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Article

14 Jan 2022

Author:
International Corporate Accountability Roundtable (ICAR)

USA: Fashion Act criticised as ‘falling short’ of driving accountability

"Statement Regarding the Fashion Sustainability and Social Accountability Act", 14 January 2021

...Although the bill, termed the New York Fashion Law, rightly aims to improve transparency surrounding human rights practices in the fashion industry, the bill falls short of driving real accountability...

Despite that many have referred to the bill as a due diligence law, the bill only mandates disclosure without establishing a system of risk management or liability for harm caused. Mandatory human rights due diligence laws...not only require disclosure of human rights risks, but also mandate that the company develop human rights due diligence processes and procedures that address those risks. Stronger mHRDD laws also impose liability on the company where it fails to comply.

The New York bill requires companies in the fashion industry to disclose supply chain mapping as well as their social and environmental impacts. Although the legislation introduced would also require companies to report their own internal due diligence policies, unlike mHRDD laws, it does not mandate that companies develop a due diligence policy, that the policy comply with international guidelines or establish liability where the company fails to properly conduct that due diligence.

Reporting requirements may generate useful data for civil society organizations and consumers, but disclosure alone is generally ineffective at establishing corporate accountability. And although mHRDD laws are not the only solution to corporate human rights abuses, they are a stronger accountability regime than reporting requirements alone. Touting disclosure laws like the NY bill as due diligence laws not only misrepresents the legislation, but also can slow real progress by diverting legislative will from more effective solutions...

If New York aims to improve corporate accountability for human rights abuses, the legislature should work to impose legislation that will have a significant impact on corporate human rights abuse, such real mHRDD laws, laws that establish prohibitions that prevent companies from engaging in abusive behavior, or laws that create civil remedies for survivors harmed by corporate abuses.

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