H&M embraces ethical business – and that could play well with Millennials
The millennial generation is renowned for its commitment to environmentalism and equality, with a large number of consumers from that demographic showing a preference for brands that pay a living wage and commit to sustainability. H&M is eager to show that they are such a brand. Yesterday, the company hosted a Fair Living Wage Summit 2018 in Phnom Penh, Cambodia, to discuss how the fashion industry can institute a fair living wage across its global production markets. It also announced that it had signed up to the Fashion Industry Charter for Climate Action, which was initiated by designer Stella McCartney at the UN Climate Change Conference in Katowice, Poland.
In the last three months, H&M’s share price has skyrocketed by 34%!
Source: Yahoo Finance
The date of yesterday’s event coincided with a self-imposed deadline for the implementation of H&M’s own living wage strategy across its global supply chain, which it set five years ago. The company said it’s accomplished two “time-bound” goals that were set out in this strategy (installing democratically elected reps for garment workers to give them a voice in the company, and using improved wage management systems that make payment fairer and more transparent). However, it is time to set new targets.
Those new targets, the company says, should be set collaboratively by brands, academics, NGOs, trade unions, partners representatives, and investors – in other words, all the major stakeholders. Hence the list of attendees at yesterday’s event. Jenny Fagerlin, the company’s global social sustainability manager, said: “By collaborating with others who are just as committed to this crucial topic as we are, we’re convinced that our industry can take big leaps forward.” H&M also noted that an evaluation of its current wage strategy, undertaken by the Ethical Trading Institute, revealed that the average wage at its supplier’s factories was between 24% and 93% higher than minimum wage (country dependent).
In different, but related, news, H&M also announced its commitment to action on climate change, joining a number of its peers as a signatory on the Fashion Industry Charter for Climate Action. The group’s CEO, Karl-Johan Persson, said in a statement: “[The Fashion Industry Charter for Climate Action] is about getting the fashion industry united in important climate work. Our industry has a global reach and only together can we create the change that is urgently needed. We are happy to be a signatory of this charter as part of our ambition to become climate positive in our value chain.”
Dominion holds H&M in its Global Trends Luxury Fund.
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