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Review Process 2021: Publication of Reports

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15.11.2021

Review Process 2021: Publication of Reports

The Review Process represents the individual responsibility of the companies in the Partnership for Sustainable Textiles (PST) to implement due diligence in their supply network. The aim of the Review Process is to analyse the most serious social, environmental and corruption risks and to prevent them effectively. Today, the PST publishes the first 34 Review Reports.

108 out of 124 Partnership members have participated in the Review Process. 36 out of 55 companies were already able to complete the process and their reports are onlineas of today. The remaining reports are still being revised after the assessment meeting and will be published successively.

53 members of the other stakeholder groups - NGOs, associations, standard setting organisations, unions, the German Federal Government and advisory members - are also participating in the Review Process and answering questions. These too, can now be found on the PST website.

16 members joined the Textiles Partnership only after the start of the reporting phase or are not subject to the reporting obligation as associate members.

Individual responsibility & due diligence

The Review Process provides companies in the Textiles Partnership with a framework for implementing their due diligence obligations and a corresponding reporting format. The process was fundamentally revised on the basis of OECD recommendations and now focuses even more strongly than before on the continuous improvement of social and environmental conditions in the value chain in line with the OECD's requirements for corporate due diligence (OECD Due Diligence Guidance).

The aim of the Textiles Partnership is to improve the living and working conditions of employees in the production countries and to minimize the environmental impact of the industry. The PST members want to achieve this with an ambitious implementation of their individual due diligence obligations. The basis for this is a risk assessment that follows the due diligence logic and focuses on the actual and potential impacts of their own business activities on business partners, employees, other stakeholders and, last but not least, on the environment and climate.

In recent months, the companies have analysed and prioritised their risks and then set targets and measures with which they can counteract these so-called Sector Risks for example wages and working hours, working conditions, greenhouse gas emissions and the use of chemicals.

Consultation and review in the assessment meeting

For the first time, one-day assessment meetings for evaluation and consultation took place. A tandem of PST secretariat and independent experts evaluated the risk analyses and targets that the companies had previously entered into the PST reporting tool TexPerT . Among other things, the tandem checked whether the targets were derived from the risk analysis in a meaningful and comprehensible way and whether the targets were sufficiently ambitious. After the meeting, the companies were able to revise their risk analysis as well as the targets and measures.

Sibylle Baumgartner from focusright, one of the independent experts, about the assessment meetings: "In the assessment meetings, we were able to hold an in-depth discussion with the companies on the requirements for a systematic risk analysis in accordance with OECD requirements. For many companies, the analysis of the entire supply chain was new and challenging. Our impression is that the Review Process sensitises the companies to a systematic and overarching risk analysis that takes the entire supply chain into account. In many cases, we have observed a positive development from the first versions to the reports that have now been published."

The German Institute for Human Rights (Deutsche Institut für Menschenrechte, DIMR) accompanied six of the 55 assessment meetings and comes to the following conclusion, among others: ""For many companies, operational challenges remain, such as the involvement of local stakeholders. Nevertheless, we can generally state that the assessment meetings, with their mix of consultation and review, are a valuable component of the Review Process. For the individual companies, they are well suited to achieve a better understanding of the individual implementation of due diligence and to adequately present their own performance. This is a positive sign and points in the right direction towards greater sustainability across the industry."

Transparency and commitment

During the Working Meeting of the Textiles Partnership , Dr. Maria Flachsbarth, Parliamentary State Secretary to the Federal Minister for Economic Cooperation and Development, expressed her appreciation to the Partnership companies for this and emphasized that the Review Process had been challenging for them, especially during the pandemic and global crisis: "I am very pleased that many of you have taken on this challenging review. The Review Process provides transparency and commitment and is a quality control. You are taking a courageous step forward and showing that you not only want to take responsibility, but are ultimately doing so in a verifiable manner. For this, I have great respect and many thanks. I am convinced that your efforts are worthwhile."

Progress and challenges

The risk analyses and assessment meetings show that many companies already know their direct suppliers well. These are, in particular, clothing manufacturers (cut, make, trim, Tier 1). However, there are still many gaps in knowledge and correspondingly less access to information and risks in the upstream value chain. The Textiles Partnership supports its members on the way to more supply chain transparency, among other things with a guideline (DE and EN), an expert group and through the Cooperation with the Open Apparel Registry.

In addition, the majority of Partnership companies see challenges in setting up effective complaints mechanisms, especially if these are to be accessible to potentially affected people down the value chain. In this context, some Partnership members joint the Partnership Initiative Complaints Mechanisms to ensure that more textile and garment workers have access to grievance mechanisms and redress. A joint project with the Fair Wear Foundation (FWF) is part of the Partnership Initiative.

As in previous years, the Review Process was again accompanied by withdrawals or exclusions. Some companies were unable to meet their reporting obligations due to a lack of resources or did not see sufficient relevance for their company. Since participation in the Review Process is mandatory for all members, members are excluded if they do not (or cannot) fulfill their reporting obligations.

About the Reports

The online Review Reports consist of four parts:

  • The company profile contains general company information, information on the value chain and supply chain management, the purchasing model and fibers.
  • The Progress Report shows whether a company has achieved the goals it set in the last review. Some companies have also provided information on how the COVID-19 pandemic has affected their company and supply chain and how they have dealt with it.
  • In the Roadmap the companies indicate which of the 11 sector risks they have identified in their supply networks and what targets and measures they have derived from them.
  • In the final section of the report, companies outline what complaints mechanisms exist in their supply chain and how they promote access to them.
What is next?

Some companies are still finalising their reports after the assessment meeting. These reports will be published successively in the coming weeks. Subsequently, the PST secretariat will evaluate the Review Process, also on the basis of feedback from members. The results are expected to be published in the 2021 Annual Report in April 2022. Consideration will then begin regarding any adjustments for the Review Process in 2023.

A central aspect of this will be the requirements of the Act on Corporate Due Diligence Obligations in Supply Chains adopted by the German Federal Government in June 2020, which are to be reflected as far as possible in the Review Process 2023. However, the head of the Partnership secretariat Jürgen Janssen is already certain: "Companies in the Partnership are familiar with due diligence. They are therefore already well prepared to meet regulatory requirements in this area. Together in the Partnership, we will continue to advance the effective implementation of due diligence."

Further information and tools:

Overview of all Review Reports: https://www.textilbuendnis.com/en/berichte/

Member overview: https://www.textilbuendnis.com/en/uebersicht/

The Review-Process: https://www.textilbuendnis.com/en/der-review-prozess/