27/01/2022

“It’s up to you, New York, New York!” Sustainability on the global runway with landmark Fashion Sustainability and Social Accountability Act

In one of the most fashionable cities in the world the message is clear – it’s chic to be green!

Backed by an alliance of key political players, non-profit organisations and sustainable fashion trailblazers such as Stella McCartney, the Fashion Sustainability and Social Accountability Act (the Fashion Act) was announced on Friday 7 January 2022. The Fashion Act, the first of its kind in the US - and mirrored only by proposed legislation relating to corporate responsibility tabled in the EU - seeks to hold fashion’s biggest stakeholders to account for their environmental impact and brings sustainability within the industry firmly into focus.

The Fashion Act reflects the growing demand for greater climate awareness and positive action from an industry that, until now, has been largely unregulated despite contributing between 4 and 8.6% of global greenhouse emissions (approximately 70% of which comes from energy-intensive raw material production). 

If passed, global apparel and footwear companies conducting business in New York would be required to map at least 50% of their supply chain and identify, whilst disclosing on their company website, at what stage they have the greatest social and environmental impact. The proposed bill requires online disclosure of information about company supply chains and their social-environmental impact.  Key areas such as greenhouse gas emissions, energy, water and chemical management and fair wages will be subject to scrutiny and companies will be required to commit to targets to reduce their impact in these areas within 18 months of enactment of the bill. They will also be required to disclose the volume of produced materials and the percentage that is recyclable.

This wide reaching legislation will apply to all apparel and footwear companies which generate more than $100 million in annual revenue, catching any global fashion retailer looking to capitalise on the lucrative New York market.

Companies failing to meet commitments made under the legislation will face fines up to 2% of annual revenue, with a list of non-compliant stakeholders published annually in the State Attorney’s report. Consumers will also be entitled to bring claims directly against offending companies to enforce compliance.

As can be expected with any proposed change – particularly one that calls for greater accountability - overcoming resistance by the industry’s key players will be critical to ensuring the bill gains the necessary support to see it passed by the NY State Senate. With industry giants such as Kering, Nike, H&M and Inditex (the biggest fashion group in the world and owners of Zara, Pull & Bear, Massimo Dutti, among others) committing to sustainability targets, it is clear that being green is now in vogue, but self-regulation runs the risk of simply paying lip service to environmental and social responsibility or, at worst, avoiding it altogether.

The hope is the Act will bring accountability to fashion’s major players and that it will signify a new season in which being green never goes out of style. From a city renowned for putting trends on the global stage, it remains to be seen whether the rest of the world will follow suit.