More than audits - Retraced highlights ten due diligence tools

Due diligence in the garment industry has evolved from voluntary social audits into an enforceable, cross-jurisdictional legal imperative driven by frameworks such as the EU Corporate Sustainability Due Diligence Directive (CSDDD) and strict forced labour import bans.

To establish genuine compliance and mitigate existential commercial risks, apparel brands and retailers should look beyond tier-1 cut-and-sew suppliers and systematically trace upstream supply networks down to yarn spinning, dye facilities and farm-level raw material harvesting. Modern human rights and environmental due diligence requires continuous, data-driven monitoring of fair wages, occupational health and wastewater emissions, backed by independent worker grievance mechanisms and verifiable audit trails.

Streamlining due diligence

How to go about this can be confusing or less effective. Social audits, for example, are probably the most visible tool in human rights due diligence but they are not without their problems. “Factories that get audited often know what auditors look for. A site can pass a social audit and pay workers below minimum wage the next month. It simply knew which records to show on the day,” states compliance platform Retraced in its latest Due Diligence Toolkit.

In addition, they are expensive: almost half (45 percent) of factories pay 5,000 to 20,000 US dollars per year in audit fees according to a 2023 survey by Worldwide Responsible Accredited Production (WRAP). The sheer number of audits, often with similar questions, leads to audit fatigue. “[Sites] run audit-ready conditions for the visit and go back to normal afterward. Sometimes conditions get worse, because the hours spent preparing have to come from somewhere,” cautions Retraced.

Audit blind spots

Then there are the blind spots: Audits cover only a moment in time, usually a single day. They do not record what happens before and after the visit. In addition, worker interviews tend to be short and workers may not trust that they are anonymous, making their responses guarded and skewed. Another problem is that audits cover mainly tier-one supplier; the rest of the supply chain often goes unchecked. And even if a problem has been identified, audits just point to it; they do not fix it; that is another step and may even be with a different stakeholder. Lastly, they do not assess a supplier's management systems, and cannot see the purchasing decision that caused a finding.

While no tool alone can replace an audit, the Due Diligence Toolkit by Retraced suggests ten tools that brands and retailers can use to complement their audits. “No single tool covers the full due diligence cycle. In practice, fashion and textile brands combine them in layers,” states the platform. At the beginning should be risk mapping and supply chain mapping, followed by audits for high-risk tier one suppliers and certifications for material claims.

Then there are tools that give workers a voice, grievance mechanisms and tools for capacity building and responsible purchasing. Brand performance assessments by multi-stakeholder initiatives and purchasing practice reforms hold brands accountable. Last but not least, management of corrective and preventive action plans, technology platforms and stakeholder engagement will help with the tracking and reporting process.

Ten tools to bind them all

Responsible purchasing practices

The first tool that Retraced introduces is actually an approach: “Responsible purchasing practices are a brand's own behaviour around pricing, lead times, forecasting, payment terms and order changes. This behaviour reflects their mindset. All of it directly affects whether a supplier can meet labor and environmental standards.”

Tools that can help are the ACT(Action, Collaboration, Transformation) agreement between global brands and IndustriALL Global Union, Fair Wear Brand Performance Checks, the Better Buying Purchasing Practices Index, which is run by Cascale, and others.

Worker voices, grievance mechanisms and corrective action

For worker-driven due diligence, Retraced recommends WOVO by Labor Solutions and the Amader Kotha Helpline in Bangladesh. For addressing grievances, the organisation recommends Speak for Change by global business association Amfori, the Fair Labor Third Party Complaint procedure, Fair Wear's complaints helplines with local teams, complaint mechanisms by the International Accord and brand-operated channels. Retraced themselves manages corrective and preventive action plans (CAPAs).

Supplier training and stakeholder engagement

It is also important that suppliers understand legal requirements, improve their management systems and address the root causes of findings. Amfori, Better Work and the Fair Labor Association provide programmes that can be delivered online, on site or through a multi-stakeholder initiative.

Finding structured dialogue with trade unions, civil society organisations, local communities and other affected groups is also crucial. “The goal is to find risks and impacts so that internal processes do not surface,” says Retraced and recommends initiatives like ACT, the Fair Labor Third Party Complaint procedure and Fair Wear’s complaint helplines.

Supply chain mapping and traceability

How can brands and retailers identify and document the facilities behind a product past tier one suppliers like fabric mills, spinners, raw material processors and farms? Retraced recommends its own multi-tier supply chain mapping and chain-of-custody records from certification schemes such as GOTS and Textile Exchange's Global Recycled Standard (GRS).

Material and product certifications and standards

Third-party certifications are required for specific materials, fibres or production processes. Among these is GOTS for organic textiles, BCI Cotton for cotton, the Leather Working Group, Responsible Down Standard, Fairtrade, Oeko-Tex Made in Green, the Forest Stewardship Council (FSC), Bluesign for chemistry and the Textile Exchange’s Recycled Claim Standard (RCS) and GRS for recycled content.

That leaves the question, which platform(s) to use? Software is certainly needed to brings supplier data into one view. In addition, compliance teams use it to manage large supplier bases and spot patterns across factories, regions and tiers.

“Without a platform, that data often sits in PDFs and spreadsheets. It becomes very hard to tell which suppliers are overdue for re-assessment, which findings keep recurring, or which corrective actions have stalled. A platform makes those questions answerable at any time,” advises Retraced. “When comparing platforms like Retraced, ask how supplier data gets in and whether suppliers will use the system themselves.”

The latest Due Diligence Toolkit by Retraced is a handy guide that gives easy access to common tools and stakeholders available to fashion brands and retailers. By embedding these risk-mitigation protocols directly into supplier contracts and procurement decisions, they can shift their due diligence from a reactive public relations safeguard into a fundamental prerequisite for lawful market access and sustained brand equity.