As the largest and perhaps most progressive state in the nation, California has become a hotbed for sustainable legislation that holds industry to account for its impacts on the environment and workers.
Laws like the Responsible Textile Recovery Act (SB 707), the Plastic Pollution Prevention and Packaging Producer Responsibility Act (SB 54), and the Garment Worker Protection Act (SB 62) have all passed in recent years, putting the onus on brands and retailers to comply with more stringent standards.
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With so many new laws taking shape—and in various stages of the regulatory process—difficulties with compliance can arise, and they’re not always a matter of ill intent or trying to skirt accountability.
Instead, many companies are finding it difficult to stay abreast of legislative developments and to understand what’s expected of them. And as arbiters of the retail sector, they’re increasingly looking to give their input during the legislative and regulatory process, so they can have a hand in the laws that will dictate the industry’s future.
The California Retailers Association (CRA) has been acting as both a voice and a resource for the industry throughout the development of these new social and ecological standards. But in the face of a rapidly shifting regulatory environment, the Sacramento-based group is stepping up its efforts with the launch of the California Retail Law Center, a legal and policy initiative designed to support retail legal teams navigating the changes.
“We found that we were dealing as a trade association with more and more calls about compliance, about the regulatory process, and having attorneys on the calls,” Rachel Michelin, CRA’s president and CEO, told Sourcing Journal. “That’s really what led to then the California retail Law Center; it’s an opportunity for both in-house legal professionals and then also outside law firms to come together and talk about what’s going on in California.”
It’s also about CRA “bringing in our expertise on the whole process and looking at these issues from a 30,000-foot level—about what was talked about during the negotiations on the statute, to how we then engage with the regulatory process, and what do we do in terms of compliance,” she said.
The California Retail Law Center is to be chaired by Danielle Hohos, who serves as deputy general counsel for Williams-Sonoma, Inc. “California sets the pace for the nation when it comes to regulation, litigation, and public policy,” said Hohos, a former chair of the California Retailers Association Board of Directors. “The California Retail Law Center creates a dedicated forum for retail legal leaders to share best practices, track emerging legal trends, and engage directly in shaping policies that impact our industry.”
As a resource within CRA, it will provide retail legal leads with state-specific guides, insights and opportunities to engage on issues like employment and labor law, privacy and artificial intelligence, consumer class actions, environmental sustainability, workplace safety and more. It will host webinars, provide updates on regulation and litigation, deploy benchmarking surveys, and offer a venue for collaboration with policymakers, including the governor and the state legislature.
It will also work with state regulators on fostering the success of statewide and local programs, Michelin said. “I think that part of the challenge for California is we’ve passed all of these laws, all these regulations, and we’ve forgotten the most important aspect, which is the consumer. When we don’t educate them first, then it’s none of these programs are going to work,” she explained.
“My members want these programs to work, so we’re going to maybe have to take it upon ourselves to figure out how we educate consumers to make sure that they understand what’s going on and how they can be participants in the process,” she added.
There’s also a lack of understanding on the part of brands and retailers about the difference between legislating and regulating. Many believe that once a bill passes and is signed into law, it’s set in stone. But actually, the regulatory process is where many of the kinks are worked out and the practical applications of the bill are formalized. Changes take place even after a law is on the books, and it’s important for companies to remain engaged throughout a bill’s journey into law and beyond.
“The challenge we have is that a lot of times they’ll call us too late, so what we’re trying to do is get ahead of the curve,” Michelin said. “We’re trying to get them engaged earlier so that we can have more of those conversations during the process and impact it.”
In the event that retailers feel that their voices haven’t been heard or considered, the California Retail Law Center will lean on amicus briefs and filing lawsuits as plaintiffs, she added. “Unfortunately, that seems to be what it takes now to get the legislature to pay attention so that they actually have to go back and fix some of these bills in statute to make them work,” she said. “It’s a path of last resort for us. We don’t like to do that, but it’s certainly something that is on the table. It is a big lift.”
Big, but important—both for the retailers and for the success of the cutting-edge legislation California is so keen to enact. “California is the biggest retail market in the nation. We have a really diverse group of members at CRA, and I think this is something innovative. I don’t think any other state is doing this,” Michelin said.
The California Retail Law Center is still in development and is slated to launch in early fall.
This article was published in SJ’s sustainability report. Click here to read more.
