Fashion has become one of the most polluting industries in the world. Responsible for both high emissions of greenhouse gases, extreme water consumption and generating large amounts of toxic chemical waste. Not to mention, being notoriously known for their poor working conditions and human rights violations, which was brought to light by the tragic collapse of Rana Plaza in 2013.
It has now become detrimental that the fashion industry makes drastic changes.
The Study
EY Norway, in collaboration with the Norwegian Fashion Hub, as well as, Norwegian Rain and Livid Jeans, have conducted a study. This is to see how blockchain technology can help contribute to a more sustainable and transparent clothing production. Also supported by Innovation Norway, they linked up supply chain with blockchain, so the consumer and partners can see first hand the steps that it took to create that article of clothing. This makes for a more transparent and trustworthy market.
A blockchain is a decentralized distributed database that verifies transactions between participating players and ensures that the information logged in the database can be accessed. Transactions are time stamped and a digital fingerprint in the form of a so-called “hash” ensures that the information cannot be changed either. The technology is therefore suitable, for example, to create trust between business partners that payments have been made or that goods have been sent by agreement. Once the information is verified on the blockchain, it can also be easily verified by third parties – such as authorities, consumer inspectors, customs authorities or auditors.
Rather than measuring sustainability based on list of criteria’s, that can easily manipulated. The fashion houses can prove to other actors in the supply chain where the product was manufactured, when and where. They will also be given the opportunity to measure the footprint of each garment against the industry average.
So far the study has focused on getting information from suppliers during the production phase. They have found that 80% of the emissions created by the clothing industry are created during this phase, but they hope that long term they can calculate the entire value chain of the participating brands.
There are still other factors that need to be in place, in order for information sharing to become accurate. Sensor technology and certification actors will be able to measure, among other things, greenhouse gas emissions, workers’ rights and the use of environmentally harmful chemicals. The information can be used by brands to make the right choice of suppliers and challenge them to improve.
Monitoring supply
The blockchain solution can also be communicated to consumers through solutions for RDFI codes on clothing. By making the footprint of a garment visible in a life-cycle perspective, one wants to encourage consumers to measures such as repair and reuse, which prolong the life of a garment and thus reduce the overall footprint. Moncler, implemented this in 2016, in order to close down on counterfeit products.
“We see that developments in the use of technology are accelerating. Today, there are exciting initiatives for the use of blockchain for both sustainable cotton production and recycled sea plastics. If the Norwegian fashion industry implements the technology early, they will be well positioned above competitors, as well as having the opportunity to connect to the blockchain systems that are being developed in other parts of the industry ”, says Joakim Marstrander, Partner EY and head of Law Norway, with observer status in Norwegian Fashion hub.
For more information contact: Fredrik Storhaug Nordbø, EY’s sustainability department (Fredrik.Storhaug.Nordboe@no.ey.com | +47 480 21 132), Mads Ribe, technology lawyer at EY and specialized in blockchain (Mads.Ribe@no.ey.com | + 47 99 22 71 56) or Magnus Jones, Nordic Blockchain Lead at EY (magnus.jones@no.ey.com | +47 922 22 345).