H&M: A Corporation with a Conscience?
By Joey White, Research Assistant
Global retailer H&M has fully embraced the value of ethically sourced products as a major part of their brand, but is this act of corporate social responsibility the real deal, or just another form of PR?
Contradictions in H&M’s Fair Labor Reporting
The company’s most recent annual Conscious Actions Sustainability Report claims they have made great strides in the enforcement of fair labor practices within their supply chains. However, contrasting reports by various labor rights organizations indicate that might not be the case. The Asia Floor Wage Alliance 2015 report found explicit evidence of unlivable wages, the use of illegal short term contracts, and women routinely being fired due to pregnancies – clear contradictions of H&M’s six labor rights commitments in Cambodia and India.
H&M also boasts about its annual presence on Ethisphere’s list of most ethical companies. Ethisphere is an Arizona-based organization that rates businesses on their ethical practices, but further research indicates that scoring is mostly based on information provided by the companies themselves. This key information is collected from a questionnaire that takes only thirty to forty minutes to complete. Considering the responses provided are unvetted and possibly biased, Ethisphere’s determination of the world’s most sustainable companies is superficial at best.
Fast-Fashion & Ethical Labor
Corporate social responsibility refers to the act of major corporations taking responsibility for the impact they have on the world. It is attractive to consumers for a corporation to be branded as socially responsible, but wouldn’t it be more attractive for the corporation to actually BE socially responsible?
The term “fast fashion” refers to affordably priced, mass-produced clothing that mimics the style of luxury brands. While the low prices associated with fast fashion are beneficial for consumers, the ultimate price is often paid by the workers producing the garments in developing nations. The fast fashion industry has long been in the spotlight for its use of unethical labor practices within supply chains. Famous examples include Zara suppliers forcing sixteen hour shifts on Brazilian workers without having a single day off during the week, Gap, Inc. suppliers in India compensating workers for 16 work days with less than forty cents per day, and Victoria’s Secret workers at a factory in Jordan being physically abused and forced to work more than five hours of overtime per day without adequate compensation. With consumers’ growing desire to purchase sustainably sourced products, major retailers are being forced to examine the integrity of their business practices.
Drawbacks of Social Responsibility Self-Reporting
As a company that does not own any of its supplier factories, for H&M corporate social responsibility means incorporating a “Sustainability Commitment” into its supplier agreements. This 9-page document detailing the required conditions for employees within its supplier factories must be signed by any prospective supply partners. Requirements include health, safety and fair wages as priorities. The company then reports its various labor rights successes through its annual Conscious Actions Sustainability Report. The problem is, these results are measured by H&M using guidelines created by H&M, which indicates clear bias in the reporting process.
Ultimately, corporate social responsibility is a promising solution to ameliorating the labor abuses of workers within corporate supply chains, but its self-regulating nature is a huge drawback. The H&M Sustainability Commitment to eliminating exploitative labor is a great start, but the company must redefine the ways they enforce this commitment if they truly want to have an impact on labor conditions. There is a need for more transparent reporting, which would be most effective through the use of a third party organization that would be more inclined to provide honest reports that highlight key areas of improvement.
Photo by ILO in Asia and the Pacific via Flickr
For more information on corporate labor rights infringements and how to be a conscious consumer, check out this blog written by Joey for the Center on Human Rights Education.
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Founded in 1964, the Josef Korbel School of International Studies is one of the world’s leading schools for the study of international relations. The School offers degree programs in international affairs and is named in honor of its founder and first dean, Josef Korbel.
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