H&M. Ethics and Social Responsibility of the Swedish Fashion Giant

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H&M. Ethics and social responsibility of the Swedish fashion giant (case study)

Author: Maria Roszkowska-Śliż, Katedra Teorii Zarządzania, Kolegium Zarządzania i Finansów, Warsaw School of Economics

Source: “Style and Substance. Sustainability Repot 2009”, H&M 2010

Warsaw, 2011

H&M Ethics and social responsibility of the Swedish fashion giant

H&M is one of the world’s largest fashion company employing 76 thousand people. The company, established in Sweden in 1947, owes now around 2 200 stores in 35 different countries. It offers a varied selection of clothes for women, men, teens and children, as well as cosmetics, shoes and accessories.

H&M offers its customers fashion and quality at the best price, nevertheless still thinking about its impact on society and environment. The company’s corporate social responsiblity strategy includes 5 areas: • Supply chain • Environment • Products • Empolyees • Community H&M doesn’t have or operate any factories of its own. It sources clothes and other products from about 700 independent suppliers. That is why one of the most important areas of its corporate social responsibility is supply chain management. The company products are manufactured in around 2 thousand production units, mostly located in Asia and Europe, often in countries with high of the risk of human rights violations and non-compliance with local labour law and internationally agreed labour standards. H&M believes that it has a responsibility to its suppliers and their employees. Being large international corporation, the company promotes human and labour rights among the suppliers in order to improve working conditions in production units.

Code of Conduct

The H&M Code of Conduct is the main tool used to influence the suppliers. The document outlines the requirements we have towards all our suppliers for improving working conditions and environmental practices in their operations. It is based on the UN Convention on the


Rights of the Child and the International Labour Organisation's (ILO) Declaration on Fundamental Principles and Rights at Work. It also stipulates that local legislation must be observed. The Code is available in 25 languages and can be downloaded from the company’s webpage. To help suppliers and their subcontractors understand the Code of Conduct and company’s expectations, H&M provides an implementation guidance document for suppliers. This guidance is available in English, Chinese, Turkish and Romanian.

Code of Conduct covers such issues like: • working conditions, • a ban on child labour, • fire safety, • working hours, • wages, • freedom of association, • environment. The document impost a ban on child labour. Nevertheless if a supplier infringes the prohibition on child labour, he is given one chance to rectify the situation. If this is dealt with in a satisfactory manner, he may continue working with H&M. Together with the supplier H&M tries to find the optimum solution, taking into account the child’s age, education and social situation. In most cases the solution involves the child being given the opportunity for schooling, which is paid for by the supplier. The supplier also compensates the family for loss of income.

According to the Code suppliers shall pay their employee at least the statutory minimum wage. However the company admits itself, that in some countries, i.e Bangldesh, the minimum wage doesn’t let people to meet their basic needs.

The document outlines also standards concerning environment protection. Suppliers must comply with all applicable environmental laws and regulations in the country of operation.. When it comes to water management, all outgoing wastewater from wet processes must be treated before it is discharged. The treated wastewater quality must meet the requirements in


local legislation or the BSR1 guidelines, whichever is stricter. The Code includes also a list of chemicals, that usage in the production process is...
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