The recent New York Times exposé “That Organic Cotton T-Shirt May Not Be as Organic as You Think’” should not be misinterpreted as an affront to farmers who choose to grow organically or the organic agricultural philosophy—in fact, it can and should be viewed as quite the opposite.
Following what I imagine was a months-long and meticulous investigation, the piece should serve as a guidepost and wake-up call to proponents of organic agriculture around the world to demand more from the sector. This includes a directive for the key beneficiaries of organic cotton, including farmers, suppliers, certification owners, brands, and consumers, to reimagine the sector by refocusing on and investing more in farmers and textile workers—the people that grow and make what we wear, and what brands and retailers sell.
The “paper-based” system that once provided visibility and perceived trust among many suppliers, brands (and consumers) needs reinvention. Although progress has been made, the opportunities for corruption exist on many levels because selling the image of “organic cotton” has become an easy way to make money with little transparency, oversight or accountability. Amid a decade-long bull market for organic cotton, we have turned a blind eye to what was happening at the farm level and in the supply chain as the industry had experienced its very own subprime mortgage crisis.
As the article points out, widespread fraud in this sector is nothing new. It spans beyond cotton and into other organic products as well, but it is likely the most pervasive and insidious in the cotton industry.
When the first pieces of organic legislation were enacted into law in the early 1990s, the legal framework that was put into place to guide the management and handling of organic products once they left the farm gate was intended to protect consumers, yet the language was ambiguous and left too much to interpretation.
This legal ambiguity was seized on by the private sector which later devised what was then a fit-for-purpose system during the early growth stage of organic cotton into what is now more than a $200 billion industry globally. Many now recognize this system as no longer being effective in protecting the very consumers that the law had intended, particularly when it comes to organic cotton. There is a growing level of confusion and skepticism among consumers, both young and old, who view many of these certification labels as institutionalized greenwashing. As an industry leader, as much as I am reticent to admit it myself, they are probably right.
The system as it currently exists only truly benefits a few—mainly private standard holders and their accredited private certification bodies. Everyone from the farmers to the brands to consumers is paying the price—in terms of both cost and reputational risk.
Annual observational “check box” assessments do not adequately capture or verify the complexities and infinite physical movements and blending of fungible fibers and materials across millions of daily transactions as organic cotton is converted into yarn, fabric, and finally, into a pair of organic cotton labeled T-shirts, jeans, and other textile products.
Unfortunately, the advent of traceability and digital technology may have come too late, as the underlying gaps in the current system have engendered levels of both negligence and fraud that are already hardcoded into the culture of the organic cotton system. Simply digitizing this fraud forever into a private blockchain ledger is not a solution.
To be clear, short-term financial interests are at the core of many of these challenges. It is estimated that this system generates well over $200 million annually for its proprietors (standard owners and certification bodies) by charging more than 12,000 manufacturers from cotton gins to distribution centers, facility-level, and product-level certification fees, creating what some in the sector refer to as the “golden pipeline” alluding to the chain of custody system for organic cotton. These fees drive up the cost of organic cotton at all stages of the supply chain which are often passed on to the final consumer while delivering little or no monetary benefits to the actual farmers and their communities who choose to grow cotton organically.
Many of those working in these certified facilities have said that despite having a scope certificate, for which they are charged $5,000 – $15,000 per facility depending on its size, they cannot physically identify or prove that the products they are handling and manufacturing in the form of yarn, fabric and finished goods (jeans) are organic, let alone if the fiber that entered this “golden pipeline” was grown organically in the first place.
It is abundantly clear from our work at Sourcery—a sourcing agency that connects brands and suppliers directly to cotton farmers—that decades of neglect and underinvestment in farms and rural communities in India and around the world have led to many of the systemic challenges that most farmers who choose to grow organically face each day. These challenges include access to adequate extension services and training, high-quality (non-GMO) seeds, bio-based fertilizers and pesticides, and clear market incentives necessary for these farmers to assume and manage the additional risks that often come with growing cotton organically. There is a dire need for more funding and commercial investment at the farm level to adequately address these and other challenges.
What many in the sector do not realize is that much of this potential funding and investment is already being apportioned, not only through excessive spending on certification, which as estimated above costs the sector over 80 cents per kilogram. This chain-of-custody premium is on top of a market premium the sector is expected to pay on organic fiber before it gets processed into textiles. These costs, along with margins added at all stages of production, amounts to billions of dollars suppliers, brands and consumers pay additionally for an organic cotton-labeled product that the sector itself cannot prove authentic.
As one of only a few industry leaders and commercial organizations willing to go on the record and named in the New York Times article, it is clear to me there is a great deal of fear and shame across the sector. This is reflected by the number of organizations and individuals that chose not to respond to interview requests and, on a more personal note, by the resentment directed at Sourcery for the quote that was published.
This is alarming because these organizations, many of which quietly share the same sentiment we do at Sourcery, are tired of the certification charade and want to see sectoral reinvention. However, because of the imbalance of power they choose to remain silent, for fear of client retribution and reputational backlash, which speaks to the depth of the moral degradation that continues to erode trust and integrity across much of the organic cotton sector. Until founding Sourcery, I too was complicit for the same reasons because I was powerless to effect real change.
The only way to restore the trust in organic cotton going forward is to call for a reinvention of the system. This begins by reinvesting the money spent on the “golden pipeline” back into the estimated 222,000 farmers and their communities that are said to grow cotton organically. This will begin to solve the first major challenge, literally at its root, where organic cotton is cultivated and grown.
To address the second major challenge, this industry and its leaders must champion legislation that asks the United States Department of Agriculture (USDA) and the Federal Trade Commission (FTC) and their governmental counterparts in other geographies, including India and Europe, to assume the regulatory authority and responsibility for managing organic cotton supply chains to ensure that the real organic cotton grown at farms around the world makes its way into organic products without private interests standing between transparency and integrity.
Given the current and proposed legislation that governments have made to address forced labor, greenwashing, circularity and climate action in these same supply chains—they must also act on organic cotton and other claimed “sustainable fibers” that are privately managed using this same defunct approach. What’s more, complementary and more robust systems have been developed around chemicals management and social compliance as well as innovative traceability technologies that can better serve suppliers and brands when handling organic cotton fiber and products that also protect consumers, who are empowered to make more informed purchasing decisions through enhanced transparency. These systems come at a fraction of the cost and can be deployed at a much larger scale than the existing paper-based systems (or its proposed digital twin) that currently define organic cotton and make it far too expensive and risky to adopt at scale.
If organic cotton is ever to gain a foothold as a trusted, sustainable fiber, a new way forward is needed that puts farmers at the head of the table. This is particularly the case as the sector transitions toward regenerative cotton, which requires real engagement, commitment and scientifically verified outcomes to address climate change and ecosystem restoration.
We are entering an era where true sustainable cotton will be defined by science, economics, and innovation, rather than qualitative romanticism or dogma.
The leaders in organic cotton have had two choices for some time and now must choose a path going forward. One, to continue the existing system and remain indifferent to the deep, systemic challenges for their own short-term financial interests, or a second, based on integrity, where the challenges are openly confronted, and the sector is positioned to deliver more meaningful and measurable outcomes for farmers, suppliers, brands and consumers.
Although it will likely hurt our own short-term business interests at Sourcery, we choose integrity because we choose a better future for everyone from farmers to consumers.
Crispin Argento is the managing director of Sourcery and the former executive director of the Organic Cotton Accelerator.