Systemic and Structural Barriers Leading to Failed Sustainability Strategies in MSIs: New Study

A report by Transformers Foundation reveals that some of the industry's most influential multi stakeholder initiatives or MSIs often reinforce systemic barriers that limit supplier participation, leading to a cycle of distrust, disengagement, and ineffective sustainability strategies.

Long Story, Cut Short
  • The report hopes to help MSIs reach their potential to build a more inclusive, equitable, and sustainable fashion industry.
  • It examines the pivotal role of MSIs in driving sustainability within the fashion industry by drawing from the experiences of suppliers working and/or affiliated with MSIs.
Suppliers tend to see them as organisations whose primary activities come at a higher cost to the supply chain relative to brands and retailers, and who fall short of their missions and goals.
Chained Up Suppliers tend to see MSIs as organisations whose primary activities come at a higher cost to the supply chain relative to brands and retailers, and who fall short of their missions and goals. Siswanto / International Labour Organization

Transformers Foundation has come up with a report that explores the systemic barriers preventing meaningful supplier engagement in some of the industry's most influential multi stakeholder initiatives or MSIs, including Cascale, Textile Exchange, SLCP and ZDHC.

  • The report, ‘Collective Action Reimagined: A Call for Fair Process and Supplier Inclusion in Fashion’s Multi-Stakeholder Initiatives’, uncovers how rules, governance, and processes often perpetuate supplier exclusion.
  • The findings reveal that these organisations, though well-intentioned, often reinforce systemic barriers that limit supplier participation, leading to a cycle of distrust, disengagement, and ineffective sustainability strategies.
  • It examines the pivotal role of MSIs in driving sustainability within the fashion industry by drawing from the experiences of suppliers working and/or affiliated with MSIs. These experiences explore the extent to which MSIs are succeeding in their efforts to drive sustainability within the fashion industry.
  • The report looks at four key and influential MSIs—Cascale (formerly Sustainable Apparel Coalition), Textile Exchange, the Social & Labor Convergence Program (SLCP), and Zero Discharge of Hazardous Chemicals (ZDHC)—examining how—if at all—their processes include suppliers.

THE CHALLENGES: Few suppliers are actively engaged in MSIs due to systemic problems. Though MSIs did not cause the resource-based constraints that suppliers face, these organisations’ own rules, governance processes, and norms often replicate them, fuelling a cycle of supplier distrust and disengagement that undermines agency and ownership in the solutions put forward by these groups.

  • Suppliers who were part of the research often perceive MSIs as having developed strategies and standards, tools, and assessments that are enacted solely by the supply chain for the benefit of brands and retailers without their full participation or buy-in.
  • Suppliers tend to see them as organisations whose primary activities come at a higher cost to the supply chain relative to brands and retailers, and who fall short of their missions and goals.

WHY MSIS: MSIs are voluntary multi-stakeholder initiatives that form to solve complex global challenges that, as the World Bank puts it, “no one party alone has the capacity, resources, and know-how to” tackle.

  • By bringing together stakeholders with diverse and complementary skills and visions, MSIs have the potential to drive change that goes beyond any participants’ narrow self-interest to serve a collectively determined higher purpose. This is an idealised version of how MSIs work–but this ideal is important to hold up and work towards.
  • The findings and solutions apply to all other organisations that convene stakeholders to work to solve social or environmental problems in the fashion supply chain.
  • The standards, tools, and assessments developed by these four organizations–and many others in our sector–are largely enacted in the supply chain, making suppliers key stakeholders.
  • This report does not aim to undermine these MSIs but rather to bring to the surface how suppliers experience their processes.
  • The research uncovers the inner functions of these organisations through suppliers’ eyes, unveiling how they develop standards, organize activities, and ultimately allocate power and voice.
  • The research captures the ways that MSIs have changed over time and continuously evolve. There appears to be a window for further transformation.

LOVEJOY’S CALL: By tapping into this adaptability, the conclusion supports and echoes independent researcher Ilishio Lovejoy’s call to adapt and apply the organisational management theory of fair process to transform MSIs and enhance stakeholder engagement. Fair process is founded on three key principles:

Acknowledgment and reduction of bias: It calls for non-biased decision-making that involves participants’ perceptions of justice within a process.

  • Organisations should acknowledge the role of bias and work to ensure that stakeholders feel they are being treated fairly in relation to others.

Equitable engagement and decision-making. The report just isn’t calling for suppliers to have a seat at the table; they must have a meaningful voice in decision-making.

  • It advocates equitable engagement and decision-making, which would address the power differentials and barriers suppliers face to engagement.

Transparency around the process: Transparency is key to building trust and buy-in in solutions.

  • It advocates for clear rules and reporting concerning who makes decisions, how members can and cannot influence decisions, clear communication of final decisions, and how and why decisions were reached.

In conclusion, for MSIs to drive genuine progress in the fashion industry, they must transform their approach to supplier inclusion and ensure that all stakeholders’ voices are heard.

Collective Action Reimagined
Collective Action Reimagined
A Call for Fair Process and Supplier Inclusion in Fashion’s Multi-Stakeholder Initiatives
  • Authored by:

    Elizabeth L Cline

  • Publisher: Transformers Foundation
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  • Dated posted: 12 November 2024
  • Last modified: 12 November 2024