Abstract This paper explores the relationships between textile wastewater management and its impact on ecosystems and community livelihoods. Using the case of the wastewater management practices of the Bangladesh textile industry and thematic analysis of key informant interviews with industry representatives in the production value chain, the study illustrates perceptions of sustainability transformation regarding wastewater management, specifically by integrating sustainable water and energy practices. The findings reveal the adverse effects of textile wastewater on freshwater resources, such as the obstruction of socio‐economic development and environmental sustainability, and highlight the distinctions between compliant and non‐compliant textile industries regarding sustainability transformation. These results also indicate challenges that hinder the sustainability of textile effluent treatment, including the absence of techno‐ecology, pro‐environmental behaviour, stringent regulations, reliable surveillance, and collaborative actions. Recommendations include improving cooperation among community‐stakeholders and decision‐makers to promote sustainability transformation in textile wastewater management, prioritising water energy resources to advance environmental development, and fulfilling socio‐economic demands.
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