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The importance of supply chain responsibility in the retail sector

In a recent article published in Retail Week, it was revealed that investors behind Zara owner Inditex are urging the fashion giant to publicly disclose a comprehensive list of suppliers. This move aims to enhance supply chain risk management and enable better evaluation of future situations.

While Inditex currently publishes an annual list of suppliers from its core countries, it does not provide specific information about individual factories. This lack of transparency has drawn criticism from investors and regulators, who demand greater disclosure from companies, particularly in the fashion retail sector, to ensure ethical supply chain practices.

Several major fashion and sportswear brands, including Adidas, Nike, Primark, Puma, M&S, H&M, and Hugo Boss, already publish detailed supplier lists, which include factory names and addresses. This level of transparency allows for increased accountability and demonstrates a commitment to ethical sourcing.

Inditex shareholders have expressed the importance of having access to this information to assess the company's due diligence and to ensure the availability of crucial data. These investors collectively hold a stake in the business valued at approximately £1.56bn.

Inditex, in response to the call for transparency, emphasized its commitment to maintaining high standards in its supply chain. The company believes that its industry-leading traceability system, which provides maximum visibility of the supply chain, is a key factor in achieving this commitment.

This latest development in supply chain responsibility highlights the growing trend within the retail sector towards enhanced transparency and ethical practices. The pressure on fashion retailers to demonstrate responsible supply chain management continues to increase, with investors and regulators demanding greater disclosure to ensure adherence to regulations such as the Bribery Act and antislavery legislation.

As the retail sector progresses, it is clear that companies must embrace a culture of transparency and accountability to build trust with stakeholders and meet the expectations of an ethically conscious consumer base.