OXFORDSHIRE, United Kingdom — “In the game of capitalism the players are trying to compete for profits,” Blackrock’s former head of ESG Tariq Fancy told BoF VOICES 2022. “Many companies are playing dirty.”

For years, businesses from finance to fashion have spun a “convenient fantasy” that voluntary commitments will be enough to curb pollution and establish supply chains powered by well-paid and socially secure workers.

The “inconvenient truth” is that fashion companies left to their own devices (just like other under-regulated sectors, from meatpacking to tech) are not going to enact change that is ultimately more costly and complex than business as usual. Most brands’ emissions are still growing and reports of labour abuses like wage theft and union busting have increased since the pandemic.

The only way to push the industry from virtue signalling (read: greenwashing) to real action is for governments to change the rules of the game, speakers including ethical fashion activist and British House of Lords member Baroness Lola Young and New Standard Institute director Maxine Bédat told BoF’s annual summit in the Cotswolds.

“It can’t be voluntary. It has to be mandatory,” Fancy said. “Then we actually have a chance of turning the tide this decade.”

Regulation is coming, but slowly and messily.

On Wednesday the European Commission proposed new rules to drastically slash packaging waste that would require brands to rethink the materials they use for everything from perfume bottles to e-commerce deliveries. But the text of the regulation could still be changed and has met resistance from the plastics and packaging sectors.

A new proposal for another set of rules aimed at making big companies legally responsible for managing human rights and environmental risks in their supply chains was lambasted by civil society groups for watering down the requirements. Meanwhile, hotly debated guidelines on how brands should back up any green marketing claims have been delayed yet again.

Across the Atlantic, efforts to toughen up oversight of the fashion industry in the shape of the New York Fashion Act will be reintroduced to the State Assembly in January, but it’s unclear whether or not the bill will pass.

“Governments need to take bold action, and we need to tell them to be bold at the ballot box and at every opportunity,” Baroness Young told VOICES. Delay and inaction only means a higher price to pay down the line. “It’s not borrowing from the future — it’s stealing,” she said.