Building an ethical retail empire - How you can create a lasting postive impact on society
Corporate social responsibility impact on customers and ethical business practices are of utmost importance in today’s retail industry, involving all stakeholders, from an employee to its customers, helping the entire organisation locally and globally. In the current millennium, with the exposure of social media, consumers are more stringent on how brands and retailers behave ethically. A recent survey by Accenture shows that 71% of Gen Zs refuses to support unethical retailers by criticizing and boycotting them through social media. It is therefore important that companies develop strategies and change their operation in correlation to the consumers’ behaviours, particularly from the ethical attributes of a business.
Having a sustainable, environmental, and ethical business will help reduce these issues and at the same time, attract new clientele or customers, retain employees, improve sustainability, and engage the right suppliers, making the retail segment a business and environmentally friendly industry.
Based on a study done by World Retail Congress, retailers should embed ethical practices into sustainability across their organisations, especially since millennials are now willing to pay the extra dollar to purchase from an ethical business where sustainable materials are used. This will positively impacting the company’s profit.
Shaping an Ethical Workplace Culture
Ethical values must be instilled from top to bottom in an organisation leadership, led by example; no racial, gender or status discrimination is practiced in hiring, benefits, or promotion. Retailers need to ensure that they take a detailed approach in their business ethics practices and culture as this will determine the right things that people should do. This helps create a conducive atmosphere within the organisation and retail store environment where everyone is treated with respect.
Lush UK documented that most of their loyal customers choose to only buy from retailers that practice good ethical values on social and environmental issues, creating a socially responsible reputation in the industry. With customers demanding businesses to be more focused in their ecological and environmental ways, considering factors such as animal testing, environmental pollution, and safe production, failing would result in enormous harm to the climate, society, community, individual, and even animals.
So what can we, as a business, do to reduce the impact of existing environmental damage? At Lush Malaysia, we engage in many beach collaborated activities; Port Dickson back in 2018, Club Med Cherating in 2019, with a pause during Covid and a full-on initiative from 2022 onwards in Kota Kinabalu, Penang and Kuantan.
Beach cleanup
In addition, coral planting is now our focus as 50% to 70% of oxygen supply comes from the sea. If our corals are not protected, human society will not be able to survive. We’ve planted over 450 corals onto 9 frames at Lang Tengah in collaboration with CoralKu in March last year. Our most recent initiatives include a beach cleanup in Club Med Bintan and witnessing the release of baby turtles into the sea in May 2023.
Coral Planting & Clipping at Lang Tengah with CoralKu
Release of Turtle
Waste Management
Solid and liquid waste management has been a challenging issue in many cities in developing countries as such Indonesia, Philippines, Malaysia, Thailand etc. The fast fashion industry is known as the second industrial polluter after the oil industry, affecting the environment negatively. The retail industry has always been a major contributor to waste due to its limited capabilities, where the recycling process is only at 28%. Global waste management is seeing an increase in solid waste in landfills, which is not an ideal solution resulting in land contamination.
To reduce contributing to this issue, Lush performs all its recycling in their own green hub located in several countrie such the the United Kingdom. In countries like Malaysia, Lush engages with a reputable recycle company where waste is filled in drums and not channeled to drains or streams that flows to the sea. This is verified with a legal certificate indicating the process, quantity and detailed report with photos attached of how the entire waste was handled. All plastic containers, pots and bottles are sent to a legitimate registered recycling company. This method should be adopted and implemented across all retail brands for the betterment of our environment and future generations, making this world a lusher place to live in.
Recycle Packaging
The retail industry stands as the main contributor of plastic packaging that makes up 40% of plastic usage globally. It is estimated that plastic packaging alone in Malaysia is amounted to approximately 148 thousand metric tons per annum and valued at RM30 billion. Plastic waste also contains toxic chemicals such as lead and cadmium that can impair one’s health in illness such as Alzheimer, coronary disease, kidney failure and others, an example as to when we eat fish the microplastic that sits in the fish’s stomach and transfers to our body when we consume them. When discarded into drains and not through proper recycling methods, it also leads to marine animals being suffocated or tangled in plastic waste. It is estimated that in Malaysia we consume 70,000 microplastic annually.
Consumers can play a part by reducing the use of plastic bags or single use of plastic and via recycling. The average waste an individual produces in Malysia is approximately 0.85 kg to 1.5kg per day, which is one of the highest in Southeast Asia while neighbouring countries such as Philippines and Indonesia produce only 0.22 to 0.4kg of waste per day, nearly three quarters lesser. The government of Malaysia is also taking initiatives with zero-single plastic use policy by year 2025 for all stakeholders to be part of this journey for a sustainable future.
Many retailers have taken measures in reducing plastic usage by using recycled plastic packaging in attempting to be a sustainable business model and at the same time, increasing their revenue by these ethical practices.
Carbon Emission
Animal testing is not only cruel and unethical, but also unnecessary as the results of 95% of animal testing fails when it comes to human outcomes, making wasteful in terms of time, money and other resources. Cosmetic brands such as Lush source for ingredients and raw materials from suppliers that do not participate in animal testing but rely on human volunteers (Lush US). Peta has deemed this practice a humane alternative to animal testing. Many other cosmetics companies uphold this ban on animal testing and truly believe that the support of public will increase the awareness of boycotting manufacturers who are still participating in animal testing practices.
Another problem is that many retailers claim that suppliers are not committed to sustainability posing a huge obstacle. For example, retailers may choose to purchase packaging materials made from recycled materials, such as biodegradable packaging instead of Styrofoam. Consumer retailers can source their raw materials and labour in a responsible and ethical manner. However, sourcing from fair-trade suppliers will increase the cost of products compared to conventional suppliers, and consumers need to be educated on the benefits of fair-trade supplies. Procurement or sourcing of raw materials should be centralized and thereafter be dispatched to manufacturing hubs, an act that Lush UK practices. With this in place, sourcing fair trade suppliers will be made possible.
Conclusion
By Harvinder Harchand, Director for LUSH Malaysia
Join Harvinder – "Ethical and sustainable supply chain – How Lush became an early adopter of regenerative agriculture methods to source high-quality, sustainable raw materials and how the company optimizes its value chain" on 7th June at eTail Asia 2023. Find out more here.