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Transparent Cotton Sourcing: Best Practices for Supply Chain Management with the U.S. Cotton Trust Protocol

In the past year, there has been heightened scrutiny throughout the fashion supply chain, specifically within the textile industry. As a result of these changes, brands and retailers increasingly need to track the source of their products and provide transparency to consumers. As companies work to meet sustainability commitments and goals, it becomes ever clearer that adding visibility throughout the supply chain has become mission critical.

In the recent webinar, “Transparent Cotton Sourcing: Best Practices for Supply Chain Management,” Sourcing Journal’s Jasmin Malik Chua spoke with Dr. Gary Adams, president of the U.S. Cotton Trust Protocol; Amit Gautam, founder and CEO of TextileGenesis™; and Nicole Bivens Collinson, president of international trade & government relations at Sandler, Travis & Rosenberg, about these challenges and what the textile and apparel industry can do to mitigate risk regarding cotton fiber sourcing. They also discussed how the Trust Protocol helps brands meet their sustainability targets.

Launched in 2020, the Trust Protocol is designed to set a new standard in more sustainably grown cotton, ensuring that it contributes to the protection and preservation of the planet, using the most sustainable and responsible techniques.

Within its first year, the Trust Protocol announced a collaboration with TextileGenesis™ to create the Protocol Consumption Management Solution (PCMS), which made the program the world’s first sustainable cotton fiber to offer its members article-level supply chain transparency. The PCMS harnesses blockchain technology to record and verify the movement of U.S. cotton fiber along the entire supply chain.

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“The Trust Protocol started out with an initial focus on environmental metrics and collecting the data from the growers—both on their farm-level management, as well as field-level analysis,” said Adams. “But then we saw the increasing need for brands and retailers to be able to provide additional transparency within their supply chain, and that led us to developing the Protocol Consumption Management Solution.”

Explaining the role of his company, Gautam said, “TextileGenesis™ is essentially a supply chain platform enabled by blockchain technology to create full fiber to retail traceability.” He continued, “The fiber coin that we have created becomes a digital token called a Protocol Cotton Consumption Unit. One kilogram of sustainable fiber becomes one Protocol Cotton Consumption Unit, and as fiber is transformed to yarn to fabric to garment, Protocol Cotton Consumption Units are passed along, considering the article level inventory at each stage in the supply chain.”

Never has this mattered more than now, as these companies face increased scrutiny from consumers, as well as new regulations regarding cotton fiber sourcing. With so many developments happening, Bivens Collinson offered some insight on what companies should be most concerned about. “From soil to shelf, companies need to have visibility in their supply chain all the way back so that they can say, ‘I know where that was made. I know how it was made. I know the conditions under which it was made,’” she said.

Bivens Collinson continued, “You need to have some kind of method of tracking for every single entry for every single garment or product that is made. There needs to be a paper trail or electronic documentation trail that demonstrates to authorities that the cotton used in your product was grown ethically, and that its point of origin does not include banned geographical areas. You need to show the enforcement agency that you have exercised due diligence and you have exercised reasonable care. Those are two critical elements to avoid potential penalties.”

So how does the U.S. Cotton Trust Protocol provide brands and retailers with more assurance of their cotton’s provenance?

“I would start by saying that in the United States, we have a distinct advantage that with every bale of cotton produced, it is assigned a unique Permanent Bale Identification number and is graded by the USDA,” Adams said. “So, in essence, every bale has been counted. When growers upload bales into the Trust Protocol platform, the PBI is uploaded as well, and they are crosschecked against the USDA database.”

The Trust Protocol offers article-specific, double verification of every transaction by ensuring availability of Protocol-eligible materials and by verifying invoices and shipping documents. The PCMS creates a transparency map that provides the authenticated origin of the U.S. cotton, along with the names and locations of the Trust Protocol mill and manufacturer members that were involved in all parts of the production process, into the finished products that are shipped to the brand and retailer.

Demand for supply chain transparency has never been greater, and in its first year, the Trust Protocol uploaded approximately 950,000 bales into the system and welcomed over 560 members of the supply chain—from global mills and manufacturers to brands and retailers, including Gap Inc., PVH, Levi’s, Target and Tesco.

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