The fashion giants and their dirty cotton economy

The wet savannahs of the Brazilian Cerrado extend over more than two million square kilometers – but the ecosystem is threatened. Last year, deforestation in the Cerrado increased by 43 percent. One reason for this is soy cultivation, say environmentalists. A new investigation by the British non-governmental organization (NGO) Earthsight now also blames large-scale cotton cultivation for this. Accordingly, cultivation is accompanied by illegal deforestation, land grabbing and violence against residents of the Cerrado. The cotton later ended up in the supply chains of the world’s two largest fashion chains, Zara and H&M, according to the NGO report. This one is the one South German newspaper and other international media.

The industrial cotton farms Earthsight examined, are among the largest cotton producers in Brazil. In the past, some producers have had to deal with court injunctions. Some were convicted of corruption and fined millions of dollars for illegally clearing about 100,000 hectares of Cerrado wilderness, reports said Earthsight.

The controversial cotton ended up in clothing from H&M and Zara

According to its own information, the NGO tracked 816,000 tons of harvested cotton from the examined estates to eight Asian companies. They are said to have produced at least 36 million items of clothing and household goods for German branches of H&M, Zara and Zara sister brands Bershka and Pull&Bear over a twelve-month period.

Despite the revelations of Earthsight The cotton examined was certified by the Better Cotton Initiative (BCI), which checks compliance with environmental standards. In order to achieve their sustainability goals, fashion companies such as Zara parent Inditex and H&M rely on such certificates.

“The results of the Earthsightreport are worrying and we take them very seriously,” said an H&M spokesman to the SZ. After the BCI announced the result of the Earthsightreport, it initiated a third-party investigation. The Better Cotton rules were then updated on March 1st – but they remain full of gaps, conflicts of interest and weak enforcement, the NGO criticizes in a statement. “We are in close dialogue with Better Cotton to follow the outcome of the investigation and the next steps to strengthen and review their standards,” says the H&M spokesman.

Inditex, which is behind Zara, also refers to Better Cotton. “We take the allegations against Better Cotton very seriously and have called on the company to publish the results of their investigation as quickly as possible and to take all necessary measures to ensure sustainable cotton certification according to the highest standards,” says an Inditex spokeswoman for the SZ.

The BCI was founded in 2005 by fashion companies and non-governmental organizations – H&M itself was involved in the founding. There has been debate about the effectiveness of such organizations for a long time. In 2019, a series of French television documentaries made greenwashing accusations against the BCI, saying the initiative portrayed products as more ecological than they actually are. The environmental and occupational safety standards by which BCI measures its certificates are actually not high enough.

The current regulations do not go far enough for the NGO

Work is underway at the EU level on the supply chain law, which is intended to guarantee compliance with human rights and environmental standards in global supply chains. There should also be a duty of care for sustainable corporate management and a regulation that should regulate deforestation. However, these regulations do not go far enough for the NGO.

“So that we can wear our new favorite jeans or T-shirt with a clear conscience in the future, it is important that the law for deforestation-free supply chains is extended to ecosystems such as the Cerrado and to cotton,” says Anna Cavazzini, the German EU representative Parliamentarian for the SZ Green Party. Nevertheless, the companies have great market power, which they can use to ensure compliance with their suppliers’ environmental and employee rights even without legal changes, says the chairwoman of the EU Parliament’s Committee on the Internal Market and Consumer Protection. Currently, however, their purchasing practices often have the opposite effect by switching suppliers to drive down purchasing prices. This makes it impossible to check the working conditions on site. Cavazzini says: It is the responsibility of fashion companies to shape their practices so that they build long-term and sustainable relationships with their suppliers.