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Why fashion retailers should ‘be more Boohoo’ when it comes to operations and supply chain transparency  

We all learn from mistakes. Boohoo showed retailers what can happen when a ‘fashion house’ is not in order – Protect believes a transparency pledge may be the way forward.

The Boohoo story of poor and Covid unsafe working practices broke during the height of the pandemic. Since then, an independent review by Alison Levitt QC went on to find ‘very serious supply chain issues’ and recommended an ‘Agenda for Change’ programme to improve standards in Boohoo’s factories. Boohoo’s response is a “transparency pledge”, which includes ‘strengthening its corporate governance, substantially increasing our responsible sourcing, ethical compliance and sustainability teams, map and measure our global supply chain, developed new tech solutions, adapted our processes and invested resource and funds to support garment workers’. This mapping of the global supply chain has resulted in Boohoo publishing details of the 1,100 factories it uses in China, India, and Turkey amongst other countries which includes 96 UK sites.  Boohoo has also linked its £150m bonus pot scheme for directors to supply chain improvements.

Protect has been championing good governance to corporates for almost 30 years, and support hundreds of organisations instil healthy speak up cultures. Protect’s Business Development Director Jon Cunningham said, “The UK consumes the most clothes in Europe, yet major British brands are falling behind European counterparts when it comes to transparency. Supply chain transparency is something we would like to see a lot more of from all organisations.”

Fashion Revolution publish an annual Fashion Transparency Index, a review of 250 of the world’s largest fashion brands and retailers ranked according to their level of public disclosure on human rights and environmental policies, practices and impacts in their own operations and in their supply chains. For 2021, 19 brands that were reviewed in last year’s Index have since disclosed their first-tier manufacturers for the first time, including: Boohoo, Carhartt, Carrefour, Desigual, Dick’s Sporting Goods, Dr Martens, Ermenegildo Zegna, Fendi, Foschini, Fossil, Gucci, JD Sports, LL Bean, Mango, Miu Miu, Nordstrom, Otto, Prada and UGG.

Fashion Revolution said ‘it is exciting to see several major luxury brands disclose their suppliers for the first time this year, marking an important step forward in transparency from this part of the sector.’

As many consumers become more aware and want to know everything – from the origins of a lunchtime sandwich to how and where that summer shirt was made –  ESG – environmental, social and governance – will become  a key metric many firms will use alongside financial returns to appeal to consumers as well as investors and board members.

However, here in the UK we may be the biggest consumers of fashion but we are trailing being our European counterparts in transparency. (source : Fashion Index)

Protect’s research (YouGov, April 2021) shows retail is the poor relation compared to other sectors in whistleblowing awareness. Just 33% of retail workers were aware of a whistleblowing law, and just 29% were aware of their retail employer having a whistleblowing policy. Perhaps the most unsettling findings was the response to ‘Do you know how to raise a concern at work? Just 16% of retail workers said yes they knew, 44% said no, but they could find out, and 40% said no.

During the height of the pandemic, calls to Protect’s Advice Line for whistleblowers were at an all-time high. Many of the calls were about furlough fraud, including many from the retail and hospitality sectors.

Worried and concerned retail workers were being asked to commit furlough fraud by their employers, despite them knowing it was wrong, and fraudulent to do so. Consumers, investors, and Board members want a new look for retail.  Business Development Director Jon Cunningham added, “Many retail companies are on a journey towards best practice when it comes to transparency.  Effective whistleblowing arrangements support good governance and extending these to supply chains may prove to be an effective early warning system protecting against harm to people, reputations and finances.”