Accusations about maltreatment and abuse have plagued the notorious world of fashion for numerous years. Attention has lately focussed on the working conditions of those crafting garments and accessories retailed in high-end department stores at enormous costs. Clever branding might persuade us to believe that these unique products are the work of master craftsmen whose skills are valued for their quality and mastery – in some instances, this might indeed be accurate. However, the truth doesn’t always align with this perception.
A recent lawsuit in Milan shed light on the dark underpinnings of the luxury fashion sector, where workers making Armani handbags priced at €1,800 were reported to be earning a meagre €2 to €3 an hour. The ordeal, characterised by deplorable and hazardous working conditions, underscores the exploitative and avaricious bottom line concealed within the seemingly elegant appeal of high-end fashion.
The Armani Group insists that they have always implemented proactive measures to keep exploitation in their supply chain to a minimum. A subsidiary known as Giorgio Armani Operations, regarded as the industrial division of the Armani Group, outsourced the manufacturing of their leather goods to two companies. These companies then passed down the assignment to four separate groups using undocumented Chinese and Pakistani immigrants in Milan who were subjected to squalid conditions. They were coerced into utilising equipment with deliberately and severely compromised safety measures. It was reported that these workers sometimes pulled seven-day weeks with an average of ten working hours a day, making bags for Armani’s subcontractors that were sold at €93, repurchased by Armani for €250, then brought to market for a price of €1,800.
Historically, the “made in Italy” tag carried with it a sense of grandeur and integrity, symbolising meticulous craftsmanship and a high level of detail that allows brands to elevate their prices. Buyers associate the label with not just superior quality but also with an expectation for ethical production standards. Conditions of workforce violation are generally linked with budget fashion labels operating in China and Southeast Asia, selling garments at impossibly low costs. Discovering that workers were allegedly exploited mere kilometres away from Armani’s main office in Milan serves as a stern reminder that price tags and a European origin may not always signal ethical production methods in fashion and accessories.
Just a few weeks after a Bloomberg probe pointed a finger at Loro Piana, a luxury brand under the umbrella of LVMH, another luxury court case involving Armani arose. Loro Piana is famed for high-grade, lavishly priced items: Jeremy Strong, in his character of Kendall Roy, was often seen in Succession wearing a cap made by Loro Piana worth €500. The brand is also known for their €9,000 vicuña sweaters crafted from the wool of vicuñas, a rare camelid species native to the Andes, as per Bloomberg’s findings. Surprisingly, it was discovered via Bloomberg that some local Lucanas farmers shearing vicuñas in Peru were left unpaid for their effort despite the exorbitant price of the end product. Adding to the irony, LVMH is headed by the world’s wealthiest man, Bernard Arnault, with an estimated value of $214 billion, says Forbes.
[ LVMH has become the first European firm to achieve a mammoth market capitalisation of $500bn ]
In their response to Bloomberg, Loro Piana said, “Upon landing in Peru in the 80s, Loro Piana has consistently adhered to scrupulous ethical and responsible commercial conduct. Locally, Loro Piana plays a crucial part, safeguarding and boosting the demand and worth of the vicuña fibre, irrespective of market trends.”
Despite the sheer hilarity of a €9,000 sweater, it’s intriguing how well-known brands that oftentimes parade their dedication to ethical principles and social accountability can yet uphold commercial strategies that seem to support exploitation.
Fashion supply chains’ lack of transparency contributes to the problem. A fashion piece’s production can involve an intricate and sprawling network of manufacturing and distribution due to the labour-intensive nature of the fashion world. Moreover, extensive subcontracting and outsourcing give room for brands to insulate themselves from unethical conduct, making the claim that with their distance, it’s unfeasible for them to detect any malpractices.
The cycle of production could incorporate several players: from silk and cotton farmers, to textile producers, pattern cutters, and even logistics businesses responsible for transport. Although it’s now a norm for luxury brands to disclose details on the final manufacturing stages, including the list of direct suppliers and collaborators, clarity about what transpires further down the supply chain, such as animal shearing, is generally cloudy and hard to locate.
Many people question how fashion corporations can so easily dismiss accusations of exploitation while their profits soar, with little accountability for their actions. Paramount factors fuelling such patterns include lax regulation, diverse international laws and cultural norms.
In response to these concerns, after lengthy discussions, the EU Parliament has finally given their approval to the Corporate Sustainability Due Diligence Directive. This regulation is designed to impose legal obligations on companies for any violation of environmental and ethical standards in their supply chains. The Directive insists on companies playing their part in addressing and resolving or minimising any damage to environmental and human rights within their supply chains. Any company not adhering to these requirements faces penalties, amounting up to 5% of their yearly turnover.
However, on the downside, the final version has been significantly diluted from what was initially proposed for curbing widespread breaches of ethical norms. Lobbying from business groups against perceived regulatory overreach lead to a string of concessions, resulting in far fewer companies now being subjected to the directive than originally planned. Consequently, the directive now only concerns companies with more than 1,000 staff and a net turnover above €450 million, thus offering a very basic framework with significant potential for evasion.
Moreover, customers are left in a moral and ethical dilemma, wondering what they are genuinely paying for with their purchases. If supposed luxury items are produced in grim factories by untrained workers, it prompts people to question if this is the ‘made in Italy’ quality that was initially promised. Or have they fallen into the trap of funding marketing costs, extravagant property prices and enhancing the wallets of the extremely rich – the sort of people who can effortlessly splurge on a €9,000 jumper.
Elaine Maguire O’Connor, a fashion law professional and writer, shares these concerns.