Five key takeaways from the OECD Forum on Due Diligence 2024

Panellist sit on stage at the OECD Forum on Due Diligence in the Garment & Footwear Sector. Photo credit: OECD.

Last week the annual OECD Forum on Due Diligence in the Garment and Footwear Sector took place in Paris, bringing together 600 stakeholders in-person and over 750 virtually. ETI were fortunate enough to join the event in-person and online, organising five side sessions and moderating a Forum session on living wages.

Why does ETI attend?

Often events like the OECD Forum face criticism for being a ‘talking shop’ accused of driving little progress from a cluster of conference rooms in Paris. At ETI we see the benefit in multi-stakeholder forums that pull the sector together for a single event, to develop new connections, collaborate and build momentum on the key challenges and opportunities faced by the sector. To join the conversation which takes a critical look at what’s working and what’s not and shares it sector-wide.

We were pleased to see many ETI company members – including Bestseller, Inditex, Lindex, New Look, TFG, The Very Group and Primark – already engaging with human rights due diligence, present at the event but couldn’t help thinking more would benefit from taking part, especially in the face of emerging legislation.

In a week jam packed with discussion on various hard-hitting issues impacting global supply chains, it’s always important to step back and reflect on what has been heard, absorbed, and taken forward from the event. 

Here are the top five takeaways from ETI staff:
"Fashion is becoming a regulated industry"

Bear in mind this was ahead of the CSDDD’s latest setback on 28 February, but the sentiment still stands! Brands are facing a rush of regulations that go beyond collecting certifications and completing audits, with one brand highlighting that their legal team had identified over 80 upcoming pieces of legislation that will impact the apparel and textile industry. From the UK, France, Germany, Norway, and Switzerland more and more countries are introducing mandatory human rights and environmental due diligence and reporting obligations on companies, some even extending to responsibilities around greenwashing. Going forward businesses over certain turnover thresholds will have to dive deep into their supply chains to make structural change. They have a crucial role to play in translating these changes into practical actions for their suppliers, as well as a responsibility in supporting their implementation. 

“Alternatives to social auditing are on the up”

Audits can offer valuable insights into global supply chains, but increasingly retailers and suppliers are realising they should not and cannot constitute the entirety of a company's due diligence strategy. For example, audits rarely capture nuanced issues, such as sexual harassment, exploitative practices, and restrictions on freedom of movement and association. They can however be improved to complement a smart mix of human rights and environmental due diligence tools developed in consultation with workers and trade unions. These can include supply chain disclosure, independent grievance mechanisms, responsible purchasing practices and clear policies for remediation. Given the highly feminised nature of the sector, community engagement tools that enable off-site interviews with women workers are also essential to understand issues from a gender perspective. The focus should be on how to use data to make improvements rather than on data collection itself.

Catch up on related sessions:

“Legally binding agreements with unions work!”

These agreements can foster cooperation through establishing a legal mandate to ensure the representation of workers' voices and effective grievance procedures. Examples such as the Dindigul agreement or the Lesotho agreements focussing on gender based violence and harassment (GBVH) can lead to positive change for the workers. They also demonstrate that with the right stakeholders at the table and genuine willingness to collaborate, difficult issues like GBVH can be tackled effectively. ETI company member  Tesco has signed an agreement with IUF to better protect workers in their supply chains. These agreements can be transformative in addressing many of the issues we see, but they require meaningful engagement and commitment from all parties to ensure responsibilities are balanced across brands, retailers, suppliers, trade unions and workers.

Catch up on related sessions:

“Meaningful engagement is targeted and ongoing process”

The focus on human rights due diligence in the face of legislative requirements has also given rise to a conversation on how to meaningfully engage sector stakeholders in line with the OECD guidelines. Ideally, this should involve a process of interaction and dialogue between an enterprise and its potentially affected stakeholders, with the aim of understanding and responding to their concerns. But who should be engaged and how? For the garment and footwear sector, top of the list are workers and their legitimate representatives, such as noted already - trade unions! Whilst we are seeing progress by brands and retailers on this, there is still more work to be done particularly in establishing trust and fostering a two-way communication process. It’s also vital not to forget the role of the supplier and manufacturer in engagement, particularly when designing collective action that they will be expected to the deliver. Suppliers have to feel a part of the process for them to meaningfully support improvement activity and should not be expected the bear an unequal proportion of financial risk. Transparency by all stakeholders is critical and hopefully legislation on mandatory HRDD can help drive this forward.

Catch up on related sessions:

“Climate change impacts on workers need to be better understood”

2023 was the hottest year on record and 2024 appears to be continuing the trend. Despite this, the garment and footwear sector are still behind when it comes to understanding the real impacts on workers making their products. Climate events such as severe flooding and extreme heat are already impacting the health and productivity of workers. They are also presenting imminent business and material risks for fashion brands and investors. More needs to be done in this area and the sector needs to focus on adaptation strategies to protect workers and ensure the resilience of supply chains in regions most at risk. But to do this, workers and their representatives need to have a seat at the table. They need to be treated as critical stakeholders, with a stake in decision making and as sources of potential solutions. This is the experience of ETI Bangladesh and was highlighted in our session on Green Social Dialogue. The costs of inaction far outweigh the financial burden of taking practical steps now. Many improvements are shown to have an almost immediate return on investment. Worker-management dialogue is essential to identifying and implementing these improvements efficiently and fundamental to calls for a just transition. 

Catch up on related sessions:

Without long-term commitment to engage, collaborate with and support stakeholders to implement these changes across global supply chains little sustainable progress will be made in this sector. Much of this can be delivered through responsible purchasing practices and stakeholder engagement. Multi-stakeholder initiatives like ETI, can add real value here, by aligning our frameworks and using our leverage to drive real change in this sector and others.

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Some side sessions organisers chose to record their event. The OECD will share recordings on session pages where they are available.

ETI's blog covers issues at the intersection of business and human rights. We feature posts by, for and from our members and allies; we do not accept or offer payment for posts or publish content outside of these criteria. We welcome a range of insights and opinions from our guest bloggers, though don't necessarily agree with everything they say.