The Good and The Bad of Retail

Holly Whitelaw & Zoha Inam

Overview

In this smore we will be looking at the best and the worst ethical companies in retail, more specifically in clothing. We will be looking at how they treat their staff over seas, what their clothing is made of and if they are even making an effort to be a more ethical company as a whole. Included will be pictures and videos displaying how each company is the best and the worst, as well as an ethical guideline created to show how we think companies should be conducing themselves in today's day in age.


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"H&M's initiative to create a wage policy for the suppliers in their production countries is an important step to resolve one of the major problems in the textile and clothing industry; how to find models for decisions on fair living wages and stable conditions in the labour market."

Bengt Johansson, CSR ambassador at Swedish Ministry for Foreign Affairs


H&M For the Best Ethical Company

A long term goal of the companies is to create fair living wages for employees in countries outside of North America, to ensure that they are not getting paid below minimum wage and can actually support themselves and a family on their wage. They have already begun promoting a better living wage and have been for years but now there are steps in place to push the along. H&M is setting an example and showing other retail companies what they can do and only hoping they follow in their footsteps in doing the right thing.

As seen in the picture below a slogan of H&M's is "Long live fashion!" they are collecting only clothing of people and separating them into three categories.

Rewear - they will be sold as second hand clothes around the world to benefited other countries.

Reuse - they will be converted into other products if they are unsuitable to wear.

Recycle - they will be turned into manufacturing parts like insulating fibers.

So as you can see H&M is making an effort to be more eco-friendly by implementing the three R's into what they do and creating a place for people to donate old clothes instead of simply throwing them out.

H&M has a strict rule against using animals for testing on their cosmetics or using of things like fur, they do not sell real fur at all and are against it where as other retailers sell real fur and push to have it made more normal among society.

H&M not only works towards making better living wages but to make sure their employees are safe and know their rights, They educate employees on their rights to ensure they know what they are entitled to, they also hold thousands of work interviews so employees can let them know what is happening in all of the different factories and wither they are being treated safely. H&M Is against child labour and has been working together with UNICEF since 2004, even funding some of their work.

Last is how H&M is not only helping its employees but has a foundation called 'H&M Conscious Foundation' it is a non-profit foundation with a mission to contribute to positive long term change for people and communities where H&M operates. Some issues they prioritized are 1. Clean water, 2. Strengthening woman, 3. Safeguarding natural resources, 4. Education and 5. Reduction of poverty through self-empowerment.

H&M is helping employees, the areas in which the employees live, animals, the environment and showing other companies that they can do it too, they are using eco-friendly materials in their clothing and launched a new eco-friendly collection, they are paving the way for retail countries everywhere to follow in their footsteps and help make the world a better place.

Costs/Benifits Analysis

As stated above H&M is going above and beyond what other companies are doing to help the world with the work they do. The costs can be along the lines of now with all the work they are doing and all the funding they are doing they are going to need to raise the prices of their clothes, which is a small thing but it is helping a large cause so it is not an outrageous thing to see, though it will be impacting the purchasers of clothes it will be benefiting so many others i'm sure most people wouldn't mind paying a few extra dollars if they knew it was going to a good cause. It does not really cost any other parties as the work H&M are doing is all good and besides the consumers no other parties are being 'negatively' affected though I wouldn't even say the consumers are negatively affected. The benefits of what H&M are doing are countless, they are helping employees around the world, the families of the employees, animals that are in need of protection from clothing companies, they are helping children around the world and the world as a whole with their use of the three R's (reduce, reuse, recycle). I don't think H&M Is really harming anyone in what they are doing and even if they were I don't think the costs would ever out weigh the benefits of all the people being bettered by the work they are doing. One big benefit as said before is they are setting an example for other companies and showing them they too can do good for their employees and the world as a whole.


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TopShop For the Worst Ethical Company

Top shop is one of the second largest retailer of high street fashion apparel and accessories in the UK. With more than 300 stores across the UK, over 250,000 shoppers visiting the Oxford Circus flagship every week, and over 140 stores in international territories. Top shop is a leader in up-to-the-minute affordable style. Although Topshop has introduced a few lines boasting the use of organic and fair trade cotton the evidence of Topshop using forced child labour as slavery in the production of majority of its products , puts Topshop in a bad light. Limited lines observing ethical trade do not make-up for the change we can expect from a brand such as Topshop in its entirety.


Cost Analysis

Consumers

Moral Obligations

N/A

Consumers feel as though they are part of the unethical act. This effects the demand for Topshop products.


Psychological problems

£10 per session= £100

By being a propagator in an act so despicable, consumers may have a psychological reaction and would require therapy.


Faulty products/returns quality of stuff/Return costs

45%

Sweatshops in Uzbekistan would give way to faulty and low quality products. Consumers would have to ship their stuff back for a refund and also refrain from buying again.


Government

Global Reputation

-40%

The UK earns a bad reputation amongst other countries. Trading countries may take a stand and boycott business with the UK.


UN benefits

- £5 million

The United Nations awards nations that maintain good ethical behaviour with monetary awards. The UK may be deprived of this due to Topshop’s unethical business practice.


Trade Agreements Severed

- £10 billion

Trade Organization involving the UK may suspend them apply trade barriers as a way to protect themselves from being involved in unethical behavior.


Business Owners

Decreased Sales due to bad publicity

-50%

Topshop will face a significant fall in its sales as loyal customers switch to other alternatives


Governmental fines

£10 million

Topshop faces charges from the government for unethical business practices and has to pay a penalty.


Strikes from sales staff

300stores X 30workers on strike = 9000. 9000 people X £1000 avg salary per month = $9,000,000 worth of expenses

Lost time cost


Code of Ethics

  • Companies need to ensure they are helping the world and not just hindering it, be that with ensuring safety to employees or starting organizations to help people, companies should be giving back.

  • Companies need to ensure the products they are making are not harming animals or the environment any more than they need to be, ensure environmental choices and working towards being eco-friendly

  • Companies need to ensure that their employees are treated fairly and justly and are not harmed in any way, shape or form by the company or anyone represented by the company

  • Ensuring the safety of customers using their products or investing into their business and ensuring no frauds or scams will take place with the customers money.

  • Age limitations as norm in country of origin  This is important because this takes child labour out of the question and ensures that the company plays no part in keeping the child from having a normal and healthy childhood

  • Adequate steps shall be taken to prevent accidents and injury by minimizing the causes of hazards in the working environment  It is the organizations responsibility to provide these workers with basic rights and have a workplace free of health hazards

  • Workers should be given reasonable pay, benefits and vacations  Corporations must ensure that ALL their workers are happy and satisfied with their work and have the peace of mind to be productive.

  • Workers of other countries must be treated similar to the workers from the origin country  This is to guarantee the there is no discrepancy in the treatment of workers because they are from and underdeveloped country