Navigating the Green Threads
A Comparative Analysis of EU and Chinese Regulations on Fashion Sustainability
The journey toward sustainability in the fashion industry is a focal point for regulatory initiatives from both the European Union (EU) and China. While significant strides have been made in regulating fashion towards sustainability, the implementation of legislation has progressed at a measured pace. Despite the issuance of various directives, there is ongoing work to enact more stringent laws. However, a positive momentum for change is evident in both the EU and China.
Beginning with the EU, this article delves into the current state of regulations governing fashion sustainability, with a specific focus on measures outlined in the EU Strategy for Sustainable and Circular Textiles. Key topics include eco-design, digital passports for textile products, transparency, greenwashing, the release of microplastics, packaging and surplus textile management, and extended producer responsibility.
Subsequently, we will offer an insightful comparison with Chinese regulations on fashion sustainability, highlighting differences in approach and priorities. Leveraging the perspective of Between Conscious, a company operating in both the European and Chinese markets, we aim to provide a dual perspective, contributing to a comprehensive understanding of how the future of sustainable fashion is being shaped.
EU regulations:
1. Eco.design:
Starting from 2009, regulations such as the 2009/125/EC Directive have played a fundamental role in establishing a framework for eco-design in textile products that in 2021 saved a significant €120 billion in energy costs for EU consumers. On March 30 2023, a new regulation (ESPR) on the eco-design of sustainable products was proposed, aiming to extend the scope of the current directive. This has the potential to generate primary energy savings equivalent to 132 million tons of oil by 2030. Recognizing the significance of public input, the European Commission has initiated an online public consultation to identify priorities for new productions, keeping the consultation open until April 25.
Digital passport:
2. Digital product passports, initially implemented in France, are set to become the standard for all European products under the Sustainable Products Eco-design Regulation. These passports capture essential information about a product's circularity and sustainability, enabling informed consumer choices and enhancing transparency. Businesses along the value chain stand to benefit, contributing to environmental goals and reducing resource dependency. The implementation of product passports aligns with commitments to track concerning substances and supports the EU's goal of zero pollution. Additionally, the Commission will review regulations on textile product labeling to incorporate circularity aspects and enhance transparency in the textile industry.
3. Transparency and greenwashing
The Textile Product Labeling Law (1007/2011) in Europe mandates rules for labeling textile products, promoting transparency and a circular economy. Currently, greenwashing lacks specific regulation, but the upcoming Corporate Sustainability Reporting Directive (CSRD) will require large companies to publish regular reports on environmental and social impact activities, enhancing transparency. Despite this, companies must adhere to existing regulations on deceptive advertising, preventing false environmental claims.
4. Microplastics pollution
Micro-plastic pollution, particularly from synthetic textile fibers, poses a significant environmental concern. The European Commission's proposed measures aim to limit intentionally added microplastics in the fashion industry, covering avoidable sources. This includes focusing on production processes, pre-washing, labeling, and promoting innovative materials. Potential solutions such as washing machine filters and circular fabric treatment models are highlighted to mitigate the impact of microplastics, addressing the consequences of fast fashion and the increasing use of synthetic fibers.
5. The Packaging and Packaging Waste Directive
The Packaging and Packaging Waste Directive aims to reduce the environmental impact of packaging waste through measures promoting its reduction, reuse, and recycling. The EU is currently working on updating this directive. The EU Strategy for Sustainable and Circular Textiles includes plans for harmonized standards on extended producer responsibility and economic incentives to enhance textile sustainability. Aligned with this, the Waste Framework Directive emphasizes waste hierarchy and measures to prevent or reduce negative environmental impacts, enhancing resource efficiency.
The approach of China to sustainability reflects the characteristics of the country and its differences compared to Europe, manifesting as a result in the commitment to sustainability that is reshaping its regulatory landscape, with a distinct emphasis on Environmental, Social, and Governance (ESG) strategies.
ESG Strategies and Reporting: Chinese companies are swiftly adopting ESG strategies, responding to the expectations of customers, investors, and the government. ESG reporting is gaining prominence, with 53% of surveyed companies already announcing ESG, CSR, or sustainability strategies. Anticipated to become the norm by 2026, this reflects a growing trend toward transparency, aligning with global ESG reporting standards.
Motivations and Governance: ESG motivations in China are evolving, propelled by diverse stakeholders. Customer and shareholder pressures are influential drivers, shaping corporate behavior. It is more and more common in the Board of directors in Chinese companies to have some managers responsible for fair remunerations of the employees and transparent career paths. Larger companies, in particular, lead in committee independence, signaling dedication to outperforming existing legislation.
China's Green Revolution: China's ambitious sustainability goals extend beyond national carbon commitments, encompassing a transformative shift in the fashion industry.
ESG Integration and Consumer Influence: Chinese companies are increasingly integrating ESG principles into their operations, promoting eco-friendly practices and ethical labor standards. Consumer awareness is on the rise, with 77% of surveyed consumers willing to pay a premium of 5-20% for sustainable fashion products. This consumer-driven demand underscores the industry's trajectory toward sustainability.
Regulatory Landscape and Investor Influence: China's regulatory landscape is evolving to robustly support ESG reporting, aligning with stringent global regulations. Government initiatives and the influence of investors are driving Chinese companies to meet international ESG standards. This significant shift indicates that market concerns are pivotal in shaping corporate behavior, reflecting a broader commitment to sustainable business practices.
China's ESG journey stands as a testament to its dedication to ethical, transparent, and sustainable business operations. As the regulatory landscape matures, China's fashion industry is poised for a transformative shift toward greener and more responsible practices, guided by the principles of ESG.
Despite the vastly different approaches of the two countries, both are aimed in the same direction, towards the formulation of laws that regulate a more sustainable transformation in the world of fashion. At Between Conscious, as a company dedicated to the sustainable transformation of businesses in the fashion industry in both Italy and China, we strongly believe that comparing and integrating these two visions is the only way to meet the challenge of climate change, given its global nature.
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