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Press Release

11 Jan 2024

Fashion brands’ failure to eradicate forced labour putting workers at heightened risk

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New analysis reveals luxury brands, including LVMH and Salvatore Ferragamo, are among the worst offenders.

The biggest names in fashion continue to rely on paper promises to eradicate forced labour, putting supply chain workers at heightened risk – but a handful of leading companies show progress is possible, according to new research from the Business & Human Rights Resource Centre. In the fourth edition of the KnowTheChain Apparel & Footwear Benchmark, 65 of the world’s largest apparel and footwear companies were benchmarked on efforts to protect workers in their supply chains from forced labour risks. Concerningly, the average score was just 21 out of 100. The report highlights key gaps in company practices – while also showcasing good practice examples and making recommendations for company action.

Allegations of forced labour were identified in the supply chains of almost half of benchmarked companies. More than one in five companies (20%) scored a shocking 5/100 or less, while more than one in third of companies (34%) scored less than 10/100. Yet better practice is achievable, with three companies (Lululemon, Puma and Adidas) scoring over 50/100. The highest performing company (Lululemon) disclosed markedly stronger human rights due diligence efforts to address forced labour risks.

Áine Clarke, Head of KnowTheChain and Investor Strategy, Business & Human Rights Resource Centre, said: “The fashion industry has long since been in the media spotlight for its endemic human rights risks and labour abuse scandals. Despite this, most companies are not adapting to the scale and scope of these issues across global supply chains. Exacerbated by multiple crises in 2023 – including climate breakdown, international conflict and post-pandemic realignment – alongside an increase in strategic litigation, legislation and associated operational, reputational and financial risks, makes this ‘business-as-usual’ approach by so many brands short-sighted and misguided.

“With the recent political deal on the EU’s Corporate Sustainability Due Diligence Directive, this year’s benchmark findings should serve as an especially timely call to action for companies and their investors to look again at business models that perpetuate abuse and create shared prosperity for CEOs, shareholders and, crucially, workers alike.”

Key findings: 

  • There is a significant gap between the efforts of the average company in the sector, scoring (21/100) and the highest-scoring company (63/100). While only three companies scored above 50/100, over 20% of companies scored just 5/100 or less.
  • Companies benchmarked since 2016 performed significantly better, on average, than those assessed for the first time this year.
  • Companies scored lowest on the themes of Purchasing Practices (12/100) and Remedy (7/100). On the theme of Recruitment, which is a vital tool to preventing and remedying risks to migrant workers, companies scored an average of 14/100.
  • Less than a quarter (22%) of companies disclosed engaging with local or global unions to improve freedom of association in their supply chains – a critical measure to uphold decent work and prevent labour rights abuses.
  • Despite allegations of forced labour identified in the supply chains of almost half of benchmarked companies, only 22% disclosed an example of remedy outcomes for workers in their supply chains.
  • More than three quarters of benchmarked companies (77%) source from at least one country at high-risk of forced labour (Argentina, Bangladesh, Brazil, China, Ethiopia, India, Malaysia, Nepal, North Korea, Thailand, Vietnam), yet only 8% of companies disclosed detail on forced labour risks identified across supply chain tiers. This suggests at best a lack of transparency, and at worst a failure in robust due diligence that goes beyond the first tier.

Luxury laggards

Clarke added, “While the largest apparel companies have experienced staggering revenue growth and profit margins since the pandemic, those who work for them continue to face some of the most impoverished conditions. The largest apparel companies have experienced a combined growth of US$42b since 2022, yet an estimated US$71m is still owed to workers because of wage and severance theft committed during the pandemic. This disparity is most evident in luxury fashion, where record revenue growth and profit margins seem increasingly divorced from workers, and working conditions, in global supply chains. For multiple years running, luxury brands such as LVMH (6/100) and Salvatore Ferragamo (4/100) have performed among the poorest in the benchmark.

“Conversely, Lululemon (63/100) and Puma (58/100) posted top scores on human rights performance, while reporting strong financial results to shareholders in 2022 and 2023 – despite increasingly complex operating environments. Unfortunately, these examples represent the practice of only a small cluster of companies, rather than the majority in the Benchmark – but they make clear prioritising worker protections is both possible and profitable.”


Notes to editors:

  • KnowTheChain is a programme of the Business & Human Rights Resource Centre that publicly assesses companies across three high-risk sectors (Apparel & Footwear, Food & Beverage and Information Communications & Technology) on how they are addressing forced labour and labour rights issues within their global supply chains.
  • The 2023 Apparel & Footwear Benchmark report is the 12th published benchmark since KnowTheChain’s inception in 2016 – and the 4th benchmark of the apparel and footwear industry.