Addressing sector risks together

Certain risks occur particularly frequently in the textile sector. Therefore, they are called industry or sector risks.

The Textile Partnership bases its work, requirements and recommendations largely on the OECD Sector Handbook (OECD Due Diligence Guidance). In it, the OECD defines:

"Sector risks are risks that are common across all product lines and locations in the apparel and footwear sector worldwide. Key features that characterise apparel and footwear supply chains, such as low-skilled labour, intensive and decentralised production, and short lead times, increase the risk of certain negative impacts on labour and human rights. Many of these risks exist at every stage of the supply chain. Similarly, the materials used in products and product development also increase the risk of certain environmental harms at different stages of the apparel and footwear supply chain. For example, there is a higher risk of hazardous chemicals being used in wet processing than in cut, make and trim."

Social, environmental and corruption risks

Sector risks can be clustered into human rights and social risks, ecological risks and corruption risks. In most cases, the risks are not independent of each other, but are mutually dependent and mutually reinforcing. Which risks (potentially) occur and to what extent can differ depending on the country/region, supply chain level, product group, material or business model.

The Textile Partnership supports member companies in fulfilling their responsibilities and due diligence obligations in the supply chain and in minimising risks. Therefore, the sector risks largely reflect the issues we work on together in the Textile Partnership. In addition, there are cross-cutting issues that feed into the identification and addressing of all sector risks. These include responsible sourcing practices, grievance mechanisms and the widest possible knowledge and transparency of the supply chain.

Responsible purchasing practices by brand and retail companies are crucial for safe and good working conditions in the supply chain. They can contribute significantly to minimising the various sector risks. With the annual topic 2021 legt das Textilbündnis daher einen Fokus auf verantwortungsvolle Einkaufspraktiken und bietet seinen Mitgliedsunternehmen verschiedene Unterstützungsangebote. Dazu gehören Trainings, Selbst -und Lieferantenbewertungen der eigenen Geschäftspraktiken. Darüber hinaus erarbeitet das Textilbündnis zusammen mit anderen Multi-Stakeholder-Initiativen einen Referenzrahmen zu Einkaufspraktiken.

Another key lever is complaints mechanisms: Workers in textile supply chains must have the opportunity to draw attention to malpractices in the workplace and receive effective relief or redress if needed. This is an elementary component of corporate due diligence, as demanded by the United Nations, the ILO and the OECD, among others.

The Textile Partnership is committed to strengthening existing complaints mechanisms and making them accessible to as many workers in the textile sector as possible. For more information on the Partnership's initiative and the cooperation project with the Fair Wear Foundation and the Dutch Textile Partnership, please go to here.

In the Review Process, members are also required to report on and set targets for redress and complaints mechanisms. You outline the channels through which affected parties in your supply chain can communicate complaints. In addition, the number and topics of complaints received are recorded.

In addition, Partnership members collect reports on complaints or incidents in the textile supply chain in an Incident List. The list helps companies to identify specific incidents and possible risks in their own supply chain.

Transparency in one's own supply chain is a fundamental prerequisite for the implementation of corporate due diligence. Companies can only effectively address social, environmental and corruption risks in their supply chain if they know where, how and by whom their products are produced.

Weitere Infos zu Supply Chain Transparency.

Companies report on eleven sector risks

In the workshop on 18 May, Review Process risk analysis and risk prioritisation are of central importance. Each company must individually check two things in particular: Do the sector risks occur in one's own value chain and if so, how (actual negative impact)? Or is there even a potential risk of them occurring? The Textile Partnership counts the sector risks in textile supply chains according to the risks identified by the OECD: