When we discuss accountability in the fashion industry, we tend to focus a lot on the brands. After all, it is their business model that is creating and perpetuating the inequalities across the supply chain. Yet, not only that the fashion system is made out of different players (including us, the consumers) but the brands never stand alone. It is time to get the investors in the picture.
During the lockdown, Bela decided to research about accountability in the fashion industry. After investigating 10 big brands (Adidas, Under Armour and ASOS included) it became apparent to her that most investment companies own large proportions of the big brands. A few of those investment companies are popping up more than once for different clothing brands. This is why we cannot ignore them. While we should not stop demanding the brands to take accountability for (not) paying their garment workers, we have to take the full picture into account. The fact is that the investors play a key role in funding and managing the brands’ actions: brands depend on their support and money. Therefore, it is fundamental to address investors when we discuss unfair labour.
The investors have the power in the fashion industry.
They choose to invest in what they “love and support”. Usually, this means investing in whatever is to be a successful business. For example, with the eco-conscious trend in the West, sustainable fashion has seen a steady increase in importance, especially over recent years. Investors have piled into sustainable funds, which pulled in a record-breaking €120bn in Europe last year — 2.5 times the amount in 2018. This amount shows that yes, investors do have the money to invest in sustainability. Unfortunately, only if that means further profit.
It is time to challenge this.
We believe that investors and shareholders can directly influence how the fashion system works. Investors’ actions shape the brand’s business and policies and, ultimately, they decide how women are treated in the RMG industry. So, opening a conversation about this is necessary for both investors and workers. We want to understand how investors and shareholders are making their investment choices. What processes are in place? Who is accountable for making them? But also, how much visibility do investors really have of the company’s supply chain and their role in modern slavery? Finally, who writes the internal ethical and sustainability policies?
By investing in a company, the investors decide on its growth and success. Therefore, companies need to have transparent relationships with investors for them to know what they are funding and supporting. This however does not remove any responsibility from the brands: they need to prioritise the people who make their clothes, over their own profit. Paying the workers their earned wages, instead of paying off the stakeholders (as Clean Clothes Campaign recently noticed), would be a place to start.
What would be the next one? Share your thoughts with us!
Bela & Tena