Environmental Management Portfolio of Korean Fashion Brands

Abstract

Green growth or green management practices originating from advanced countries proliferated worldwide during the 2000s. According to the Low Carbon, Green Growth Act announced by the government of South Korea in April 2010, business should gradually adopt an environmental management system (EMS) to efficiently use resources and energy and to minimize the emission of greenhouse gas or other pollutants as a result of business activities. In addition, businesses should acknowledge social and ethical responsibilities. Environmental management systems were introduced in Korea as a competitive strategy in the early 1990s, and have increased in Korea since 2003 under the influence of the product-related environmental regulations of European countries and the Korean government. Achieving the ISO 14001 standard requires an EMS system. This critical and authoritative certification system, legislated in 1996, directly connects to business reliability. The number of corporations with the ISO 14001 certification continues to increase, with over 223,000 cases worldwide in 2009 and a 300 percent increase internationally since 2005. Korea, with sixth largest number of certifications, had 7,843 certified corporations in 2009 (ICIN, 2010). Green management systems seem to be a requirement for competitive differentiation in the fashion industry. In the fashion market, environment-conscious designers and fashion brands all over the world have produced environmentally friendly fashions by using organic materials, recycled materials, or green designs, appealing to consumers. The fashion market has continued to grow in size by launching typical organic lines and eco-friendly brands. A similar tendency for green marketing strategies can be found in Korea. A significant number of Korean national brands produce clothes with organic cotton; well-being materials, such as charcoal, corn, or bamboo; and recycled textiles. In addition, several brands have promoted environmental campaigns and have contributed a certain portion of profits to environment-related organizations (Dong, 2010). Recently, fashion brands have extended green practices to obtain official eco-labels or to adopt environmental management systems. This study investigates the environmental management system of a specific fashion corporation and analyzes green marketing strategies with respect to the elements of an EMS. We collected data from articles, journals, the brand website, and interviews conducted in 2009. For the study, we selected the Kolon Group as a leading example of an eco-friendly organization among domestic companies. Among fourteen subsidiary companies, six, including the Kolon Industry, obtained ISO 14001 certifications. The first Kolon fashion brand was KOLON SPORT in 1973, and three sportswear brands were launched in 1980s. After taking over the Cambridge division in 2007 and merging with Cambridge Kolon in 2009, Kolon Industry changed its name to ‘Kolon Industry and Cambridge Kolon’, which included 28 popular fashion brands. The company’s fashion brands were divided into five categories: outdoor, sports & golf (5 brands), men’s wear (10 brands), women’s wear (2 brands), casual wear (2 brands) and others (3 shoes & 6 premium brands). The Kolon fashion division announced their business vision as “Eco Fashion Innovator” after FnC Kolon obtained ISO 14001 certification in June 2008 (Kang, 2009b), considering the environment as a core value for competitive strength. Kolon practices environment-conscious activities, from textile development to visual merchandising in retail locations (Jung, 2008). Kolon Industry and Cambridge Kolon also use eco-friendly goods production, socially responsible promotion, and a recycled packaging system. Except shoes and premium brand categories, typical fashion brands are actively participating in distinct green marketing practices and strategies. First, organic cotton goods produced through environmentally friendly processes are the most common green product strategy across brands, except golf wear. Second, the use of eco-friendly and biodegradable ingredients, such as bamboo, bean, charcoal, corn, or volcanic ash, is another strategy. Third, brands have used recycled PET (Polyethylene Terephthalate) bottles that decrease greenhouse gases. Fourth, brands have produced energy-effective products, named ‘Cool Biz’ or ‘Warm Biz’, which can be classified as eco-friendly products. Fifth, brands have used natural dyeing products, such as polygonum indigo, charcoal, and pomegranate, as an eco-friendly strategy. In addition, “trashion”, a portmanteau word of trash and fashion, can be found in a casual brand, ‘series.’ Finally, specific items, such as t-shirts or bags, deliver environmental messages as a communication tool. Outdoor sports brands seem to practice eco-friendly product strategies most actively. Sports brands have used organic cotton and the recycled PET bottles items, and men’s wear included items with biodegradable ingredients as well as temperature-controlled suits. With respect to communication, the Kolon Group implemented diverse marketing communication strategies. For example, in 2010, Kolon made a three-year agreement with the Join Together Society NGO to donate 2- to 3-year-old products in stock to third-world countries, amounting to five hundred million worth of stock each year. Outdoor sportswear brands practice green management the most thoroughly, whereas other brand categories apply green management to limited areas. Women’s wear and casual wear usually engage in customer participation events. To maintain customers and to thrive in the ever-critical global market, it is time to take part in environmental business practices. To survive in the competitive market, it is imperative to establish a systematic tool to improve environmental performance and reduce the long-term environmental impacts of products, services, retailers, suppliers, and employees. Future green branding strategy should be responsible from social, ethical, and environmental perspectives.