What’s Next for Fashion’s Most Controversial Sustainability Tool? #797

One of fashion’s most widely used sustainability tools should not be used on its own and more work is needed to improve the underlying data, according to a third-party report commissioned by its maker, the Sustainable Apparel Coalition (SAC), in response to a greenwashing controversy that has rocked the industry.

The SAC’s Higg Materials Sustainability Index (MSI) “could be prone to misinterpretation” when used by itself, the report conducted by KPMG concluded. Instead it should be integrated into broader product assessments, which themselves still need to be refined, the report found.

The review lays out a series of detailed recommendations for the SAC, which is seeking to restore confidence in its tools after regulators in Norway concluded its material ratings were not robust enough to back up consumer-facing marketing claims last year.

The high-profile scandal exposed long-standing criticism of the integrity and quality of the data underpinning the MSI and the validity of its metrics, casting doubt on the fashion industry’s reliance on self-regulated and corporate-funded standards like the SAC’s.

“This is not a comfortable exercise,” said Jeremy Lardeau, the SAC’s vice president of the Higg Index. “This is us putting out the unfiltered opinion of 10 experts on something that has been quite a hot issue.”

Here’s what you need to know:

Why Is This Review Happening?

In 2021, the SAC began encouraging its 250-plus members to place sustainability ratings on their products, using its Higg tools. But the consumer-facing labels attracted fresh scrutiny to the MSI, which had long faced criticism — both internally and externally.

The materials tool rests on third-party lifecycle assessments, a well-established, but loosely defined methodology for measuring environmental impact. Critics argue that these can be skewed because there aren’t uniform parameters for measurement; lifecycle assessments for materials are often conducted by manufacturers and producers, who have a vested interest in casting their material in the best light possible.

The quality of the available datasets has also been widely contested as unrepresentative, inconsistent, inadequate and in some cases simply old. Moreover, the methodology has come under fire for neglecting to take into account important impact areas, for instance the MSI doesn’t measure the environmental cost involved with disposing of a material at the end of its life.

Last June, Norway’s consumer watchdog ruled product labels backed by material impact data from the Higg were misleading, putting the sustainability ratings tool at the centre of a greenwashing crackdown that has challenged the credibility of the industry’s environmental efforts.

In response, the SAC suspended the consumer-facing programme, announced plans to double down on data collection and commissioned a third-party review, the results of which were published this week.

What Do the Experts Conclude?

The recommendations were broadly in line with guidance published by Dutch and Norwegian regulators last year, which called for the SAC to plug data gaps, contextualise claims and verify findings.

But while the report put forward numerous recommendations for ways in which the SAC’s tools should be improved, there was also limited consensus among the 10 experts consulted, pointing to just how contentious and complex these issues remain.

Key recommendations included:

More Clarity: The tools should come with better warnings to prevent inappropriate comparisons and ensure users — primarily product designers — properly understand how to interpret the data. It should be clear what parameters were used to make impact assessments and the degree of certainty around the data’s integrity. Where an assessment is based on a specific geography, that should be visibly signalled.

More Coverage: At the moment, the Higg material and product assessments are based on five impact categories, such as global warming potential and water pollution. According to the experts consulted, that presents a limited perspective of the environmental toll exacted by the apparel and footwear sector; it should be expanded to align with efforts to establish a common measurement for sustainability within the European Union, which considers 16 impact categories. New impact areas, like biodiversity and microplastics, should also be included in the future as consensus around how to measure them improves.

More Data Integrity: The SAC should develop an ongoing strategy to improve data quality and standardise parameters for impact assessments. At the moment, it relies on global averages to normalise the data it presents, but this can lead to misrepresentations since much of this data is old and impact can actually vary a lot depending on location, the report concluded. Over time, the SAC should look to enhance its product assessments with primary data collected directly from factories via the Higg portal.

What Happens Next?

The SAC said many of the recommendations laid out in the report were already in its roadmap, though not all could be enacted right away.

“Clearly there’s work ahead of us to figure out the best way to implement some of the recommendations,” said Lardeau. “Some are pretty straightforward and we’ll be able to incorporate [them] pretty quickly; some require more substantive work to figure out the how and the when, and that’s what’s ahead of us.”

The organisation has already started. It’s spent the last two years working to align the industry on a standardised model to measure the impact of cotton farming, which should allow fresh data gathering efforts to kick off early next year. Similar work has been conducted around metrics for wet processing, where much of the industry’s most significant impact takes place.