Climate change first became news and gained media coverage thirty-two years ago when, in 1988, scientific reports with reference to global warming showing evidence of a significant rise in global temperatures as a result of the negative impacts of carbon emissions and the concentration of greenhouse gases, mainly from fossil fuel burning, became front-page news. Since then, further research on climate change has been carried out and executed linking additional human-induced factors that aggravate this phenomenon, such as deforestation, agriculture and farming.
This newly found understanding and knowledge regarding human’s activities responsible for the deterioration and weakening of the planet Earth’s climate and environment as well as a rapidly increasing world population, an excessive use of the planet’s resources, overconsumption and the excessive production of waste, resulted in a growing global concern and urgency to address these problems in a broad and multidisciplinary manner, from human attitudes to all levels of human. The term implemented to describe and embody this environmental consciousness is “sustainability”, a term that has become more popular over the years but that is certainly more than a trend as it is, fundamentally, equivalent to the concept of a balance between humans and ecosystems, to conserve natural resources available “in order to meet the needs of the present without compromising the ability of future generations meeting their needs” (WCED, 1987, P.
43) but also provides an approach aimed at four main pillars and areas that include human, social, economic and environmental sectors.Is Sustainability crucial to corporate success in today’s evolving society?
The overwhelming accumulation of scientific evidence and the significant number of environmental disasters have resulted in the public’s increasing awareness and consciousness of environmental impacts and a progressively globally expanding environmental movement.
As a consequence of the exponentially growth of the importance put on sustainability, businesses have experienced an increasing pressure from customers to implement sustainability in all aspects of their business model.
As the second most pollutant industry, contributor of 10 percent to the global carbon footprint and one of the sectors with the highest rate of air, soil and water pollution, the Fashion Industry, has also been experiencing a form of reshaping as the result of increasing demand for brands and companies that have sustainability principles and social responsibility at the core of their business operation, strategy, values and mission. This idea of corporate sustainability and corporate social responsibility has been a subject of many discussions, including in the Fashion Industry, regarding what it means, if it brings any value to a company and what it implies for businesses.
Corporate sustainability (CS), is a conscious management business approach which aims to provide long-term value for a firm or entity by the implementation of strategies that target every aspect of doing business including social, environmental cultural, ethical and economic, not only in order to improve the company’s performance but also, most importantly, to re-shape the previous business model into a more environmental, socially ethical and transparent one, from supply chain management, to how and where materials are sourced, to employees working conditions and labour practices.
This essay will argue that, companies and brands who make an active commitment to having sustainability and ethical practices at the top of their agenda, not only have better brand recognition and reputation, higher competitive advantage, increased growth, financial performance and a higher rate of staff retention but also experience, overall, higher success rates.
Sustainability represents a mean of substantial growth for mass-market and luxury fashion brands. As Seara (2028) argues, fashion brands willing to adapt to the ever-evolving environment in the industry and to make a commitment to successfully implement better practices into the company, not only will they substantially improve their environmental and social performance but also increase profitability, improve brand building and risk management. For brands who strive to expand their business and venture into a sustainability scheme, the process itself is no different than any other operational transformation as it requires a set foundation of strategy and goals that allow the company to embrace sustainability as a core value, which leads to the implementation of these ideals and intensification of efforts across the supply chain with measures such as, the improvement of materials chosen, increase in productivity, efficiency and conservation of resources utilized, use of alternative sustainable materials, partnerships with ethical and respected suppliers and improvement of labour and working conditions, consequently, these investments are beneficial, increase profitability and bring value to the company. In contrast, some argue that the promotion of a greener Fashion Industry is a marketing trick and that, particularly in the luxury goods sector, brands will not adhere to this movement as they feel that it will decrease the company’s value as the idea of sustainability does not align with the market’s principles and is contradictory to the values of the customers who frequently purchase from luxury retailers (Kapferer, 2013) while others argue that customers do not consistently have sustainability in mind when making purchases decisions. Nevertheless, with the continuous increase in customer awareness when it comes to environmental issues and ethical consumerism which leads to consumers making more informative decisions regarding their purchases by, for example, investing in quality over quantity, brands who adopt a sustainable strategy will not only, attract more customers but also have a competitive advantage and stand out amongst their competitors which leads to better brand recognition and better financial performance.
In all pillars of society, sustainability is the future. As Zhenmin (2015) argues, the way people have been living their lives for decades is not sustainable which means “we are at risk of irreversibly degrading the natural systems that sustain us”. This means that businesses will have to implement sustainable development into their strategies and treat it as a number one priority. In our current society, the idea of capitalism is still very much present and it is an ideology of capital, which means that for this economic system the most important notion is the concentration and prioritization of capital, frequently at any human and environmental cost. Today, society as a whole, is dealing with the consequences of putting solely profit above anything else in society as this means employers get paid less than what it takes to live, it means having a system that is fundamentally exploitative, unsustainable and that creates economic inequality. In some countries like the United States of America it means many people who need medication, that was once free, do not have access to it because they cannot afford it due to the fact that it was privatized, therefore, our priorities, at the moment, are not sustainable and need to collectively change. This applies to fashion brands and companies in general as, with the growth of the sustainable market and with society expanding and progressing towards a more innovative and sustainable future, in order to keep the business going, to stay relevant and to continue being sought out by consumers, companies are going to have to stay up to date, embrace change and innovation in order to cater to the current customers wants and expectations since the green and sustainable market is no longer a niche market. Ultimately, companies will have to understand the value of the environment and natural resources (Adams, 2018). Some argue that it is unrealistic to believe that we are still capable to change the direction in which we are going in and that it is too late to address the issues at hand, therefore, the main concern should be about “surviving not thriving” (Cheever, 2015), others argue that companies should only focus on profit and that focusing on welfare related subjects would only increase overall costs with little to no benefit for the firm (DeFoe, 2015). Yet, Defoe (2016) does not fully consider previously conducted studies that show companies with high sustainability measures, substantially outperformed companies with a lower sustainability profile, when it comes to the stock market, assets and equity. The study also shows that companies who adopted 40% of sustainable policies experienced a higher rate of about 4,8%, in above-market return, over companies who only implemented 10% of sustainable policies (Eccles, 2012). Furthermore, there is no middle ground when it comes to the climate crisis we, as a society, are experiencing so it is imperative that it is addressed accordingly and in correspondence with scientific data, it is a matter of data and science and it requires a global effort and amendment of the economy and policies. The way society is structured and organized, mostly revolving around personal gain and profit it is not sustainable. Implementing sustainability in business will significantly help in the transition to move forward to a more balanced, modern, fair and moral society where there is harmony between humans and the environment, profit and well-being.
For companies, applying sustainability to their core business strategy is largely beneficial. As Eccles (2012) argues, firms who adopt a sustainable approach and make sustainable development a core value and a main portion of their business model, experience significant more benefits than those who do not. Therefore, the benefits of executing sustainability focused policies such as adopting an ethical supply chain management, improving the efficiency and the methods by which natural resources are obtained, introducing policies that aim at carbon emission reduction, making employees human rights and working conditions a priority and making innovation part of the core values that run the company as it provides opportunity to, not only stand out but also to find different fabric alternatives that are safer and more environmentally friendly, have proven to, largely, outweigh the costs or the possible difficulties and challenges of reforming or readjusting a brands business strategy to a new different set of values and ideals. On the other hand, some argue that embracing sustainability policies leads to an erosion and demolishment of stakeholder values as the company’s changing priorities might result in the loss of support of certain stakeholders , others argue that implementing such policies will not only increase the amount of costs but also make the products more expensive which, consequently, would result in not as many people purchasing the merchandising manufactured or that the concept of sustainability is too broad, therefore companies cannot apply it to their operation (Laughland, 2011). However, multiple studies and companies have come forward and have proven that, contrary to what some believe, adopting a greener approach to business, while having its challenges related to finding the right suppliers or the right materials, has demonstrated to be vastly favourable across different parts of the corporation. Some of the reported benefits include, increased brand awareness, improvement in customers loyalty and trust due the transparency related to company’s practices as this makes customers feel like they can trust the brand, reduction of operation costs, waste and pollution as a result of the increased effectiveness in resource and material sourcing and management, better long term relationship with suppliers, value increase for stakeholders due to customer loyalty and employee retention because employees and more attracted and committed to companies that are proactive. Another significant benefit is that, even though most sustainable products and labels have a higher price point than the average produce partially due having to work with fare trade artisans, with customers mentality regarding buying habits and the environment modifying, nowadays people not only expect brands to act upon these issues but are also more likely to purchase something based on a quality of quantity mindset. This means that, when given the option, consumers will chose products and companies that align with their personal beliefs and will chose to purchase products or goods from establishments in which they trust where they do not need to feel guilty about purchasing an item or feel like they have to choose between quality or ethical practices, it is no longer just about the products themselves and more about buying into a brands overall message.
The Fashion Industry is one of the most degrading and wasteful in the world and although it plays an important role in society, it is doing more harm than good. As Sumner (2019) argues, fashion is more than just clothing and accessories, it allows people to express themselves, to have fun, to be creative, to express cultural identity and it is a way of self-empowerment. However, it is no secret that the current way the industry works is extremely harmful to the environment, with a system that is centered around fast fashion, the constant upcoming of trends, the availability of cheap clothing and, essentially, the concept of constant product disposability and consumerism which puts pressure on consumers to keep buying new pieces in order to feel like they are up to date with trends. By 2030, the industry’s water consumption will reach 118 billion cubic meters, its carbon footprint will reach 2,791 million tons and the amount of waste created by industry’s activity will be 148 million tons (Sumner, 2019). Furthermore, its social and human impact is visible in many ways across the globe from health risks that result from the use of extremely harmful chemicals that are released into water streams to human exploitation, usually, in the factories located in developing countries in which workers work extremely long hours and do not earn a living wage or are forced to work without earning any money and where child labour is still very much existent. On the other hand, many argue that fast fashion means that everyone has access to cheap clothing and that if brands were changed in order to be ethical, people would not be able to afford it or that all sustainable fashion looks the same and is not fashionable or stylish (Bauck, 2018). However, it can be argued that someone who wishes to make a lifestyle shift and support the idea of ethical fashion, actually spends less money because of this new way of living that is primarily focused on slow fashion habits, that means shopping less often, purchasing second hand clothing and repairing items instead of buying new ones. Furthermore, more fashion houses across all sectors within the industry are taking action and advocating towards sustainability which means that there is variety within ethical fashion, with luxury brands such as Armani, Versace and Gucci putting a stop to the use of real fur, to H&M with a garment collection scheme to Stella MacCartney with the use of vegan spider-silk (McKee, 2020). This means that consumers do not necessarily need to choose between style or ethically made products and that sustainable fashion can become accessible. However, these initiatives are not enough, the industry has a responsibility to improve its environment and social impact and there needs to be more brands supporting the movement.
The climate crisis currently being faced is real and demands urgent intrinsic change in the way society operates and is structured. With the continuous change in consumer habits and mentality and with the shift in society being expressed by an increased interest in sustainability and concern for environmental and social impacts therefore, in order to continue being successful, companies must embrace change and shift the way business is done and what priorities are set to align with consumers evolving practices.