Fashion companies have become better at documenting their labor commitments, but evidence that those promises are improving conditions for garment workers remains scarce.
Nearly nine in 10 companies assessed in Baptist World Aid Australia‘s 2026 Ethical Fashion Report could not demonstrate that workers at any of their final-stage manufacturing facilities received a living wage. Across the companies surveyed, an average of just 3.1 percent of final-stage facilities paid all workers a living wage.
Baptist World Aid Australia examined 138 companies representing 543 fashion and footwear brands for its latest Ethical Fashion Report, released Tuesday. Their average score was 31.5 out of 100, barely above the 31.3 recorded in 2024.
“Transparency alone is not moving the needle,” the report stated.
The gap was particularly pronounced between corporate governance and implementation. Companies averaged 68 percent in policies and governance but just 30 percent in supplier relationships and human rights monitoring. Worker empowerment, which encompasses living wages, collective bargaining, grievance mechanisms and rights training, was the lowest-scoring category, averaging 3.3 out of 25 possible points.
The underwear brand Mighty Good Basics was an outlier, earning 94 out of 100 overall and 23 of 25 points for worker empowerment. Even among higher-scoring companies, that category proved difficult: AS Colour, a blank apparel brand, earned 12 of 25 points despite a 67-point overall score. The gap was wider at H&M Group and Shein, which received seven and one worker-empowerment points, respectively. All four companies submitted information directly to researchers.
The report found that 93 percent of companies had supplier codes of conduct, but only 63 percent monitored how their own purchasing practices affected suppliers’ ability to meet those requirements. Just 7 percent received full credit for responsible purchasing practices.
Those practices include how brands negotiate prices, establish production deadlines, forecast demand and change or cancel orders. Each can affect whether suppliers have sufficient resources to comply with labor standards.
“Company purchasing behaviors also play a role in the lack of progress in worker empowerment,” the researchers wrote.
The report identified aggressive price negotiations, unpredictable orders and unrealistic lead times as potential obstacles to improving wages and working conditions. It argued that supplier training and social audits alone cannot address those pressures without corresponding changes in brands’ commercial relationships.
Workers also had limited avenues to raise concerns. Accessible grievance mechanisms covered most final-stage workers at just 22 percent of the companies assessed. Evidence of widespread worker-rights training was even harder to find, with only 7 percent meeting that threshold.
Baptist World Aid also found that only 4 percent of companies had credible, time-bound commitments to paying living wages at the final stage of production.
Although brands have made progress identifying their direct manufacturers, the researchers estimated that 39 percent of final-stage suppliers remained effectively unmonitored after accounting for both supplier tracing and social auditing. That share climbed to 83 percent for inputs suppliers and 93 percent for raw-material suppliers.
Even companies with established monitoring programs may therefore have limited visibility into working conditions at textile mills, processing facilities and other upstream operations.
The report also questioned whether transparency-focused legislation has delivered meaningful improvements for workers.
Seventy-one percent of assessed companies had published modern slavery statements. Among those companies, however, 78 percent lacked sufficient policies or strategies to protect workers when forced or child labor was identified, while 71 percent lacked grievance mechanisms accessible to most workers in their supply chains.
“Even though many companies comply with their legal obligations, our research clearly shows that transparency alone does not guarantee the implementation of even the most basic measures needed to safeguard workers,” the report stated.
The overall improvement also masks differences among companies assessed in both years. Of the 138 included in the latest report, 110 appeared in the 2024 edition. Those that submitted information in both years raised their average score by 2.4 points, although researchers found they could substantiate a narrower range of practices. The 2026 assessment added 28 companies, including 16 based in the U.K.
Researchers relied entirely on public disclosures for 58 percent of companies. That leaves a significant blind spot in the rankings: a practice that isn’t publicly documented cannot earn credit, even if a company has implemented it. Nor does a high score establish that working conditions meet the report’s standards at every supplier facility.
The researchers assessed more than 15,000 data points across corporate governance, supply-chain tracing, supplier relationships, worker empowerment and environmental sustainability.
Baptist World Aid concluded that voluntary commitments and disclosure requirements have not produced improvements commensurate with the scale of labor risks across global apparel production. The report called for stronger government requirements, more accountable purchasing practices and greater worker participation in decisions affecting wages and working conditions.
For an industry that has spent more than a decade expanding its sustainability reporting, the findings point to a persistent problem: documenting responsible sourcing is not the same as demonstrating that it works.