Cascale is positioning one of its Higg sustainability tools as a way companies can meet their regulatory reporting obligations under European Union law, specifically the corporate sustainability reporting directive, a measure that more than 80 percent of Europe-based corporations have admitted to fretting over in terms of their ability to comply.
But the Higg Brand & Retail Module (BRM) which measures a business’s sustainability performance across 11 impact areas across the environmental, social and governance spectrum, isn’t perfect by any means, admitted Maravillas Rodriguez Zarco. senior director of Higg Index strategy and operations at the multi-stakeholder organization formerly known as the Sustainable Apparel Coalition. A mapping exercise that Cascale published in the form of a white paper found a 65 percent overlap between the BRM and the European sustainability reporting standards, or ESRS.
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While achieving 100 percent would be impossible because portions of the ESRS either aren’t material to the textile, apparel, and footwear industry or outside of the Higg BRM’s stated scope, the two’s “broad alignment” points to the latter’s usefulness in fulfilling the requirements of the former, she said. These include conducting impact material assessments, structuring sustainability statements, establishing governance structures, identifying risks and setting, implementing and measuring “achievable” targets.
At the same time, the tool needs to evolve to fill in as many gaps as possible with new assessment questions and updated guidance, Zarco said. “That is something that we want to address in 2024 and start using in 2025 with the updated version,” she added.
One aspect the BRM isn’t equipped to manage, however, is a company’s value chain. Such measurements are covered under other products, such as the Higg Facility Environmental Module and the Higg Facility Social & Labor Module. Leveraging the entire Higg suite, Zarco said, is necessary if brands seek a more holistic view of their operations.
Still, Cascale says it’s confident that the Higg BRM can support many corporations’ needs—and even more so after it’s updated. Next year, large companies with more than 500 employees will have to include their first CSRD-compliant sustainability report covering the 2024 financial year. While the tool’s main purpose is to drive “impactful, data-driven sustainability strategies,” it can also make executives’ lives a “little bit easier,” she said.
Following that, Cascale’s focus at the end of 2024 and into 2025 will shift to the EU’s corporate sustainability due diligence directive and how it can support members such as Adidas, Nike and Zara owner Inditex in staying on the right side of the law. The CSDDD will require businesses to flag, prevent and mitigate any adverse human rights and environmental impacts linked to their supply chains. It entered into force this past July and must be transposed into member-state laws by July 2026.
“Our tools are in constant evolution,” Zarco said.
