Why Doesn’t Inditex Publish a Supplier List?
Finding out which suppliers Adidas, H&M or Patagonia work with is easy. Like many major brands, they publish their first-tier supplier lists online, an offer of transparency that slowly became de rigueur for fashion firms after the 2013 collapse of Rana Plaza in Bangladesh. The tragic deaths of 1,134 garment workers were compounded by the absence of information about which brands and retailers were sourcing from the building’s factories at the time. Activists had to sift through the bloody rubble for labels and documentation that would unmask names such as Benetton, Mango and Primark.
Almost 11 years later, the percentage of clothing purveyors that disclose their first-tier (read: cut and sew) factories has risen from nearly nil to 52 percent, according to Fashion Revolution’s 2023 Fashion Transparency Index. Even notoriously taciturn luxury sellers are beginning to give up the goods. Doing so is what Liv Simpliciano, the advocacy group’s policy and research manager, calls the “bare minimum” or an “entry point to accountability,” since campaigners can’t connect brands to social or environmental violations if they don’t know where production is taking place.
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“The fact that more than half of the world’s largest fashion brands disclose this information really gives no excuse to their peers who deliberately keep this information secret,” she said. “It serves to maintain the status quo and prohibits collective action, which is so sorely needed amid a deepening climate crisis and glacial progress on living wages for the people who make our clothes.”
When Boohoo confronted allegations about sweatshop-like conditions at its U.K. suppliers in 2020, it made its directory of contractors public the following year—a first for an ultra-fast fashion company.
But one big name that has bucked this trend also happens to be the biggest (for now). Beyond stating the number of factories it sources from in a dozen countries, Zara owner Inditex does not offer insight into its suppliers.
Inditex says it does divulge this information, just not to everyone.
“Inditex shares factory details with IndustriALL Global Union and partner organizations which work with us to ensure workers’ rights and safety,” a spokesperson said. “Inditex has a deep commitment to maintaining high standards in its supply chain and believes that our industry-leading traceability system, which gives us maximum visibility of the supply chain, is key to this.”
The Bershka and Pull&Bear owner signed a global framework agreement with IndustriALL in 2007 to improve industrial relations in the sector and pave the way for more responsible sourcing. Under a new protocol that they signed in 2022, Inditex and IndustriALL agreed to formulate a joint work plan focusing on “continued respect” for freedom of association, the right to collective bargaining and the provision of training to suppliers, workers and workers’ representatives.
“As part of our GFA with any global brand, it is a requirement to provide to IndustriALL and its affiliates its supplier list. Inditex provides this to us on an annual basis,” Christina Hajagos-Clausen, director of the textile and garment industry at IndustriALL, told Sourcing Journal. “As IndustriALL launched the transparency pledge in 2016, we encourage all global brands and retailers to make their supplier lists public.”
Inditex also shares names with the secretariat of the International Accord for Health and Safety in the Textile and Garment Industry, of which it was an early signatory back when the agreement was known as the Accord for Fire and Building Safety in Bangladesh, again, following the Rana Plaza disaster. The secretariat uses this data to create an aggregated list of all suppliers, including sub-contractors, and makes them available on the Accord website. Any information tying specific companies with particular factories, however, is treated as confidential.
According to Natalie Grillon, executive director of the Open Supply Hub, an open-source supply chain mapping platform, Inditex did publish a Tier 2 list of wet processing facilities in 2018, back when Open Apparel Registry, the Open Supply Hub‘s predecessor, “didn’t exist yet.” This list was uploaded into the system and is still cited in entries under “Inditex.”
There are signs that investors want more, however. When Reuters asked five Inditex shareholders on Monday, many were in favor of increased disclosure, which could help with their due diligence work.
“In our engagement with Inditex one of the things we ask is if they could disclose a list of their suppliers and the geographical location,” said Dutch asset manager MN, which heads the Inditex dialogue for Platform Living Wage Financials, a group of 20 institutional investors with a combined 6.58 trillion euros ($7 trillion) in assets under management. “Even though Inditex assures us that they have this data available, up until now Inditex is not willing to disclose this information, unlike some industry peers who publish extensive supplier lists.”
Grace Su, portfolio manager at Clearbridge Investments, which holds Inditex shares, has likewise asked for more visibility into the retail giant’s supply chain.
“It’s very important because of all the scrutiny around ESG and labor and inputs,” she told Reuters. “They claim to be a leader in this so it’s really important for them to actually have that level of disclosure.”
Some investors say that publishing its factories could result in Inditex’s rivals poaching its suppliers. Simpliciano isn’t convinced, however.
“This isn’t about commercial sensitivity, it’s about evading responsibility,” she said. “We urgently call on investors to ramp up pressure on big fashion and to pay towards the meticulous work of civil society who make sense of these factory lists and aggregate critical information they leverage to assess their portfolios.”
The fact that disclosure isn’t universal demonstrates the failure of voluntary corporate action to alter the status quo, many civil society groups say. Information about supplier factories, for instance, can help workers achieve faster redress for supply chain abuses by using their buyers’ influence as leverage.
Scott Nova, executive director of the Worker Rights Consortium, a nonprofit based in Washington, D.C., called public disclosure of factory locations “fundamental to labor rights.”
“The only reason to hide the factories where your clothing is produced is to avoid accountability for what is happening to workers in those factories,” he told Sourcing Journal.