Positive threads of progress throughout the apparel supply chain

Clothing production is changing. From factory safety, worker conditions and animal rights to supply chains – by which we mean the network of people, resources and activities involved between the company and its suppliers to produce a specific product – all elements of production are under scrutiny, and consumers care. Ruth Romer, Private Sector Advisor at WaterAid, explains why and how multinational corporations should be investing in sustainable development. 

Beyond the apparel sector, global supply chains have a disproportionately large part to play in some of today’s most pressing social and environmental challenges, including access to clean water, decent sanitation and hygiene for people living in poverty globally. With 80% of global trade flowing through multinational corporations and one in five jobs linked to global supply chains, this presents an opportunity for scale and reach in driving positive change.

Waiting around is not an option. Currently 844 million people globally are living without access to clean water, while a staggering 2.3 billion are without access to a decent toilet. Meanwhile, at the UN High-level Political Forum on Sustainable Development (HLPF) in July, the international community was clear that the global sustainable development goal relating to access to clean water and decent sanitation (SDG 6) is woefully behind the 2030 deadline.

Harnessing global supply chains to improve access to clean water, decent sanitation and hygiene could help change this and the business community must be at the heart of the solution.

Driving change through global supply chains and ready-made garment industry

The significant potential of driving more impactful change on environmental and social issues through global supply chains is highlighted in the 2017 joint report by World Business Council for Sustainable Development, WaterAid and the CEO Water Mandate.

The report estimates that one in five people are employed in globalised supply chains, and that 80-90% of these people work within micro- small- and medium-sized enterprises in developing countries.

The global apparel industry presents a large and intertwined supply chain, it is valued at US$ 3 trillion dollars and accounts for 2% of the world’s GDP. In Asia, where the ready-made garment industry dominates, three quarters of the garment workers worldwide are female and there are significant risks to workers with regards to human rights as well as safety and working conditions across the value chain.

This sector therefore presents an opportunity for improvements in working conditions, especially with regards to WASH provisioning in the workplace.

HSBC championing enhanced water, sanitation and hygiene (WASH) provisioning in apparel supply chains

A 2018 report from Business and Sustainable Development Commission highlights the business case and potential economic value to be gained from applying the sustainable development goals and going beyond 'business as usual' approaches. HSBC, as well as other leading companies are starting to recognise the win-wins for people, planet and profit from investing in sustainability and aligning with the SDGs.

HSBC is going beyond 'business as usual' and is working with WaterAid on a new project focused on sustainable apparel supply chains in India and Bangladesh. It will improve WASH facilities in ready-made garment factories in Bangladesh, as well as for artisanal garment workers and leather tanneries in India. The facilities will also be extended into workers’ communities.

Alongside this work, data will be collected to test the business case for WASH, and determine the return on investment (ROI). Once this data has been collected and the ROI defined, this will help strengthen the business case for investing in WASH and drive action on a wider scale.

The work to test the business case will be underpinned by new practical guidance that was launched on 23 August 2018 at World Water Week. The guide – ‘Strengthening the business case for water, sanitation and hygiene – how to measure value for your business’ – was championed by WaterAid’s partners Diageo, Gap Inc. and Unilever, and endorsed by WASH4Work.

The guide will help companies provide evidence of the benefits and financial value, or ROI, of their WASH interventions, and make the case for greater investment in WASH within the company and beyond. This guide provides an opportunity for progressive companies to lead and showcase the incentives for business investment on WASH whilst catalysing action.

In order to achieve meaningful change in the apparel industry and its sprawling supply chains, the business community needs to scale up its WASH investments – no one organisation can do this singlehandedly. Some businesses, like the largest global trade bank HSBC, are leading the charge, but in order to build momentum, evidence is needed to generate action on a broader scale. With WaterAid’s new guide and companies like HSBC, Diageo, Gap Inc,. and Unilever putting it into practice, global supply chains could become the avenue that makes SDG 6 a goal within our sights by 2030.

The original version of this article was first published on Ethical Corp on 31 August 2018.