How the Textile Exchange's new index aims to make a material difference
A new tool, released today, aims to push apparel and home furnishings companies further toward sustainability, and ramps up efforts by the textile and fashion industries to align material choices with the Sustainable Development Goals.
The Material Change Index (MCI) produced by the nonprofit Textile Exchange, is part of that organization’s Corporate Fiber & Materials Benchmark program, which enables participating companies to measure, manage and integrate a preferred fiber and materials strategy into their business. The index was created in part through the voluntary participation of more than 170 companies, including major brands such as Adidas, C&A, Gucci, IKEA, Inditex, Nike, Patagonia and Tchibo.
GreenBiz Group is serving as the lead media partner for the launch of the index, including publishing a series of articles produced by the Textile Exchange over the coming weeks with actionable insights for apparel and textile companies looking to source raw materials more sustainably. The MCI family of indices tracks progress across cotton, polyester, nylon, manmade cellulosics, down, wool, material circularity and the SDGs.
The index launch comes at a pivotal moment for the fashion industry, which has been under increased scrutiny for its environmental and social impacts. One reason is that the fashion industry’s sprawling supply chains stitches together a wide range of sectors and concerns, including agriculture, chemicals, energy, forestry, oil and gas, retail and transportation. And in each of those lies a range of extraction, energy, emissions and waste challenges, as well as a variety of social issues, from animal welfare to the rights of indigenous cultures.
The Textile Exchange focuses on the fiber material portion, "the very beginning of a quite long and often quite convoluted supply chain," explains Liesl Truscott, director of the organization’s European and materials strategy. "It can get either forgotten about or is relatively invisible when the industry looks at the apparel and footwear and home textiles that are being produced."
Truscott’s organization has been working for nearly two decades to bring visibility into the industry’s supply chain. It began its life as the Organic Cotton Exchange, then became the Organic Exchange, now the Textile Exchange, at each step taking on an increasingly broad portfolio — from cotton to additional materials, and from organic to other means of growing and producing sustainable textiles.
Along the way, the group, which has roughly 200 member companies — including brands, retailers and suppliers — has created a series of industry standards, covering organic content, recycled claims, chain-of-custody verification and "responsible down," as in the feathery type.
"When you think about the whole volume of the industry, we still may be small in number, but we're mighty in leadership," LaRhea Pepper, the Textile Exchange’s managing director, told me recently. "We definitely have the brands and retailers and their supply network that are driving and being innovative and adopting those best practices, experimenting with business models, and really homing in on how they can make the best impact."
At the core of the Textile Exchange’s work is a benchmarking program, in which companies disclose a range of policies and practices, and their performance against each, via a secure online portal. The information submitted by companies is reviewed by the Textile Exchange and verified by an independent third party. The group also publishes a leaderboard of volume users of sustainable fibers, including which companies are using the sustainability standards associated with those fibers.
"It taps into a company's natural instincts to be competitive, to be able to lead in improvements, and so there's a bit of a friendly race to the top that's incorporated into a benchmarking program," explained Truscott.
The disclosure process itself is significant, she explained, by requiring companies themselves to better understand the sources and conditions under which their materials are produced. "At one point, if you asked a company where their cotton is coming from, they wouldn't know or wouldn't really be expected to know. Now, with the standards and the traceability that chain-of-custody can provide, we have better tools for collecting that data, centralizing it and being able to see further back. And country of origin was something nobody talked about a few years ago, and now it's fairly common, particularly among the leaders and those that are fast catching up."
To be sure, while materials typically represent the lion’s share of an apparel company’s supply chain, it may be only a fraction of its environmental impact. At C&A, the European fashion manufacturer and retailer that’s been a leader in circular economy, "Raw materials represent 17 percent of our impact" from a life-cycle perspective, Jeffrey Hogue, the company’s chief sustainability officer and a Textile Exchange member, told me.
Still, he said, sustainable sourcing can have an outsized impact, both internally and externally. "I think that the leading brands create a very holistic approach around sourcing sustainable fibers, where it's not just about gaining more volume and using a third party to verify. It's about educating our buying and sourcing organization to make the right decisions when they're faced with difficult tradeoffs. It's about going beyond certifications and actually putting our feet on the ground to evaluate with our own eyes what's happening there and to create more engagement at the farm level. It's about improving livelihoods."
It will be interesting to watch how the Materials Change Index moves companies and, ultimately markets, and how broadly it is adopted beyond the current Textile Exchange membership. "I think there's a lot more opportunity for the industry to come together collectively to work on these problems and not just having a number of leading brands setting their own commitments in isolation of other entities," says Hogue.
Adds Pepper: "It's exciting, because there's finally this awakening at this bigger level, but it's also daunting at some level of, ‘Whoa, we've got a lot of work to do.’ But I think the thing that's most hopeful is that we have a direction of travel."