Building Ethical Supply Chains: The Case of H&M in China

Abstract

The fast-fashion retail giant H&M has effectively been canceled in China following the company’s decision to stop using cotton from the country’s Xinjiang region after reports of human rights abuses and forced labor camps. Retailers have banned its clothing from online shops and scrubbed its signage and logos from storefronts and maps, state media and social networks are boycotting the brand, and influencers and celebrities are speaking out against the company’s decision. Although H&M announced its plans for a more ethical supply chain last year, the debate has resurfaced following a string of recent sanctions against China (namely from the United States, European Union, Canada, and Britain), resulting in the ongoing boycotts. This case reviews the issue and asks students to discuss the balance between profit and ethics in building supply chains.

This case was prepared for inclusion in Sage Business Cases primarily as a basis for classroom discussion or self-study, and is not meant to illustrate either effective or ineffective management styles. Nothing herein shall be deemed to be an endorsement of any kind. This case is for scholarly, educational, or personal use only within your university, and cannot be forwarded outside the university or used for other commercial purposes.

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