What is sustainability reporting? Is it important for fashion brands?

The fashion industry is no stranger to ecological and ethical issues. In a climate of growing attention, sustainability reporting is an increasingly useful tool.

Under pressure from customers and stakeholders, fashion companies are increasingly looking for green and ethical practices. However, the risk of falling into greenwashing is always around the corner. One of the best ways to demonstrate a company’s ESG commitment is through sustainability reporting.

What is a sustainability report?

A sustainability report is a document that contains information about the organisation’s economic, environmental, and social impact. It also gives an overview of the company’s strategy and goals for sustainability. By publishing this information publicly, companies can show their customers, investors, and other interested parties that they are committed to sustainable practices. It helps to build trust with customers and other stakeholders who would otherwise have little insight into the company’s operations, by creating an environment of transparency and responsibility. 

The benefits of sustainability reporting for fashion brands

The benefits of publishing a sustainability report for fashion brands cannot be overstated. Not only does it show customers that the company is serious about its environmental and social responsibilities, but it can help create a competitive advantage by setting a benchmark for other companies in the industry to match or surpass.

By making sustainability reports an integral part of corporate strategy fashion brands can demonstrate their commitment to sustainability and align their corporate values with their operational practices. In addition to providing this information, fashion companies can also use their sustainability reports to better engage with their customers. When brands make the report accessible online or through other channels, they can give consumers an opportunity to learn more about how the fashion industry is working towards a more sustainable future. Furthermore, they can encourage customers to take part in initiatives by offering rewards or discounts for taking action on issues highlighted in the report.

What should be in a sustainability report

A sustainability report provides an overview of how a company manages different aspects of its activity. For example, how ethically it sources materials and produces garments, how waste-conscious its production processes are, and how its products have been developed with environmental considerations in mind. But also, energy usage, employee wellbeing initiatives, corporate governance policies, etc. 

The report should also outline the company’s progress toward achieving its sustainability goals and objectives. This could include details on how the company is reducing its carbon footprint or improving its supply chain practices. Additionally, it should also describe any actions taken to address issues raised by stakeholders such as customers or shareholders. 

However, sustainability reports should not only provide complete information about a company's performance in terms of environmental and social impacts but also economic indicators.

To create a sustainability report, companies can follow certain guidelines, such as the ones below.

The 4 stages of sustainability reporting

The process of sustainability reporting should involve four stages: 

• Planning – gathering all the necessary information and deciding which elements should be included. 
• Gathering Data – collecting data from both internal and external sources. 
• Analysis – analyzing the data to determine performance in key areas such as energy usage, waste management, employee wellbeing, etc. 
• Communication – communicating the findings of the report to stakeholders in an accessible manner. 

The 3 elements of sustainability reporting

Sustainability reports should include three key elements: 

• A description of the company’s business activities and its strategy for sustainable development. 
• Data about the company’s performance in terms of environmental and social impact, as well as economic indicators. 
• An analysis of the company’s progress toward achieving its sustainability goals. 

These elements should be presented clearly and concisely in order to provide an accurate picture of a company’s performance and commitment to sustainability. 

The 7 principles of sustainability reporting

In order to ensure that sustainability reports are reliable, accurate, and transparent, there are seven principles that fashion companies should adhere to when creating theirs. These include: 

• Accurate reporting – ensuring accuracy in all aspects of the report such as data collection and reporting methodology. 
• Relevance – providing complete and relevant information about the company's performance. 
• Materiality – considering both environmental and social impact when selecting topics for inclusion in the report. 
• Comparability – using an industry-wide reporting framework so results can be compared between companies. 
• Stakeholder engagement – engaging stakeholders throughout the process to ensure the credibility and relevance of information included in the report. 
• Transparency – being open and honest about all aspects of the report. 
• Long-term focus – taking a long-term view and considering the impacts of future investments.

Examples of companies already making sustainability reports

Some of the leading fashion brands have already started to publish their own sustainability reports. For example, H&M has been publishing its annual Sustainability Report since 2007. Similarly, Zara released its first sustainability report in 2018 with a commitment to reducing water consumption and energy use.

Among the luxury fashion brands, an example is Armani, which released its first sustainability report in 2019. This report outlines the company’s initiatives to reduce greenhouse gas emissions and waste production, as well as its efforts to promote diversity and inclusion in the workplace.

Certilogo also appears in the 2020 edition of the Armani sustainability report, as a partner in the fight against counterfeiting. In fact, our authentication system, implemented during the Spring Summer 2018 season on almost all the Group's lines, allows consumers, in full respect of privacy, to authenticate the garments with a simple scan of a QR Code present on the labels. Furthermore, the use of the Certilogo QR code has expanded the product-related content released by the brand to its customers.

Learn more about Certilogo’s connected products.