The proliferation of certifications, standards and regulations designed to clean up fashion’s supply chain and increase transparency has resulted in a costly, complex and inefficient reporting burden. Now, attention is turning to how to streamline the requirements to avoid stalling progress towards crucial climate targets.
“There’s so much complexity, so many regulations and so much data that needs to be captured right now. It’s raining requirements,” says Pauline God, policy and partnership manager at traceability platform TrusTrace.
In the scramble to comply, brands are building out their own approaches, putting pressure on downstream suppliers who have to grapple with multiple reporting systems, and siloing efforts to make improvements in the supply chain. “A 45 per cent reduction of greenhouse gases by 2030 [as called for in the Paris Agreement] is what we’re shooting for. But we’re not going to do that unless we’re all rowing in the same direction,” says Colin Browne, CEO of global non-profit industry alliance Cascale.
At the Organisation for Economic Co-operation and Development (OECD) Forum on Due Diligence in the Garment and Footwear Sector, which took place on 11 to 12 February, steps were taken towards finding a collective solution. At the forum, key fashion industry stakeholders — including brands and suppliers — met with representatives from the United Nations Economic Commission for Europe (UNECE). The commission has been tasked with scoping out how to develop a core set of sustainability and circularity metrics, and standards for easy data sharing along the value chain.
The main challenge? Too many requirements calling for too much work to abide by them. The volume of requirements — from carbon emissions calculations to waste reporting — is compounded by the number of different IT and traceability systems used by brands. These demand the input (often manually) of the same information multiple times, for instance via email, onto sharepoints or onto certification portals.
“Our customers want collaboration and partnership, but they don’t have it between them,” says Mostafiz Uddin, owner and managing director of Denim Expert Limited, a Bangladeshi denim manufacturer. “[One brand] is following the Ethical Trade Initiative while the other is following Better Work [both programmes focus on labour rights]. Everybody wants different data.”
Cost is another key concern. Brands and suppliers are forced to invest in training, staffing, auditing, data collection, tech development and onboarding different IT systems — yet those investments are not returned via increased efficiencies, the supply of resources to enact positive change, or higher purchase prices. “There are no benefits to all these extra burdens,” says Uddin.
Feedback collated by Global Textiles Transparency Governance (GTTG), a multistakeholder project to improve transparency in the industry, suggests the current system actively disincentivises the collection of honest, high-quality supply chain data. Auditors, unions, organisations and workers may face personal or economic reprisals if they offer up data that reflects poorly on manufacturers, GTTG found. It added that regulators’ focus on quantity — rather than quality — of data has been known to encourage people to falsify numbers to meet targets. In October 2024, GTTG published its ‘Playbook for Shared Data Systems’, the findings of which are informing the UNECE’s research into how to simplify the requirements for brands.
A lack of standardisation also plagues supply chain reporting. Not only do different certifications and regulations require impacts to be measured in different ways, making comparison and broader applicability of the data impossible, but terminology varies widely too. Suppliers, factories and organisations can be labelled differently across systems while the multiple tiers and processes within the supply chain are not uniformly referenced.
Furthering the problem is fashion’s competitive nature: both brands and traceability platforms tend to resist sharing information with rivals. But such a confused approach further increases workload, says Christian Hudson, chair of the UN Centre for Trade Facilitation’s team of specialists on ESG data in value chains, because if people aren’t using the same metrics and measures there is simply no interest — or point — in sharing data.
Finding a way forward
Several recent initiatives and pilots have sought to tackle these challenges. In December, the Apparel Alliance — made up of Cascale, Textile Exchange, Zero Discharge of Hazardous Chemicals Foundation (ZDHC) and the Apparel Impact Institute — published the ‘Supply Chain Taxonomy’. Aiming to establish a uniform classification system in the textile supply chain, it breaks down which actors, processes and products sit within each supply chain tier.
The alliance consulted with stakeholders such as the International Organisation for Standardisation (ISO), the United National Environment Programme (UNEP), UNECE, manufacturers and brands to build the taxonomy. “Until now, there hasn’t been a consistent lexicon, and this tries to put consistency in place,” says Browne.
With a common taxonomy, different platforms and systems can begin to harmonise, paving the way for interoperability — the concept behind another recent Textile Exchange initiative. Building on Textile Exchange’s TrackIt system, which electronically tracks the chain of custody of certified materials (Global Recycled Standard and Recycled Claim Standard), a new multi-party traceability system is being piloted in 2025. TrusTrace is among the technology partners for the pilot, alongside Peterson Technologies, Retraced and TextileGenesis. “The idea is to test interoperability between our systems, between competitors, so in the end a brand can see the certified materials moving through the whole system in one single place,” says God.
“Our goal for the TrackIt pilot is to make sure there’s a single source of truth for this transaction information… and reduce inefficiencies,” says Beth Jensen, senior director of climate and nature impact at Textile Exchange.
Similar thinking inspired the collaboration between business association Amfori and ZDHC. Launched in late November along with Amfori’s new Chemical Management in Fashion module, designed to help companies improve chemical management in their supply chains, it provides Amfori members dual navigation of both organisations’ platforms, using an Open Supply ID to ensure universal recognition. Amfori members (including textile firms, retailers and brands) and their business partners (such as manufacturers and producers) will be required to take the module, and the results will be benchmarked against ZDHC metrics, reducing the need for double reporting on the supply side and allowing members to see all information in one place.
IoT (a network of physical objects embedded with sensors, software and connectivity) service provider Temera, owned by smart tag manufacturer Beontag, also trialled a multi-platform solution in 2024. Blockchain-linked near-field communication (NFC) chips enabled customers to scan and verify the authenticity and sustainability credentials of limited-edition, “repurposed sea-plastic” luggage from luxury leather goods brand MCM. Key details needed for the digital product passport (DPP) — a digital record of a product’s lifecycle, required from 2030 under EU regulation — were stored by Aura Blockchain Consortium. “Our platform collects many thousands of events, so we have an interface where we say, ‘This touchpoint is key for the DPP, or this is the key touchpoint for marketing communication,’” says Temera’s co-founder and managing director Francesco Pieri.
Building interoperability, multiplying impact
Interoperability of this kind is crucial to reduce reporting burdens. That’s why it’s a key goal of the playbook and, according to GTTG, the preferred option of almost every stakeholder surveyed versus continuing as is or the creation of a singular, dominant data platform. (The latter could lead to ‘data hoarding’ and would require oversight to ensure data was being handled properly, critics say. Such a platform would be also costly and energy intensive to run and host.)
What might it look like at a wider scale? Hudson points to Open Banking as an example — a mutually agreed protocol that allows third-party developers conditional access to certain financial information. It can allow consumers to see all their balances in one place, or an accounting programme to check an invoice as paid when a bank transfer is made.
In a supply chain context, it could mean a supplier uploading certification data once and its clients being able to see it across their various chosen traceability platforms; compliance with one certification translating to compliance with another with similar metrics; or facilitating the flow of anonymised rewards or incentives for accurate data collection.
As brands, platforms and industry organisations begin to explore different solutions to the complexities of supply chain reporting, there is a risk of overlapping schemes complicating things further, increasing duplicative workloads and diluting widescale progress. Such inefficiencies are already at play within the many similar sustainability schemes instigated by brands, from recycling projects to water-saving initiatives. “One of the observations that I have is that there’s an awful lot of organisations out there that are doing great work, but there may be too many. Too many cooks in the kitchen means there is not the focus to really drive meaningful change,” says Cascale’s Browne.
With the EU’s looming Omnibus Simplification Package, reporting goalposts may soon move again, adding more uncertainty about how best to comply. The package is designed to reduce the reporting burden of the Corporate Sustainability Reporting Directive (CSRD), which requires companies to report on over 1,000 data points across topics including pollution and biodiversity, and the Corporate Sustainability Due Diligence Directive (CSDDD), which requires companies to identify, remediate and report on adverse human rights and environmental impacts. (While some welcome efforts to tackle the reporting burden, critics fear it will result in a watering down of EU sustainability regulations.)
It is hoped that the G7 Agenda on Circular Textiles and Fashion (G7 ACT), which aims to promote greater circularity in the sector (and gave UNECE the remit of standardising the requirements on brands and suppliers) will help to keep fashion on course. “A lot of the discrete efforts that have been going on across the industry are now being given a frame by the G7 ACT to come together to be useful,” says Del Hudson, an independent policy advisor.
Though EU regulations could be about to change, the G7 ACT accounts for global legislative needs, so a simplified, harmonised reporting ecosystem — whether to meet voluntary or mandatory requirements — still looks set to emerge. Its success will rely on a willingness to collaborate and industry players resisting the urge to move independently.
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