Corporate sustainability in the fast fashion industry: the case of H&M

Treball Final de Grau en Administració d'Empreses. Codi: AE1049. Curs 2018-2019The textile sector is an important part of the world trade, being the second sector of consumption worldwide estimated at more than 30 million tons per year (Shen, 2014). For this reason, it is considered important to understand the most relevant aspects of this sector and its tendency towards sustainability. The world in which we live is in a process of constant change and, in recent years, the business model known as "fast fashion" has revolutionized this sector generating great benefits for large fashion distribution chains (Salcedo, 2014). They have managed to seduce their clientele with the constant updating of their designs and the low prices of their products, so that more and more clothes are being produced and purchased, characterized by a short life cycle. These brands take as an example the best fashion designers and reproduce their garments quickly and economically, which means that everyone has access to buy fashion when they want. However, despite the opportunities that fast-fashion produces, it generates negative impacts on the environment and society, contributing to the unsustainability of the system. The devastating consequences for the planet of this fashion trend increase with the completion of textile finishing processes, generating a large negative impact on the water of the planet (López, 2012). For this reason, it is important that companies evolve and modify the way they relate to the environment and society by adopting a circular perspective. That is, everything is connected and we all belong to the same system (Salcedo, 2014). The challenge for many fashion companies is to recognize the importance of sustainability in business and incorporate green practices into their supply chain (Shen, 2014). Bearing in mind that there is a dominant model in this industry, which is fast fashion, the objective of this paper is to analyze to what extent companies that follow this business model can be truly sustainable. To reach that goal we are going to do a case study taking a company that has that business model such as H & M, which is one of the oldest firms that has been moving towards a more sustainable model of fashion production for several years. In addition, it is a leading company in the market with a very high turnover and international presence, and, therefore, it becomes an interesting case study. For this purpose, the sustainability reports of this company will be analyzed, which can help improve the reliability of the results. This research project is structured as follows. First, we will review the literature emphasizing the concept of sustainability over time and the need to adopt this new paradigm. The new concept of sustainability consists of social, environmental and economic aspects. Second, we will analyze corporate sustainability in the context of environmental sustainability. In the third place, we will explain what the fast-fashion business model consists of, and what it means for society in general. It is necessary to reinvent design practices so that they are more sustainable over time. To achieve this goal, the textile industry faces challenges such as: use and treatment of water, energy consumption and emissions, use of chemicals and toxic waste, generation and management of waste, decent working conditions and new business models. Fourth, we will focus on our case study, which has already been selected as the framework of this work. Finally, we show the results and the main conclusions that are extracted from the study, as well as the limitations and possible proposals for improvement for future research