How relevant is Ethics for fast fashion brand, SHEIN and what are the implications

of their unethical practices and labor conditions for its consumers?

Corporate Strategy and Governance

CW1

Ms. Rachel Stephanie Lim 22210534

Word Count: 6,494

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Acknowledgments
I would like to express my sincere gratitude to the following individuals who contributed to the
successful completion of this research paper, for their support, guidance and resources:
First and foremost, I extend my heartfelt thanks to our professor Sir Abdul Shahid, who guided
and encouraged us throughout the research process by teaching lectures concisely and patiently. Your
insights and constructive feedback played a significant role in shaping the direction of this study.

I also would like to thank the participants of our study who took the time to complete the
questionnaires and provide us with valuable insights. Your contributions were essential in helping me
gain a deeper understanding of the topic and became the backbone of the study.

I would also like to acknowledge Buckinghamshire New University for providing us with the
necessary resources, including access to research materials, library facilities, and computing resources,
which greatly facilitated the research process.

Additionally, I extend my appreciation to our friends and family who supported me emotionally
and encouraged me to persevere during the research process. Your unwavering support was instrumental
in keeping us motivated.

Finally, I am grateful to the broader academic community for producing the wealth of research
and literature that I consulted throughout this study’s secondary research because of the study’s nature of
limitation. Your contributions to the field have enriched my understanding and informed my research.

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Abstract

A significant concern associated with SHEIN revolves around its labor practices. Fast fashion
companies often outsource production to countries with lenient labor laws, resulting in exploitative
working conditions. Reports of low wages, long hours, and inadequate safety measures within SHEIN's
supply chain cast doubt on the company's commitment to ethical employment practices and employee
well-being. This ethical quandary raises questions about SHEIN's social responsibility, transparency, and
authenticity, while also perpetuating a culture of excessive consumerism and disposable fashion.
Furthermore, SHEIN has faced criticism concerning labor practices and sustainability. Reports highlight
poor working conditions, low pay, and inadequate protections in its supply chain, raising concerns about
workers' rights. Additionally, SHEIN's fast fashion model contributes to environmental issues like
resource depletion, waste production, and pollution. The brand's lack of transparency about its suppliers
and factories hinders labor and environmental evaluation, and accusations of copyright violations have
been made for replicating designs without permission from smaller creators and brands.

This report aimed to investigate the impact of SHEIN's ethical practices on its brand image and
employee satisfaction. The research questions focused on the relevance of ethics in the fashion industry
and the effects of SHEIN's ethical practices on consumers. The research objectives involve assessing
SHEIN's ethical standards and supply chain transparency, studying consumer awareness and perception,
and proposing solutions for SHEIN's ethical sustainability.

This was first conducted through a literature review based on what ethical fashion is, the relation
of ethics with business and how this affects the consumer, to understand more of the study. Through this
and the study which was distributed to 30 SHEIN consumers through a Google Forms survey, data
collected indicates a fairly positive perception among SHEIN consumers regarding the relevance of
business ethics. More than half of the respondents (86.7%) rated ethics as either "Very Important" or
"Important" (4 or 5 on a scale of 1-5). Respondents demonstrated awareness of ethical issues related to
SHEIN, with 86.7% concerned about exploitation of labor, environmental pollution, and poor working
conditions. Moreover, 76.7% believe it's very important for fast fashion brands to take social and
environmental responsibility.

Despite these ethical concerns, respondents' main motivations for purchasing from SHEIN are
affordable prices (93.3%) and trendy styles (80%). This raises a challenge for sustainable fashion brands,
as SHEIN's competitive pricing makes it difficult for sustainable brands to compete. However, the rise of
ethical consumerism is pressuring brands to become more transparent and ethical. In addition, the
questionnaire explored how much worker exploitation influenced purchasing decisions, with 80%

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indicating some influence and 20% significant influence. On the other hand, it was revealed that 73.3%
alter their shopping habits due to ethical concerns while 90% were willing to pay more for SHEIN's
sustainable products, while 60% sought out purchases from sustainable brands. Moreover, SHEIN's
unethical practices lead to loss of consumers, damaged reputation, and reduced brand loyalty. Improving
ethical behavior can attract loyal clients willing to pay a premium for ethical products, as shown by
responses in Questions 10 and 17. Additionally, consumers value empathetic assistance from a company's
employees, enhancing their positive perception and loyalty. Overall, the study reveals that SHEIN's
unethical practices impact consumer behavior, loyalty, and the brand's reputation. Ethical improvements
can lead to greater customer loyalty, brand attachment, and support

In conclusion, the findings of this study highlight the importance of ethics in the consumer
fashion industry, particularly in the case of SHEIN. Ethical practices are vital for upholding human rights,
protecting the environment, gaining customer trust, managing reputation, positively impacting society,
and ensuring long-term company success. Achieving perfect sustainability in the fast fashion sector is
challenging due to rapid trends, but not impossible.

A primary recommendation for SHEIN is to enhance its workforce conditions comprehensively,

prioritizing well-being, rights, and safety. This involves fair wages, access to healthcare, paid time off,
and reasonable working hours. Ethical standards impact not only employees' welfare but also consumers'
well-being according to Maslow's Hierarchy of Needs.

SHEIN should also focus on transparency within its supply chain by partnering with third-party
companies for extensive supplier facility audits, specifically clear criteria for supplier selection and a
detailed code of behavior accessible to the public are important steps. Finally, collaborating with industry
peers and sustainability organizations will accelerate ethical growth.

Regarding the effects of SHEIN's unethical practices and labor conditions on consumers, it can be
inferred that these practices negatively impact customers. Consumers are increasingly aware of social
responsibility issues like fair labor and ethical treatment of employees. Reports of exploitative labor
practices could lead socially conscious customers to boycott SHEIN. Negative information can spread
quickly through social media, damaging the brand's reputation. Consumers often align their purchases
with their ethical values, creating a moral dilemma when purchasing from SHEIN. Additionally, the
competitive fashion industry also offers alternatives that align better with consumer values. In conclusion,
SHEIN should prioritize overall well-being over short-term profits to ensure sustained success and
maintain a positive brand image.

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Contents
Title 1
Acknowledgments 2

Abstract 3

Table of Contents 5

Chapter 1: Introduction 7

1.1 Background of Organization 8

1.2 Problem or Issue 8

1.3 Research Aim 9

1.4 Research Questions 9

1.5 Research Objectives 9

Chapter 2: Literature Review 9

2.1 What is Ethical Fashion 9

2.2 Relation of Ethics with Business 11

2.3 Relation of Ethical Practices to Consumer Behavior 14

2.4 Theoretical Framework 15

3.0 Methodology 16

3.1 Primary Research 16

3.2 Secondary Research 17

4.0 Findings 18

4.1 Analysis

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5.0 Recommendation and Action Plan

6.0 Conclusion

7.0 References

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Chapter 1: Introduction

Consumer preferences have significantly shifted in favor of sustainability and ethical behavior in
recent years, which has had a huge impact on the global fashion business. Fashion firms are under
increasing pressure to embrace ethical standards across their supply chains as worries about the
environment and labor conditions gain traction. SHEIN is one company that has had tremendous growth,
especially with younger customers. However, as concerns about its sustainability policies increase, so
does its success. This essay digs into SHEIN's sustainability difficulties, looking at its effects on the
environment, working conditions, and the business model's general ethical implications.

SHEIN, an online fast fashion company established in 2008, has swiftly gained notoriety for its
selection of reasonably priced, stylish clothing. SHEIN has drawn the interest of fashion-conscious
shoppers looking for affordable options because to its wide selection of items and business model, which
places an emphasis on quick production and delivery. However, one of the most pressing issues linked to
SHEIN are their labor practices. With fast fashion being infamous for outsourcing production to nations
with lax labor laws, the result of this are abusive working conditions (House of Commons 2019, p.12)..
There have been reports of low pay, lengthy working hours, and insufficient safety precautions in
SHEIN's supply chain which calls to doubt the company's dedication to ethical employment practices and
the welfare of its employees. The business strategy of SHEIN calls into question issues of social
responsibility, transparency, and authenticity, as well as a culture of excessive consumerism and
disposable fashion is facilitated by the quickening of the manufacturing cycle and the emphasis on
duplicating runway trends for a fraction of the price. This supports unsustainable purchase habits while
also undermining the innovative work of clothes designers and makers.

SHEIN must address its ethical challenges as it broadens its global presence and draws in a large
client base. The necessity for a thorough reevaluation of SHEIN's business methods is highlighted by
abusive labor abuses and ethical issues. This paper dives into the rising ethical importance in the
consumer fasion industry and how unethical practices in an organization can affect consumers.
Furthermore, this paper will present recommendations on how SHEIN, a fast fashion brand, can improve
over time with its practices.

1.1 Background of Organization

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 SHEIN is a global fast-fashion e-commerce business that specializes in hip clothes and
accessories for adults, kids, and everyone in between. Chris Xu launched the business in Nanjing, China,
in October 2008. It began as a modest business-to-business portal that provided wholesale fashion goods
to international merchants. The fashion brand developed into a well-known direct-to-consumer sales-
focused internet retail brand over time. The business gained popularity quickly and broadened its product
offering to include a huge selection of clothing, footwear, accessories, and cosmetic products. SHEIN is
renowned for its low costs, regular product releases, and speedy fad adoption.

Serving clients in more than 200 nations and territories, SHEIN has established a considerable
global footprint. The business caters to many markets across the world with specialized websites and apps
that are available in several languages. SHEIN has successfully amassed a sizable and devoted customer
base by placing a significant emphasis on digital marketing and social media involvement, especially
among young, fashion-conscious customers. Furthermore, the vertically integrated supply chain of
SHEIN is one noteworthy feature of its business strategy. The business owns and operates its
manufacturing facilities, allowing it to closely regulate output and keep costs low. Additionally, due to its
vertical integration, SHEIN is able to routinely launch new goods and react quickly to market demands.

However, it's important to note that SHEIN has faced criticism and controversy regarding its
labor practices and sustainability. Firstly, SHEIN has come under fire for its labor policies, notably
in respect to its supplier chain, and for violating workers' rights. In several of its manufacturing sites, it
has been claimed that there are bad working conditions, low pay, excessive hours, and insufficient worker
protections. Reports have drawn attention to problems like forced labor, worker exploitation, and
unhealthy working conditions.

Secondly, the brand shares the reputation of fast fashion for having a large environmental impact.
The business has come under fire for its role in resource depletion, waste production, and pollution. The
use of unsustainable materials, unnecessary packaging, and a high product turnover rate that promotes
overconsumption and clothes disposal are all causes for concern.

Thirdly, SHEIN has come under fire for keeping certain aspects of its manufacturing and supply
chain under wraps. The company's refusal to share information on the factories and suppliers it uses has
drawn criticism from some stakeholders since it makes it harder to evaluate and keep track of labor and
environmental standards. In addition, the brand has been charged with copyright violations and design
theft from unaffiliated creators and smaller brands. Some have alleged that the business duplicates and
sells goods that are very similar to those made by other designers without their consent or payment.

1.2 Research Aim

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The aim of this report is to determine whether the ethical practices of SHEIN affect their growing brand
image, as well as the work culture in terms of their employee satisfaction and turnover. The research will
be conducted to develop a conclusion, and provide a recommendation afterwards which will serve as a
solution.

1.3 Research Questions

1. How relevant is ethics in the consumer fashion industry?

2. What are the effects of SHEIN’s ethical practices and labor conditions as a fast fashion company for its
consumers?

1.4 Research Objectives

-Assess ethical standards of SHEIN and supply chain transparency through thorough research

-Examine consumer awareness and education and whether this affects their view and relationship of the
brand, by collecting data from actual SHEIN consumers

-Explore the potential solutions and remedies for SHEIN to adapt as a fast fashion brand to becoming
more ethically sustainable

2.0 Literature Review

2.1 What is Ethical Fashion

Ethical fashion is an approach to clothing and accessory design, manufacture, and consumption
which aims to give social, environmental, and ethical factors priority to a fashion product's life cycle.
Consequently, ethical fashion can also mean the incorporation of fair trade principles, free labor
conditions, using ethically and biodegradable sourced materials. Presently, the size of the market for
ethical fashion is predicted to increase from $7.57 billion in 2022 to $8.17 billion in 2023 and anticipated
to increase up to $11.12 billion by 2027. Additionally, global brands such as Christian Dior SE, H&M
AB, NIKE Inc. and Adidas to name a few, have hopped on and dominated the ethical fashion trend.
Furthermore, Asia-Pacific dominated the global market with Western Europe ranking as the second-
largest region. However, the idea still remains debatable as to whether the majority of consumers are

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willing to forgo fast-fashion pieces they desire, in order to purchase from ethical brands instead at a much
higher price.

The main components of ethical fashion include social responsibility, environmental

sustainability, animal welfare and transparency which will be discussed in detail below. Firstly, the goal
of ethical fashion is to ensure that everyone participating in the fashion supply chain—from raw material
suppliers to garment workers and beyond—receives fair treatment and safe working conditions. In
addition to supporting gender equality and workers' rights, this also entails paying fair wages and setting
suitable work hours. Secondly, ethical fashion is dedicated to minimizing the effects of the fashion
industry on the environment such as the utilization of eco-friendly resources, reducing waste and
pollution, and implementing sustainable production techniques are all part of it. This involves
encouraging the use of renewable energy sources, recycling, and upcycling. Thirdly, the process of ethical
fashion abhors the use of materials derived from animals that were harmed or cruelly treated in order to
obtain them. This includes finding alternatives to fur, leather, and other products derived from animals, as
well as making sure that animals used in the supply chain are treated ethically. Additionally, the process
promotes supply chain transparency so that customers may find out where and how their clothing is
created. Brands that are dedicated to upholding ethical standards are transparent about their production
methods, products, and employee working circumstances. Lastly, ethical fashion is high on respecting and
valuing the cultural heritage of communities involved in the production of fashion products by seeking to
preserve traditional craftsmanship and support artisanal techniques. Through ethical fashion, consumers
can make more conscious choices and support brands that align with their values. Ethical fashion aims to
create a positive impact on society, the environment, and the fashion industry as a whole.

On the other hand, consumers have lately been expressing a keen interest in firms' ethical
business practices such as sustainability, social responsibility, fair labor standards, environmental
influence and ethical material sourcing. Firstly, this is due to consumer awareness because of social
media which allows both a brand’s good and bad information to spread rapidly to consumers.

2.2 Relation of Ethics with Business

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 The shareholder and stakeholder theories are frequently the emphasis of contemporary business
ethics, which is to say that it is primarily concerned with the correct ethical behavior of firms. How
should businesses be run? While Freeman (1984) suggested that it should instead be in the interests of all
stakeholder groups, including as the local community, employees, and suppliers, Friedman (1970)
maintained that it should be in conformity with the desires of the owners. Today, ethics remains to be
unavoidable in business given ethics deals with the various choices in life, resulting in different ends that
lead to certain associated costs regardless of free will (Knight, 1923). The word "business ethics" is used
in at least three different senses, according to De George (2005). The first is the academic approach,
where the former word is used to establish an ethical framework for assessing business in academic
publications, meetings, teaching, and research, among other places. The second strategy is centered on the
public usage of the idea by the media and audiences to debate about moral or immoral decisions made by
business leaders, firms, and economic agents in response to corporate scandals. The third strategy aligns
with forces and trends to explicitly create ethical policies within corporations, including codes of ethics,
ethics officers, ethics committees, and ethics training, in an effort to address criticism sparked by some
recent and significant wrongdoings and broaden the idea of social responsibility among businesspeople
(De George, 2005). Additionally, Fuller states that one of the first issues in regards to ethics is the means
to end the model of organizations. Given profit is ultimately the end goal for any business, a range of
means to accomplish such is employed. It is clear that this business perspective creates ethical difficulty,
with people, their rights and wellbeing at the center of ethics. Meanwhile, profits remain to be the main
aim of business. If the golden rule—do unto others as you would have them do unto you—is the
governing concept of ethics, then for business, the guiding principle is "caveat emptor"—let the buyer
beware (Wesly Crag, 1997).

Presently, employees and managers deal with moral dilemmas, organizational pressures, and
ethical temptations every day, which could easily result in wrongdoing. According to studies, over 40%
of US workers, reported seeing workplace misbehavior in the preceding year with the most significant

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types being:

Figure 1.0: Unethical Activity Types in the Workplace (Schwartz, 2017).

This becomes alarming for the organization, considering the model of Maslow’s Hierarchy of
Needs specifies the importance fulfilled needs are for an organization. Abraham Maslow established the
psychological theory known as Maslow's Hierarchy of Needs, which contends that humans are driven by
several degrees of needs and prioritize satiating these needs in a particular sequence. The five levels of
the hierarchy are typically represented as a pyramid, with the most basic physiological demands at the
bottom and self-actualization at the top. There are five levels:

● Physiological requirements (such as those for food, drink, and shelter).

● Security demands stability, security, and safety.
● Needs for love and belonging.
● Esteem demands include self-esteem, acceptance, and status.
● Needs for self-actualization (personal development, realizing one's potential).

Happiness may essentially be divided into two categories: economic well-being and general
emotional health. The term "emotional state" relates to how stressed out employees are as well as how
they feel about their surroundings and themselves. Employee satisfaction is crucial because, no matter
what their job entails, it helps them accomplish it more effectively. Additionally, fewer workplace
disputes occur because cheerful people tend to overlook little slights or irritations. (Stewart, C., Omid N.,
Stumpf J., 2016). Although Maslow’s Hierarchy of Needs is a psychological theory, its relation to
business ethics stands present, such as how employers should understand how crucial it is to provide for
the fundamental physiological and safety needs of their workers in the context of business ethics. The

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wellbeing of employees is influenced by offering them fair compensation, a secure working environment,
access to healthcare, and other necessary benefits. Secondly, the social requirements of employees are
met by ethical companies' promotion of a respectful and inclusive workplace environment that fosters
teamwork, open communication and belongingness. Within the workplace, there should be opportunities
for social connection and teamwork, as well as equitable treatment without prejudice. Furthermore,
organizations have to think about the safety needs of the workforce by implementing proper safety
measures, relevant regulations, harassment and discrimination free culture. Aside from this, ethical
businesses tend to meet the esteem needs of their employees by providing various opportunities for
professional growth and development through promotions, achievements, mentorship programs and
support, allowing them to reach their full potential. Finally, Cangemi’s study (2009) concluded that apart
from basic needs, employees want to be satisfied the most in terms of the two highest categories: self-
actualization and self-esteem, specifically being their own person and needing to create something
valuable. In addition, employees desire to be treated fairly, regarded seriously and respected as equals.
Lastly, material compensation follows which serve the physiological and safety needs of employees
(Cangemi, J).

Presently, in terms of Maslow’s Hierarchy of Needs, SHEIN is unable to meet the psychological
and safety needs of its workers by requiring them to work up to 18 hours per day way below minimum
wage, only giving employees a day off in a whole month, setting up informal factories in residential
buildings across China and Europe and deducting two thirds of their regular wage for minor mistakes
made on its clothing items, violating Chinese labor laws. Aside from this, the majority of the brand’s
working conditions remain unsafe with zero windows and emergency exits, with staff given no formal
contract with SHEIN as they are usually recruited through dispatch agencies that give zero rights to
employees. Furthermore, there have been many claims that SHEIN’s clothing contains harmful and toxic
ingredients such as PFAS and phthalates, with 15 over 47 items breaching European regulations because
of hazardous chemicals which can be harmful to the environment and its employees. On the other hand,
SHEIN announced this year regarding its investment of $5M for employee childcare centers and another
$10M to build lifestyle facilities for its workers, enabling them to feel the critical aspect of love and
belongingness. Unfortunately, SHEIN has no record online of providing employees with benefits. In
addition, it’s safe to assume that the brand does not provide its employees with bonus opportunities since
they are not able to get even the bare minimum wage. Lastly, self-actualization of employees has failed to
be met since employees are overworked and unable to rest and recharge.

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2.3: Relation of Ethical Practices to Consumers

Consumer happiness is influenced by how customers feel about marketing, how they view
businesses, and how they interact with one other (Chan and Cui, 2004). Consumers frequently have to
make judgments that have moral and ethical repercussions. They must make decisions about choosing
between abstaining from unethical behavior and engaging in it. The study of consumer ethics is extremely
important in this regard from both a theoretical and practical standpoint. Notably, there are two major
reasons why it is essential to comprehend the aspects affecting customers' ethical ideas (Creyer, 1997).
The first benefit is that it enables us to assess how consumers feel about actions that might be considered
unethical. Second, this identification can reveal consumer sentiments toward their own behavior as well
as company policies that put sustainability and ethical behavior first (Ramos Hidalgo, 2016).

In a study conducted by the Journal of Research for Consumers (2006) with the primary objective
to determine whether knowledge of a product's immoral nature would have a more significant impact to
consumers and a hypothesis to whether unfavorable details about a company's labor practices will trigger
negative emotional reactions among consumers, upon research it became clear that solely engaging in
unethical behavior does not suffice to prevent consumers from choosing a brand. This observation forms
the basis for the second hypothesis of this study: the dissemination of adverse information concerning a
company's labor practices will not wield an influence over a consumer's buying behavior.
Consumerism is more complex than choosing to avoid buying something because it is morally
dubious. For instance, refraining from buying products made with child labor does not inevitably result in
better living conditions for kids in poor countries. As a result, in addition to the above mentioned issues,
some well-intentioned consumers may legitimately assume that boycotting unethical products is worse
than doing so. Additionally, customers may believe that choosing alternative brands won't make a big
difference because they believe that other manufacturers engage in the same unethical behaviors (Brenton
Scott, 2006).
On the other hand, in another study conducted on Consumers’ Perceptions of Retail Business
Ethics and Loyalty, the fierce rivalry in the retail sector makes retailers very concerned about retaining
client loyalty. When people feel that their interactions with brands are valuable, customers are more likely
to stick with them. Furthermore, long-term gains from upholding moral principles are eventually
beneficial to the retail industry. According to F. Diallo and C. Lambey-Checchin (1989), ethical business
practices have a favorable effect on revenue and organizational effectiveness. A competitive advantage,
sustained earnings, and enhanced customer relations can result from ethical behavior. According to prior
study (Valenzuela et al. 2010), there is a direct correlation between customers' perceptions of a retailer's
ethical behavior and their level of loyalty). Customers are more motivated to engage in business and make

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repeat purchases from retailers they see favorably in terms of both financial and non-financial factors.
They are also more likely to display both attitudinal and behavioral loyalty towards ethical shops or
suppliers as displayed in Figure 2.0.

Figure 2.0: Consumers’ Perceptions of Retail Business Ethics and Loyalty to the Retailer

Businesses aim to foster client trust in order to maintain long-term relationships with them
(Morgan and Hunt 1994). Conscious business practices foster trust, which can subsequently boost
customer loyalty (Kang and Hustvedt 2014). Moreover, trust is one of the most important determinants of
loyalty, according to Chaudhuri and Holbrook (2001). Because of its significant impact on loyalty, trust
has been extensively explored in marketing literature. According to Valenzuela et al. (2010) and
Alrubaiee (2012), research demonstrates that customer views of ethical behavior have a direct impact on
trust. This, in turn, influences customer loyalty. We propose that trust might be based on moral principles
(Stanaland et al. 2011) and be connected to a particular store (Kenning 2008).

Lastly, unethical practices can lead to boycotting from the general public such as in the case of
Nike. The sports brand was accused in the 1990s of creating its well-known products in conditions
resembling sweatshops (Paharia, Vohs, and Deshpandé 2013). The employment of child labor,
subminimum wage payments, excessive overtime, verbal abuse, sexual harassment, and prison-like
industrial conditions were all included in these conditions, according to Beder (2002, p. 24). Throughout

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the world, Nike was boycotted as a result of these unethical supply chain activities. In order to call
attention to the poor working conditions in the factories and demand changes and fair pay, activists used
demonstrations, hunger strikes, and boycotts (Harrison and Scorse 2004). The Worker Rights Consortium
brought together numerous universities to launch hunger strikes in opposition to the use of Nike items at
their institutions (Ross 2004). This eventually led to the brand’s reputation being damaged, a major stock
price drop and troubling sales. In response, to combat the illegal wildlife trafficking and increase public
awareness about it, Nike partnered with Ali Hewson and the NGO WILDAID (Dodes 2010).

3.0 Research Methodology

In order to analyze the appropriate data, both primary and secondary research were used as the
means for this paper. These efforts were utilized in order to pinpoint the problem areas of SHEIN and its
potential resolutions. Furthermore, the main research techniques were in the form of secondary research
to gather information since data was limited due to the restriction of contact with SHEIN workers due to
the brand’s privacy. Apart from this, primary research was done through interviews, observations and
questionnaires with consumers who regularly shop at the brand.

3.1 Ethics

It was crucial to take into account the ethical implications of taking and disclosing someone else's
response while compiling the data for this report. All respondents gave their consent for the interview in
which their names were kept anonymous. Furthermore, while study was being done, the Data Protection
Act (1998) was carried through the project which ensured that data was fully utilized for the report only
and kept privately. Furthemore, consent was ensured from each respondent as the terms and conditions
were placed on the survey front itself.

3.2 Primary Research

The questionnaires were supplied to 30 SHEIN consumers, which was a substantial amount for a
small-scale research given scope was limited. The questionnaires were sent via Google forms link via
Facebook Messenger and had multiple choice questions in order for respondents to answer the survey
most efficiently. Furthermore, the main focus of the questionnaire was for consumers to evaluate the
impact and influence of business ethics and sustainability as a factor to decision-making purchases. The
questionnaire also focused on how often they purchase on SHEIN, their motivations for doing so and how

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they think the fast fashion brand can improve in the long run. Finally, the summarized responses were
collated into pie charts and graphs to visually present the dominant answer to each question.

It is also important to note that although names were asked in the questionnaire, it was kept in an
anonymous manner in order for respondents to give their best answer comfortably. The questionnaire had
a total of 18 questions, in order for them to evaluate areas or questions they might have not considered or
thought about prior. On the other hand, standardized questions and response forms are a benefit of
surveys. Due to the uniformity of the questions and options provided to respondents, there is less chance
of bias during the data gathering process. Additionally, surveys frequently yield quantitative data that can
be statistically evaluated. This can make it easier to spot trends, correlations, and patterns in the data
(Jones, Baxter, Khanduja, 2013). Using both primary and secondary research enables specialized and
targeted information from primary research while secondary research gives the subject a larger
perspective and background knowledge, both offering a complete picture. Secondly, findings from
primary research can be verified or reinforced by already published secondary research. The overall
credibility of the research is boosted if the conclusions reached through primary research are consistent
with those reached through secondary sources. By offering knowledge and data that is already available,
secondary research can save time and resources. Additionally, before developing their main research
methodologies, this can assist researchers in comprehending the current research landscape (British
Library, n.d).

3.3 Secondary Research

The secondary research methods used included: articles, journals and websites. This method is
beneficial to the study since it uses information from various sources that has been collected and
published by others, accelerating the speed of data collection. Apart from this, primary research is not
possible for all studies such as in the case of this study due to the secrecy of the organization and its
associated expenses. Finally, the secondary research conducted will be able to support, validate and cross-
verify the results derived from the primary research.

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4.0 Findings and Analysis

4.1 The Findings

4.2 Analysis

The data collected during the questionnaire offers a fairly positive result in terms of consumers’
perception on relevance of business ethics with over 36.7% voting that it is Very Important (5) and 50%
voting for Important (4) with the remaining voting its relevance to them. Secondly, consumers are aware
of the ethical issues surrounding SHEIN with 33.3% Very Aware, 53.3% Somewhat aware and the
remainder not familiar and unaware (refer to Appendix D). In relation to this, most of the respondents
answered from a range of middle to high in terms of being concerned for the ethical and environmental
practices of fashion brands namely 13.3% answered 5, 36.7% gave a 4 and 36.7% answered 3, from a
scale of 1-5.

The questionnaires were completed by participants who have purchased on SHEIN or continue to
do so with a set of 18 questions in total through Google Forms. Most importantly, terms and conditions of
the study were displayed at the top portion of the questionnaire, ensuring each respondent is aware of
what they are about to get into. Furthemore, when the respondents would have clarifications, this would
be discussed on a private message via Facebook. Following the interview, it’s apparent that the majority
of consumers purchase on SHEIN rarely and occasionally, with the items being clothing and accessories.
Additionally, the motivation of SHEIN consumers would have to be the affordable prices at most with
trendy styles, inclusive sizing and fast shipping, to follow. Lastly, it seems to be that although the
respondents still purchase at SHEIN, they also resort to a variety of other clothing brands since the
frequency is not high. It was also mentioned previously that consumers are mainly aware of the ethical
issues behind the brand and are willing to support the brand even further and pay a higher amount if they
are willing to make visible steps.

4.2i How relevant is ethics in the consumer fashion industry?

Question 5 of the questionnaire directly asks the respondents on whether a scale of 1-5 and how
important they believe ethics are to the success of an organization with 36.7% answering 5, 50%
answering 4, 6.7% answering 3 and the remainder answering not important. Consequently, Question 7
tackles the awareness present to these environmental issues in which 53.3% answered somewhat aware,
33.3% very aware, 10% not very aware and 3.3% not very aware at all. In relation to this, it can be
concluded that ethics matter to modern day consumers since Question 8 tackles the alteration of shopping

18
habits due to ethical concerns which 73.3% of respondents answered sometimes, 20% never and 6.7%
answering yes frequently. Presently, the respondents are most concerned with the exploitation of labor
which ranked 83.3%, environmental pollution and waste ranking 86.7% and poor working conditions in
factories ranking 86.7%. Furthermore, the importance of ethics can be seen as 76.7% of consumers
believe that it is very important for fast fashion brands to take responsibility for both social and
environmental impact.

However, although these responses implied their ethical and sustainability concerns, the main
motivation for consumers to continually purchase from SHEIN are the affordable prices (93.3%), trendy
styles (80%), free or fast shipping (40%), positive reviews (26.7%) and variety of sizes (36.7%) with their
purchases being both rarely (53.3%) and occasionally (43.3%). This becomes one of the main issues of
sustainable fashion brands since SHEIN has several advantages for its shoppers, most especially their
affordable pricing for similar styles, which make sustainable brands nearly impossible to compete.
Fortunately, the importance of business ethics has rosen through the years thanks to recognized activist
groups such as Greenpeace International which have been gaining favorable consumer response with their
campaign named, “Join the Fashion Revolution: Be part of the Global Movement Calling for Fairer,
Safer, Cleaner, More Transparent Fashion Industry.” Furthermore, social media remains to be the most
significant contributor in terms of raising awareness for this specific issue by allowing information to
instantaneously reach consumers, compelling them to reflect on who made their clothes and in what
condition they were made. With the number of ethical consumers rising, this has pushed brands such as
Gucci, Michael Kors and other luxurious brands to become more transparent and even ban the use of
unethical material in their clothing (Jacometti, 2016).

Today, code of ethics acts as a company’s constitution and a self-control mechanism, becoming a
behavioral guiding concept (Nieweler 2014). As a result, codes of ethics are complex in terms of their
aim. From a structural point of view, these codes represent and emphasize the culture and values of a
corporation. From an organizational standpoint, they can lead a business to create a specific department
for compliance and monitoring tasks or corporate social responsibility. A code of ethics may affect
operating costs or strengthen norms of behavior that apply to a company's executives, depending on how
it is implemented. In terms of human resources, codes of ethics may be crucial in luring particular talents
or people with special qualities. The employment of codes of ethics to communicate messages about a
certain brand to the general public is one notable application in the fashion business that gives them great
corporate value (Townsend, 2018).

In reflection of the questionnaire results, consumers do find business ethics relevant in the
consumer fashion industry. This means to say that if SHEIN continues to perform bad practices such as

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labor exploitation, lack of transparency in supply chain, copyright infringement and disposable
consumption from the fast fashion culture, it will definitely lose a significant amount of supports,
particularly in first world countries wherein consumers are more cultured, aware and mindfully against
these practices such as the United States. Furthemore, ongoing claims and proof of unethical behavior
might seriously harm SHEIN's reputation wherein the brand's credibility and long-term viability may be
affected by negative press and consumer backlash, which can erode consumer faith in the product or
service. Lastly, there could also be legal repercussions, which could include fines and penalties for
copyright infringement, labor exploitation, and false advertising.

4.2ii What are the effects of SHEIN’s unethical practices and labor conditions as a fast fashion company
for its consumers?

Question 16 of the questionnaire asked the respondents how much the exploitation of their
workers influenced their purchasing decisions in which 80% answered some influence and 20% answered
significant influence. Moreover, Question 8 deals with the alteration of consumer shopping habits due to
ethical concerns in which 73.3% answered “yes sometimes.” Aside from this, respondents answered in
Question 17 that they are 90% more willing to pay slightly above for SHEIN’s products if they used
sustainable methods, since in Question 11, 60% answered “yes, sometimes” regarding whether they seek
out to purchase clothing from sustainable brands. However, although consumers have present awareness
regarding the unethical activities of SHEIN, this does not necessarily evade them from purchasing from
fast fashion brands in general. As previously mentioned above, consumerism is complex since refraining
from purchasing from SHEIN will not inevitably stop the malpractices of the firm (Brenton Scott, 2006).

On the other hand, as pointed out in Figure 2.0 on the Consumers’ Perceptions of Retail Business
Ethics and Loyalty to the Retailer in Figure 2.0, consumers are favorable towards brands who engage in
ethical business. On SHEIN’s end, since their poor working conditions and practices may cause
consumers to lose loyalty to the brand, this will lead to short-term consumers who will most likely
purchase from SHEIN at least once or rarely, as shown in the survey wherein majority of the respondents
(56.5%) answered “rarely” when it comes to how often they shop on the online platform. However,
unethical practices can also realistically lead to boycott from the public, similarly to what was pointed out
with Nike previously. In another interview derived online from a former SHEIN consumer, she mentions
shopping from the brand meant you could get a replica from another brand’s top but a large fraction of the
price (Flanrey Morgan, 2021). Meanwhile, Sierra Vigil, another former consumer states that SHEIN used

20
to be a platform you used to shop on prior to knowing their company practices, which no one talks about
now.

These are all significant proof of the main effects of SHEIN’s unethical practices which are loss
of consumers, damaged brand reputation and decreased brand loyalty. By progressing SHEIN’s ethical
behavior, commitment and practice, the brand will be able to attract loyal clients who will pay a premium
for its products and show greater emotional attachment and devotion to the brand if they will be more
ethically honest. This can be proven through Question 10 wherein respondents claimed they are more
likely to support fast fashion brands who pursue more sustainable practices even if they are slightly more
expensive. In terms of Question 17, 90% answered they are willing to pay specifically for SHEIN if they
pursued sustainable methods. Secondly, consumers value obtaining supportive assistance from a
company's workers greatly since they feel more positively about brands when their employees are
empathic, which increases consumer happiness and brand loyalty (Iglesias Oriol, 2019).

5.0 Recommendations and Action Plan

Primary and secondary research methods were used to acquire insights into diverse consumer
viewpoints on the topic. Throughout the study, it has become clear that SHEIN’s consumers would gladly
support the brand even further if they pursued more ethical work practices. Furthermore, with the usage
of social media such as Tiktok and Instagram, SHEIN’s brand reputation has affected its consumer
loyalty with its former clients being aware of the implications behind its fast fashion nature. The key
research methods used in this project are described below in order to provide focused recommendations in
certain areas.

How relevant is ethics in business?

The results of this research has identified that in the consumer fashion industry specifically
SHEIN, ethics are crucial since they uphold human rights, protect the environment, win customer trust,
manage reputations, and positively affect society and aids in long-term company success and creates a
more just and sustainable industry (O'Byrne Andre, 2017). Realistically speaking, fast fashion clothing
cannot be fully sustainable since they are always keeping up with fast fashion trends, making their centers
produce and deliver clothes quickly. Although fast fashion has a number of inherent challenges that make
achieving perfect sustainability more difficult, it is not an impossible goal. Firstly, the recommendation
would be for SHEIN to improve its workforce condition through a comprehensive approach by

21
prioritizing its well-being, rights and employee safety. One way to do this would be to ensure that
employees are paid fairly and receive benefits that are equal to or better than the applicable laws and
industry standards. This includes providing access to healthcare, paid time off, and other essential
benefits. Secondly, enforcing reasonable working hours and discouraging overwork or irregular schedules
with proper rest periods since SHEIN’s employees rarely have breaks and are underpaid. This is integral
in upgrading the ethical standards of the brand which will eventually impact the health of its consumers
because of the Maslow’s Hierarchy of Needs. As mentioned previously, the welfare of the workforce is
key to the success of the company, which is accomplished by giving into the needs of the employees.
Aside from this, another recommendation for SHEIN would be to adhere to a more transparent supply
chain by forming partnerships with third-party companies to perform extensive audits of supplier facilities
to verify compliance with moral and environmentally friendly standards. Furthermore, the selection of
suppliers should be based on transparent criteria. Additionally, SHEIN should create and implement a
detailed code of behavior for suppliers that details ethical standards, environmental considerations, and
labor norms which will be accessible to the general public, along with their supplier compliance reports.
In addition, SHEIN should collaborate with industry peers who can accelerate their growth to more
ethical practices such as suppliers of more environmentally friendly materials and also sustainability
organizations the brand can invest in for charitable causes.

What are the effects of SHEIN’s unethical practices and labor conditions as a fast fashion company for its
consumers?

It can be concluded that SHEIN’s unethical practices have a negative impact on its consumers
since customers are becoming more aware of social responsibility problems, such as fair labor standards,
human rights, and treating employees ethically. Socially conscious customers may choose to boycott
Shein in response to reports of exploitative labor practices in the company's supply chain. Furthemore, the
usage of social media has also led to the reputation damage since negative information can quickly spread
on online platforms. Apart from this, consumers prefer to align their purchasing habits with their ethical
values which will often cause a moral dilemma associated with purchasing from SHEIN. In addition, the
consumer fashion industry has also been saturated with both local and international brands that offer
better values in line with the consumers. Overall, SHEIN must prioritize the overall wellbeing of its
organization so as to not pursue short-term success with a focus on solely profits.

22
 ACTION PLAN

Action Date to Date to Potential Issues Resources Needed

Begin Accomplish
By

Increasing employee wage and 3/15/23 4/15/23 Since SHEIN is SHEIN’s financial
benefits most known for department must
its low cost, oversee the budget
increasing salary allocation to cover
will affect the the wage increase,
pricing of its as well as gauge
products and also their financial
their situation for the
competitiveness year. Secondly,
since their gross they will have to
earnings will also comply with the
decrease in labor laws of the
effect. country and adhere
to legal expertise’s
advice on their
contracts.

Amending work hours and 3/15/23 4/15/23 If SHEIN Aside from budget
allowing employees to have decreases work allocation, it
breaks hours, it will be would be best for
challenging for SHEIN to hire a
them to mass human resources
produce and team to manage its
immediately ship employees
out orders altogether.
considering the Additionally, the
bulk amount of brand should
SKU’s they conduct training
carry. In and development

23

Partner with extensive audit
firm who can monitor
transparent supply chain
Develop code of ethics for
suppliers
addition, since a for its employees
lot of workload to train them in
will be delayed, protocols and
they will have to regulated work
pass the hours.
responsibility to
other employees
which will cause
stress on the
organization.
5/15/23 5/15/24 One of the SHEIN must work
challenges can be with a third-party
data accuracy auditing team that
since SHEIN will establish the
deals with process and areas
thousands of of assessment.
warehouses. This This then should
can also lead to be followed by
supplier project managers
resistance since who will execute
not all will want the audit and
to cooperate and monitor the project
expose their data progress. Lastly,
and operation an implementation
details. team must be
assigned to
different suppliers
since it will be
hard to manage if
short-staffed.
6/15/23 9/15/23 It will be difficult SHEIN will need
to assess whose to hire an ethics
24
 standards of expert who will
ethics will be guide the
followed, since development
cultural process and supply
differences will chain
be at play. It will professionals who
also be hard to can trace every
implement this component part of
will all suppliers the process. This
since they may can also be aided
also be resistant by legal advisors
to substantial who can align the
changes of code with the
existing laws.
operations.

5.0 Conclusion

In conclusion, this research highlights the critical importance of ethics in the consumer fashion
industry, particularly within companies like SHEIN. Ethical practices not only uphold human rights and
protect the environment but also foster customer trust, manage reputations, contribute positively to
society, and play a pivotal role in achieving long-term company success. While the inherent nature of fast
fashion presents challenges to achieving perfect sustainability, it remains an achievable goal through
strategic actions.

The recommendations provided for SHEIN revolve around improving workforce conditions and
supply chain transparency. Prioritizing employee well-being, fair wages, and benefits reflects a
comprehensive approach that not only enhances ethical standards but also positively impacts employee
morale and overall brand reputation. Implementing reasonable working hours and rest periods contributes
to a healthier workforce and consumer well-being, aligning with the fundamental principles of Maslow's
Hierarchy of Needs.

Enhancing supply chain transparency by conducting thorough audits and adhering to a

transparent supplier selection process demonstrates SHEIN's commitment to ethical and sustainable

25
practices. A detailed code of behavior for suppliers, publicly accessible compliance reports, and
collaboration with industry peers and sustainability organizations further solidify the brand's dedication to
ethical growth.

However, the effects of SHEIN's unethical practices and labor conditions on its consumers are
detrimental. As consumer awareness of social responsibility grows, negative impacts on human rights and
employee treatment can lead to customer boycotts, reputation damage through social media, and ethical
dilemmas for potential buyers. Given the saturated market and the availability of alternatives that align
better with ethical values, SHEIN's pursuit of short-term profit must not overshadow the need for
sustainable, responsible practices.

In the ever-evolving landscape of consumer preferences, SHEIN's commitment to ethical

practices will not only contribute to a more just and sustainable industry but also foster trust, loyalty, and
enduring success. Recognizing the significance of ethical choices and their ripple effects across the
supply chain is essential for the brand's future growth and positive impact on consumers, employees, and
society at large.

6.0 References

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 Wire Feed (2023). SHEIN announces an investment of R$750 million and expects to generate
100,000 new jobs [online] Available at:

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20 July 2023]

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[Accessed 20 July 2023]

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[Accessed 11 Aug. 2023]

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11 Aug. 2023].

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[Accessed July 30 2023]

Journal of Business Ethics (1997). Teaching Business Ethics: The role of ethics in business and in
business education [online] Available at:
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August 2023]

Cangemi, J. (2009). Analysis of an adversarial labor/management situation in a Latin American

industrial setting: A case study using Maslow’s Hierarchy of Needs. Organization Development Journal,
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 Wiley Blackwell (2017). Business Ethics: An Ethical Decision-Making Approach [online]
Available at: https://ebookcentral.proquest.com/lib/bucks-shib/reader.action?
docID=4812597&query=ethics+in+business [Accessed 30 July 2023]

Cerchia, Rosella (2019). The Ethical Consumer and Codes of Ethics in the Fashion Industry
[online] Available at: https://www.mdpi.com/2075-471X/8/4/23

[Accessed 10 August 2023]

Zhao, Hongshan (2021). A study on the Impact of Consumer Ethics on Apparel Purchasing
Behavior [online] Available at:
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[Accessed 10 August 2023]

UK Sage Pub (n.d). Ethical and Sustainable Fashion [online] Available at:
https://uk.sagepub.com/sites/default/files/upm-assets/122020_book_item_122020.pdf

[Accessed 10 August 2023]

Trade Journal (2022). Fast Fashion giant SHEIN aims to cut emissions 25% by 2030 [online]
Available at: https://www.proquest.com/pq1business/docview/2725720712/BD65014EE5674C69PQ/4?
accountid=7179

[Accessed 11 August 2023]

PMC Pub Med Central (2013). A quick guide to survey research [online] Available at:
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3964639/#:~:text=Survey%20research%20is%20a
%20unique,the%20availability%20of%20validated%20models.

[Accessed 25 July 2023]

British Library: Business & IP Centre (n.d). Primary Market Research vs Secondary Market
Research [online] Available at: https://www.bl.uk/business-and-ip-centre/articles/primary-market-
research-vs-secondary-market-research

[Accessed 25 July 2023]

8.0 Appendix

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Appendix A: Research Consent Form

29
Appendix B: Participation Information Sheet

30
Appendix C: Interview Questionnaire

31
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Appendix D: Response Summary

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