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It is simply quite amazing how little consumers know about the clothes they buy or use in their daily lives. Of course, US laws requires brands to provide fundamental product information, for example the fiber content and country of origin. However, this minimal sort of labeling tells us nothing about how our clothing is manufactured, or the environmental impact these items have created globally, or for that matter, the role of diversity, equity, and inclusion.

After all, a genuinely sustainable industry, fashion/textiles included, is one which is composed of various people of different backgrounds, and where there is reported transparency of this representation throughout the entire textile/fashion value chain, reverberating throughout the organization.

But of late,�� the dynamics of being transparent in the fashion industry have become more urgent and apparent post-Covid, and especially in the wake of the protests following the death of George Floyd and the resulting /news2022-11a/Black Lives Matter protests. Fashion lovers throughout the globe have blamed the fashion industry for its lackadaisical approach in fighting racism and embracing diversity representation. It is just not purely exclusive to fashion-loving consumers but has extended to a new breed of activist investors as well—who are calling for ethical and responsible sourcing, as observed by recently.

“The conversations are real and valid,” notes Dan, a merchant retailer from Bangladesh who requested to be identified by a pseudonym to preserve his anonymity because of the sensitivity of the topic. “We are living in the century of (ESG) reports and the idea of sustainability, in line with the 2030 (SDG) goals—which is here to stay. Period,” he clarifies.

Malaysian fashion designer, Melinda Looi.

Malaysian fashion icon and designer, wholeheartedly agrees by making a strong stand: “Diversity is important because it allows room for representation. In this day and age, our youth deserve to evolve without thinking that a certain skin tone or “body” is the standard. If we keep chasing the possible, we will always fail to see our own potential as human beings.”

In fact, the call for diversity is part of the United Nation’s Diversity Council initiatives towards overall (SDG), which includes goal 5 (Gender Equality), Goal 10 (Reduced Inequalities) and Goal 17 (Partnerships).

“Instinctively speaking, many of us know that diversity does matter. Fostering a diverse and inclusive environment is part of our responsibility as humane people, good citizens, and caring leaders,” adds Dan.

With the global sustainability movement leapfrogging in the fashion industry, consumer consciousness about diversity and environmental concerns have also taken on new meaning and momentum. So much, that shoppers are demanding more insight into the garments that make up this US$2.5 trillion pre-pandemic annual global business.

Clearly this is not going to be a fad, deems Looi, “I think the younger generations are stronger and more adamant on change and that’s always the secret ingredient for effective change.”

“We should always remember, diversity is without a doubt good for business,” as Dan also notes. And Dan is probably right. According to McKinsey’s 2020 and 2018 reports Diversity Wins and , there clearly exists a positive correlation between diversity and company financial and reputational performance: an ethically and culturally well mixed executive team from various backgrounds are more likely to outperform their homogeneous counterparts when it comes to profitability. The reports attributed the positive relationship between diversity and financial performance to indicators such as enhanced access to talent, better decision making, in-depth consumer insight, and improved employee engagement.

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Bluewashing

But as positive as we are towards diversity, we must also be careful about “bluewashing”, a term closely related to ‘’. Greenwashing was popularized in 1986 by environmentalist Jay Westerveld, talking about companies exaggerating their commitment towards environmental sustainability. These companies might state that a product is “eco-friendly,” when nothing concrete has been undertaken to make the product environmentally friendly. It is a marketing tool, not real improvement. An example of greenwashing would be merely making the color of the product packaging green instead of making the product itself more environmentally friendly.

Bluewashing is a company’s practice of “paying lip service” to their corporate social responsibility by deliberately using the UN Sustainable Development Goals to promote selected responsible practices that are at odds with the reality of their core operations with regards to issues such as fair labor, poverty, and human rights. A company’s (ESG) report might say all the right things, but if the company doesn’t actually follow through, that ESG means very little.

“Bluewashing is the operational gap that exists between the SDGs and ESG,” warns Dan.

What Needs to Change

To circumvent bluewashing issues, companies need to follow the example of good leaders. “Diversity must be embraced at the top and must trickle down through the whole organization. After which, the company’s C-suite need to carry-out robust policies to create awareness and change within its corporate culture,” says Dan.

What complicates this issue on diversity is the sad notion that power within the fashion industry nonetheless largely rests in the hands of white male executives and board members, as pointed out by the 2020 McKinsey Report—a reality some have set out to change.

The report highlighted that employees of color only consisted of 16% of C-suite positions and 15% of board members. In contrast, white men comprised about 54% in C-suite functions and 72% of board membership positions. This includes gender inequality as well.

Apart from internal practices, lack of diversity impacts the whole supply chain. “Often the current practices in the fashion industry involving supply chain processes have disproportionate impacts on people of color. They are more likely to be affected by poor labor practices and negative environmental effects in relation to fabric mills and clothing manufacturers globally. Case in point: Rana Plaza in Bangladesh. It is crucial for the industry to address these issues from a sustainability and diversity point of view,” explains Dan.

Admittedly, is one of the worst industrial incidents to hit the garment industry. As Looi despondently feels, it is perhaps the lack of urgency in the matter from people who think it may not affect them directly. However, Looi’s believes that blockchain technology is going to be a game changer, aiding diversity in the supply chain, and allowing people to showcase and sell their fashion as artware via (NFTs).

In the final analysis, consumers are the guardians of diversity—their collective purchasing power to credit or discredit a fashion company’s policy towards diversity is crucial to the whole equation. However, with activist investors, fashion industry “watch dog” organizations (i.e., ) ever more playing an important role in supporting diversity goals and providing accountability, and with the advent of technology, blockchain, and quick response (QR) codes via the smartphone, the dynamics of the industry are fast changing.

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��ɫֱ�� the Author

Dr Thanaseelen Rajasakran is an Assistant Professor at a Malaysian university, Universiti Tunku Abdul Rahman. He is passionate about all things concerning United Nations sustainable development goals—as mother earth and its co-habitant stakeholders are unable to tolerate human selfishness.