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Eco-friendly design, reporting, monitoring of the supply chain and supply chains. And, again, the dissemination of reliable and measurable information on products that, in the past, were only defined as “green”. These are just some of the paradigm shifts that fashion companies will have to implement under the pressure of the European regulations approved in the parliamentary term which will end in a few weeks.
After the entry into force of the regulation on zero deforestation supply chains (operational from 29 June 2023), the CSRD and the Green Claims, this week the European Parliament approved two key provisions of the Green Deal: the Ecodesign regulation and the Directive Csddd. All five regulations will have a strong impact on the fashion system – the second most polluting industry in the world – and on several fronts: the regulation on zero-deforestation supply chains (which, to date, only concerns bovine-derived products and therefore leather) and the Corporate sustainability due diligence directive (Csddd) require companies to have greater control over their supply chain. The Csddd, in particular, requires large companies (with 1,000 employees and 450 million in revenues and up) to check that practices that harm the environment, workers and local communities do not occur along their supply chains.
The directive, approved at second reading in Strasbourg on 24 April, but which still lacks definitive approval from the European Council, has had a complex process which has led to a significant reduction in the scope of application. But, insiders confirm, it will have an impact on small and medium-sized Italian businesses which, for example, in fashion represent important pieces of the supply chains of large luxury groups.
The Green Claims and CSRD directives concern, obviously in different ways, the communication of the level of sustainability of products and the impact of fashion companies. Green Claims, in force since 26 March, concerns the sphere of communications: it aims to reduce greenwashing practices by replacing reliable or measurable information with the words “green” and “sustainable”, while the Corporate sustainability reporting directive, in force since 5 January, consolidates sustainability reporting obligations and from 1 January 2026 (with reference to the 2025 financial year) it will apply to unlisted companies with over 250 employees (a very low percentage of the fashion system in Italy) and revenues over 40 million euros, while from 2027 (fiscal year 2026) also to listed SMEs.
The impact on companies, however, is not negligible: «Companies that are affected by the CSRD in the fiscal year 2025 will have to submit a report that discloses performance based on 1,200 parameters and that is approved by an auditor. In order to comply with this regulation, companies must make an effort and not only economically, but at the same time the CSRD is becoming a new strategic pivot – explains Matteo Capellini, expert partner of Bain&Co –. The starting point for the change in strategy, in fact, is the measurement of the real impact of the products, based however on scientific data”.