From words to measurable impact: OECD due diligence forum urges transition

The main sessions of the 2026 OECD Forum on Due Diligence in the Garment and Footwear Sector, which took place on 11 and 12 February, centred on the urgent transition from a culture of compliance to one of tangible impact, specifically focusing on how global brands must navigate an increasingly volatile geopolitical landscape.

In his opening remarks, Carmine Di Noia, OECD director for financial and enterprise affairs, stated that while the framework for responsible business conduct is well-established, the current global climate—marked by economic volatility and supply chain shocks—demands that companies move beyond mere words to achieve measurable impacts on the ground. He underscored the necessity of building long-term resilience through shared responsibility, urging stakeholders to integrate due diligence into the core of their business strategies to better protect vulnerable workers and navigate the complexities of a shifting regulatory landscape.

Regulation to the rescue

Following was a session on navigating supply these chain shocks by balancing agility with due diligence, indicating how important adaptation is in an increasing volatile trade environment. Bärbel Kofler, state secretary, German Federal Ministry for Economic Cooperation and Development, delivered a strong call for standardised, international minimum standards, advocating for the finalisation and robust implementation of the EU Corporate Sustainability Due Diligence Directive (CSDDD). She drew positive parallels to the German Supply Chain Due Diligence Act, noting its success in its first year, particularly regarding the creation of help desks for suppliers. Kofler emphasised that the fashion industry is rapidly becoming a “regulated sector,” and urged stakeholders to embrace binding frameworks to ensure a level playing field and to provide victims of human rights abuses with genuine, legal paths to remediation.

”The fashion industry is rapidly becoming a regulated sector.”

H.E. Heng Sour, minister of labour and vocational training, positioned Cambodia as a “pioneer of compliance,” accentuating that the country views labour and environmental standards as a competitive advantage rather than a regulatory burden. Given that the sector accounts for almost 50 percent of the country’s exports, he highlighted Cambodia’s historical role as the first nation to implement the ILO Better Factories program and detailed recent modernisation efforts to Cambodia’s labor inspection systems.

Climate resilience is a must

Integrating climate resilience into human rights due diligence was another major point discussed at the forum, recognising that extreme heat and environmental degradation are now direct threats to worker safety and livelihood stability in major production hubs. Adding to the main sessions, side sessions on “extreme heat mitigation” highlighted how climate change is a direct labour rights issue, requiring brands to invest in factory cooling and health safety as a core component of their due diligence. The panel discussion “From risks to resilience: Due diligence to respond to climate-related impacts on workers” emphasised that climate change is no longer just an environmental metric but a critical labour rights crisis requiring unannounced inspections to capture real-time factory conditions.

Panelists, including Mohammad Monower Hossain of TEAM Group, IndustriAll general secretary Atle Hoie and Cara Schulte from Climate Rights International, stressed that adaptation must be a shared financial responsibility rather than a burden passed down to suppliers or workers. The session underscored that “climate risks—particularly extreme heat—must be systematically integrated into due diligence processes,” with workers frequently requesting basic but vital interventions like improved ventilation and medical support.

Sophie Lavaud from the OECD noted that adaptation measures are most effective when they move beyond simple audits, as demonstrated by pilots where “financial safety nets before climate shocks... particularly in response to heat stress—can also improve productivity.” The discussion concluded that building resilience is an illusion without enforceable heat policies and temperature tracking, as workers simply “do not have the flexibility” to absorb these environmental shocks on their own. “We are not asking for luxury, just basic rights,” quoted Schulte a worker in Karachi, calling climate resilience “a sound business decision”.

Protecting all workers along the supply chain

The forum also dedicated significant time to the evolution of purchasing practices, emphasising that brands can no longer treat ethical sourcing and price negotiations as separate functions if they intend to support living wages. There was a notable focus on the “invisible” segments of the supply chain, particularly the informal workers in the circular economy and textile waste sectors who are often left out of traditional audit cycles. The session “The missing millions: Due diligence in informal settings” discussed the unique due diligence challenges faced by home-based workers (HBWs) and waste pickers in the circular economy. Francesca Mangano, head of CSR and sustainability of TFG Brands London, shared a progressive corporate approach, explaining how her company moved beyond a basic code of conduct to implement a specific homeworker policy. Recognising that high-end embellished garments cannot be made by machines, she sought to de-stigmatise homeworkers and treat them as an “extended branch of the family tree” rather than a liability to be hidden.

Due diligence implications of e-commerce-driven business models

Discussions also grappled with the rapid rise of "ultra-fast" fashion and e-commerce business models, examining how digital tools and AI can be harnessed to monitor labor conditions in real-time rather than relying on outdated annual snapshots. The panel discussion “Supply chains 4.0: Due diligence implications of e-commerce-driven business models” addressed the disruptive impact of ultra-fast fashion, where demand-driven production cycles and digitalised logistics are fundamentally challenging traditional responsible business conduct frameworks.

Panelists like Reformation’s Kathleen Talbot, ShinWon’s Eunice Kim, Anithra Varia of the Labour Rights, Business and Human Rights Centre and others argued that the industry's shift toward high-speed, small-batch sourcing creates a “visibility gap,” as the pressure for rapid turnaround often leads to unauthorised subcontracting in the most vulnerable, least-monitored tiers of the supply chain. Experts noted that while AI and real-time data offer new possibilities for oversight, “traditional audit-based monitoring is not working anymore” for these fragmented models, as they struggle to keep pace with the sheer velocity of the production-to-consumer cycle. The growth of e-commerce is “reshaping supply chain structures,” thus requiring a shift from periodic compliance checks to continuous, tech-enabled due diligence that accounts for the unique risks of the “on-demand” economy. The session concluded that as business models evolve at digital speed, regulatory approaches must also adapt to ensure that “human rights and environmental sustainability are not sacrificed for commercial agility.”

Side sessions deepen understanding of key industry concerns

As if that was not enough food for thought, the well-balanced side sessions that took place on 9th, 10th and 13th February, focused on transforming data from a compliance checkbox into a tool for real-world worker empowerment. Many sessions, such as those led by WageIndicator and the Ethical Trading Initiative, emphasised “worker-driven” data—moving away from top-down audits toward information generated by workers and trade unions. These discussions highlighted how credible, safe data can strengthen collective bargaining, especially in regions like Indonesia and Bangladesh, and ensure that freedom of association is more than just a policy on paper.

"Due diligence and digital product passports... will only work if we treat facility data as public infrastructure, not private assets."

The digital product passport (DPP) certainly helps bringing more transparency into the supply chain as it serves as a structured digital record under the Ecodesign for Sustainable Products Regulation (ESPR). These passports do not replace due diligence but rather act as “structured containers” for the necessary data to support it. This is what Catherine Lomonaco, founder of GoTrace, highlighted at a session on 10th February. Nathalie Grillon, CEO of Open Supply Hub, cautioned that “due diligence and digital product passports... will only work if we treat facility data as public infrastructure, not private assets,” urging the industry to move away from viewing supplier locations as private competitive advantages.

Old textiles and new empowerment plattforms

A panel dedicated to the manufacturer-led ATTI platform (Apparel and Textile Transformation Initiative) explored how garment manufacturers can enable environmental transformation and how to do this in a nationally coordinated, structured and country-specific way. “We are very much trying to shift the vibe away from compliance and develop a platform that enables manufacturers themselves to identify the priorities for the industry,” explained senior advisor Olivia Windham-Stewart the initiative’s unique position as a manufacturer-led programme, supported by the International Apparel Federation (IAF) and the International Textile Manufacturers Federation (ITMF).

The session “Used, exported ... ignored?” was dedicated to rethinking due diligence in used textile flows and explored the environmental, economic and social impacts of the rapidly expanding second-hand textile trade, drawing on early findings from Accelerating Circularity, BSR and WWF’s study tracking material flows, and their impacts, from the US, UK and EU to major import regions. Asked about the one change they would make, the panelists mentioned the market infrastructure, sanitation and storage as well as a clear definition between what is waste and what are second-hand textiles. A global standard for exporting countries is also on the wish list. The new EU-funded UNECE–ECLAC study, launched at the forum, titled “Making Trade Work for Circularity” should help as it provides a practical regulatory blueprint to shift second-hand textile trade from “waste displacement” toward value-preserving circularity.

Wage equity and ethical sourcing

A significant portion of the side session agenda was also dedicated to the practicalities of wage equity and financial inclusion. Sessions hosted by the Fair Labor Association and the Better Than Cash Alliance explored the role of wage verification and the transition to responsible digital payments. The goal of these sessions was to move “beyond data collection” to ensure that workers—particularly women, who face unique barriers — actually receive their full earnings and gain greater financial independence through secure, transparent systems.

Ethical sourcing and purchasing practices remained a central theme, with side events focusing on “responsible disengagement” and the impact of trade volatility. Organisations like Cascale and the Ethical Trading Initiative led workshops on how companies can stay responsible during sudden shifts, such as the introduction of new tariffs or regional instability.

Animal welfare is a big part of ethical sourcing, which was discussed in the session “From Policy to Proof: Ensuring Animal Welfare in Textile Supply Chains”. It addressed the critical need for brands to move beyond broad policy statements toward verified, data-driven evidence of animal protection. Speakers from Four Paws International and OECD Watch highlighted that since the 2023 update to the OECD Guidelines, animal welfare is no longer a “niche” concern but a core pillar of responsible business conduct that must be integrated into standard risk assessments.

The session emphasised that “certification fatigue” among suppliers can be mitigated through the adoption of robust, third-party standards that provide a clear proof of origin for animal-derived materials like wool, down and leather. Panelists noted that while consumers are increasingly demanding transparency, brands must ensure that their “animal-friendly” claims are backed by rigorous traceability, as “vague commitments without transparent reporting now represent a significant reputational and regulatory risk.” Ultimately, the discussion concluded that the most successful companies are those that view animal welfare not as an isolated compliance task, but as a “vital component of a holistic sustainability strategy” that builds long-term consumer trust.

Finally, the side sessions underscored the growing role of investors and cross-sector collaboration in driving accountability. The introduction of the Fair Labor Association and Investors Roundtable (FLAIR) demonstrated a shift toward engaging financial stakeholders in human rights strategies. By bringing together governments, investors, and civil society, these sessions aimed to create a multiplier effect, where public procurement and investor pressure work together to standardise high ethical expectations across both the upstream and downstream tiers of the global garment supply chain.