Sustainability mandates in fashion have largely had no stringent laws that can hold brands accountable. But, if passed, New York’s Fashion Sustainability and Social Accountability Act (“Fashion Act”) will be the first in the US to impose obligations of sustainability on fashion’s biggest names.
As stated in the background of the act, Stella McCartney said, “Fashion is one of the most harmful industries and least policed. Sadly, the idea of us self-regulating [is] not a fair thing to ask of an industry. We need to be helped. If we could just have some regulation, some policies, some [standardised] methods to measure our impact.”
Announced earlier this year, ahead of New York Fashion Week, the act will apply on fashion and accessories labels with more than $100 million in annual revenue, and operating out of New York. This will include luxury fashion houses like Prada as well as fast fashion giants like Shein.
While many brands have already committed to sustainability goals minus any regulations, like Kerring, the act will impose strict regulations to ensure increased commitment to sustainability. This will eliminate the advantages companies might enjoy by adopting climate-friendly methods of production.
Following are the provisions of the law, as stated in its legislative backgrounder:
Clear, relevant, common and transparent environmental accounting and disclosures
Currently, company estimates and reporting of environmental impacts is voluntary, inconsistent and often unaudited. This legislation would require clear, relevant common and transparent reporting on energy, greenhouse gas emissions, water, plastic use, and chemical
management. Greenhouse gas emission reporting would be required to conform to the universal environmental accounting standards set forth in the GHG Protocol Corporate Standard and the GHG Protocol Scope 3 Standard. This will provide an apples to apples comparison of different companies’ impacts.
To tackle the plastics crisis, companies would be required to disclose their material use, including plastic-based materials, opening what has been a black box in the industry. These material disclosures would be a critical first step to curb plastic use in the fashion industry.
Mandatory science-based targets
The act will requiring companies wishing to sell to the New York market to set and achieve Science Based Targets. Science Based Targets means that the pace of reductions are in line with the scale required to keep global warming below 2C from pre-industrial levels, as set out in the Paris Agreement.
Mandatory due-diligence and meaningful labour disclosures
The fashion industry has relied on a broken system of factory audits that have been unsuccessful in curbing labor abuses in its supply chain. By requiring mandatory due diligence, companies will be required to actively engage in improving standards in their supply chain.
The law would be enforced by the Attorney General or the Attorney General’s designated administrator. Additionally, citizens may commence a civil action against a person or business in violation, or to ensure the Attorney General is enforcing the requirements of the law. Companies found to be out of compliance and which do not remedy within three months of notice of non compliance may be fined up to 2 per cent of annual revenues.
It also states that the proceeds from the law will go to the disadvantaged communities who disproportionately experience the effects of climate crisis. This includes “communities of color, immigrants, low-income and people for whom English is not their native language.”
As per the National Law Review, companies will be given a timeline to comply and impact — 12 months to comply with the mapping directive and 18 months to make their initial impact disclosures.
Will this act change the way sustainability in the fashion industry is promised and delivered?
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