The fast fashion industry has faced mounting criticism over its environmental impact and human rights record. Now, regulators and the general public are increasingly pressuring fashion brands to increase transparency and improve their ESG practices. Thanks to legislation like the EU’s Circular Economy Action Plan, or the US’ Uyghur Forced Labour Prevention Act, fast fashion brands are being forced to invest more heavily in supply chain transparency.
Unfortunately, pinpointing exactly how and where clothes were made, by whom, and under what conditions is a major challenge. Increasingly, fast fashion manufacturers are turning to blockchain as a potential solution.
Blockchain technology has been around since 2009 when the technology emerged as a way to underpin digital currencies like Bitcoin. The purpose in that case was to provide a distributed ledger to record and notarise transactions without the need for a centralised authorising agency.
Since then, blockchain’s potential for creating a verifiable, tamper-proof record of events has raised the technology’s profile as a method of creating visibility in the supply chain. The technology has seen relatively widespread adoption in the finance and food production sectors.
More recently, fashion manufacturers have embraced blockchain for its potential to trace clothing along the value chain.
Blockchain in vogue this season
The first instance of blockchain used to authenticate the supply chain journey of a piece of clothing comes from 2017. London-based designer Martine Jarlgaard launched a project which tracked the passage of raw material through the supply chain all the way to the finished garment.
More recently, UK fashion retailer New Look announced plans in November to integrate blockchain based tracking into its operations. “The platform will integrate with retailer, manufacturer and supplier systems, as well as other third-parties, such as certification agencies, lifecycle datasets and other sustainability solution providers, to provide granular insight into New Look’s supply chain,” said Shameek Ghosh, CEO of TrusTrace, who provided the blockchain solution to New Look.
Clare Woodford, global director of impact and engagement at Alpine Group, stressed in a recent interview that blockchain is more than embracing a trend. “It’s future-proofing the fashion industry by creating a supply chain that is not only efficient and secure but also accountable and responsible,” she explained.
Blockchain adoption is certainly moving forward. The technology, however, is still in the process of transitioning from the experimental PR stunt stage to widespread implementation. “As with the broader trend in enterprise blockchain adoption, the apparel and textile industry’s initial foray into blockchain was characterised more by experimentation than by widespread implementation,” said Nicklas Nilsson, a consultant for GlobalData. “It’s only in the past couple of years that we’ve seen a meaningful shift towards practical applications, particularly in enhancing supply chain transparency.”
Criticism of blockchain in fast fashion
There’s no denying the excitement surrounding blockchain as a potential guarantor of supply chain sustainability. Reports of human rights violations and unsustainable practices consistently plague the fashion industry. For many brands, a blockchain-based authentication of their ESG bonafides could represent the reputational (and legal) armour they desperately need.
However, the idea that by informing consumers, blockchain will push brands towards embracing genuine stability has its critics. Relying on a technology, effective or not, to alter practices that are core to an industry’s business model can never be effective, argues Nayla Ajaltouni of Éthique sur l’étiquette. “The business model of fast fashion is based on the break-up of the value chain, poor quality, pressure on wages, and low production costs,” she explains. “If brands do not respect human rights, it is not because they lack a technological tool; if they want it, they can already do so all along their supply chain. It’s not blockchain that’s going to change things”.
- Digital Supply Chain
- Sustainability