Reshoring and modern slavery in the supply chain:case study evidence and action research in the textiles and fashion industry

Abstract

Manufacturing and sourcing location decisions in the textiles and fashion industry are complex, e.g. involving the trade-off between cost and lead time considerations. With this in mind, firms are looking to reshore and move manufacturing back to their domestic location. The sustainability agenda is adding to this complexity, with different locations having different implications for transparency and the risk of social problems. Modern slavery is an important global social issue, which is affecting the industry given that the growing demand for cheap, fast fashion can lead to worker exploitation. This thesis focuses on these two current issues, reshoring and modern slavery and presents three papers. The first paper focusses on reshoring and the remaining two papers investigate the phenomenon of modern slavery. The reshoring paper presents a single case study and extends the literature on reshoring that has largely focused on why firms reshore to provide greater understanding of how they can go about implementing the decision to reshore. The paper uses a two-stage approach (systematic literature review and case study evidence) and presents a conceptual framework that provides a structure to consider not only the factors influencing the decision to reshore but also some of the considerations needed to implement the reshoring decision. Further, a contingency perspective is adopted as several of the factors that affect the reshoring process, both in terms of whether a decision to reshore is taken and how implementation is approached, are context specific. The two modern slavery papers are based on an action research project. The primary engagement is with Fashion and Sports Co. (a multi £billion turnover company), to understand how brands and retailers are tackling modern slavery within the textiles and fashion industry. Research into modern slavery from a supply chain perspective is however limited and this thesis contributes to filling the gap. Paper 2 uses relational theory to investigate how brands and retailers are responding to modern slavery legislation. Empirical evidence is used to understand how competing buyers collaborate with one another as previous research has focused on vertical collaboration between buyers and their suppliers, particularly in a socially sustainable supply chain context. The research focusses on five collaborative initiatives taken to tackle modern slavery (e.g. joint training) used by Fashion and Sports Co, along with its horizontal collaboration with 35 other brands/retailers. The study advances knowledge on the creation of socially sustainable competitive advantage (e.g. cost savings, knowledge sharing and enhanced reputation) through horizontal collaboration. Successful horizontal collaboration is dependent on both relational capital (e.g. trust and commitment) and effective (formal and informal) governance mechanisms (e.g. legislation and the involvement of non-governmental organisations (NGOs) and trade bodies). Further, working with non-business actors can facilitate collaboration and provide knowledge and resources important for overcoming uncertainty when responding to new legislation. Paper 3 focusses on modern slavery detection and remediation. Prior literature has highlighted the shortcomings of supply chain auditing and questioned the suitability of this approach for detecting modern slavery. This paper uses action research with Fashion and Sports Co. to investigate how they are detecting modern slavery at a high-risk supplier in South East Asia, in collaboration with a large multinational NGO and another of the supplier’s key customers. The study suggests that a more targeted audit can identify key indicators of modern slavery. This type of audit includes investigating the end-to–end recruitment process by using a parallel structure of management and worker interviews and documentation review. The research also investigates the ongoing remediation process involving a local NGO.