Investors call on the business community to take steps to mitigate the worst outcomes of this…
Call on luxury fashion brands to enhance transparency around the identification and management of material ESG issues, including efforts on living wage.
Improved transparency into how luxury fashion supply chains are managed and which labor and human rights issues are considered most material presents an opportunity to protect brand value from reputational, legal, and operational risks. It can also enable more productive conversations so that we can work together to address these pressing industry challenges and understand current best practices for luxury.
We acknowledge that the luxury fashion business model differs from ‘fast-fashion’. However, on social disclosure in particular, the luxury fashion sector can lag behind best practices compared to the apparel sector as a whole. Luxury fashion brands are also not immune to living wage risks, particularly in their supply chain. We believe that by not addressing living wage, the luxury fashion sector is missing out on opportunities related to improved human rights compliance and prevention of reputational risks, as well as business benefits such as reduced worker absenteeism and turnover rate, improved productivity, and addressing potential future labor shortage. We also consider living wage to be a salient human right that needs to be protected and guaranteed by all players.