While brands may have stringent social and environmental standards on paper, it’s up to suppliers to actually meet them, and on the whole, there’s been a downward shift in what brands are willing to pay suppliers, according to researchers. That limits what suppliers are able to do for both their environmental footprint and their employees. And, while fashion brands are increasingly setting lofty sustainability goals, the spotlight is usually on things like emissions targets, and the wellbeing of supply chain workers rarely features prominently in ambitious sustainability strategies. The Bangladesh Accord, a binding agreement that measurably improved factory safety after the Rana Plaza disaster in 2013, expired last year. Many international brands have yet to sign on to the renewed version — and even as the only major effort targeting social standards in the supply chain, it focuses on factory safety, not on worker wellbeing and wages.
Now, orders are once again being cancelled and labour advocates are worried about the implications for workers, particularly amid such rapid inflation. Retailers including Target, Walmart and Macy’s have said during recent investor calls that they are cancelling or reducing orders as they struggle with losses and excess inventory. Those conversations do not detail how those actions impact suppliers — if the companies pay factories for orders they’ve cancelled, for example — and spokespeople for the companies did not respond to or declined to answer questions about whether they paid suppliers for cancelled orders. Paid-for cancelled orders would be an improvement over past order cancellations without pay, but experts warn that there are still ramifications for suppliers.