What role can legislation play in actionable Transparency?

In itself, compliance is nothing new to the fashion industry. However, a new era of legislation has started in which the legislative landscape is developing at an unprecedented pace: not only are the amounts of new legislation increasing, but requirements are also becoming more and more stringent. In response to these regulations, companies focused on data collection are emerging left and right. The underlying ideology of this response seems to be “the more data, the better.” However, before we all jump on the data bandwagon, it could be valuable to go back to the roots of why these legislations are emerging.?

The fashion industry, like other industries, has been plagued with many issues. Many of these issues are environmental - the fashion industry is the third largest polluting industry, and responsible for the creation of enormous landfills. Furthermore, the industry grapples with issues of a social nature as well, such as forced labour, structural underpayment of workers, and bad and unsafe working conditions. These issues are all symptoms of a faulty bigger system, which the regulations are trying to change. As the textile industry navigates the labyrinth of these regulations, it becomes evident that it is unwise to just view their requirements as bureaucratic hurdles. Compliance cannot be viewed separately from the rest of business activities anymore, instead, it will change how business is done.

On the one hand, legislation can be a tool to break out of a lock-in of certain patterns. By setting a new set of requirements that every party in the system has to adhere to, it can create a level playing field. On the other hand, legislation can become a new set of constraints or an administrative burden that does not facilitate change. If more rules are added, but the system does not change what is valued in a certain system, will the rules then really change anything?

The limitations of legislation

Shared problems should also translate to shared responsibility, and this is not always translated into the legislation. This is why it is important with any new legislative developments, to ask what it implies in regards of distribution of responsibility, specifically the difference between direct and indirect responsibility. Indirect responsibility refers to parties who are responsible for holding other parties accountable, but are not taking actions themselves. Direct responsibility, on the other hand, refers to parties who take action. This subtle difference between indirect responsibility - setting targets - and direct responsibility - implementing those targets - is crucial. It can become problematic when the parties are not familiar with each other’s context, leading to misunderstanding and frustration on both sides. PaperTale aims to make sure these parties are connected, aligning target setting with implementation, and giving each side opportunities to thrive in new circumstances.???

In conclusion: Do we need more rules?

Yes, legislation is a fruitful starting point for setting requirements for different parties, but other tools are needed to assist the industry in the alignment of direct and indirect responsibility in sustainability performance. The fashion industry finds itself in a system lock-in, and multiple keys are necessary to unlock it.???

Next week we dive into why we have developed our solution in a holistic way, and why we think this approach is the most suitable because it is unconventional, not in spite of it.