest fashion brands and retailers, ranked according to how much they disclose about their social and environmental policies, practices and impacts. This year, H&M, C&A and Adidas/Reebok made it to the top three slots scoring 73, 70 and 69 percent, respectively, out of 250 possible points, followed by Esprit with 64 percent and Marks & Spencer and Patagonia at 60 percent each.

While Adidas and Reebok (together with Patagonia) already occupied the top slot last year, all scoring 64 percent, H&M was ranked fourth in 2019 together with Esprit, both scoring 61 percent. Patagonia lost 4 percentage points, ranking sixth this year, while Marks & Spencer gained that much compared to last year. Esprit gained 2 percentage points. New this year: 50 additional brands were reviewed, including major brands from Australia, New Zealand, India, Norway, Poland, South Africa and Switzerland for the first time. Several online retailers were also added, among them Fashion Nova from the US, Koovs from India and Pretty Little Thing from the UK.

What does the score of the Top Ten mean?

According to the Index, scoring between 71 and 80 percent - achieved only by H&M this year - means that these brands are disclosing all of the information in terms of employed and supplier policies, supplier assessment and remediation processes. They are also publishing detailed supplier lists for manufacturers, processing facilities and suppliers of raw materials such as cotton, wool or viscose. They also publish detailed information about their due diligence processes and outcomes, supplier assessments and remediation findings as well as sharing comparatively more comprehensive and detailed information than any other brands on spotlight issues like forced labour, living wages, gender equality, use of sustainable materials, circularity, hazardous chemicals, their carbon and water footprint and more.

In comparison, brands scoring between 61 and 70 percent (rank 2-4: C&A, Adidas/Reebok & Esprit) are not yet disclosing all of their suppliers of raw materials and would be addressing most of the spotlight issues as well as production and waste volumes, progress on strategies to reduce waste and use of virgin plastics, progress of sustainable material use and more detailed carbon and water use data.

The rest of the Top Ten (rank 5-10) with Marks & Spencer and Patagonia sharing fifth place, The North Face, Timberland, Vans and Wrangler in seventh place, all having achieved 59 percent; Puma in eighth place with 57 percent, Asos in nine place with 55 percent and Converse, Jordan and Nike in tenth place with 55 percent each - fall into the range of brands scoring between 51 and 60 percent.

This means that these brands will be disclosing most human rights and environmental policies, procedures, social and environmental goals and information about their governance and due diligence processes. In terms of supplier assessments, they publish some detailed information but not all. They are also addressing some of the spotlight issues but not all. Other brands in this range are Benetton, Calvin Klein, Tommy Hilfiger and Van Heusen, all at 54 percent.

Much to be desired when it comes to transparency

A look at the Top Ten brands and beyond reveals two things: One, that it is tough to reach the highest ranges of 81 to 90 and 91 to 100 percent transparency and that companies are still not doing all that great when it comes to transparency, with even the best company reaching only 73 percent or 182 out of 250 possible points.

So while the Top Ten companies can certainly be proud of the fact to be the most transparent among the world’s 250 biggest fashion brands and retailers, they should not forget that the top two percentage ranges have not even been tackled yet. Companies in the 81 to 90 and 91 to 100 percentage range would be sharing detailed supplier lists for at least 95 percent of all suppliers from manufacturing to raw materials. They would also be mapping social and environmental impacts into their financial business model and disclosing ample data on their use of sustainable materials.

They would also provide sex-disaggregated data on job roles within their own operations and in the supply chain as well as detailed information about purchasing practices, the approach and progress towards tackling modern slavery and living wages in their supply chains. They would also disclose their carbon emissions, use of renewable energy and water footprint. Lofty goals or achievable ones? In any case, the way to reach there will be long, with lots to do.

How are luxury brands faring in the Fashion Transparency Index 2020?

At 48 percent, Italian luxury label Gucci is the highest scoring luxury brand, up from 40 percent in 2019. It is also the only brand to score 100 percent on policy and commitments, found the Index. The other Kering Group brands came in just behind Gucci, with Balenciaga and Saint Laurent at 47 percent and Bottega Veneta at 46 percent.

“Ermenegildo Zegna has become the first luxury brand to publish a detailed supplier list. However, Hermes has disclosed many of its owned and operated manufacturers and suppliers for many years. Meanwhile, Balenciaga, Bottega Veneta, Gucci and Saint Laurent have also published a handful of raw material suppliers this year. We hope to see more luxury brands follow their lead,” states the Index.

What does the winner have to say?

As one would expect, Swedish fast fashion giant H&M is thrilled to be in the top spot: “It is a great honor to be ranked as number one in the Fashion Transparency Index 2020 and a great recognition of our work. We always aim to be as transparent as possible in our progress towards a more sustainable fashion future, as well as the challenges ahead, in order to keep driving industry change. We are committed to continue taking steps for greater transparency so customers can make informed decisions and drive a positive impact in the industry through our extensive work to become fully circular and climate positive, while being a fair and equal company,” commented Hanna Hallin, global strategy lead for transparency at the H&M Group, in a press release published on Tuesday.

While it is certainly an achievement to have come up from 153 points to 182 points or jumping a whole percentage range from 61 to 73 percent in just one year, as Hanna Hallin rightly said, driving industry change has to be a key goal of any company wanting to move ahead in terms of transparency and sustainability.

More than half of brands and retailers are still scoring below 20 percent

“More than half (54 percent) of brands score 20 percent or less. However, there are fewer low-scoring brands this year compared to 2019. Twenty-eight percent of brands score 10 percent or less compared to 36 percent of brands last year. Of the [50] new brands added to the Index, 15 score 5 percent or less, including Canada Goose, Fashion Nova, Pepe Jeans and DKNY,” finds up the Index.

And in that regard, there is much to do as though the overall average score of the 250 brands reviewed has gone up by two percentage points since 2019 (and by three since 2017), it is still only at 23 percent. For the average score in each section, this means that while it is considerably higher for some of them, for example 52 percent for policy and commitments or governance (29 percent), it is even lower in others like know, show & fix (17 percent), traceability (16 percent) and spotlight issues (15 percent).

Not to forget that there is also a sad Top Ten of companies that have not even achieved one point on the Fashion Transparency Index, the “Rotten Cotton” so to say. They are Bally, Belle, Elie Tahari, Heilan Home, Jessica Simpson, Max Mara, Mexx, Pepe Jeans and Youngor.

The impact of coronavirus

Last but not least, the Fashion Transparency Index stresses the point that a crisis like the current global coronavirus pandemic shows how crucial transparency is. “If major brands and retailers are publishing information about their business values, who their suppliers are, what supply chain policies are in place, how they do business with suppliers and their purchasing practices, then stakeholders can hold them to account for exactly the type of situation unfolding now where major brands are stopping and delaying payments and cancelling orders from their suppliers with little regard for how this will affect the livelihoods of workers across the supply chain,” it iterates.

Another major issue that the coronavirus situation is highlighting is the problem of overconsumption. The demand for clothing has plummeted as people across the world are staying home and reassessing what they spend their hard earned money on. With big, individual brands easily producing more than a billion items of clothing each year, it is to be seen what will happen to them as overstock is piling up in warehouses. As only a few brands disclose their waste production, circular solutions and textile-to-textile recycling efforts, one can only speculate.

Conclusion: Majority of brands and retailers lack transparency

The 2020 Fashion Transparency Index published by Fashion Revolution was able to draw major conclusions for the range of social and environmental topics reviewed for 250 of the world’s biggest brands and retailers. They are:

• Participation in the Fashion Transparency Index is influencing brands to disclose more social and environmental information
• Brands continue to publish more about their policies than how they implement them
• Information and data dumping seems like a deliberate strategy and is an ongoing problem
• Encouraging progress was made on disclosing supplier lists
• There is a continued lack of transparency on living wages for workers in the supply chain
• Most brands do not disclose any information about their purchasing practices
• The coronavirus pandemic is proving why transparency is so vital
• Coronavirus is casting a spotlight on overconsumption
• Climate crisis is an increasingly important issue for brands but more transparency is needed

The full report can be viewed and downloaded on the Fashion Revolution website (fashionrevolution.org).

Images: Fashion Transparency Index, 2020 edition / Fashion Revolution