Impact Incentives allow brands to reward farms that follow best practices.
Brands often don’t know where material such as leather comes from. Because of this, they can’t have an impact on the farmers, and the farmers can’t know what the brands’ expectations are. Impact Incentives close this gap. They’re certificates traded in support of a sustainability claim, issued when a set of criteria—relating to animal welfare or zero-, for instance— have been met. The physical goods and Impact Incentives are traded separately from each other; the incentives represent a quantity of verified material that has been produced.
How it Works
Brands can go beyond their own supply chain.
Incentives mean an efficient transfer of value.
Bypassing complex supply chains
There are usually many players involved in any one supply chain, and it’s no different for the fashion and textile industry. Because of this, traceability can be expensive and even impossible.
In addition to its traceability issues, a long supply chain tends to be costly. Typically each owner at each stage will apply their own mark-up. The Incentives system means that almost all the money that a brand pays to have a climate-friendly impact goes to the farmer.
Taking back the time and energy that would be invested to address traceability means a more efficient transfer of value to the farmer. Brands can support more farms for the same amount of money, and farmers can be incentivized more strongly to follow best practices.
Investing in moving the industry forward.
Impact Partnership is an additional program that sits alongside Impact Incentives. It can be used by brands to support the producers that need help to move towards best practices through training, infrastructure, equipment investments, and more.
Impact Partnerships are a way for brands and retailers at one end of the supply chain to help address the cost of climate-friendly practices at the other end.
By creating a tool for brands to support farmers investing in best practices, we accelerate the production of more responsible materials, letting companies meet their own targets and contribute to meaningful change at a global level.
Working together through an Impact Partnership builds and strengthens relationships. Beyond the exchange of financial support and information, having more engagement between brands and program partners enriches understanding on both sides.
The Impact Alliance provides governance and policy framework for Impact Incentives and Impact Partnership.
The Impact Alliance is a voluntary collaboration between sustainability standards owners across cotton, leather, beef and soy to support the development of an Impact Incentives trading platform. Its members work together to define, promote, and oversee the trading of Impact Incentives and Impact Partnership Incentives.