Nine in 10 Fashion Companies Fail to Pay Living Wages in Final-Stage Facilities: Study
Meghan Hall
4 min read
The 10th edition of Baptist World Aid’s Ethical Fashion Report serves as a reminder that progress in fashion continues to come slowly.
The Australian non-profit studied 120 companies, encompassing 460 brands to determine how resilient their attempts to prevent further environmental decay and worker mistreatment. Some of the brands are based in Australia, while others are global brands.
To assess the companies, the organization took into account their supplier relationships, sustainability progress, worker empowerment programs, risk management and general governance, to devise a score out of 100 possible points for each company. The factors were not weighted equally; brands could receive up to 6 points for “policies and governance,” up to 15 points for “tracing and risk,” up to 33 points for “supplier relationships and human rights monitoring,” up to 25 points for “worker empowerment” and up to 21 points for “environmental sustainability.”
According to the results, the apparel industry has stronger safeguards against labor and environmental exploitation than the footwear industry. Among apparel players, the average score sat at 32.9, while footwear companies saw an average score of 24.2.
The findings also show significant gaps in sustainability strategy, companies’ work to vet whether employees in their supply chains receive a livable wage and more.
Nearly 89 percent of all companies studied in 2024 did not pay a living wage in any of its final-stage facilities. About 10 percent of companies paid a living wage in some facilities, which, as the report points out, could be as few as one to two. Since 2022, there has been a one percentage point decrease—37 percent to 36 percent—in the proportion of companies that have made a commitment to paying a living wage, which may be a sign that, for many companies, that has not yet become a major priority.
Since 2022, when Baptist World Aid last released a report on ethical fashion, companies have stepped up their sustainable fiber game; In 2022, 15 percent of brands used sustainable fibers for more than half their product volume. In 2024, that figure increased by six percentage points to 21 percent of companies studied. Additionally, 68 percent of brands share at least some ways consumers can reduce the environmental impacts of their products, both during use and at time of disposal. That figure grew 11 percentage points from 2022, when just 57 percent of brands could say the same.
Still, sustainability continues to go by the wayside for some. According to the report, “Half of the companies assessed [in 2024] could not evidence any commitment to climate action.” Companies that scored 0 in the sustainability assessment include Temu, Stussy and Nine West.
About half of brands voluntarily disclosed information to the researchers, while the other half were measured based on publicly available documentation like publicly reported supplier lists and sustainability reports.
Among others, brands like Adidas, H&M, Levi Strauss & Co., Lululemon, New Balance, Nike, Puma, Patagonia and Inditex—the parent company of Zara—fell into the index’s top 20 percent of brands, based on final score. While, in general, the organization noted that brands that participated in the process rather than being scored based on public documents fared better in terms of score, H&M and Levis’s did not participate in the process. They scored 57 and 56, respectively, against an average of 31.3. Patagonia and Inditex brought home two of the report’s highest scores—69 and 66, respectively. Adidas earned a score of 63, while Puma scored 61, New Balance came in at 60, Lululemon saw a 58 and Nike grabbed a 51.
Baptist World Aid noted in a blog post published earlier this week that, in the past, it has received questions and criticism on how it’s possible for fast-fashion companies, like Princess Polly, Inditex and H&M, to end up in the top one-fifth of all ranked companies.
“Our research examines a very specific question: ’How strong are the systems companies have to mitigate the risks of worker exploitation and environmental degradation?’ It may be true that these fast fashion brands have contributed to a destructive cultural change, but that’s not what the report is seeking to address,” researchers wrote. “When fast fashion companies score highly, it shows that larger companies are still able to take steps towards a more ethical supply chain.”
Still, not all fast-fashion players saw strong scores. Shein earned a score of 20—more than 10 points below average, but still an increase from its 2022 score—while Temu was given a whopping 0 points. Baptist World Aid noted that Shein participated in the assessment, while Temu did not.
Up until last year, Baptist World Aid had been releasing these reports annually; in 2023, it decided to take a pause to ensure changes it made to the grading policy and methodology in 2022 matched industry best practices and were fair representations.
According to the report, researchers now plan to present the report bi-annually.
“This 10th edition of the report marks the move to a two-year reporting cycle (rather than annual), acknowledging the often-slow pace of progress in the areas we assess and allowing time for companies to advance toward their commitments,” researchers wrote.
