Radical Transparency & Blockchain, a Match Made in Heaven? – Part 1

This is part 1 of a 2-part article. In this first article we look at what is blockchain, why we need it and how it could help brands with radical transparency.

According to the Business of Fashion’s 2019 “The State of Fashion” report, 42% of millennials and 37% of Gen Z want to know what goes into products and how they are made before they buy, and 66% say they are willing to pay more for sustainable goods.

But we don’t need to read facts and figures in a report to see what people think about the environment. Anyone who witnessed, or indeed was affected by Extinction Rebellion’s audacious latest mass demonstration will have realised that this trend is huge. The protest blocked several major roads in London with human sit-ins for nine days, causing traffic to come to a standstill, bus routes to be cancelled and affecting almost everyone travelling through London. XR’s aim was to call for environmental action from the government before it’s too late.

When thousands of people are literally willing to go to jail to protect the earth – 1065 people were willingly arrested and 53 charged with thousands more ready to take their places in the road – you know it’s not just a fad and industry needs to take notice. The fashion industry in particular is often named as one of the chief culprits of environmental pollution, and it’s long been clear that we need to act.

Of course, we already are. There are many environmental initiatives and “green” schemes proliferating across the fashion world, with everyone from fast fashion giants H&M to couture brands like Chanel joining the bandwagon. But where the public initially welcomed these moves, after a few companies were caught out green-washing their brands, public joy soon turned to suspicion. “Prove it!” was the cry that went up.

NO MORE FASHION INDUSTRY SECRETS

Traditionally, fashion companies love to keep their secrets. From the details of next season’s collection to who, exactly, they get their supplies from, the dread of copyists plus resistance to the public knowing exactly what the monetary mark-up is means they keep it all under wraps.

As well as this, manufacturing is a complicated behemoth. Every button, zip, and length of sewing thread is manufactured, shipped and sold before the garment is even begun, so it’s not just a case of ensuring the fabric of the garment is organic and the machinists are paid fair wages – although that comes into it too.

But nowadays, many companies have so many lines and produce such a volume of garments it’s genuinely hard to keep track of where they bought each individual button from. To complicate matters, the company they bought the button from got it from a manufacturer who in turn might have subcontracted the work, possibly in a different country. Supply chains are often extremely fragmented and spread across multiple countries. A fashion label might believe that they have 1,000 to 2,000 suppliers, but add in the sub-suppliers, and the true number is more like 20,000 to 50,000.

Image: Fashion Revolution.org

Others, inevitably, reward the cynicism of consumers by cheating. Some will bend labelling requirements by having 80% of the garment made up cheaply abroad, and then finished in the local economy to earn that reassuring label. A “Made in England” tag connotes quality and high standards for workers, which may not be the case in other countries.

RADICAL TRANSPARENCY THROUGH BLOCKCHAIN

So, what can be done about it? Customers are looking for radical transparency across the supply chain, and top brands recognise that it is now good business practice to show them where their clothes come from. And it’s not just individual customers who would like to know details: campaign groups like Fashion Revolution are finding strength in numbers by recruiting fashion industry players at all levels to speak up for change. They publish an annual report of 200 of the biggest brands in fashion today, ranked according to how they are performing in terms of transparency and traceability. We find that this “name and shame” method is a good tool for encouraging businesses to change their ways.

But even the companies who would like to oblige may find it hard to keep track. Some brands who are already trying to demonstrate traceability may well be telling the truth in their claims, but cynical customers argue a brand can say whatever it likes in its marketing without a lot of proof.

What’s needed is an impartial record of a garment’s journey. Blockchain technology is one answer. Blockchain is mainly associated with cryptocurrency, a financial concept that might sound both complicated and of little relevance to fashion. However, the way it works is both simple and transferable. Blockchain is a public, decentralized list of records that are linked and secured using cryptography. Each individual entry is locked and secure. It can be added to, but the original entries cannot be altered. It is almost incorruptible because it is hosted by millions of computers simultaneously. Hacking and altering one “block” would do no good because so many other computers are still keeping a faithful record. Knowing that this information is decentralised and secure makes the claims for traceability extremely trustworthy for the consumer. It is the perfect method for showing each step in a garment’s manufacture.

This information can be published in different ways. Authenticity can be embedded in the clothes themselves via an RFID tag which stores all the blockchain information. Alternatively, it can be listed on the company website such as that of Everlane’s, one of the first pioneering brands to do so.

THE DREAM OF A GUILT-FREE FASHION WORLD

So, what is stopping the industry from adopting blockchain and turning fashion shopping from what has started to feel like a very guilty pleasure into a joyful experience once more? Partly it’s just that as a new technology, big companies are waiting for others to use it to prove its effectiveness. An increasing number of businesses are, in fact, already trialling it – LVMH, Martine Jarlgaard and Paris-based non-profit Arianee are a few who are looking into it. We’ll delve a bit more into their undertakings in part two.

If big fashion corporations decide to collaborate and adopt the technology en-masse, it will be far more quickly systematised to the fashion world’s needs. This will have a trickle-down effect making the technology cheaper, easier to use and standardised so that every business, however small or large, will feel confident and able to use the technology. It will mean that the dream of the fashion world becoming as transparent, sustainable and ethical as it is entirely capable of would be one huge leap closer.

PART 2 – COMING NEXT MONTH ON RADICAL TRANSPARENCY AND BLOCKCHAIN

The companies who are nailing sustainability, the technology they use – and what can we learn from them?