Comment | The true value of a $12 t-shirt

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In Malaysia and other garment-producing countries we surveyed, workers described being trapped in a similar trap: debt bondage after paying exorbitant wages to unscrupulous employers.

The apparel industry suffers from what economists call the “agency problem.” Brands rely on auditors to identify violations at factories – and then often require factories to pay for their own audits. Surprisingly, conventional audits are short, unreliable and, as Transparentem found in most of the audited factories we investigated, easily manipulated. Suppliers, already operating on razor-thin margins, cannot afford to lose customers. Nor are auditors who often show little interest in scrutinizing their clients to the extent of their comfort.

Young consumers, who tend to be progressive and question received wisdom, offer the world’s best hope for change. They are concerned about ethical consumption, seeing it as a question of self-identity. In the year In 2015, 73 percent of global millennials said they would pay more for sustainable products. As millennial incomes continue to grow, that figure is likely to grow even more. Millions of users of sites like Poshmark and Depop—websites focused on helping consumers buy and sell used clothing—are millennials and Gen Xers, many of whom are looking for a way to avoid first-class fast fashion consumption altogether.

Many younger consumers are also obsessed with truth, and are not buying the superficial “greenwashing” or unethical claims of some brands. Nor should they be. So far, precious few companies—Patagonia is a notable exception—even attempt to be sufficiently transparent about the true working conditions in their supply chains. Although younger consumers will pay more for sustainable products, brands lack the transparency needed to close the deal.

This gives an opportunity. We know that young consumers are willing to pay more for clothes made by workers whose voices can be heard. And we all need to know that those workers are safe. The first, urgent step: Apparel companies should publish full, detailed social compliance audits at all upstream factories to help assess working conditions. Such disclosure allows investors, other brands, consumers, activists, unions, and, critically, employees themselves to audit auditors and become increasingly part of the monitoring process.

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