In a yin-yang world, every company's brand value is positively correlated with magnitude of reputation risk. This means we live in a era where business needs to transcend ESG Reporting (Environment - Social - Governance) that is limited to negatively screening out externalities that could cause harm to society, the economy or the environment. It also means going beyond Corporate Social Responsibility (CSR) efforts, which are often limited to 'donating' a certain percentage of a company's budget to a 'good cause'. However well intentioned both are, in essence neither make a tangible, sustainable impact. There is a need for companies to engage in strategic efforts that make good business sense while simultaneously improving the world around them.
H&M has figured out the magic formula to do just that with their new initiative to give an $1 million award to anyone with an innovative solution to recycle clothes. The beauty of this idea? It not only will create obvious positive impact on the environment, but it also makes fantastic business sense!As stated in the article, as population pressure mounts, retailers like H&M are concerned about potential future shortages of cotton, which is heavily water and pesticide dependent.
Hopefully in the future we will see an avalanche of awakening in businesses that seek to do good by pursuing a double bottom line: profit + people/planet!
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Hennes & Mauritz, the world's second-biggest fashion retailer, is launching a new effort to promote recycling as it seeks to cut its environmental impact, boost its ethical credentials and address looming shortages of raw materials. The move comes as critics point out the damage being caused by a throwaway culture fueled by cheap clothing that has seen a sharp rise in the number of garments sold annually around the world.