Brand support for decarbonisation in supply chain
Does the company disclose how the brand is supporting its suppliers with operational expenses (OpEx) required to meet brand supply chain decarbonisation targets, particularly in transitioning to renewable energy and electrification?
About the data
What Fuels Fashion?’ is a special edition report of the Global Fashion Transparency Index. It has been designed to measure transparency of brand disclosure about climate and energy-related data in their own operations and supply chains. The research is broken down into five key themes, including: Accountability, Decarbonisation, Energy Procurement, Financing Decarbonisation and Just Transition and Advocacy.
200 of the world's largest fashion brands have been selected based on their annual turnover, over $1 billion USD and representing a spread of market segments including high street, luxury, sportswear, accessories, footwear and denim from across Europe, North America, South America, Asia and Africa. Where brands are privately held, estimates have been made regarding their size and turnover. Geographic spread is considered too.
200 of the world's largest fashion brands have been selected based on their annual turnover, over $1 billion USD and representing a spread of market segments including high street, luxury, sportswear, accessories, footwear and denim from across Europe, North America, South America, Asia and Africa. Where brands are privately held, estimates have been made regarding their size and turnover. Geographic spread is considered too.
Methodology
Operational expenses (OpEx), such as increased energy costs, can significantly impact and burden suppliers when transitioning to renewable energy. For example, renewable electricity costs significantly more than coal in some regions. To enable a just transition, brands should show they are willing to cover these higher costs by including them in the prices they pay for products or by directly helping to pay for them.
Brands could disclose:
- A commitment to absorb the increased operational costs (e.g. higher electricity prices from renewable energy use) in purchasing prices
- Specific examples of how OpEx support is being provided, including the regions or suppliers involved.
- How the brand plans to subsidise increased OpEx e.g. brand pays the difference between coal-based electricity and renewable energy costs for 5 years to help suppliers transition or the brand gives suppliers a fixed yearly payment to offset renewable energy costs like maintenance and tariffs.
We only award points for publicly disclosed information on the brand or parent company's own website. This means information disclosed on:
• Sustainability/CR microsite, provided there is a direct web link to it from the main brand or parent company website;
• In annual reports or annual sustainability/CSR reports (only counted if dated January 2023 or later) published on the brand or parent company website;
• In any other documents which are publicly available and can be downloaded freely from the brands' website; or
• Via external, third party websites but only when there is a direct web link from the brand or parent company's website to the third party website (e.g. Bangladesh Accord, Better Work, CDP, FLA, ETI, BSCI/amfori websites) where specific disclosures can be found.
The methodology is based on existing international standards and benchmarks such as: SDGs, ETI Base Code, UNGPs, OECD Due Diligence Guidelines, Fair Labor Association’s Freedom of Association guidelines, the GhG Protocol, CDP, Climate Action 100+ among others. It has also been developed to align with other industry benchmarks and relevant initiatives including the Transparency Pledge, Corporate Human Rights Benchmark, the Open Data Standard for the Apparel Sector and the World Benchmarking Alliance.
Brands could disclose:
- A commitment to absorb the increased operational costs (e.g. higher electricity prices from renewable energy use) in purchasing prices
- Specific examples of how OpEx support is being provided, including the regions or suppliers involved.
- How the brand plans to subsidise increased OpEx e.g. brand pays the difference between coal-based electricity and renewable energy costs for 5 years to help suppliers transition or the brand gives suppliers a fixed yearly payment to offset renewable energy costs like maintenance and tariffs.
We only award points for publicly disclosed information on the brand or parent company's own website. This means information disclosed on:
• Sustainability/CR microsite, provided there is a direct web link to it from the main brand or parent company website;
• In annual reports or annual sustainability/CSR reports (only counted if dated January 2023 or later) published on the brand or parent company website;
• In any other documents which are publicly available and can be downloaded freely from the brands' website; or
• Via external, third party websites but only when there is a direct web link from the brand or parent company's website to the third party website (e.g. Bangladesh Accord, Better Work, CDP, FLA, ETI, BSCI/amfori websites) where specific disclosures can be found.
The methodology is based on existing international standards and benchmarks such as: SDGs, ETI Base Code, UNGPs, OECD Due Diligence Guidelines, Fair Labor Association’s Freedom of Association guidelines, the GhG Protocol, CDP, Climate Action 100+ among others. It has also been developed to align with other industry benchmarks and relevant initiatives including the Transparency Pledge, Corporate Human Rights Benchmark, the Open Data Standard for the Apparel Sector and the World Benchmarking Alliance.
License
Topics
Framework Mappings
Value Type
Category
Options
Yes
No
Assessment
Steward Assessed