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The vast majority of consumers might assume that issues in the supply chain are the problem of high-street retail chains, driven by the pressures of fast fashion and/or lower prices. It is easy to assume that luxury goods, which sell on quality and prestige rather than affordability, would not encounter poor labour standards; which have come to be associated with low cost goods. The reasonable assumption is where there are large profit margins there will be money to ensure good working conditions.

However, a report published last week may dispel that myth. The World Wide Fund for Nature (WWF) published the Deeper Luxury Report, which investigates the performance of 10 luxury brands against issues such as Ethical Trade, the Environment and Stakeholder Engagement.

None of the brands investigated achieved an A grade.  L’Oréal achieved the highest of all the brands with a C+.

WWF argue that consumers aspire to the exclusivity, style and quality associated with these brands. But are these exclusive values a true reflection of how the brands operate? Are the luxury brands at risk of losing their cachet? WWF’s investigations show that consumers increasingly associate luxury with high ethical standards, however many traditional luxury brands’ CSR records are poor. WWF urge luxury brands to develop ethical and sustainable programmes and make them integral to their business.

This will not only ensure that the working conditions in their supply chains are focused on and potentially improved, but also that the issue of labour standards, and CSR as a whole, are kept on the retail agenda. The concept of a luxury brand needs to change; a luxury product should mean more than price and quality, it should speak of the values of the consumer.

Some designer’s have already caught on to this notion. Designer and fashion icon Katherine Hamnett endorses the report by saying “Consumers’ increasing concerns with environmental and social problems are the greatest cultural shift of the 21st century and points the way to how these industries must behave if they are to keep their cachet which they need to survive.”

It has also been stated that the subject of ethical sourcing is “this season’s hottest dinner party debate” and that “hostesses up and down the country would be well advised to find out where their ingredients have been sourced from”. This, from ‘renowned shopper’ Tamara Beckwith, not a stranger to luxury goods herself.

Impactt’s experience echoes the report’s findings; luxury brands’ engagement with ethical trade has been very limited. Our benchmarking work has shown us that the majority of luxury brands provide little or no information about their supply chains and no outward commitment to ethical trade in general. The isolated use of charity campaigns, and the assurance that products are hand-made and high quality, is the extent of the information available.

It is our opinion that the pressures of ethical trade should be applied indiscriminately to all industries, and luxury goods should not be exempt from pressure simply because of the price tags or the labels. The WWF report will help to ensure that this issue is made part of the luxury agenda.