Fostering Human Connections: A Path to Responsible Purchasing Practices

Blogpost, 22 December 2023

Responsible purchasing practices (RPPs) lie at the heart of social and environmental progress within supply chains. The ever-evolving landscape we navigate, with new legislations like the upcoming European Union Corporate Sustainability Due Diligence Directive (EU CSDDD), demands a keen understanding of RPPs and a commitment to their continuous improvement.


With over 1400 ratings, the results of the third cycle of our purchasing practices metric are underway, and will be revealed at our side session at the OECD Forum on Due Diligence in the Garment and Footwear Sector in February 2024.

In anticipation of that, a Better Buying scorecard, derived from a separate index on purchasing practices, suggests improvements in cost-related aspects and payment terms by brands. However, there are notable declines in planning, forecasting, and sustainable partnerships. Stay tuned to see whether these findings are confirmed by The Industry We Want’s (TIWW) purchasing practices metric.

In their recent webinar ‘Implementing Responsible Purchasing Practices: Sharing Progress and Lessons Learnt’, the MSI Working Group on Responsible Purchasing Practices and the Learning and Implementation Community (LIC) illuminated the ongoing transformative journey of 36 garment brands and retailers committed to enhancing their purchasing practices over a two-year period.

Throughout the discussion, stakeholders consistently underscored the importance of recognising the profound impact of a brand's decisions on the human rights of individuals across the supply chain. Establishing a deeper understanding of these consequences necessitates building stronger human connections and fostering partnerships instead of transactional relations. The implementation of interactive feedback mechanisms, such as frequent video calls and in-person check-ups with supply chain partners, emerged as a vital strategy to cultivate trust, facilitate open discussions on challenges and promote collaborative problem-solving.

However, the absence of such initiatives reflects a broader gap in companies' comprehension of policies, highlighting the critical need for collaboration between brands' CSR and commercial teams. This disconnect is evident not only within brands but also within larger actors such as retailers, emphasising the importance of addressing this gap to effectively uphold human rights and environmental due diligence. The solution lies in peer-to-peer learning - as we have seen in the  LIC, as such TIWW is exploring with other stakeholders opportunities on how to tackle shared obstacles in implementing effective HREDD across supply chains.

Overall, there is a pressing need to integrate purchasing practices into due diligence legislation, empowering brands to take ownership and accountability for human rights issues in their supply chains. This integration is pivotal for fostering systemic power shifts and creating a framework where responsible purchasing practices are ingrained in the broader landscape of corporate responsibility.

The importance of SMEs

In a landscape where 65% of the 36 participating companies are SMEs, it is crucial to acknowledge the predominant presence of small and medium-sized enterprises (SMEs) in the garment and footwear sector. The OECD's research underscores the industry's SME-centric nature. However, the EU CSDDD focuses solely on Large Enterprises, leaving SMEs to independently navigate their policies, risk assessments, and monitoring. The evident reliance on peer companies and business associations for Responsible Business Conduct information highlights a low dependence on governmental, union, and civil society inputs.

TIWW supports the inclusion of all SMEs under a practicable, proportionate, and effective corporate due diligence directive. Without the inclusion of SMEs, a significant system change of the garment and textile sector cannot be achieved. We see the Directive on corporate sustainability due diligence as indispensable for fostering an equitable and just society by upholding human rights in the world of work. To realise this vision, both SMEs and large enterprises must be included in the Directive. Such inclusivity will foster a level playing field, ensuring that companies spearheading change do not compromise the competitiveness and profitability of SMEs. Moreover, it will contribute to a business environment characterised by predictability and stability, benefiting both companies and workers alike.

Mapping opportunities

A survey conducted by the LIC revealed that commercial targets’ margins and senior management engagement were part of the main obstacles hindering RPP.

Balancing a company’s focus on profit with  its commitment to ethical goals can create conflicting interests. How can we look for alternatives to address this contradiction? One way is to explore Alternative Ownership Enterprises (AOEs), to shift from shareholder primacy and support power redistribution towards workers, the community, and the planet.

Stanford Social Innovation Review highlights the benefits of AOEs, citing their positive effects on financial performance, resilience, reduced turnover rates, higher wages, improved job quality, and decreased gender and racial inequality. The flexibility of the different models for AOEs allows business owners, stakeholders, and investors to choose a model that aligns with their specific needs, and finding a balance between profit and safeguarding the company's social and environmental goals.

Another example of alternative ways of working with suppliers in addressing power imbalances are innovative and practical contracting practices that support more cooperative relations between supply chain firms and better human rights outcomes for workers. The Responsible Contracting Project serves as an invaluable resource when pursuing such endeavours.

Mapping opportunities in the garment industry is like finding puzzle pieces, representing the initial step to identify areas for improvement. Yet, solving industry challenges goes beyond isolated opportunities; it necessitates understanding how each piece fits into the broader puzzle. It's a reminder that solving the complexities of the industry requires a holistic understanding and a concerted effort to connect various elements to make a real and lasting difference. This approach is at the heart of what TIWW does.