Data-Driven Insights into Sustainability: An Artificial Intelligence (AI) Powered Analysis of ESG Practices in the Textile and Apparel Industry

The global textile and apparel (T&A) industry is under growing scrutiny for its substantial environmental and social impact, producing 92 million tons of waste annually and contributing to 20% of global water pollution. In Bangladesh, one of the world's largest apparel exporters, the integration of Environmental, Social, and Governance (ESG) practices is critical to meet international sustainability standards and maintain global competitiveness. This master's study leverages Artificial Intelligence (AI) and Machine Learning (ML) methodologies to comprehensively analyze unstructured corporate data related to ESG practices among LEED-certified Bangladeshi T&A factories. 

Our study employs advanced techniques, including Web Scraping, Natural Language Processing (NLP), and Topic Modeling, to extract and analyze sustainability-related information from factory websites. We develop a robust ML framework that utilizes Non-Negative Matrix Factorization (NMF) for topic extraction and a Random Forest classifier for ESG category prediction, achieving an 86% classification accuracy. The study uncovers four key ESG themes: Environmental Sustainability, Social : Workplace Safety and Compliance, Social: Education and Community Programs, and Governance. The analysis reveals that 46% of factories prioritize environmental initiatives, such as energy conservation and waste management, while 44% emphasize social aspects, including workplace safety and education. Governance practices are significantly underrepresented, with only 10% of companies addressing ethical governance, healthcare provisions and employee welfare.

To deepen our understanding of the ESG themes, we conducted a Centrality Analysis to identify the most influential keywords within each category, using measures such as degree, closeness, and eigenvector centrality. Furthermore, our analysis reveals that higher certification levels, like Platinum, are associated with a more balanced emphasis on environmental, social, and governance practices, while lower levels focus primarily on environmental efforts. These insights highlight key areas where the industry can improve and inform targeted strategies for enhancing ESG practices. Overall, this ML framework provides a data-driven, scalable approach for analyzing unstructured corporate data and promoting sustainability in Bangladesh’s T&A sector, offering actionable recommendations for industry stakeholders, policymakers, and global brands committed to responsible sourcing.