Demonstrate the influence of environmental and behavioural factors on corporate size, structure and strategy. Understand the processes of business planning and policy making and the reason for change over time.?
This report will present the ethical consumerism in garment industry throughout the world – whereas the companies are sourcing materials maintaining ethics regarding working environment of the suppliers. The report will also constitute the strategies might be helpful for the companies in accompanying to prevent the incident like Rana Plaza. The report will also highlight some of the tactics governed by Primark Ltd of operating ethically in sourcing materials in view of environment friendliness and values to its customers.
From the theoretical point of view, ethical consumerism is the best answer for stopping this recurrence as happened in Rana Plaza, Bangladesh. As stated by Vaughan (2012), sourcing companies always try to reduce the price of the suppliers by making them loyal to them and preventing their bargaining power. It reduces the competency as well as efficiency of the supplier companies by means of operational effectiveness. Further, it also reduces their chance of developing business. In light of this, Ruitenberg (2014), states that retail companies from developed countries are taking supply from the suppliers of third world have failed to retain ethics in many point of view. Their policy of cost reduction has cost the supplier companies to compromise with the working environment and sourcing raw materials for their operation. Ethical consumerism, subject that deals with environment protection, work culture, tax payment has many arms to reduce this type of incidents. As said by Harbin (2012), ethics may be present in buying materials for the sourcing companies and this ethics are related to control the environment friendliness and values to the consumers. It is also true that companies from retail sectors that are rich of money are sourcing their materials from the third world at minimum price for sustaining their business in intense competition. Ethical consumerism constitutes of moral consumption, purchasing, shopping investment etc. where ethics is related in the business model of the companies and the consumers in selecting the materials and suppliers and know about them (Ethicalconsumer.org, 2015). It is a normal practice in UK to follow the companies sourcing policies as it might affect the environment and so far the brand value of the company. Therefore, companies are trying to resolve this problem by providing more liberty to its suppliers throughout the world so that they might be able to maintain a sustainable policy for their business. As observed by Vaughan (2012), spending from the companies for sourcing materials from their suppliers will may make increase their cost, but it will provide the suppliers a chance with developing the infrastructure of their work place and provides indistinctly towards responsible corporate citizen. As cited by Culiberg and Bajde (2012), the suppliers might not take the necessary action from the premium paid to them for infrastructural development and environment friendly culture of operation. Companies that are involved in purchasing ethically, they can boycott those suppliers so that throughout developed market they cannot sell their products where making business provides more profit margins.
In this context, Primark Ltd an UK based retail garment company is also sourced its materials from Asian countries like Rana Plaza. It is a requirement for the company to maintain a clear policy for the suppliers so that its customers can be able to view those policies are maintained throughout the process of sourcing. Company has taken initiative in ethical consumerism by changing its policies in developing the better world of suppliers provided that consumerism becomes ethical (Hudson et al. 2013). Company has also set some policies regarding the eco-friendly bags for their customers that are used to deliver the products from their retail outlets. Company has started structural survey of their suppliers’ factories, as it has no production centre on its own. It is also true that companies from the Asian countries do not follow the minimum regulations for the factory outlet as mentioned in their respective countries (O'Neill, 2014). Therefore, companies are related as company official and expert consultant for checking their infrastructure as a whole visits suppliers of Primark. This is a step for taking precaution for doing the business where ethical consumerisms have been reflected in the whole process (Yeow et al. 2013). Primark Ltd is maintaining the rules of using chemicals in garment as per their own standard, which cross the standard of European Union and also it meets the standard as recommended by Greenpeace committee (SLASH PAGE, 2015). Company has provided the standard to t suppliers for using chemicals in garments so that toxic levels of stringent chemicals become under-controlled in every factory for the workers. Company has initiated a project namely ‘Her’, which has aimed to provide training of health care for the women worker in the factory for their well-being. It provides deep insight for the women to be aware of sexually transmitted diseases and other women related physical problems that might become irritating in workplace. This program also provides the women free treatment from the local healthcare service and sanitary napkins to the labors (Primark.com, 2015).
From the above discussion, it is clear that companies are engaged in sourcing materials from the Asian suppliers in garment industry are trying to resolve the matter of Rana Plaza and have taken some initiative so that the incident does not repeat again in this sector. The retail industries are being target of foreign media due to their payment policy to suppliers making them to pay very low wages and retain a nominal profit for developing their infrastructure. Therefore, company like Primark Ltd has started some program for checking the infrastructure of the outsourced factory outlets every year by some expert companies, which may ensure management of sourcing companies for reduction of casualties due to accidents.
It may be recommended that companies that are involved in retail business of garment industry requires to source at better price in place of better infrastructure and quality from the suppliers. Company may pay the suppliers a premium for developing infrastructure and working environment in the factory after they do the same as per the requirement.
Vaughan, T. (2012). Business ethics. Delhi: University Publications.
Harbin, M. (2012). Concepts & Elements of Sustainability. New Delhi: World Technologies.
Culiberg, B. and Bajde, D. (2012). Consumer ethical decision making. Ljubljana: [B. Culiberg].
Hudson, M., Hudson, I. and Edgerton, J. (2013). Political Consumerism in Context: An Experiment on Status and Information in Ethical Consumption Decisions. American Journal of Economics and Sociology, 72(4), pp.1009-1037.
Ruitenberg, C. (2014). On Consumerism, Collective Action, and Whether Art Teaches Anything.Educational Theory, 64(2), pp.179-194.
Yeow, P., Dean, A. and Tucker, D. (2013). Bags for Life: The Embedding of Ethical Consumerism.Journal of Business Ethics, 125(1), pp.87-99.
Primark.com, (2015). Our Ethics. Available at: https://www.primark.com/en/our-ethics [Accessed on: 13 Apr. 2015].
O'Neill, B. (2014). It’s time for a Primark shoppers’ revolt against the snobbery of ethical consumerism – Telegraph Blogs. News - Telegraph Blogs. Available at: https://blogs.telegraph.co.uk/news/brendanoneill2/100092697/it%E2%80%99s-time-for-a-primark-shoppers%E2%80%99-revolt-against-the-snobbery-of-ethical-consumerism/ [Accessed on: 13 Apr. 2015].
Ethicalconsumer.org, (2015). News feed from Ethical Consumer - BBC Primark ruling "unjust and flawed". Available at: https://www.ethicalconsumer.org/latestnews/tabid/62/entryid/715/bbc-primark-ruling-unjust-and-flawed.aspx [Accessed on: 13 Apr. 2015].
SLASH PAGE, (2015). United Colors of Benetton - Clothing for women, men and kids. Available at: https://www.benetton.com [Accessed on: 13 Apr. 2015].