PROFESSIONAL ETHICS

ASSIGNMENT: 2

GREEN PROCUREMENT IN FASHION INDUSTRY

FOR SUSTAINABILITY

SUBMITTED BY:
ANUSHKA NARAYAN
B.FTECH
 INTRODUCTION
The fashion industry has arguably grown
into one of the world’s most needlessly
polluting, wasteful, energy-intensive and
inefficient industries. Its supply chains are
so fragmented, vast and distant that many
retailers are unaware of how their fabrics
are made, and who runs the factories that
supply them. This dislocation is all the
more concerning now that the life cycle of
a garment is known to be far more
environmentally damaging than
previously assumed.
The fashion industry is growing at an impressive clip. By 2030, the sector is expected to be
worth $3.3 trillion and will manufacture 102 million tons of clothes and shoes. But this
substantial growth hasn’t come without a cost. Six years after the Rana Plaza disaster – the
fashion industry’s day of reckoning when a factory for over a dozen major brands collapsed
and killed 1,000 people – observers and analysts are left wondering whether the industry has
made any progress on sustainable sourcing in fashion.
Labor and human rights have long been a problem in clothing production, but they aren’t the
only Corporate Social Responsibility (CSR) risks the fashion industry faces. The cost of clothing
waste on the environment is also prevalent: 17 billion items are returned to retailers every
year, emitting a total of 4.7 million metric tons of CO2. And with global garment
production doubling over the last 15 years, 65% of excess garments end up in landfills or are
incinerated, releasing toxins into the environment.
Brands have made progress in addressing these issues – Reformation, Everlane, Athleta,
H&M’s Conscious clothing line and more have created lines that limit negative impact – but
there’s still room to grow. Today’s consumers want to both look good and feel good about
what they’re buying – which means delivering products and services to market that aren’t just
fashionable but are also created responsibly and ethically. Sustainability should not have to
be sacrificed in the pursuit of style – and the key to delivering on both promises lies
in sustainable procurement practices.
Every Trend Starts Somewhere
The “fast fashion” model of producing clothing as quickly as possible and at the lowest cost
perpetuated sustainability issues already present in a complex and global apparel supply
chain. A general lack of visibility and transparency can lead to problems with forced labor,
corruption, environmental issues and more for any company, but the models deployed by
fashion brands to keep up with new styles quickly has made it even harder on supply chain
and sustainability teams to address these risks.
The supply chain accounts for more than 80% of global greenhouse-gas emissions and 90% of
impacts on resources like air, land, water, biodiversity and more. Often CSR issues lie deep in
supply chains, making it hard to address with traditional procurement programs. In fact,
according to the Sustainable Procurement Barometer study, only 15% of organizations said
they have complete supply chain visibility into the CSR and sustainability performance of both
tier one and two suppliers, and only 6% reported full visibility into tier three suppliers and
beyond.

GREEN LOGISTICS
For industries with lower margins, such as the clothing industry, green supply chain
management can lead to lower supply chain related costs. These cost reductions can be
translated into significant competitive advantages and profit. Other benefits of green supply
chain management include reducing risk, improving productivity, increasing property value,
improving public image and creating healthier environments.
Green supply chain management (GrSCM) concepts manage environmental impacts where
they occur, ideally before they occur. GrSCM tries to minimise the undesirable environmental
impacts of supply chain processes within the participating organisations and the whole supply
chain as well. Srivastava (2007) defined GrSCM as “integrating environmental thinking into
supply-chain management, including product design, material sourcing and selection,
manufacturing processes, delivery of the final product to the final consumer as well as end-
of-life management of the product after its useful life.”
Reverse logistics is also a very important concept, and Rogers and Tibben-Limbke have
defined reverse logistics (RL) as“the process of planning, implementing and controlling the
efficient, cost effective flow of raw materials, in-process inventory, finished goods and related
information from the point of consumption to the point of origin for the purpose of
recapturing value or proper disposal.” RL activities vary form product/industry to product
industry, but common activities are collection, transportation, inspection/sorting, storage,
reprocessing (including recycling, reusing, repairing) and/or disposal.

GREEN PROCUREMENT
Green procurement is another subject important in the green supply chain. Burt and
Pinkerton defined procurement as the process of “Deciding what, when and how much to
purchase; the act of purchasing it; and the process of ensuring that what is required is
received on time, and in the quantity and quality specified”. Procurement activities include
inventory management, identifying requirements, determining requirement specifications,
finding appropriate suppliers, contract negotiation and management (price, amount, quality,
delivery schedules etc.), receiving, quality inspection, storage and inbound distribution. Green
procurement tries to minimise the environmental impacts of selected products and services.
It is estimated that freight transport accounts for roughly 8% of energy-related CO2 emission
worldwide. The inclusion of warehousing and goods handling is likely to add around 2 - 3
percent to this total. In the road transport sector, the amount of energy used to move freight
is increasing at a faster rate than the energy consumed by cars and buses, and may overtake
it by the early 2020’s. Green logistics represent the several strands that are moving freight
transport externalities, city logistics, reverse logistics and corporate environmental strategies
towards logistics and green supply chain management .
Logistic activities are responsible for much of the environmental cost associated with modern
retailing. Environmental effects of green logistics can be divided into six categories.
1. Greenhouse gas emission (GHG)s: Numerous gases have a global warming effect with
different degrees. Carbon dioxide is produced by burning of fossil fuels in vehicles and power
generation. It is the most important GHG emitted by retailers. Also temperature control
equipment releases refrigerant gases that can have a global warming potential thousands of
times greater than CO2. Some large retailers measured their “carbon footprints” , for example
Marks&Spencer has estimated that its logistics activities comprise approximately 11% of its
total CO2 emissions.
2. Noxious gases: These gases are nitrogen oxide, sulphur dioxide and particulate matter,
(PM10) affecting local air quality, human health, vegetation and buildings negatively.
3. Noise: This is caused by mainly vehicles and distribution centers.
4. Accidents: The cost of personnel injury/death, any damage to property and released use
of emergency services deemed to be environmental costs.
5. Waste: Retail logistics operations generate large quantities of waste, mainly in the form of
packaging material. Products damaged or life-expired in the supply chain have to be rejected
and this can also be considered a type of logistics-related waste. Today retailers must have
controls for the recycling and reuse of packaging and other waste.
6. Visual intrusion: Many people dislike the appearance of trucks and warehouses and they
believe that they reduce quality.
The average grams of CO2 emitted per tonne-km for a deep sea container ship, freight train,
heavy truck and long haul airfreight are around 14, 30, 80 and 570, respectively. Changing
freight from air or road to rail and water-born transport can significantly decrease the
retailer’s footprint. Also air transport is significantly more expensive than movement by sea,
but the difference in rates does not adequately reflect the huge difference in environmental
costs.
The global apparel market has been changing under the influence of many factors. One of the
critical observations is that developed economies have been shifting textile and apparel
production to developing economies and four major production blocks seem to have emerged
as the main competitors for this shifting production capacity: China, India, Latin and South
America, and Pan European and Mediterranean regions. The number of links in a supply chain
and logistics activities are very important. It might consist of a single link from the distribution
center to the shop or several links. Goods are transported through each link in the retail
supply chain, reflecting the retailer’s sourcing strategy, the geographical structure of the
logistics system and the efficiency of vehicle routing. By achieving higher levels of vehicle fill,
the amount of truck traffic can be reduced. In order to allow more fuel efficiency and reduce
traffic congestion, deliveries must be inside off-peak periods. Converting from conventional
diesel fuel to alternative fuels or to battery powered vehicles recharged with electricity
(generated by renewable means such as wind or water power) can significantly cut
emmissions of CO2 and noxious pollutants. H&M builds distribution centers in their
international locations in order to cut down lead times and potential logistical costs. Zara has
the opportunity to be one of the trendiest/low priced retailers, and one of the market
opportunities for Zara is to invest in internet retailing, especially directed toward the U.S.
market. Their European strategy includes having a strong production and distribution facility
in their home country in order to have short production and lead times.

MAJOR FASHION BRANDS ARE MOVING TOWARDS

SUSTAINABILITY
Several fashion companies are consulting with sustainable advisory firms, and investing
research and development into alternative production methods and materials. In early-2018,
adidas released a new sneaker line in collaboration with Parley for the Oceans that is made
from fibres recycled from waste plastic. The luxury fashion conglomerate Kering has made
commitments to cleaning its supply chain, by implementing the Natural Resources Defense
Council-implemented Clean by Design programme across its brand suppliers.
Other technologies help companies to make ethical procurement
decisions. Blockchain services offered by London-based Provenance enable companies to
trace and certify their supply chain. Cloud-based system Galaxius tracks supply chain
activity from fabric orders to garment delivery and enables performance-related pay
calculations that can result in garment workers earning up to £17 an hour.
CASE STUDY: MANGO
High street brand Mango is the latest fashion retailer to roll out a sustainable range with its
Committed Collection. Now in its third season, and manufactured in Portugal, Morocco and
Turkey, the range features garments made from certified organic and recycled cotton,
recycled polyester or cellulose-based fabric Tencel.
Beyond this capsule collection, Mango says 44 per cent of its range of garments comprise of
natural fibres. The company is currently developing an internal tool to calculate the
company’s water footprint and identify the processes, garments and installations with the
greatest water-saving potential, which will help it reduce water consumption. Mango has also
joined the Better Cotton Initiative and aims to source 50 per cent of its cotton from
sustainable suppliers by 2022.