In 2025, fashion and textile supply chain actors must navigate tariff-driven supply chain shifts, ESG data demands, and evolving EU regulations. The Omnibus package will streamline sustainability reporting, while DPP Delegated Acts will set new transparency standards for product data. Meanwhile, luxury brands face rising scrutiny on ethical sourcing, and media-driven investigations continue to influence consumers and policy. Staying ahead requires robust data, proactive compliance, and strategic adaptation. This article breaks down key regulatory trends shaping fashion in 2025—and how to prepare for them.
Supply chains shifting based on Tariffs
Tariffs in the U.S. against goods imported from China, Canada and Mexico are causing brands and manufacturers to reshuffle pieces in the supply chain and rethink sourcing strategies. Cost and risk management have escalated quickly into top priorities, with many businesses diversifying production locations to avoid penalties and maintain profitability. The shift could lead to increased nearshoring or sourcing from tariff-friendly markets, ultimately reshaping global trade supply chains in fashion.
Streamlining sustainability and due diligence reporting
The phaseout of the EU Green Deal and the refinement of the EU Omnibus package reflect a shift towards streamlining reporting in favour of stimulating industries to increase EU’s competitiveness. The Omnibus consolidates directives such as the Corporate Sustainability Reporting Directive (CSRD), the Corporate Sustainability Due Diligence Directive (CSDDD), and the EU Taxonomy Regulation, into create a unified framework for simplified compliance. Reporting remains mandatory, but the amount of reporting for medium and small sized companies have been significantly reduced. EU will also introduce a new cohort called “medium” businesses to segment a group between ultra large corporations and small business enterprises.
For fashion brands, this means less varying regulatory requirements, a push for standardized, digital reporting tools to reduce compliance burdens, and more focused sustainability targets starting with only needed reporting on Tier 1.
Brands should expect less requirements, but more pressure to demonstrate real impact—particularly through data-backed ESG claims and supply chain disclosures. Learn more about Omnibus.
Transversal Approach to ESG
Fashion brands can no longer treat ESG (Environmental, Social, and Governance) initiatives as isolated efforts by specialized teams. Instead, ESG compliance must be embedded across operations, delivering measurable outcomes such as:
- Reducing harmful Scope 3 impacts across supply chains
- Ensuring compliance for continued market access in key regions
- Backing up sustainability and product claims with robust data
Regardless of the EU is currently divided on how to move forward with reporting, Regulators and investors alike are demanding concrete proof that brands are delivering on their sustainability promises—not just making claims. Brands and suppliers will need the data to back up their ESG and corporate responsibility claims. See TrusTrace's Solution.
DPP Delegated Acts will come end of year
The Delegated Acts for the Digital Product Passport (DPP) are expected to be published by the end of 2025, setting the stage for a major transformation in product transparency and way we assess the lifecycle of each article of clothing and footwear. Fashion brands need to take a proactive approach by stress-testing their systems and data protocols now, ensuring they are prepared to meet interoperability, traceability, and compliance requirements as they become law.
Ensure you have the right data.
- Follow our data protocol for DPP, and test the readiness of your current data infrastructure
- Learn more about TrusTrace for Digital Product Passports
Luxury BEING WATCHED
For luxury brands in the EU, reputation risk is now as critical as compliance risk. In particular, brands are being closely watched for their follow-up actions on human rights, sustainability, and ethical sourcing after several high profile cases concerning forced labor discovered in supply chains.
Luxury houses are under the microscope and must now prove their commitment to ethical supply chains. Otherwise they risk public scrutiny, reputational damage, and potential regulatory action. Learn more about our solution for advanced traceability and risk management.
The Role of Media & Human Rights Reports in Regulatory Pressure
Investigative journalism and human rights reports are becoming powerful forces in shaping regulation and enforcement. Exposés on forced labor, poor working conditions, greenwashing, unmanaged textile waste and unethical sourcing are increasingly triggering regulatory crackdowns and consumer backlash. Brands and manufacturers that fail to anticipate and address these risks will find themselves in the crosshairs of both activists and policymakers.
How Can TrusTrace Help?
TrusTrace is comprehensive risk, compliance and impact platform that empowers you with reliable data from your supply chain to know, prove and improve your impact. Achieve regulatory compliance with confidence and efficiency using the TrusTrace platform. Schedule a call to receive a demo today.
