Business Ethics: CSR and Sustainability in the Clothing Industry

This report provides a comprehensive analysis of business ethics, corporate social responsibility (CSR), and sustainability within the clothing industry. It explores the significance of CSR and sustainability, offering insights into their practical application in the clothing sector. The report examines challenges and ethical issues, including environmental impact and labor practices, while providing case studies of H&M and Gap to illustrate CSR initiatives. It further identifies best practices, such as adherence to global labor laws and promoting human rights, and offers recommendations for enhancing CSR strategies. The report emphasizes the need for ethical fashion, addressing environmental concerns and the impact of manufacturing processes. It also highlights the role of business ethics theories in understanding and addressing the industry's challenges. The report aims to provide a detailed overview of the content, including the challenges, case studies, best practices and recommendations for a more responsible approach.

RUNNING HEAD: BUSINESS ETHICS
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Business Ethics

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Table of Contents
Introduction...........................................................................................................................................2
Challenges and Corporate responsibility and sustainability...................................................................2
Clothing Companies: Case studies........................................................................................................4
H&M.................................................................................................................................................4
Gap....................................................................................................................................................4
Best Practices in Clothing industry........................................................................................................5
Ethical and Moral Issues........................................................................................................................6
Recommendations.................................................................................................................................7
Conclusion.............................................................................................................................................8
References...........................................................................................................................................10

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Introduction
Corporate social responsibility and sustainability become important aspects of the business.
Sustainability is considered as the comprehensive approach that is used in organizations that
focused on maximizing and creating long term social, economic and environmental value
(Trevino and Nelson,2016). On the other side, corporate social responsibility is a model that
helps an organization to be socially accountable for its actions to stakeholders and to the
public. It is essential for the companies to take responsibility of the negative impact of their
actions on the community and society. The concept of CSR and sustainability are voluntary
business activities that include social and environmental concerns in business operations and
with stakeholder interaction. Due to this both of these concepts become a significant feature
of business ethics (Crane et.al,2019).
This report focuses on understanding and relating corporate social responsibility and
sustainability concepts in the practical scenario clothing industry. Further, two organizations
CSR and sustainable practices are discussed considering their long term objective and short
term objective. The businesses nowadays integrate business activities and goals with CSR
activities in order to give back to the society. There are many benefits that the companies get
by integrating CSR with their business goals and by formulating sustainable practices.
Further, the report highlights key challenges of corporate responsibility and sustainable
business in the clothing industry. After that, a detailed explanation about CSR activities,
goals and practices on the basis of the UN report is given of different businesses in the
clothing industry. With that best practices in the clothing industry are identifies and
considering the best practices recommendations are given on the basis of global consideration
related to corporate responsibility and sustainability.
Challenges and Corporate responsibility and sustainability
CSR is not a narrow concept rather it includes many aspects and becomes a valuable element
in the success of businesses. Due to CSR activities and sustainable practices many business
get benefits and able to compete in the market and contribute in the society and community.
Some of the best examples of CSR activities are Google, Coca Cola, Ford motor, Netflix,
Bosch and Starbucks (Bostrom and Micheletti,2016). This shows that by integrating CSR

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concepts with business goals the companies are successful and contributing their best for the
community and society and for economic development.
The clothing industry is one of the leading industries in the world, this industry is labor-
intensive due to that there are various challenges that the companies face in order to
implement CSR strategies and sustainability practices in the business. Every year people
spend a huge amount on clothing and this leads to excess level of production due to that there
are many natural resources that are used by the companies inefficiently and will bring the
next generation in trouble (Crane et.al,2019).
In the clothing industry, different types of clothes are produced which require different
conditions. “Nowadays, clothes which normally should be characterized by their endurance
and long life are completely redefined and in this modernization the desire for fast fashion
has created demand for 90 billion new garments per year, which represent consumption
hysteria that far exceeds human needs and planetary boundaries”. After looking into this
scenario it is identified that there are many challenges related to CSR activities and
sustainable business practices in the clothing industry that are highlighted below
(Ksiexak,2016).
The structure of the clothing industry and textile industry creates many challenges related to
CSR and sustainability. In the whole process of clothing manufacturing starting from creating
and selling garments the environment and society are affected. For instance, waste in the
fashion industry, CO2 emissions, use of pesticides and chemicals in fiber production, an
exertion of oil and a large amount of water, violation of human rights, and poor working
conditions are some of the challenges that companies face while operating in the clothing
industry. Further, the companies that operate in the clothing industry face challenges in
implementing CSR activities because employees and suppliers are not convinced to adopt
CSR practices and this trouble the companies as people who are connected need to do
activities voluntarily (Ksiexak,2016).
CSR is becoming a crucial area in the clothing industry as most of the companies in this
industry are not able to implement the CSR activities as required and as per the standard. In
the clothing industry, a huge amount of natural resources used by the companies and leads to
more waste. Mainly waste related to chemical dying, polyester clothing, tiny plastics, and
microfibers end up in oceans (Goworek et.al,2018). That leads to water pollution and loss of

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biodiversity. There are many challenges that the clothing industry needs to overcome that are
mainly related to the procurement of raw material, production process, and environmental
damage. Papahristou and Bilalis (2017), pointed out that throughout the process in the
clothing industry that starts from suppliers, supply chains, mediators and customer, CSR is
relevant.
Clothing Companies: Case studies
H&M and Gap are the companies that are based on less costly methods of manufacturing.
The CSR activities and practices of the companies are as follows:
H&M
H&M was established in 1947 in Sweden and at that time the company only dealt in women's
clothing segment. At present H&M is a leading brand in the clothing industry at the global
level with 3600 outlets across the world. The company does not have any factory outlet
rather it outsources all of its manufacturing processes to 800 factories in Asia and Europe.
The company since 2002 presenting CSR reports in accordance with GRI G4 guidelines.
Around 270 employees voluntarily deal with sustainability and CSR tasks and due to that
company’s policy based on following commitments that are choosing responsible partners or
suppliers, be ethical, be climate-smart, using natural resources efficiently and strengthening
communities. Further the company frame all its CSR policies and practices considering its
stakeholders such as customers, communities, colleagues, government and suppliers. The
company mainly contribute in the development of society by encouraging people to shift on
organic cotton clothes. This leads to the protection of the environment and reduces wasteful
activities. H&M is mainly known for its recycling fashion as 27% of the electricity of the
company comes from renewable sources (H&M,2018).
Gap
The gap is also a leading player in the clothing industry at the global platform. The company
ranked 57th in the global CSR rating that indicates that the CSR initiatives taken by the
company are contributing positively to the development of society and in building the
positive brand image of the company at the global level. The company aligned their CSR
activities with the UN global sustainable development objectives. The company contributes
in the society by focusing on acquiring resources from suppliers that use eco-friendly

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techniques. Further the company focus on responsibilities such as economic, legal and social
responsibilities. The social responsibilities that are fulfilled by Gap are related to supplier
sustainability and empowering women in the country. Environment responsibilities include
water stewardship strategy with that the company saved 1.3 billion liters of water in 2018
(Gap,2018).
Best Practices in the Clothing industry
In the clothing industry, the concept of CSR plays an important role because of extensive
competition brands in this segment work tirelessly to build their positive image at the
domestic and global levels. Because of increasing globalization in the clothing industry, the
operation of the companies spread geographically starting with manufacturing, retailing and
distribution in different countries. “Global retailers work hard to ensure their global corporate
standards for safety, labour, sustainability, quality of product and so forth, are adhered to and
maintained throughout their supply chain”. However, these are still considered as the daily
challenges for the companies in the clothing industry (Ksiexak,2016).
In order to overcome these challenges, the best practices that the global organizations can use
are focus on global labor laws as the clothing industry is a labor-intensive industry here fair
wages, gender equality, and working conditions plays an important role. In the clothing
industry, the best sustainable practice is to focus on human rights and provide equal
opportunities to workers and giving protection and security to workers helps the company to
contribute to the social and economic domain. Further, it is analyzed that in the clothing
industry the challenges are mainly related to human resources and in that issues are related
working conditions, wages and working hours (Nave and Ferreira,2019).
The companies that are operating at the global level need to ensure that all the CSR practices
are not only stayed to headquarter rather be followed by subsidiaries and subcontractors. The
practices that can be used and implemented by the companies in clothing industry are:
 Encouraging suppliers to abide to international standards
 Conducting supplier audit
 Implementing code of conduct for suppliers
 And creating external frameworks

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The best CSR practices in the clothing industry are connected with the suppliers and
employees as the role of supplier and the role of workers in this industry is major. Hence, the
companies can focus on implementing these practices in order to enhance their CSR strategy
and to cope up with the challenges that are mentioned above (Akbar and Ahsan,2019).
Further, for protection of workers in the clothing industry the companies should develop
socially responsible methods in the production process so that a safe and healthy environment
can be provided to workers. These changes can benefit the organizations in the clothing
industry such as building a positive image of the brand in the market, increasing profits and
giving competitive advantage. Other practices that the companies should follow are
supporting financially to local community members, encouraging employees for volunteer
contribution, and development of social program. The companies can change its
organizational structure by adopting policies related to non-discrimination, employee’s
healthcare and self-development. At last good practices can be related to improving relations
with stakeholders by ensuring corruption-free processes, encouraging transparency and
spreading CSR values in all connected members (Nave and Ferreira,2019).
Ethical and Moral Issues
Business and marketing ethics in the clothing industry are getting attention because many
companies face issues related to ethical and moral conduct in the clothing industry. Some of
the ethical issues in the clothing industry are described below:
Ethical fashion nowadays becomes a concerned topic as this industry “being the second
largest polluter of the planet after the oil industry”. Because of higher demand and production
in the clothing industry, the companies are not adhering to environmental factors and
standards. The processes in this industry are the major ethical issue as gallons of toxic
pesticides are mixed into water bodies during fiber production (Golob et.al,2019). The
clothing industry has a hefty carbon footprint that resultant in excessive pollution. Due to
that, it becomes difficult for the companies that operate in the clothing industry to run a
business ethically as in the whole process there is a negative impact on the environment and
the companies are not able to fully take responsibility for their action (Davies,2016).
The business ethics theories that are useful in this condition to understand which practices
and processes of the company are affecting the environment and our need to take care of.
“Utilitarianism theory states that an action that brings the greatest pleasure over pain for

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everyone is considered as the ethical decision”. On the other side, the theory of deontological
focus on the concept of obligation and duty “that means an individual is obliged to perform
its duties and certain actions are right due to basic nature whether it benefits others or not”
(Bowie,2017). For instance, in the clothing industry, the companies are providing basic
things to people but the cost of providing it is much higher as manufacturing processes in this
industry affect the workers, communities, animals, environment, and biodiversity.
The clothing industry also behaves unethically in relation to animal rights as during the
manufacturing process many endangered species get affected as without it is impossible to
operate in the clothing industry. Animal-based materials like fur, wool, leather, and hides are
used as accessories in this industry. This is also a major ethical issue in this industry and a
challenge in implanting CSR practices in this area. On the other side, the use of women's
bodies for sexual objectification is another major ethical issue that needs to be solved. As in
the clothing industry, “women are seen as an aesthetic object of desire of men”. As it is seen
that at the time of marketing in the clothing industry the average body shape of women is not
considered rather a sexualized body is considered for fast communication and attraction. In a
nutshell, businesses at the global level need to consider all these issues and take precautions
to deal with them in order to run a sustainable business (Todeschini et.al,2017).
Recommendations
The companies that are operating in the clothing industry have a greater impact on the society
and environment. In order to reduce their impact, they need to ensure that proper sustainable
practices and CSR strategy as per the global consideration should be integrated with the
business model. At the global platform a program is introduced named “2020 Circular
Fashion System Commitment”. The aim of this program is to push global players towards
sustainability by using a set of standards (Wu and Li,2019). It is recommended that the firm
that is operating in the global environment in the clothing industry needs to follow the
guidelines of this program.
Further, in order to run a sustainable business, the companies can implement design strategies
for cyclability, increase the volume of used clothes, resold and recycle the used clothes and
can recycle consumer textile fiber. This will help the companies to reduce the issue of
environment degradation from their side as implementing these practices in their production
process benefit the society and environment to the greater extent. The global targets for each

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company in the clothing industry are reduction in carbon, waste and water by 15% every
year. In order to meet these targets, companies can push their suppliers to implement
practices that are eco-friendly and have less impact on the environment and animals. Further,
they should value clothing by conducting various programs at the global level to bring
awareness about reuse and recycling clothes in order to extend their value as this leads to
lower demand and ultimately leads to lower production. Due to this resources are used
efficiently and waste can be reduced by the companies.
However, it is quite impossible for the companies that are operating in the clothing industry
to completely remove the negative impact of their activities on the environment and society.
But the companies can become more proactive and cognizant about reducing the social and
environmental impact of their production process or product life cycle. For that, it is
recommended that the companies should use benchmarks and tools that help to identify the
impact of their process and product decisions on the society and environment. For instance,
the companies that produce polyester shirts shift to cotton shirts as “polyester shirt has more
than double the carbon footprint of a cotton shirt”. But on the other side, one kilogram of
cotton requires 10,000-20,000 liters of water to produce ((Todeschini et.al,2017).
The tools and benchmarks that the companies can use are the “Higg Materials Sustainability
Index, Design and Development module, Product Module and Facility Environment Module.
These tools can help the company to enhance or improve its sustainability performance at the
global platform (Pedersen et.al,2018). It is recommended that the companies rather than
focusing on the end-users and suppliers should focus on front end approach that means
integrating the sustainable practices at the beginning activities such as sourcing of raw
material and change in designing and development process such as the companies should
focus on using raw material that has low environmental impact or by using digitalized tools
that help to reduce the need for physical prototype or training can be given to staff for using
eco-conscious products. Hence, the companies that are operating in the clothing industry need
to implement these practices and policies in order to overcome the challenges and issues that
they are facing related to CSR. Hence, considering these theories and the concept of business
ethics it is suggested that the front end and bottom end approach can be used by the
companies to enhance its CSR activities.

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Conclusion
In the clothing industry, there are many challenges that the companies are facing related to
CSR activities as the whole process has a negative impact on the different areas. From the
study, it is analyzed that the global considerations in the clothing industry are environmental
change, animal cruelty and social wellbeing. In the global environment, these factors play an
important role. Due to that, it becomes essential for companies that are operating in the
clothing industry to follow sustainable practices and being CSR friendly.
It is concluded that the best practices in the clothing industry are encouraging suppliers to
follow the global standard, conducting supplier audits, implementing the code of conduct for
suppliers and creating external frameworks. Further practices are related to human rights that
include avoiding child labor, giving proper working conditions to workers and encouraging
gender equality and equal pay. From the two cases that are discussed in the report of Gap and
H&M, it is identified that both the companies are sustainable and integrated CSR practices
and strategies with its business objectives that help the company to contribute more to the
economic development and social development. At, last, the companies should conduct
corporate social responsibilities activities in order to promote eco-friendly production
techniques and by investing in training employees and suppliers to opt for digital technology
to reduce the impact of their operations on the society and environment.

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References
Akbar, S. and Ahsan, K., 2019. Workplace safety compliance implementation challenges in
apparel supplier firms. Journal of Cleaner Production, 232, pp.462-473.
Boström, M. and Micheletti, M., 2016. Introducing the sustainability challenge of textiles and
clothing. Journal of Consumer Policy, 39(4), pp.367-375.
Bowie, N.E., 2017. Business ethics: A Kantian perspective. Cambridge University Press.
Crane, A., Matten, D., Glozer, S. and Spence, L., 2019. Business ethics: Managing corporate
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Davies, P.W., 2016. Current issues in business ethics. Routledge.
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%20FullReport.pdf

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Księżak, P., 2016. The CSR challenges in the clothing industry. Journal of Corporate
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