Sustainable Management Futures Assignment

Running head: SUSTAINABLE MANAGEMENT FUTURES ASSIGNMENT
Sustainable Management Futures Assignment
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Table of Contents
Introduction................................................................................................................................2
Theoretical/Conceptual approaches...........................................................................................3
Utilitarianism Ethical Approach.............................................................................................3
Virtue Theory.........................................................................................................................4
Analysis......................................................................................................................................4
Discussion and Conclusion........................................................................................................8
Reference..................................................................................................................................12

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Introduction
The retailers engaged in fashion and clothing industry have some ethical responsibilities for
ensuring the fact that they provide the employees as well as stakeholders of the companies
with certain benefits. The retailers are required to comply with the ethical standards for
ensuring the welfare of employees as well as their families. Ethics is the branch of philosophy
that objectifies the moral values of individuals. It helps in assessing or analyzing whether the
individuals’ actions are morally and ethically right or wrong. Taking the case of retail sector
into consideration, it can be said that the fashion and clothing industry holds significant role
in the overall economy of the world (Goworek and McGoldrick 2015).
It is important for the fashion and clothing industry to comply with the ethical
standards in order to have significant impact on their stakeholders. The purpose of this report
is to evaluate the business ethics of the fashion and retail industry by utilizing two contrasting
conceptual or theoretical approaches. It is however, important to identify how the ethical
standards of the retail industry have currently impacted the workers, working in the factories.
Not only the workers, but also the parties those are engaged in the overall services of
production and final consumptions get highly impacted by the industry.
The report will discuss the ethical standards of the fashion and retail industry as the
retailers have ethical responsibilities towards its workers. The focus is on GAP Inc, a clothing
store headquartered in America. It is seen that the retailers often indulge into some unethical
practices for acquiring or generating higher profitability. In this entire process, they start
misleading their target consumers by charging higher prices and conceal the truth regarding
product quality, from them. It is immensely important for them to stop such ill-practices and
charge fair prices from the target consumers. Retailers need to formulate certain strategies or

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policies in order to ensure fair selection, training and recruitment of the employees (Lueg,
Pedersen and Clemmensen 2015).
Theoretical/Conceptual approaches
Utilitarianism Ethical Approach
Utilitarianism Ethical Approach states that the best action always maximizes the
utility. According to Valentinov (2017), in utilitarianism theory, the best action is always
associated with the wellbeing of the people. Moreover, the best action definitely maximizes
the pleasure and minimizes the pain level of the people. Hence, this theory can be effectively
applied in justifying the ethical perspectives of Gap clothing retail. This theory will analyze
whether the business actions of Gap is ultimately maximizing the pleasure of the stakeholders
or not. On the other hand, Stankiewicz and Łychmus (2016) opined that being the version of
consequentialism, utilitarianism approach measures the standard of an action based on only
the rightness and wrongness of the action. Hence, this theory is relevant to assess standard the
child labor business policy of Gap. While applying the theory on Gap’s business process, it
can be seen that the organization is abusing the children of India unethically by hiring the as
labor. Moreover, such action is actually reducing the well-being of children in India. Hence,
as per Utilitarianism approach Gap is facing high level of ethical issues through maximizing
pain for the children.
One of the major limitations of Utilitarianism ethical approach is that it is extremely
difficult to predict the certainty of a consequence in future. Hence, this approach cannot be
applied on assessing the actions, whose consequences are not known beforehand. On the
other hand, Utilitarianism ethical approach does not depict enough support for the rights of
individuals (Valentinov 2017). Moreover, the proponents of ethical rights are quite unclear in
this ethical approach.

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Virtue Theory
Virtue theory of ethical approach majorly concentrates of the virtue or moral
characteristics of the people pursuing an action. Moreover, this ethical approach assesses the
ethical perspective of an action based on moral character of the actor rather than the duties or
rules and consequence of the action. According to Fernando and Moore (2015), an ethical
person always acts in accordance with the moral rules that cannot hurt anyone else. Ethical
action is likely to occur, while the ethical agent acts as virtuous person in a situation. Hence,
such ethical approach will be highly effective in assess the ethical perspectives of the
employers in Gap. On the other hand, Segon and Booth (2015) opined that virtuous person is
always honest and generous in their actions that ensure well being of other people.
Hence, this theory will be effective for evaluating the generosity and honesty level of
the employers on Gaps. While applying this theory on Gap’s action, it can be seen that the
employers of the organization are quite dishonest and unethically exploiting the child labor
just for the sake of reducing organizational cost. Hence, as per virtue theory of ethics, Gap is
actually conducting unethical business action in India. The focus of virtue theory is to
develop the moral action within the people. However, they theory does not specify the actions
to be done for ensuring moral characteristic within a person (Annas 2015).
Analysis
The understanding of the concepts of utilitarianism and virtual ethics promotes the
idea of ethical responsibility that needs to be undertaken by every company irrespective of
the industry to which it belongs. This is mainly because ethical responsibility is necessary for
the survival of the companies and ensures that customer satisfaction along with reputation of
the company be improved (Mill 2016). Hence, discussion can be made on the unethical
behaviour of certain companies that have caused a stir in the ethical practises of a company.

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The case related to GAP can be considered to understand the importance of maintaining
ethical considerations in a company.
GAP Inc, or GAP is a famous clothing retail organisation headquartered in America.
It is famous mainly for its various clothing and accessories that provide customers with a
taste of authentic fashion sense. Given its popularity in the clothing industry, the company
has branches all over the world that helps in enhancing the reputation and the business
prospects of the company (Gapinc.com 2018). Hence, it is expected that the company
maintain the satisfaction of the customers not only by its latest quality products and services
but also by conducting activities that contribute to the welfare of the society.
Therefore, the news of children being exposed to hardships came as a shock for the
world. The particular unethical issue has been discovered in India, in the backstreets of New
Delhi. According to de Lazari-Radek and Singer (2017), it is not an uncommon phenomenon
in India to use children as labour mainly because of the high rate of poverty that exists in the
country. However, it is to be considered that ethical activities require qualified and matured
workers to be involved in any type of activities that involve either heavy lifting or delicate
application of skills. In the case of Gap, the delicate application of needles for sewing the
clothes to make it look attractive is one way of producing the clothes.
It has been seen that retailers often indulge in practises that indicates unethical
behaviour to earn high profit (Barrow 2015). In the case of GAP, the company manufactures
clothes and sells it at a high rate. At the same time, the labour cost for manufacturing the
clothes are less as the children are provided with wages that are much less, than the overall
cost of the clothes. Therefore, the use of children for manufacturing process has been heavily
criticised. Piacquadio (2017) stated that the criticism is mainly because the child labour is
seen more as the application of slavery of the yester years.

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In the age of modern technology and multipurpose equipments, the use of children as
forced labour is considered as a huge backward step in the progress of a nation and society.
The company considers the fact that it aims discovering children that are being used in the
labour market as a way of helping the society. This is because GAP initiates programmes to
provide education and shelter for the children and thereby provide an opportunity to be
employed upon reaching a legal working age. According to Lucas and Galinsky (2015), this
is considered as a contradictory statement owing to aims and objectives of the ethical
considerations of a company.
As stated by Elliot (2016) it is necessary that GAP stop using children as labour as it
is considered as an abuse to the children. In this regard, a particular story can be analysed that
highlight the extent to which the company have been involved in unethical practise. It has
been seen GAP had been purchasing children from poverty-stricken families with the promise
of high payment. This in itself is unethical as the human labour can be purchased and used for
the benefit of the companies. This is one of the reasons behind considering this particular
approach as a backward step towards slavery.
Moreover, the location of the work is unhygienic and unclean and due to this, many of
the children may fall vulnerable to diseases. Therefore, a violation of the health practises of
the company is in violation as well (Van Hooft 2014). Thus, the application of utilitarianism
and virtue ethics can be undertaken in this regard. It has been seen that the virtue ethics
provides emphasise on the characters of individuals or in this the beliefs and characteristic of
GAP. Utilitarianism on the other hand, focuses on the actions that are best for the particular
situation (Fernando and Moore 2015). Judging by the behaviour undertaken by GAP, the
application of either of the ethical theories cannot be considered for the company.

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The fact that the children are forced to work as labours proves to be a serious offence
for the company. This is another factor that needs to be considered as crime as the forced
labour usually means that the children are working against their will. In the words of Carr
(2016), the manner in which the children are forced to work takes one back to the age of
slavery. The discovery of this sweatshop has been a major embarrassment for GAP. This is
mainly because of the fact that GAP is a well to do company in other countries, which has its
branches. Therefore, the owners of the company and other clothing retail sectors have
considered the discovery of this dark secret such as child labour as a shameful and unethical
act.
Therefore, it can be said that, strict actions need to be taken for preventing this
unethical conduct. Piacquadio (2017) observed that most of the items of the company that
have been manufactured by the children are being banned to protest against the unethical use
of the children. The owners of the company have decided to consider these allegations on a
serious note and have provided a notice demanding that the unethical use of children in the
manufacturing process be banned with immediate effect. Therefore, actions need to be taken
to ensure that ban on the products does not deplete the profit and reputation of the company.
It can be said that retailers who are engaged in the clothing and fashion industry have some
ethical and social responsibilities to all the stakeholders involved in the fashion industry. It
can be stated that retailers of fashion industry must intend to create benefits for the workers
who are employed in the factories and those who manufacture clothes. It can be said that the
retailing plays a significant role in the economy. Retailers generally tend to outsource the task
of manufacturing the garments to the developing nations like Bangladesh, India and China
due to the cheaper rates of labor.

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However, no steps are taken by the retailers and the companies of the clothing
Industry to ensure the welfare and the wellbeing of the manufacturers of garments in the
factories of the developing nations. It has been identified that many of the workers and the
manufacturers of garments who are employed in the factories of the developing nations have
are paid very low wages and are subjected to adverse living conditions. The live in acute
poverty and are subjected to stressful and long work hours. Further, it is has been found out
that the garments manufactured by the factories located in the developing nations employ
child labor. It has been specifically pointed out by the first social responsibility report issued
by Gap that gaps exist in the human rights policies and occupational health and safety at the
factories, which manufacture the garments that are sold by Gap Inc.
The multinational fashion giants at high prices sell the garments manufactured by
them. Such multinational fashion Companies like Gap Inc. acquire a huge profit margin by
selling such garment. Therefore, in light of the aforementioned statements it can be said that
the actions of the company mentioned above can be analyzed by the application of the ethical
theories of Utilitarianism and Virtue Ethics.
Discussion and Conclusion
In accordance with the theory of Utilitarianism, it can be stated that only those actions
can be considered ethical which produce the maximum utility for the most number of the
stakeholders involved. Utility can be defined as the wellbeing of the sentient entities. Utility
can be calculated by the benefit produced for the most number of the stakeholder minus the
efforts required to create such utility. Therefore, it can be stated that to assess whether the
actions of the company in consideration can be considered to be ethical it is first important to
identify the relevant stakeholders who are involved in the given scenario.

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In this case, it is evident that the workers who are employed in the factories and the
ones who manufacture the clothes are the primary stakeholders as they are the ones who are
responsible for carrying on the business of the company. The next step is to assess whether
the operations of the business creates utility for such shareholders. However, it is evident in
this case that no steps are taken by the corporation in consideration to ensure the well being
and the welfare of such manufacturers of garments who are employed in the factories of the
developing nations.
The extremely low wages paid to such workers, the retailers of the company in
consideration do not take adverse working conditions and the poor standard of living of such
workers present evidence of the fact that the interest of the stakeholders involved into
consideration. Further, it can be stated that Companies, operating in the clothing sector have
the responsibilities to ensure that they not only comply with the ethical standards at the
headquarters of such companies but throughout their supply chains. Therefore, in light of the
discussion above, it can be stated that the actions of the company Gap Inc cannot be said to
be in compliance with the ethical standards as analyzed by the application of the theory of
Utilitarianism.
The second ethical theory that can be applied to assess the actions of the company is
the theory of virtue ethics. As discussed above the theory of virtue ethics can be distinguished
from the branches of consequentialist theories, which take into account the actions for
assessing whether the action is good or bad and deontological theories, which focus on the
duties of the individuals rather the consequences of actions. The theory of Virtue ethics
however, focuses on the character of the individual as according to the theory if virtue ethics,
the character of individuals is the key element of ethical thinking.

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It can be stated that virtue ethics can be considered to be among the three major
approaches to in the field of normative ethics. Thus by the application of the principles of the
theory of virtue ethics to the facts of the given scenario, it can be stated that the actions of
Gap Inc. are inherently unethical. As discussed before, virtue ethicists attend to virtues rather
than consequences or duties as opposed to the proponents of Utilitarianism or proponents of
deontological theories. Therefore, in this case it is clearly evident that the actions of the
company Gap Inc are not virtuous as they do not consider the wellbeing and the welfare of
the workers who basically manufacture the clothes.
The manufacturers of the garments who are employed in the factories of the
developing nations are the ones who are primarily responsible for carrying on the business of
the fashion giants such as Gap Inc. The workers employed in the factories of the developing
countries live lives in acute poverty and are subjected to adverse working conditions. In light
of the aforementioned statements, it can be stated that the actions of Gap Inc do not exhibit
good virtues and moral character of the company. The company takes no steps to ensure that
ethical standards are complied with in the supply chains of the company. The best exhibit of
the non-compliance of the ethical standards is the employment of child labor in the factories
for the purpose of manufacturing garments. Thus in relation to the facts of the case, it can be
stated that Gap Inc. does not comply with the ethical standards as analyzed by the application
of Utilitarianism and Virtue Ethics.
To conclude, the report throws light on the unethical practices of renowned clothing
company GAP. Through the analysis, it can be stated that the company has widespread
problems, ranging from violations of child labor to usage of unsafe machineries. Thousands
of its factories are using machines and equipments that are unsafe for the workers, in order to
produce mass clothing for its retail chains. The theories of utilitarianism and virtual ethics
have been used in the report for understanding the overall purpose of morality in the fashion

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and clothing industry. The theories highlight how morality affects the organizations and how
they are supposed to conduct ethical practices for the welfare of their employees.
GAP needs to introduce certain capacity building programs, which focus on factory
workers and their conditions of working. In order to develop management systems and skills
the company needs to evolve their monitoring procedure, increase the usage of certified
programs and raise their working standards. The company recognized their duty and
attempted to take a leadership role in terms of ethical standards. However, for improving the
working conditions of the garment factory, it is important to take certain community
responsibility efforts into consideration, which include environmental practices,
volunteerism, ethical business practices as well as corporate governance.

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Reference
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