Building a green future in textile industry in Bangladesh: a focus on sustainable supply chain strategies at Square Textile Division

Abstract

Textile and ready-made garment (RMG) are a critical part of the economy of Bangladesh that provides more than 80 percent of the earnings as exports and provides millions of workers. Concurrently, this industry is among the most resource-intensive and ecologically demanding industries around the globe, with almost 10 percent of the global carbon emissions and 90 billion cubic meters of water a year. Bangladesh, as the second-largest exporter of RMG, faces mounting pressure from international buyers and regulatory bodies to adopt sustainable supply chain practices that align with global climate goals, particularly the United Nations Sustainable Development Goals (SDGs). This practicum report titled “Building a Green Future in Textile Industry in Bangladesh: A Focus on Sustainable Supply Chain Strategies at Square Textile Division” explores how one of the leading textile firms in the country—Square Textile Division—has integrated sustainability into its procurement and supply chain operations. This practicum work was done at Square Textile Division over a period of four months (February 2025 -May 2025) by relying on document review, involvement with supplier’s audit, analysis of ERP data, and live observation of the day-to-day procurement operations. The results indicate that Square Textile has incorporated sustainability in its operational strategy. Over 90 percent of its sourcing of yarn and fabric is based on internationally recognized standards like Better Cotton Initiative (BCI), Global Organic Textile Standard (GOTS), Organic Content Standard (OCS), Recycled Claim Standard (RCS) and Global Recycled Standard (GRS). Moreover, Square uses high-tech digital traceability systems to track material origin and adherence to sustainability standards in real-time (SAP ERP, Trus Trace, and Textile Genesis). Not only do these steps increase transparency, but they also assist Square in acquiring long-term agreements with international brands that have been paying an ever-increasing attention to the performance of environmental and social governance (ESG). In addition to certified procurement, Square has gone an extra mile to incorporate circular economy concepts in its operations. Reusing fabric scraps, recycling yarn, limiting water and chemical in dyeing, investing in regenerative farming methods have decreased waste and resource reliance. Moreover, Square has introduced employee-based sustainability initiatives, such as a program called Sustainability Champions, which supports behavioral change within departments and guarantees that green practices continually enhance. While carrying out the practicum work, several challenges have been revealed. A shift to sustainable operations will involve a huge initial capital expenditure on technology, infrastructure, and renewable energy systems. The problem of supplier compliance is also not new since most local suppliers do not have the resources or comply with sustainability certification. There is also knowledge deficiency at the factory-floor level, where technical personnel are often ill-informed of why and how sustainability initiatives ought to be taken. Lastly, integrity of data across ERP systems and traceability systems is a challenge to auditing and reporting. To address these impediments, Square has implemented a staged investment approach with initial emphasis on cost-cutting and compliance-oriented infrastructure projects including LED lighting, energy-efficient equipment and waste reduction, and incremental investment in water recycling facilities and renewable energy. Supplier training and audits are also being invested by the company to solidify its upstream network, and compliance visibility and coverage are increased through ERP-based monitoring and scorecards. To deal with the knowledge gaps among the employees, workshops, outside training sessions, and internal communication campaigns are being implemented continuously. Concluding this practicum, it is found that sustainable supply chain strategies are not an option, but have become a strategic requirement to the long-term competitiveness of the textile industry in Bangladesh. Square Textile Division has shown that sustainability can at the same time minimize the cost of operation, enhance brand image, and maintain adherence to the worldwide buyer expectations. Its experience offers great learning to the RMG sector at large in Bangladesh, where sustainability adoption has remained unequal. The report recommends scaling up digital traceability, strengthening supplier development programs, promoting circular economy practices, and fostering industry–government collaboration to accelerate the green transition in Bangladesh’s textile sector. By doing so, not only will firms like Square Textile Division remain competitive in global markets, but Bangladesh will also reinforce its position as a responsible and sustainable sourcing destination for the future.