Impact of California Fashion Environmental Accountability Act
The California Fashion Environmental Accountability Act: Implications for the U.S. Textile Industry and Global Exporters
California has introduced the Fashion Environmental Accountability Act of 2025 (AB 405), a landmark bill aimed at enhancing sustainability and transparency in the fashion industry. The legislation requires fashion brands with over $100 million in annual revenue operating in California to conduct comprehensive environmental due diligence, covering greenhouse gas emissions, chemical management, and wastewater testing.
With California being a major U.S. fashion hub, this law will have far-reaching consequences not only for U.S. brands and retailers but also for global textile and apparel exporters supplying the American market.
Key Provisions of the California Fashion Accountability Act
The law introduces strict environmental compliance measures for fashion brands, including:
✅ Mandatory Greenhouse Gas (GHG) Emissions Reporting
- Fashion companies must quantify and report Scope 1, 2, and 3 emissions (covering their supply chain).
- They must set reduction targets aligned with Science-Based Targets (SBTi) and the Greenhouse Gas Protocol.
✅ Supplier Transparency & Wastewater Testing
- By 2028, brands must require their Tier 2 suppliers (dyeing, finishing, printing, garment washing) to report wastewater chemical concentrations and water usage.
- Companies failing to make adequate progress in chemical remediation will be subject to penalties.
✅ Severe Penalties for Non-Compliance
- Non-compliant brands face fines of up to 2% of annual revenue.
- The collected penalties will be used for environmental remediation projects in affected communities.