Well, here’s a plot twist we didn’t see coming: H&M, Levi Strauss, and the Gap just made Ethisphere Institute’s “Most Ethical Companies” list for 2014. The third is the most surprising. This past January, the Public Eye Awards jury named Gap—which also owns the Old Navy, Banana Republic, Athleta, and Intermix brands—the worst corporation of 2013 for its “steadfast [refusal] to contribute to effective reforms in the textile industry.” One of the top purchasers of clothing in Bangladesh, the American retailer has frequently come under fire for its refusal to sign the legally binding Accord on Fire and Building Safety, choosing instead to align itself with an alternative plan, one that trade unions and labor advocates have largely denounced as a “corporate-controlled sham agreement.”
MIND THE GAP
Its spotty human-rights record notwithstanding, Gap has also aroused the ire of Greenpeace, not only for its alleged role in toxic water scandals from China to Mexico, but also for its failure to “credibly commit” to eliminating hazardous chemicals from its products and supply chain.
Greenpeace has implicated Gap in toxic water scandals from China to Mexico.
Meanwhile, the company scored a middling 42 points (out of a possible 100) in the Responsible Sourcing Network’s recent evaluation of companies’ efforts toward eliminating forced labor from their supply chains.
But Ethisphere, which has listed the company in its rankings for the eighth consecutive year, is firmly Team Gap.
“The entire community of World’s Most Ethical Companies believe that customers, employees, investors and regulators place a high premium on trust and that ethics and good governance are key in earning it,” Timothy Erblich, Ethisphere’s CEO, says in a statement. “Gap Inc. joins an exclusive community committed to driving performance through leading business practices. We congratulate everyone at Gap Inc. for this extraordinary achievement.”
To its credit, Gap did announce in February its plan to raise the minimum wage for its U.S. workforce to $9 for the remainder of 2014 and $10 in 2015, a move it says will benefit 65,000 of its employees. But Gap’s consideration of its overseas workforce, to put it mildly, falls short of reasonable expectations.
H&M and Levi’s “wins” are more understandable. Levi’s has, after all, pioneered several better-for-the-planet innovations, including its H2O-sipping “Water<Less” jeans, the triple-bottom-line “Wellthread” sourcing process for its Dockers label, and a new way of manufacturing denim using 100 percent recycled water.
In 2010, Levi’s led an industry-wide ban on sandblasting, a denim-distressing technique linked to a fatal lung condition in workers, although at least one labor group questioned the effectiveness of an injunction that is widely circumvented due to lack of oversight.
No matter what you think of “fast fashion,” H&M has at least done its bit to raise sustainability’s profile.
And despite what you think of “fast fashion”—we’re hardly fans, as you can imagine—H&M has at least done its bit to raise sustainability’s profile among the general populace, whether it’s producing the dedicated “Conscious” and “Conscious Exclusive” collections or launching a first-of-its-kind global clothes-recycling initiative. It is also one of the biggest buyers of organic cotton in the world.
The Swedish retailer has fielded its share of sweatshop scandals, to be sure, but it has pledged to deliver a living wage to more than 850,000 textile workers by 2018—a “positive” if not entirely perfect step, according to Emma Harbour of the Clean Clothes Campaign.
2014 marks H&M’s fourth appearance in Ethisphere’s rankings. “H&M joins an exclusive community committed to driving performance through leading business practices,” Erblich says. “We congratulate everyone at H&M for this extraordinary achievement.”
Ethisphere bases its World’s Most Ethical Companies assessment on scores generated in five key categories: ethics and compliance program (25 percent); reputation, leadership, and innovation (20 percent); governance (10 percent); corporate citizenship and responsibility (25 percent), and culture of ethics (20 percent), all of which sound pretty amorphous.
To draw a contrast, GoodGuide, a watchdog group that has evaluated 182 apparel companies based on environmental, social, and health performance, consistently places Patagonia at the top of its rankings.
Update: March 31, 2014
An eagle-eyed reader forwarded a 2010 article in Slate about certain conflicts of interest that Ethisphere may not be quite so forthcoming about. Oh, irony.