The past decade has seen an uptick in legislation regulating fashion manufacturing. These bills address the industry’s social and environmental concerns — reshoring production, increasing garment worker wages, and creating supply chain accountability. This proposed legislation is vitally important because while grassroots advocacy for change is important, government intervention will ultimately create the most widespread change. Below, Bucha Bio explores why government action is needed and how the current wave of bills and laws will change the fashion industry of the future.
“In the past 60 years, domestically manufactured clothing has dropped from 95% to less than 3% of all clothing bought in the United States.”
Why is federal and global oversight needed?
The fashion industry is highly unregulated due to its complex and global supply chains. A garment designed in the United States can have raw materials grown in India, be woven into fabric in Taiwan, sewn together in Vietnam, and then distributed worldwide. The supply chains get even more convoluted if a product contains many different raw materials.
Global oversight is challenging, given differing regulations. Brands have historically shied away from taking responsibility for the manufacturing malpractices of their outsourced factories. These include dangerous working conditions, unfair wages, and mistreatment of workers. For those brands that do choose to pursue responsible manufacturing practices of their own volition, they are at a financial disadvantage in the eyes of consumers. The current systems in place incentivize ignoring overproduction and underpaying workers. Creating legislation mandating sustainable practices evens the playing field for those wishing to see positive industry change.
Previous attempts at regulating the fashion industry
The Multifiber Arrangement (MFA), signed in 1974, was one of the first major regulations on sourcing within the fashion industry. The agreement placed limits on textile and clothing imports from developing countries. This allowed domestic production in developed countries to compete with the lower cost of outsourced manufacturing.
When the MFA expired 2005, brands clambered to have the majority of their production outsourced to countries where wages were lower and labor regulation was more lenient. This led to the gradual creation of the expansive supply chains we see today. In the past 60 years, domestically manufactured clothing has dropped from 95% to less than 3% of all clothing bought in the United States.
At the same time, more lenient labor regulations in outsourced factories have sometimes had tragic consequences. In 2013, the Rana Plaza factory in Bangladesh collapsed, killing more than 1,000 people and injuring 2,500. The day before the collapse, the factory was known to have violated many building codes, and the collapse resulted from structural failure. Many well-known brands manufactured clothing at the factory, including Walmart, Zara, and Primark.
While the catastrophe was in the limelight, the public demanded accountability for fashion brands. The 2013 Accord on Fire and Safety was passed, a binding contract holding over 200 brands responsible for ensuring safe working conditions in Bangladesh. Over 38,000 inspections have repaired over 120,000 hazards since then. Though many more inspections are needed, this was a good first step to holding brands accountable for their supply chains. While the Accord on Fire and Safety expired in 2021, it was later renewed as the International Accord for Health and Safety in the Textile and Garment Industry.
Recent legislative efforts
As the extent of production malpractices is surfacing, many recent state and federal bills are now requiring brands to report and publish their sustainability practices per global guidelines. California’s Transparency in Supply Chain Act, passed in 2010, is one of these. It requires brands and manufacturers doing business in California to disclose certifications, audits, and internal accountability in compliance with local slavery and human trafficking regulations.
The New York Fashion Sustainability and Social Accountability Act, unveiled in January 2022, follows in its footsteps. It targets any fashion retailer or manufacturer that does business in New York with global revenue of over $100 million. Companies under the act would need to put a “good faith effort” into mapping at least 50% of their supply chain. They would also need to disclose their impact, as well as set targets for impact reduction. Failure to comply will result in a monetary fine of up to 2% of annual revenues and being published in a noncompliance list.
The New York bill builds atop the framework of the California bill by including penalties for noncompliance. However, it continues to enforce reporting and disclosure rather than outcomes.
The beginnings of a more regulated industry
While the increased focus on regulating the fashion industry is promising, transparency and disclosure are only the first steps. Requiring brands to disclose information continues to place the burden of research on the consumer. Ultimately, brands and suppliers, not consumers, should be the ones responsible for the sustainability of their supply chain. Brands should be rewarded for making progress in the outcomes of their efforts, not simply for the efforts themselves.
The FABRIC Act, a bill currently facing US Congress, is unique and promising in that it holds brands and suppliers jointly responsible for the well-being of the garment workers they employ. The act enforces minimum wage standards and also rewards manufacturers who comply with these standards with tax credits and grants to continue developing their sustainable practices. While this act currently only applies to domestic garment workers in the US to encourage reshoring manufacturing, it stands as a model piece of legislation in the way it holds both brands and suppliers accountable for the outcomes of their actions, not only their efforts.
As governments begin to take on a more major role in regulating the fashion industry, we are seeing more and more legislation introduced. Topics include prohibiting harmful PFAS chemicals in casual apparel, banning sales of new fur products, and incentivizing the use of clean energy. Though these first steps are encouraging, more global oversight will continue to be needed to accelerate progress towards a more ethical industry.
