Luxury brands are bottom of the class

Luxury brands may be good at racking up big profits, but their ethical and environmental performance leaves a lot to be desired, according to a new sustainability audit by the WWF. Using the likes of Sienna Miller as a clothes horse may not be enough to save them from a consumer backlash, apparently...

Last Updated: 06 Nov 2012

The WWF (that’s the charity, not the wrestling federation) has produced a report called Deeper Luxury that examines the governance, environmental, and social performance of the world’s top ten luxury brands, and grades them on a school-like scale of A to F. It turns out that these ten companies are more a remedial class than a top set: L’Oreal was the best of a bad bunch with a feeble C+, while Bulgari and Tod’s failed the test completely, scoring a miserable F.

The companies were graded on the basis of both their own reporting, and NGO and media coverage. The WWF concluded that the £77bn luxury goods industry was guilty of depleting natural resources and exploiting cheap labour – all under a veil of secrecy. With their big budgets, they could and should be doing a lot more, it says.

And there’s a good commercial argument for improving sustainability, the charity argues. Now luxury goods are becoming more accessible, the real competitive advantage no longer comes from exclusivity – it’s about using better business practices to create a brand consumers can admire. ‘Many successful people now want the brands they use to reflect their concerns and aspirations for a better world,’ the report says. Or in other words, as WWF policy adviser Anthony Kleanthous puts it: ‘Who wants to pay extra for a dirty brand?’ 

Tod’s, rock bottom with a measly 34.9%, is endorsed by actress Sienna Miller – who’s unlikely to be amused by the results, since they rather undermine the environmental credentials she’s carefully fostered by fronting the Global Cool campaign. The WWF will be putting pressure on these celebs to apply their personal principles to the brands they choose to promote (though to be honest, we’d be surprised if most of them give it that much thought).

The ten companies will no doubt take issue with the report's findings - basing conclusions on third-party coverage seems a little dubious, for instance. But it's an issue they can’t afford to ignore. Consumers with this much money to spend are increasingly preoccupied with sustainability issues – so unless these brands adjust their approach to match, they might it hard to maintain their appeal.

And at the very least, if the WWF has anything to do with it, they could be running out of decent celebrities to endorse their products before long. Jade Goody for Gucci, anyone?

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