Responsible and Sustainable Business Model Innovation in the Textile Industry: Exploring Approaches to Social Sustainability

Introduction

The textile industry with its global reach and interconnectedness provides huge potentials regarding the development towards more ecological, social and economic sustainability (Barnes & Lea-Greenwood, 2006; Franco, 2017; Börjeson & Boström, 2018). Yet, according to Köksal et al. (2017), textile value and supply chains are increasingly complex, globally dispersed and highly dynamic. Further, they are long and involve multiple partners with often conflicting objectives (Börjeson & Boström, 2018). Changes in consumer attitudes and consumption patterns reinforced by fast-paced trends in fashion and product design (Niinimäki & Hassi, 2011) are seen to apply massive pressure on the various actors resulting in severe environmental damages and questionable social practices (Köksal et al., 2017; Lueg et al., 2015). These challenges have been persistently highlighted in prior studies on the textile industry (Gardetti & Torres, 2012; Franco, 2017).

Against this background, research on the responsibilities of the textile industry has emphasized the strategic necessity of companies to maintain their competitive advantage by incorporating concerns related to environmental performance (Börjeson & Boström, 2018). In this regard, environmental risk management with regard to the management of hazardous chemicals in textile products, production and distribution channels have achieved considerable attention in the last decade, both among practitioners and scholars. However, the featuring elements of the contemporary textile industry conflict with the long-term orientation of sustainable development (Köksal et al., 2017). At the same time achieving sustainability seems to be a greater challenge for textile companies.

In this chapter we argue that sustainability in the textile industry does not only mean to integrate environmental concerns into a firm’s strategy and business model, but also needs to be reflected by the adequate management and incorporation of social values and responsibilities in a company’s business model. The impact of social issues on operational and reputational risk management has repeatedly been highlighted in prior research on global supply and value chains (e.g., Klassen & Vereecke, 2012; Lund-Thomsen & Lindgreen, 2014). Social issues affecting global supply and value chains of companies comprise multiple aspects such as labor practices in less affluent countries, public concerns related to human rights abuses, management of cultural differences or one-sided power relationships (Klassen & Vereecke, 2012; Eriksson & Svensson, 2015; Khurana & Ricchetti, 2016; Pedersen et al., 2018).

Against this background, a fundamental re-thinking of existing business models, structures and practices is of prime importance (Arnold, 2017a). Indeed, changes and adjustments to existing business model conceptualizations are seen to provide alternative solutions and foster sustainability-oriented innovations and transformations (Evans et al., 2017; Bocken et al., 2014; Dickson & Chang, 2015). By integrating sustainable values into a company’s business model and identifying all value flows among the involved stakeholders, business model innovations aim at a more holistic approach and integrated thinking (Evans et al., 2017).