Without knowledge of source materials, "the worst forms of worker rights abuse (including forced and child labor) will continue to remain prevalent," the report says.
Fashion companies have improved oversight of fabric producers but remain largely ignorant of raw materials sources and labor conditions, according to a Baptist World Aid Australia investigation of 87 companies and 308 brands.
"In 2013, 41 percent of companies had engaged in some effort to know their input suppliers (e.g., where their fabric is produced), this has now increased to 79 percent," the report noted.
However, "only 31 percent of companies knew more than 75 percent of their input suppliers, and at the next tier down - at the raw materials level - only 5 percent of companies knew who all of their suppliers were."
Without knowledge of source materials, "the worst forms of worker rights abuse (including forced and child labor) will continue to remain prevalent."
Fashion companies were graded based on the following criteria: company policies, supply-chain knowledge, auditing and supplier relationships, and worker empowerment.
"The grades awarded ... are a measure of the efforts undertaken by each company to mitigate the risks of forced labor, child labor and worker exploitation throughout their supply chains," Baptist World Aid Australia explained.
"Higher grades correspond to companies with a labor rights management system that, if implemented well, should reduce the risk and extent of worker exploitation in the production of that company's products."
The median grade was a C+, with six companies receiving an A and nine receiving an F rating.
Among the highest rated companies were Adidas Group (A-) and Patagonia (A-), and among the lowest rated was Forever 21 (D-).
Companies scoring toward the median grade included Abercrombie & Fitch (C-), Lacoste (C+), Levi Strauss & Co. (C+), Lulu Lemon Athletica (C), New Balance (C+), Nike (C+) and The Gap Inc. (C+).
The full 2016 fashion report is available here, and an ethical shopping guide based on the report is available here.
As part of its Behind the Barcode investigations, which includes fashion manufacturing investigation, the organization looked at the prevalence of forced and child labor in electronic manufacturing in early 2016.